Real Estate Agent / Sol Proprietor
CASE: Chad
- Chad, age 53, is married.
- He is a successful real estate agent with no employees.
- Chad has a net profit of $500,000 (after paying self-employment tax).
Chads Tax Liability before implementing Designer DB Plus® Plan
- Net Profit after Expenses and deductions$500,000
- Married Filing jointly tax Liability at 35%$175,000
- Creditor Protected Retirement Savings$0.00
- Tax Free Medical Reimbursement in Retirement$0.00
GOAL: Chad wants to retain more of his earnings, pay lower taxes, secure his retirement savings, and prepare for the high cost of health and medical care in retirement
Plan
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.
- Net Profit after Expenses:$500,000
- Plan Contribution$175,000
- Qualified Business Income:$0.00
- Pass-through Deduction:$0.00
- Taxable Income:$0.00
Tax & Deferred Savings First Year
$129,304
First-Year Creditor Protected Savings:
$262,000
*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.