Beyond the Case Podcast · Season 1, Episode 96, hosted by Sohin Shah · October 1, 2026
Key takeaways
- Accountants report on the past; owners and CEOs should read their numbers with an eye on the future, including intangible value financial statements don't show.
- Ask your CFO or outside advisors what peers are doing. Proactive planning is where most tax savings are found.
- Trusts can protect assets and move future growth out of a taxable estate: transferring a business at today's value uses far less of the lifetime exemption than transferring it after decades of growth.
- If a sale is likely, plan at least five years ahead. Qualified small business stock (QSBS) rules for C corporations can exclude millions of gain, but only if the structure is in place early.
- Real estate investors often combine 1031 exchanges with the step-up in basis at death to defer and then eliminate capital gains tax.
- Protect your professional standards, even when that means letting a client go.
- Delegate. Give experienced leaders authority, protect your health and family time, and step away regularly to gain perspective.
Full transcript
Transcript courtesy of Beyond the Case, published with the host's permission and lightly edited for readability.
Sohin Shah 0:00
Hey everyone, welcome to another episode of Beyond the Case. This is a podcast where global leaders from Harvard Business School's OPM community join in a personal capacity to share the real lessons, life principles and mental models behind building enduring companies. My guest today is Vikas Garg. He was originally in OPM 65 for Unit 1, and now he's going to do Unit 2 with my cohort as part of OPM 67. So it's great to speak to you for the first time, Vikas, and hopefully there are a lot more conversations we can have on campus next month as well.
Vikas Garg 0:37
Yes, nice to meet you. Nice to be introduced before we meet officially at Harvard.
Sohin Shah 0:43
Vikas, do you want to give a quick overview of who you are, where you come from and what business you're in, so the listeners can understand your journey?
Vikas Garg 0:53
Sure. By profession, I'm a chartered accountant and CPA, and I did ICWA back when I was in India. We moved to the US in 2003, and I started my practice in 2005. It started as what we call a garage business, from the basement. The idea came from my roommate, who was running an IT firm. He said, why don't you start your own practice? Let's register a company first. We registered, and from there we just kept growing and growing. We saw so much potential. Right now we have offices in Virginia, DC and New York, and we serve all types of clients, from individuals to corporate taxation, whether it's a small business or a billion-dollar company. We specialize in IRS audit representation, financial audits and M&A. Those three are our specialties now.
Sohin Shah 1:58
As someone with an accounting background, you've been trained to recognize risk. And as an entrepreneur, you've had to take risk. How do these two instincts pull you in different directions, and how do you keep a balance?
Vikas Garg 2:19
I'll put it simply. I joined my CA program in 1995, and after I qualified in 1998 I joined LG Electronics. I was very energetic, and you love what the accounting profession teaches you first. Then in 2003 I joined one of the entrepreneurs at the Dalmia Group, and that changed my whole perspective. I was working directly under them, and the way an entrepreneur and company owner looks at the numbers, even the chart of accounts, is completely different. As an accountant, you produce the books, and that's a validation of what the CEO already knows. When you're running your business, know your financial numbers yourself. You shouldn't need to ask anybody; as the owner you have a feel for them. The accounting profession works on the past and history. CEOs work on the future.
Sohin Shah 3:23
You've seen the financial statements of many businesses. What do successful entrepreneurs do better than others when it comes to creating lasting wealth? What quality of decisions do they make, and what strategies benefit them most?
Vikas Garg 3:48
When you look at the financial numbers, financials are the past, not the future. I just came back from OPM Ignite in Dubai. One of the speakers talked about a report consultants prepared when Emirates airline was in the planning phase. The consultants said that if you start an airline in Dubai, you won't get the traffic and you'll lose money. The founders made a decision to move forward anyway, and Emirates became one of the most profitable airlines compared to all the others. So there are two things: tangible assets, what you see, and intangible assets. Financial statements show only the tangible, not the full value a business has. Even the profit numbers on the financial statements aren't necessarily the right indication. That's how my thinking changed from accountant to entrepreneur.
Sohin Shah 5:24
Do business owners get so focused on saving taxes that they lose sight of good business decisions? Any tips for entrepreneurs?
Vikas Garg 5:44
Business owners can learn a lot from taxes. What we often see is that some business owners only look at growth. They completely neglect the tax-saving opportunities because they're so busy inside the business. That's where the CFO comes in. If you have the right CFO on your team, they'll keep looking at tax savings. But if your CFO isn't as proactive as you are, you'll leave a lot of money on the table. We've seen many times that people lose money because they're not doing proactive planning. For example, in the US, if you're not doing trust planning, you're going to pay heavy taxes. Your future plans should align with your CFO's.
Sohin Shah 6:37
So have a conversation with your CFO on the strategy ahead, so they understand it.
Vikas Garg 6:45
Internal CFOs and outside CFOs. There are many peer groups out there. Talk to other CEOs, see what strategies they're using, and then ask your CFO: one of my friends is doing this, why aren't we? If you ask that ten times, your CFO will explore it, and they may bring you real value.
Sohin Shah 7:12
You mentioned trusts. My understanding is they're a way to minimize taxes when passing wealth from one generation to the next, and to protect against liabilities.
Vikas Garg 7:28
It's both. One, you protect against liabilities. Two, you avoid the generation-to-generation transfer tax. For the audience, here's how it works. Right now the limit is $15 million per person, and it changes over time. So one person can transfer $15 million to family, and a husband and wife can transfer $30 million. Say you leave $100 million of assets to your kids. The first $30 million is exempt, and the other $70 million is taxed at roughly 40%. That's with no planning. With planning, here's what a trust does. Say you start a company that's worth $5 million today, and after 20 years it's worth $100 million. If you set up the trust now and transfer the stock into it at today's value, you use only $5 million of your $30 million. When the assets pass to your kids after 20 years, the transfer counts as $5 million, not $100 million, so you avoid the tax on that growth. That's what goes on behind the scenes. People say wealthy families aren't paying taxes; the reason is that the assets sit in trusts, and they don't distribute them out. The first generation might be five people, the second 15, then 30 or 50. Four or five generations stay on as trust beneficiaries without paying transfer tax.
Editor's note: the 2026 federal estate and gift tax exemption is $15 million per person, and the top estate tax rate is 40%. Trust planning depends on each family's facts; speak with an advisor before acting.
Sohin Shah 9:23
And the trust can earn income and make distributions as well?
Vikas Garg 9:28
Yes. The trust earns income, and it goes to the beneficiaries, while you avoid the transfer tax.
Sohin Shah 9:36
Incredible. Beyond trusts, what other surprises do business owners face when they try to sell a business they've worked so hard on?
Vikas Garg 9:48
A couple of things. When someone starts a business, the first thing 90% of people do is set up an S corporation. If you think you may sell the company down the line, you need to think five years ahead, because there's a $10 million capital gain exclusion for C corporations. If you're building your company to sell to private equity or someone else, plan five years ahead, convert to a C corporation, and remain as the founder. After five years, when you sell, the first $10 million of gain is tax-free, per owner. So you're saving roughly $2 million. Second, many times you have receivables sitting in the company that would be taxed as ordinary income. How you structure the sale can change how much of the price is treated as capital gain. We call this the QSBS election.
Sohin Shah 11:04
Brilliant. There's a lot to learn here. It's a knowledge bank.
Vikas Garg 11:12
But it has to be implemented five years ahead.
Editor's note: qualified small business stock (QSBS, Section 1202) applies only to stock originally issued by a qualifying C corporation; S corporation stock does not qualify, and the holding period starts when the C corporation stock is issued. For stock issued after July 4, 2025, the exclusion cap is $15 million (or 10 times basis), with a 50% exclusion after three years, 75% after four and 100% after five. Many service businesses do not qualify.
Vikas Garg 11:16
The other thing we see is real estate. Have you heard of the 1031 exchange?
Sohin Shah 11:32
Yes, 45 days to identify a like-kind property.
Vikas Garg 11:35
Let me give you some background. Many of the billionaires you see, the real estate owners, aren't paying taxes. Their main strategy works like this: they buy a building, sell it, use a 1031 exchange to buy another building, and keep doing that. Then when they pass away, the assets go to their kids, and the fair market value on that date becomes the kids' cost basis. Say you bought a property for $1 million and kept exchanging for 20 years, and the last property is worth $50 million. That's a $49 million gain. But with the step-up in basis when the property passes to your kids, if they sell, their basis is the value on the date they inherited it. They completely bypass the $49 million capital gain. So between trusts and the step-up in basis, if you plan properly, you can legally avoid a lot of tax. That's how some of the biggest real estate families in this country do it.
Sohin Shah 13:08
Have you ever not seen eye to eye with a client on their business practices? Those must be uncomfortable conversations. How do you encourage a client to listen to your professional opinion and still keep your calm?
Vikas Garg 13:28
I'll bring in Professor Das. Before I went to Unit 1, this was a challenge for me: clients weren't listening, they were pressuring us to do things, and we were feeling that pressure. I asked this question in Unit 1, and he asked just one thing: can you let the client go? Do you have the courage to say no? If the client says they're going somewhere else, let them go. That Unit 1 class gave me the confidence. From then until now, our team has been very strong. If something is wrong, we don't do it, no matter who asks. And now the impression clients have is that whatever comes from our team is correct, so they listen and follow. It went completely the other way. We lost a couple of clients, but that's a good sign on our side.
Sohin Shah 14:39
Are you still the key decision maker, or have you decentralized to the point where your team works with clients and makes them feel comfortable?
Vikas Garg 14:54
Right now there are two key people in the company, me and my wife. We started together, and she's co-CEO. My focus is the technical side. My wife handles client relations, HR and day-to-day operations. We have about 15 leaders here and about 40 to 45 employees in India, and every department has its own head. One leader has almost 20 years of experience on the audit side. Our audit director retired from a career of about 35 years before joining us. In taxation we have people who've been with us for about 15 years. So it's largely decentralized. I mostly get involved in critical issues, for example when a client won't listen and we need to decide whether to keep them. If I'm away, the firm keeps running with our leaders, except for a few key decisions.
Sohin Shah 16:10
Your business seems fast-paced. What, amid all this growth, inspired you to consider OPM at Harvard and go back to executive education?
Vikas Garg 16:34
Harvard gives you room to breathe. It lets you think outside the box and reset your mind and your clock. You go there with so many problems, and after three weeks you come back with solutions. Meeting like-minded people is awesome. It's hard to explain; if somebody asks what you learned, it's hard to say. The experience sits in your brain. My wife and I both went to OPM Ignite, and she used to ask me, you went for three weeks, what did you learn? I couldn't explain it. After three days with about 200 OPM participants and 50 spouses in the same hotel, I asked her what she learned.
Sohin Shah 17:36
And she said she learned a lot but couldn't explain it. Very well said. You mentioned Professor Das. Was he the professor who made the biggest impression on you, or is there a case or conversation that still stays with you?
Vikas Garg 17:52
Professor Das and others. Honestly, I've forgotten many of the professors' names, but the lessons are built in. There was the toothbrush case, where the idea was spin, spin, spin. And there was the OYO case about Ritesh Agarwal: he went up, went down, and suddenly went up again. Those cases stay with you. When a challenge comes up in day-to-day business, you think, it's not just me. Many business owners have been through this. You remember live examples of how others handled it, and you find a solution.
Sohin Shah 18:52
If you could speak to your younger self from 25 years ago, after everything you've seen and experienced, what would you say?
Vikas Garg 19:07
When I was young, I was fully focused on growing the company. We worked 15 or 16 hours a day to grow the business. Now I'd say: work strategically and protect your time. If you're going to work more than 10 hours a day, delegate your work to other people. Keep up your health, exercise and healthy food, and have a social life. Don't neglect your spouse and kids. Spend at least one dedicated hour every day with your family. That gives you the boost and energy for your day-to-day business growth.
Sohin Shah 19:56
Last question. Is there a book that has influenced you that you'd like to share?
Vikas Garg 20:04
I'm not much of a reader, but I follow a motivational speaker in India who taught me when I was studying for my CA and later became a friend. He visits companies and gives talks, and he's known for having employees walk on burning coals. The energy he puts into you is incredible, and I keep watching his talks.
Sohin Shah 20:54
Have you tried walking on fire with him?
Vikas Garg 20:59
No. I haven't been to Delhi since, but if I meet him, he'll definitely make me do it. People do it, ordinary people like us, because of how much fire he puts inside you. That fire in a company is called motivation.
Sohin Shah 21:25
Well said. Thank you, Vikas. You shared a lot of wisdom and a lot of strategies. How can people reach you if they want to speak further?
Vikas Garg 21:43
They can call our office at 703-880-8412.
Sohin Shah 21:50
Sounds good. Thanks, Vikas.
Vikas Garg 21:52
Thank you.
General information only, not tax or legal advice for your situation. Tax law changes; figures reflect the law when recorded unless noted.