Entity optimization, retirement plan maximization, and exit planning that actually moves your effective rate.
At $1M of net income the tax bill is usually the largest single expense in the business, and it is the one line nobody manages. The entity was chosen when the company was small. Owner compensation was set once. The retirement plan is whatever the payroll provider offered. The return is filed accurately and the strategy conversation never happens.
The levers at this level are structural. S corporation versus partnership versus C corporation changes self-employment tax, the qualified business income deduction and how an eventual sale is taxed. A defined benefit or cash balance plan layered on the 401(k) can move well into six figures a year off the table. Family employment, the accountable plan, the home office and vehicle rules and the timing of large purchases each add to it.
We run the last three years through a strategy lens, model the entity and compensation alternatives, and write a plan with a calendar. You take it to your CPA or have us implement it and carry the ongoing accounting and filing.
What we typically see: An entity chosen at $200K and never revisited. Owner salary set by guesswork. A SIMPLE IRA where a defined benefit plan belongs. A tax bill discovered in April, paid with an extension and a penalty.
Each one is modeled against your numbers and written into the blueprint with the documentation it needs.
Same CPA for a decade, every return on time. The review found six figures of planning before a single new strategy was even deployed.
Filing reports what happened. Planning changes it before the year closes: the compensation level, the retirement plan design, the purchases and the entity structure are all decisions with a deadline.
It depends on age, income and how many employees must be covered. Contribution limits well above the 401(k) cap are common for owners in their late forties and up. The actuary sets the number; we model whether it fits.
Sometimes. The answer comes from modeling your numbers under each structure, including what happens at sale. Many owners keep the entity and change the compensation and plan design instead.
A review of three years of returns and the entities, a written blueprint of every strategy that applies and what it is worth, then implementation by us or your CPA, with quarterly check-ins.
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Have one specific question instead? Book a Strategy Session with Jose.