Retirement Actuarial Services
Business Owner Tax Deduction Case Examples
Case examples make the concept concrete — but they are illustrations, not guarantees. The same income can produce very different opportunities depending on the facts.
Case examples are one of the clearest ways to understand advanced plan design, because they show how the same income can produce very different opportunities depending on age, staffing, and goals. The examples below are hypothetical and simplified for illustration — they are not promises of a specific result, and actual figures require a feasibility study.
Example 1: Dental practice owner
Age 56 · Income $650,000 · 4 employees. A basic 401(k) alone captures only a fraction of the available deduction. A Cash Balance Plan paired with a coordinated 401(k) and profit sharing layer could materially raise total deductible contributions, with a possible 401(h) layer for retirement medical planning. Age and favorable staff size make this a strong screening profile.
Example 2: Solo consultant
Age 59 · Income $500,000 · 1 employee. Low employee count plus higher age often produces a very favorable owner-to-staff ratio. The likely focus: accelerated retirement funding through a Cash Balance Plan and long-term tax deferral, layered on a maximized 401(k).
Example 3: Medical group owner
Age 52 · Income $900,000 · 6 employees. Strong income supports a substantial design, while staff demographics drive the employee cost. A coordinated Cash Balance, 401(k)/profit sharing, and 401(h) review is typically warranted — the kind of multi-layer design Designer DB Plus is built to evaluate.
Example 4: CPA firm owner
Age 61 · Income $750,000 · 8 employees. Older age supports large contributions, and the owner is well positioned to coordinate plan design with their own tax expertise. The focus is plan redesign, profit sharing allocation, and a potential medical reimbursement layer.
Notice the pattern: age and employee count move the opportunity as much as income does. A 42-year-old with the same $650,000 income and 20 employees would have a very different profile from the dentist in Example 1.
How to read these examples
The takeaway is not a specific dollar figure — it is the principle that your facts determine your opportunity. The purpose of the Business Owner Tax Savings Analysis is to identify whether your specific combination of age, income, employees, and current plan suggests that a deeper, professionally reviewed feasibility study is worthwhile.
Authoritative sources
Frequently Asked Questions
- Are these case examples guaranteed results?
- No. They are hypothetical and simplified for illustration. Actual contributions and tax outcomes depend on census data, compensation, plan design, actuarial assumptions, and applicable law.
- Why do two owners with the same income get different results?
- Because age, employee count, compensation structure, and current plan all affect the design. Age and staffing often move the opportunity as much as income does.
- How do I know which example is closest to me?
- The Tax Opportunity Score screens your specific facts and indicates whether a deeper feasibility review is likely to be worthwhile.
Use the Business Owner Tax Savings Analysis™ to estimate whether an advanced plan design may be worth reviewing for your income, age, and employee base.
Get My Tax Opportunity ScoreEducational only. Retirement Actuarial Services works alongside your CPA, tax advisor, and legal counsel. Plan feasibility, contribution limits, deductions, and 401(h) reimbursements depend on compensation, employee census, plan documents, actuarial assumptions, IRS limits, and applicable law. Examples are hypothetical and do not guarantee results.
