The Situation

Mike and Lily built their practice the hard way — long hours, steady growth, and a reputation that kept the schedule full. They have roughly $1 million in annual revenue, a net worth near $6 million.

They were in the highest federal bracket, writing large checks every year. They had a corporate CPA who kept the S corporation compliant and filed returns on time — but nobody was proactively planning how to legally reduce taxes, coordinate the business with their personal balance sheet.

They had set up a 401(k) and were contributing, but they sensed there were other ways to put away far more each year and weren’t sure what they were leaving on the table.

They had young children they wanted protected — not someday, but now. Yet the practice had no group life insurance, and their personal protection and estate plans hadn’t been updated to match a $6 million net worth and a growing payroll. They were great earners and consistent savers, but like many business owners, they’d never stitched business tax strategy, investments, benefits, and family protection into one coordinated plan.

They read articles, listened to podcasts, and got pitches for products. What they wanted was simpler: How do we pay less tax legally? How do we fund college? How do we know our kids are taken care of? They didn’t want another sales conversation — they wanted a team that understood S corps, practice cash flow, and owner compensation — and would explain the “why” behind every recommendation.

The Approach

Mike and Lily looked for advisors who had done this for business owners before — not generic retirement seminars, but planning that started with entity structure, cash flow, and tax.

Just as important, they wanted to understand the plan: reasonable salary, retirement plans, insurance, investments, and estate basics — without jargon or a black box. They wanted clarity that someone was optimizing for their tax bill and their family, not a product commission.

The planning process focused on three pillars: tax planning, wealth management, and protection — with the practice and the household treated as one system.

The Results

Mike and Lily were relieved to work with a team that could do more than manage a brokerage account. They received a comprehensive plan that incorporated:

• A personalized net worth map — practice equity, cash reserves, real estate, retirement accounts (401(k), IRAs), taxable investments, 529s, and personal assets — so every decision started from one clear picture of what they owned and owed.

• Advanced retirement and tax-deferral strategies, including:

  • S corporation compensation review — analysis of reasonable salary vs. distributions, payroll taxes, and QBI considerations.

  • 401(k) design and utilization — employee and employer contributions, match/profit-sharing concepts, and coordination with payroll.

  • Cash balance plan evaluation — illustrating how additional tax-deductible contributions could accelerate retirement savings given their age, income, and practice cash flow.

  • Exploration of hiring children and certain family members for legitimate work in the practice, where appropriate — combining real job duties with income shifting and possible Roth IRA / 529 funding opportunities.

  • Augusta Rule planning — where a home office or related business use of their residence could support a defensible, documented rent strategy between the practice and the household.

• Tax-efficient investing — asset location across taxable, tax-deferred, and tax-free accounts; awareness of NIIT, capital gains, and turnover; and portfolio design aligned with their long horizon and high current tax bracket.

• Education funding — 529 plan strategy for their children, aligned with state tax benefits where applicable and with their goal of funding school without sacrificing retirement security.

• Protection and benefits for the practice and family

Mike and Lily now see how practice income, personal investments, retirement plans, and protection fit together