6/17/14 at 01:31 PM 0 Comments

Is Your CPA Helping You Develop a Legacy and Fulfill the Parable of the Talents?

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Or Is Your CPA Still Asleep on the Front Porch Recovering from Tax Season?

Or is Your CPA Looking Ahead…Even Further Than You’ve Ever Dreamed?

Has Your Business Arrived But Your CPA is Still Sleeping at the Wheel?

At His CPA PC we “bring to the financial table” so MUCH more than just income tax preparation. Should your CPA’s first and initial goal every year to save you income taxes. ABSOLUTLEY YES!

However your CPA should be able to do much more than just prepare income taxes.

“As a Duluth CPA Firm Serving Gwinnett/Atlanta taxpayers and abroad we seek a more holistic view of money and fiscal management. Working with the ebbs and flows of business fluctuations and an ever changing global economy, His CPA PC is able to respond and to make corrections in short term strategies while focusing on a long term vision. Be sure you work with a CPA who can see both ‘the forest and the trees’”. ---His CPA PC President, John Dillard CPA

The below is a sample letter we might send to a client who is reporting substantive taxable income.

2014 Tax Planning & Legacy Considerations

It was great to see you today and to discuss tax planning and developing a legacy.

Before we go forward with what retirement plan to utilize this year I suggest we meet along with your financial adviser to discuss all the below.

Adding you to pay you for your contribution to the family business.

Adding you to salary while continuing your present retirement plan an owner only 401K http://www.irs.gov/Retirement-Plans/One-Participant-401(k)-Plans 

Considering setting and funding a Defined Benefit Plan this year. For an overview of these plans see http://www.newyorklife.com/nyl/v/index.jsp?vgnextoid=9cd02f5a919d2210a2b3019d221024301cacRCRD 

Adding you to salary and setting up a Defined Benefit Plan this year.

Impact to retirement plans of adding other employees other than yourselves if do so in future years.

IRS Filing Requirements of a Owner401K vs. a Defined Benefit Plan, annual costs and Plan Documents.

We discussed considering starting and beginning the funding a legacy where you might leave in your will or set up a trust with a substantive portion of your financial assets. This is to confirm my wife’s and my plan of giving approximately one-third to each of our two children and then to leave the rest in a legacy (such as a bequest to a church, non-profit, setting up a trust, a library etc. etc.) while keeping the Parable of the Talents in mind).

If you can please have your financial adviser come prepared to discuss:

-Plan requirement s of adding you to salary in each a owner only 401K and Defined Benefit Plans.

-How adding other employees other than yourselves might impact an owner only 401K and Defined Benefit Plan.

-What they suggest as options to study and consider setting up a legacy and to update your wills accordingly.

-Do several projections based upon several varying rates of returns given present assets, life insurance, liabilities etc. and saving levels.

-Your after net after income taxes income for the last two years has averaged approximately $112K assuming $47.5K to Owner Only 401K having been deducted/paid.

-Funding your children’s private college tuition.

-Review and consideration of future estate planning considerations, taxes and funding.

-Review and consideration of present life insurance, disability insurance and long term care insurance.

To get us thinking about a legacy and its development might I suggest http://creatinglegacy.com/category/legacy-stories/ 

Based upon the above your 2014 estimated taxable income and your income taxes to the IRS and GA will be $45K & $11K respectively reflecting a marginal tax rate to the IRS of 33% and to GA of 6%.

II you have not yet done so I suggest you have a good business attorney critique and evaluate the contracts you have with both your clients and with your independent contactors’ to ensure your business interest are adequately protected.

Consider having an independent insurance lines agent review both your personal and business lines to ensure adequate coverage limits etc. to cover all practical business and personal interests and exposures including property, liability, errors & omissions and umbrella policies.

www.HisCPA.com  a Duluth GA CPA Firm Taking Christianity Into the World

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