4 secrets to lowering taxes
Post on 23-Jun-2015
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4 Secrets Successful Business Owners & Professionals Use to
Reduce Taxes and Create Wealth
Presented By:
Ken Shapero, LUTCFVice President
CJA and Associates
A Few Questions Before We Start…
What type of business entities do they own?
How many full time employees?
Are any of their businesses a target for lawsuits?
How much is too much tax? $100,000+ $250,000+ $1,000,000+
Are they using allall the planning available under current tax laws to legally reduce their tax liability, protect their assets and create significant additional wealth???
If not, let’s explore the 4 Secrets4 Secrets!
A Few Questions Before We Start…
Secret #1
What type of qualified retirement plan do they offer? Is it an employee benefit plan or Is it an EMPLOYEREMPLOYER benefit plan?
Secret #1
Employer
25%
75%
Employees
Most companies tend to have employeeemployee benefit plans!!!
Secret #1
5%
95%Employer
Employees
Smart Employers offer Employer Benefit Plans in which the owner/owners receive 80% to 95%80% to 95% of the total contributions.
Free Feasibility Study
Please allow us to offer you and your clients a
FREE feasibility studyFREE feasibility study to assist you in discovering
what type of plan would work best for their business.
What type of employer sponsored benefit plan would allow your clients and a number of their certain key employees to purchase personal life insurance with a 35% discount35% discount and have
the policy paid up in 5 yearspaid up in 5 years?
Secret #2
Business Pays a tax deductible premium for life insurance for employees of corporation including key employees/owners.
Premiums are partially tax deductible to employees based on benefit provided
Upon transfer of the policy to the employee, the employee owns policy and all rights associated with policy including future tax-free loans.
Tax-free death benefit may be paid to employee’s beneficiary in event of death.
Section 79 Plans
Advantages of Section 79 Plans
Contributions to the plans may be tax-deductible.
Income tax-free portable death benefit. Tax-deferred accumulation. Tax-free income in later years. Only 60-65%60-65% of the contribution is included in
taxable income to employees. Benefits of future planning are substantial
Supplemental Retirement Income Wealth Transfer Estate and Liquidity Planning
1. How comfortable are you today with our current or proposed health care system?
2. What impact will it have on you, your clients and your families after retirement?
Secret #3
Secret #3
If you could set up a private plan that guaranteesguarantees you will have a pool of money
to draw upon in post-retirement and it would be tax-deductibletax-deductible, tax-deferredtax-deferred,
creditor protectedcreditor protected and more importantly provide tax free reimbursementsprovide tax free reimbursements for almost any medical expense,
would you be interested?would you be interested?
Example
Name First Year Contribution
% Of First Year Contribution
Plan Account Value @ NRA
Owner #1 $246,357 47.05% $646,500
Owner #2 $277,223 52.95% $727,500
Total Contribution: $523,580
Husband and Wife, age 62
NRA 65
1 other employee ineligibile due to service
Secret #3
Employers today are using this
““Post Retirement Medical Reimbursement Plan”Post Retirement Medical Reimbursement Plan”
for themselves and their employees with
confidence that no matter what happens with
health care reform they will have resources to
provide for their needs.
Sample Numbers
Census Owner, age 62 retiring at age 65, salary
$235,000
Account at Retirement: $1,374,000
Annual Withdrawal: $97,489
Total Sum of Withdrawals: $2,437,217
Create
Your OwnYour Own
Insurance Company
Secret #4
Secret #4
The purpose of creating your own insurance company is
primarily to insureinsure or reinsurereinsure the risks of the owner.
Secret #4: A Little History
Around since the 1950’s
Currently over 5,000 privately owned small insurance companies
Used by nearly 80% of S & P
Substantial Case Law & IRS Guidance
Why Consider Your Own Insurance Company?
Contribute significant Pre-Tax dollars (under IRC 831b) up to $1,200,000 per insurance company
Grow the money over flexible periods of time (no 59 ½, no 70 ½, no eventual IRD Tax) on a tax favored basis
Asset Protection Structure; protected from the claims of creditors personally & professionally
Why Consider Your Own Insurance Company?
No contribution for employees
Ability to access the money on a favorable tax basis while living and passing assets to loved ones without gift and estate taxes
Tax Favored access to assets based on clients & advisors Dividend rates @ 15% Capital Gains rate @ 15% Tax Free
Typical Captive Structure
Shareholders Shareholders
Parent Company Parent Company
Premiums
Claims
Possible Risks
Insured Workers Comp Auto Insurance General Liability Property Coverage
Deductibles Exclusions
Possible Risks
Uninsured Administrative Actions Legal Defense Construction Defect Employment Practices Product Liability Product Warranty Terrorism Risk Computer Operations
Captive Benefits
Insurance is typically a good investment Provides coverage for uninsured risks Lower insurance cost-overhead and profit are
a large portion of premium Establishes best risk management practices Provides tax benefits Creates wealth Facilitates wealth transfer Asset Protection
To Review
Secret #1: Have an Employer Benefit Employer Benefit Qualified Retirement PlanQualified Retirement Plan
Secret #2: Buy your personal life insurance with Big DiscountsBig Discounts paid for by your company
Secret #3: Set up your own “Post “Post Retirement Medical Reimbursement Plan”Retirement Medical Reimbursement Plan”
Secret #4: Set up your own Insurance CompanyInsurance Company
Sign Up For A Private Consultation To Sign Up For A Private Consultation To Discuss Any Of These Plans!Discuss Any Of These Plans!
Thank You!
For Additional Information Contact:
Kenneth Akiva Shapero Kenneth Akiva Shapero
LUTCFLUTCF
954-775-5514
kshapero@cjamarketing.com
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