InSight-Full®: Tax Mitigation

Taxation in a portfolio or a financial plan is a total loss of return. Clients with an InSight-Full® plan can see the effect tax has on a portfolio and have a full picture of their strategy in an effort to compensate. Different clients and investment strategies cause a variation in the pace of capital gains realizations. This creates an inextricable heterogeneity in the tax management strategy and the investments yield. Tax burdens reduce the return premium client can anticipate and will reduce the overall trajectory of a portfolio. Tax burdens exacerbate the equity premium calculations.

A key area of focus in the InSight-Full® plan is supporting clients by sharing different tax mitigation strategies they can employ personally and professionally. Even though InSight does not provide tax filing, at InSight we make clients aware of the current tax code and help them deploy strategies to make the most from their situation. 

InSight partners with different CPAs or with your current accountant in order to provide clients with the most up to date tax strategy. Some elements are more difficult to reduce like payroll and property taxes, InSight helps our clients learn about different ideas that can help our clients keep more money in their pocket and business. We know utilizing a handful of these deductions or credits (home office expenses, credits for kids and education, spousal 401ks, capital investments, carry forward deductions, business mileage) could make a big impact on your IRS bill. 

We work closely with your Tax professional, and InSight encourages you consult your tax advisor or professional about different strategies available to you.  If you don’t have a taxation consultant, let us know and we can give you an introduction. 

Tax For Small Business Owners:

As a business owner, individuals have many unique opportunities that are only available to them. But few take the time or hire the right people to help them take advantage of the strategies. For our clients, if we can help them lessen their tax burden by partnering their personal plan with CPA’s. By providing on-going and timely education we can help them do what they do best and that is running their business.  

One simple way we help our clients is talking to them about how they’ve structured their business and why. When it comes to starting your business or restructuring your current corporation, picking the right entity and tax classification is a critical decision. Although simple on the surface, having the proper setup can have major tax implications. From Sole Proprietorships, Partnerships, LLCs, PLLCs, S-Corps, and C-Corps, you have a lot of options.

Most of our Dentist Practice owners and small business owners use LLCs or PLLCs as their entity and their tax classification is an S-Corp. They do this because generally, the set up costs are low, taxation is flow through or pass through, and as owners they’re W-2 employees.  A big benefit of having the S-Corp tax classification is that excess profits distributed to shareholders beyond reasonable compensation are not considered self-employment income and are not subject to social security or payroll taxes which means big savings and over time a larger net worth. Therefore, an S corporation provides many of the benefits of a corporation without any double taxation of income earned by the corporation. 

Pin It on Pinterest