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Solutions for Personal Clients

Case Studies


Bob was a research analyst at a hedge fund who had recently been given equity in his firm and would be getting K-1s with profit allocations for the first time. This would be in addition to his base salary and bonus.  His wife, Cheryl, was doing a fellowship at a major hospital, and wanted to start her own medical practice soon.  When we met them, they were both working in New York but lived in a New Jersey rental apartment.  They wanted to buy a house in the next year and had a modest investment portfolio, along with some a few real estate investments that Bob had made with friends over the years. Bob thought the time was about right to get an accountant.  We couldn’t have agreed more.

During our initial meeting, we discovered that while Bob and Cheryl were tops in their fields, taxes and personal finance weren’t their strong suits. So we started to build a plan for them that would allow them build their financial lives in a comprehensive, tax efficient manner.

The first thing to tackle was their immediate tax needs, so we discussed the need for quarterly estimated taxes to cover Bob’s partnership income, and explained to him why he had a multi-state return and that his hedge-fund partnership income would be sourced to New Jersey, despite his office being in New York. We showed him how real estate can be a tax efficient investment, but that current tax losses could not offset from other types of income, such as his salary. We also talked about timing strategies for his bonus, which might save him taxes or at least defer them for a year.

The next step was to address Cheryl’s new medical practice.  We discussed the differences between LLCs and S-Corporations and even modeled the first few years of business results with her, so that she could see how the differences in taxation would affect their overall tax burden.  When she was ready to start, we formed an LLC for her and we set her office up with an accounting system that would give her good financial reporting throughout the year.

The last step came after they had their two children.  At that time we made sure that they have a basic estate plan that included wills, trusts for the children, and the proper amount of insurances to protect them all in different scenarios.

Today, we speak to them quarterly to ensure we are up on any changes in their lives, to update them of new tax laws that affect them and to offer advanced tax planning, and of course to make sure our clients are filing all the proper forms on a timely basis.



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