Client of the Week

Tax Law Helps Tax Lawyers’ Retirement

A married couple in their early 60’s has built up a successful tax law practice. They plan to work at least another 5 years and want to use the intervening years to maximize their retirement savings. In 2022, they increased their W-2 to pay themselves $305,000 and $285,000. Although they have 3 employees, ranging in age from 29 to 46, we were able to design a combined Cash Balance and Safe Harbor 401(k) program that provides 99% of the contribution for the owners. Each year, if their business situation remains the same, they will be able to put $510,000 toward their own retirement and just $6,120 total for their employees. They know tax law — we estimate they will save themselves $194,800 in current year tax liabilities.

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