Advisors, advisory firms and attorneys: are you missing out on benefits?

Posted on November 15, 2008 by Bill Faiferlick

My primary objective in working with an advisor, advisory firms and attorneys is to identify clients who are concerned with the financial loss associated with unnecessary overspending in the form of higher than required federal tax payments. Unfortunately, many are unaware that they are overpaying by some estimates millions of dollars in unnecessary taxes.

For most high income earners, they are constantly being reassured by their tax professional that everything possible is or has already been done or has been considered in the on-going effort to reduce their tax liabilities. For tens of thousands of successful individuals across this country, quite the opposite is true.

To illustrate this point, Congress amended several little known obscure restrictive limitations as far back as 2000 allowing for the quick tax deductible accumulations of as little as $70,000 up to $350,000 a year per individual.

The availability of these types of legitimate tax deductions are not generally discussed or brought to most clients by their CPA due to the lack of specialized knowledge in working with, designing and administering these professional and owner benefit plans.

In fact, while a few CPAs may admit their intellectual limitations with such planning opportunities, few can argue with the fact that these types of opportunities have been available to top executives of large public corporations for literally decades. Whereas smaller nonpublic business and professionals had literally been discriminated against during this same period, with very limited deductions available in the common 401(k) or profit sharing arrangements, these deductions are often either too little, or in the case where there are employees, the required employees contribution often offsets the saving for those most in need.

What may have ultimately helped change Congress’ mindset was the looming monetary crisis that will result when as many as 80 million baby boomers start entering retirement in 2008. It is expected that as high as 80% of those retirees will be unable to satisfactorily support themselves throughout the longest retirement period ever experienced by any industrialized nation today. Because of this, everyone has to do more financially to prepare for retirement and its associated unexpected costs of injury or illness.

It’s left to people who desire more control, increased confidentiality with their money, and who want to take advantage of accumulation and protection strategies which go far beyond the best advice CPAs can offer. People do not sustain wealth by giving or paying considerably more than what is necessary.

My emphasis is on meaningful reductions of existing tax obligations, or outlining ways which will afford the client increased privacy and protection by applying certain lesser known risk reducing strategies. For higher net worth individuals seeking significant diversification and protection strategies, this often includes discussing the use of international investment opportunities not commonly understood or properly implemented in the U.S.

By performing very specific services in highly specialized tax sensitive areas, my services compliment the client’s financial goals by eliminating or cutting out unwarranted expenditures, creating new desirable tax savings, and risk-reducing opportunities uncommon in the marketplace today.