RAF

Inside RAF’s Tax Strategy with Jeff Hoeflich

Jeff Hoeflich brings decades of technical expertise, strategic collaboration, and disciplined execution to RAF Equity. As Director of Tax Compliance, Jeff oversees all aspects of tax compliance across the firm. With 35 years of experience, he’s helped founders and leadership navigate complex transactions, structure deals thoughtfully, and minimize unintended tax consequences.
In this Q&A, Jeff shares his approach to tax compliance in private equity and how proactive planning ultimately benefits investors over the long term.

Q. What are your key focus areas at RAF, and how do they support the firm’s broader mission?

A. “My role involves overseeing both individual and corporate tax compliance for the RAF family of companies. What sets us apart is that our tax department operates entirely in-house. If anyone in our portfolio has a question, we’re right down the hall and able to support them directly.
Handling financial matters internally saves significant time and expense compared to working with an outside consultant. From a broader perspective, this structure ensures consistency in how returns are prepared and how transactions are treated, which has been part of RAF’s approach.”

Q. How does RAF work with founders during major liquidity events?

A. “When a company is sold, it becomes a significant taxable event for everyone involved. I work closely with portfolio leadership to set things up the right way from the start and to understand the tax implications involved, whether they are selling or acquiring businesses.
Our role is to structure transactions properly so the tax impact is managed effectively. Alignment across the team helps avoid inconsistencies and mistakes. By reducing tax exposure at the time of a liquidity event, investors retain more capital. That additional capital can then be redeployed into future investments, compounding value creation over time. In many cases, the tax implications affect shareholders more directly than the company, which is why thoughtful planning is so important.”

Q. What are common tax considerations in private equity deals?

A. “The main objective is to achieve the most tax-efficient outcome possible.
There are various structuring mechanics involved when preparing for an eventual liquidity event that can reduce tax exposure if implemented correctly. At RAF, we set up each deal thoughtfully from the beginning so that when an exit occurs, the tax impact is minimized.”

Q. What tax planning mistakes do companies often make?

A. “One of the most common mistakes is failing to structure a transaction properly at the outset. Decisions made early, sometimes years before an exit, can create unintended tax consequences later. If details are overlooked during the initial structuring phase, companies can face significant tax challenges 10 years down the road when it’s time to sell.
As the Director of Tax Compliance, I get involved in acquisitions as early as possible to review the structure and address potential issues from day one. By integrating tax strategy into each stage of a transaction, RAF helps protect investor returns while positioning portfolio companies for long-term success.”

Learn More About RAF

RAF was founded 45+ years ago and acquires control positions in middle-market companies across a diverse set of industries. We maintain a long-term strategy focused on investing in businesses with strong management teams, a demonstrated history of business growth, and potential for acceleration, with EBITDA of $5-20 million.