By Carole C. Foos, CPA, David B. Mandell, JD, MBA

With the legislation President Obama has signed into law this year, nearly all physicians will see their federal income, Medicare and capital gains taxes increase in the coming years. When you add to these federal tax increases, the various proposals in place to increase state and municipal taxes and fees, you could see your combined marginal tax rate increase by 10% (up to 45% to 58%, depending on your state). This could be an increase of up to 20% on the taxes paid on dollars earned over $250,000. This is no small set of changes and they should not be taken lightly.
Though many of your colleagues are complaining and some have been threatening to leave the country, we want to offer more practical advice in this article. The good news is that there are techniques most doctors can implement in 2010 to help reduce your taxes in 2011… and beyond. Many of these techniques are powerful enough to equalize or go beyond the proposed tax increases. Savvy doctors who take advantage of these strategies could expect to reduce their annual tax liabilities – even if all the proposed tax increases become law.

By Carole C. Foos, CPA, David B. Mandell, JD, MBA, Jason O'Dell, CWM

As a physician, do you realize that – between income, capital gains, Medicare, self-employment and other taxes, you spend 40 to 50% of your working hours laboring for the IRS and your state? That is a lot of time with patients for someone else’s benefit. Given the significance of this fact, shouldn’t your advisors be giving you creative ways to legally reduce your tax liabilities? How many tax-reducing ideas does your CPA regularly provide you? If you are like most physicians, you probably get very few tax planning ideas from your advisors.

By David B. Mandell, JD, MBA, Jason O'Dell, CWM

As an attorney and consultant to thousands of physicians across the country, we are constantly astounded by the attitudes of physicians regarding the sale of their medical practice. Most often today, we hear the complaint that doctors do not feel they can sell their practice for any significant value. They generally do not feel the practice is “worth anything,” especially if they do not have younger partners to buy them out.

By Andrew Schwartz, CPA

Taxes are going up. With many of the provisions of the 2001 Tax Act expiring at the end of this year, most tax brackets are set to increase by a few percentage points on New Year's Day. For high income taxpayers, the top bracket will increase by 4.6%, from the current rate of 35% up to 39.6%. Meanwhile, the tax credit for a child under the age of 17 is slated to be slashed in half to $500, and the dependent care credit will be cut by 20%. Plus, we'll see the return of the marriage penalty and the stealth tax.

Sounds rough, right? There is some good news for doctors in practice, however. Let's take a look at a few new tax breaks enacted earlier this year.

By Christopher R. Jarvis, MBA, Jason O'Dell, CWM

Changes in tax laws can catch successful people off guard. With most physicians so busy worrying about potential reimbursement reductions, they don’t have the time to address the important challenge of establishing a tax-wise estate plan for their families. In our experience, fewer than 5% of doctors have an adequate estate plan in place when we meet. This upcoming tax law change will create even more shortfalls in most doctor families’ planning.

By Carole C. Foos, CPA, David B. Mandell, JD, MBA

There is little doubt that every physician in the U.S. has an opinion on the recent healthcare legislation and its impact on medical care in this country. We are sure you do. What is less clear is whether or not most physicians understand the tax ramifications of the new law. In this article, we will lay out the most significant tax provisions of the healthcare law and make some suggestions about ways to reduce the tax impact on you.

By Tish Wold, CFP

While the Estate Tax has been eliminated (for 2010) so has the step up in basis. What has replaced them? How about Income Tax and a Modified Carryover Basis?

By C. L. Huddleston, J.D.

In the appropriate situation, Roth IRA conversions can be a home run for doctors and their families. Some of the considerations are obvious and intuitive, but others are more obscure.

By Carole C. Foos, CPA, David B. Mandell, JD, MBA

Many doctors invest in real estate - in rental properties, commercial developments, surgery centers or even their office or home. This article provides guidance on how to protect such assets and leverage them for tax benefits as well.

By Lawrence B. Keller, CFP®, Andrew Schwartz, CPA

Although it has been around since 1998, and is one of the best financial tools available, most physicians, as high-income taxpayers, were unable to take advantage of it due to income limitations. However, as part of The Tax Increase Prevention and Reconciliation Act of 2005 (TIPRA) signed into law by President Bush on May 17, 2006, that has changed. Now, taxpayers earning more than $100,000, finally have the option to convert their IRAs and other eligible retirement accounts to a Roth IRA as of January 1, 2010.