A lot of my conversations often go the same way – I meet someone new, we start a nice conversation, and I get asked what I do for a living. I respond that I’m a tax attorney and…eyes glaze over. Because I know my sparkling personality couldn’t possibly be the cause, I’ve decided (likely out of self-preservation) that part of the reason is that people don’t always understand what it means to be a tax attorney or what it’s like to work with a tax attorney. My New Year’s Resolution? Let’s fix that! (Even if my reasoning is inherently flawed, it really helps the flow of this blog if that premise is true, so just go with me here). To solve this problem (that I admittedly may or may not have fabricated) and quash other myths (I get it, no one is talking about tax attorneys, but I’m creating a narrative here), I thought I’d offer a glimpse into what it looks like when I, as a tax attorney, meet with someone who is considering tax planning needs. This should help with some of that eye glazing.
Initial Meeting: “What Are The Basics?”
My initial client meetings typically involve those who are considering an attorney for estate planning, business planning, and/or tax planning. In this meeting, my job is to ask the right questions.
If you keep reading, and you find yourself thinking any of the following:
- “I should probably know the answer to that.”
- “We’ve been meaning to deal with this.”
- “That sounds uncomfortably relevant.”
Then, now is a good time for us to chat; a thoughtful and honest conversation about where you are and where you want to go.
Big-Picture & Goals: “Why Are We Here?”
When meeting with a new client, I like to get a handle on the big picture. The following questions are things to consider:
- What prompted you to come in or reach out now? (A perfect answer would be, “I read an interesting blog that helped explain what I need and how to prepare in a comfortable way.”)
- What are your top concerns when you think about your finances, family, or business?
- Minimizing taxes
- Protecting assets
- Taking care of family
- Maintaining control
- Avoiding future disputes
- All of the Above
- What is it that you really want to fix?
The preliminary overview is often targeted at what you are specifically worried might go wrong if you don’t get a plan in place.
A whole host of reasons can be the initial trigger, be it a new child, the sale or impending sale of a business, realizing your “plan” is partly in a drawer at the office and partly in a three-ring binder from 1998, or you had a recent combative probate experience with a family member.
Whatever the reason, we can first zero in on whether we’re solving an urgent problem, doing preventative planning, or cleaning up something that no longer fits.
Estate Planning: “Who Gets What, When, and How Much Drama Is Allowed?”
When it comes to estate planning, it’s really about people, hence the complications. Estate planning is very personal, and while I try to reassure clients that “I’ve seen it all,” it can be intimidating to share such intimate details.
When setting the stage for estate planning, I typically ask about:
- Your spouse (current, former, or blended-family situations)
- Your kids (ages matter, so do personalities)
- Anyone you consider “family,” even if the law disagrees
Understanding the players involved helps create an overarching structure for effective planning.
When it comes to beneficiaries, the following are some examples of “special circumstances”:
- Minor children
- Special needs
- Addiction issues
- Spendthrifts
- Someone who really shouldn’t receive a large lump sum at 25
Analyzing these aspects is important because equal is not always fair, and fair is not always tax efficient. Planning lets you protect people not only from themselves, but also from creditors, bad influences, or bad decisions.
Then we get to some of the harder choices – deciding who you trust to handle money and make decisions. Even the best structured plans in the world can fail if the wrong person is in charge. Proper estate planning translates real life into a plan that works even when emotions run high, and you’re not around to explain yourself. Remember, estate planning isn’t just about assets; it’s about people with assets, and people can be…unpredictable.
Business Planning: “How’s the Money Made and Who Could Mess It Up?”
When it comes to business, I go right to structure. I want to know:
- Entity type (LLC, S Corp, C Corp, Partnership, Sole Proprietorship)
- Ownership (Individual, Trust, Multiple Parties)
- Documented governance (Who’s in charge)
- Undocumented governance (Who thinks they’re in charge)
These preliminary questions are important because entity structure affects taxes, liability, estate planning, and succession planning. The wrong structure can quietly cost you tens of thousands of dollars a year.
I then ask about current business succession planning; the proverbial, “What happens if something happens?” This something includes (among others) disability, incapacity, retirement, and (unfortunately) death. If the business depends solely on one person and there’s no plan, the family may inherit a mess instead of an asset.
My personal advice is that a business can be a powerful wealth-building tool or a planning disaster if it’s ignored. In analyzing the business, I try to focus on the following:
- Where taxes might show up
- Where risk lives
- Where planning opportunities are hidden
More often than not, this is the point in a meeting where a client says, “I didn’t realize that mattered.”
Tax Planning: “What Are You Paying & Why?”
Once I get to the tax planning piece, people often say, “I have a CPA, and they handle that.” And that’s a great start. I like CPAs, and I work with them often. Having a team of good advisors is key because tax planning is proactive and comprehensive, not simply compliance-driven.
I’ll ask questions about how you make your income:
- W-2?
- Business Income?
- Investments?
- Real Estate?
- A mix?
This is important because income is taxed differently. Efficient tax planning involves legally shifting, timing, or characterizing income to reduce annual tax exposure; not just reporting income accurately on a return.
I’ll also be interested in what you own, be it real estate, investment accounts, retirement plans, life insurance, business interests, you name it. These all become relevant for tax planning because taxes aren’t just important when you earn money, it’s also important when you sell, gift, inherit, or (again, unfortunately) die.
Good tax planning also gets at what’s keeping you up at night. It could be paying too much tax, leaving a mess for heirs, losing control, the IRS, or a business partner. An appropriate tax plan isn’t always the most technically efficient; it’s also whatever helps you sleep at night. Remember, for tax planning, we focus on what’s next, not what’s already happened. The earlier the conversation, the more options you usually have.
The Final Question: “What Does Success Look Like For You, and How Do We Get There With Minimal Tax, Risk, and Regret?”
This answer really requires honesty, context, and sometimes confronting what you’ve been avoiding. That’s where I come in to guide you, by turning big questions into clear answers with a plan that works. If you’re thinking about answers and want guidance, let’s talk.
For more information or to seek counsel from our Taxation group, please reach out to request a consultation or call us at 216-696-1422.
