Construction Company / S Corp with 10 Employees

Construction Company / S Corp

Bill’s Tax Liability without implementing Designer DB Plus® Plan

  • Net Profit after Expenses and deductions$797,000
  • Married Filing jointly tax Liability at 37%$294,890
  • Creditor Protected Retirement Savings$0.00
  • Tax Free Medical Reimbursement in Retirement$0.00

GOAL: Bill wants to save on taxes. provide employee benefits while controlling costs, and ensuring he has enough retirement savings to maintain his lifestyle while simultaneously creating tax-free money for the high cost of Health and Medical expenses in retirement.

  • Net Profit after Expenses:$797,471
  • Plan Contribution$561,627
  • Qualified Business Income:$235,844
  • Pass-through Deduction:($47,169)
  • Taxable Income:$188,675
  • Tax & Deferred Savings First Year

    $249,782*
  • Creditor Protected Retirement Savings:

    $526,137
  • Tax Free Medical Reimbursement in Retirement

    $157,841

ADDITIONAL DEDUCTION: As an owner of a pass-through entity, this client qualified for the 20% QBI tax deduction under the (Section 199A) threshold for married couples.

Note: his income was above the threshold before plan implementation, disqualifying him from the additional tax deduction.

*Please consult your tax advisor; RAS does not provide tax advice but will collaborate with your tax advisor.

* Tax savings compared to no Plan and (Section 199A) QBI deduction. The case assumes an estimated 37% tax rate. RAS does not provide tax advice. This example is based on specific assumptions and is used for illustrative purposes only.