First Tax Reform and then we will get into some things you must do to help you this time of year. Tax Reform keeps the 3.8% tax on investment income for higher-income taxpayers. See my Tax Summary. Tax Reform likewise retains the lower rates on long-term capital gain and qualified dividends. This year you can use investments that have lost value to offset those that have gained. If you have margin interest, you can deduct it with certain limits and I can show you how to boost those limits with long-term capital gains and qualified dividends. Read more.

What’s Tax Reform going to do to capital gains and dividends? For most taxpayers, Tax Reform will keep the 15% maximum rate on “qualified dividends” (from domestic US companies) and on long-term capital gains (investments held 12 months or more. Tax Reform will likewise keep the 3.8% net investment income surtax on upper-incomers.

3.8% tax on net investment income. This year and under Tax Reform a 3.8% tax applies to the lesser of (a) net investment income or (b) the excess of modified adjusted gross income over “modified adjusted gross income” exceeds, $250,000 for joint filers, $125,000 for married separate filers, and $200,000 for other taxpayers. Investment income includes interest, dividends, capital gains, annuities, royalties and passive rental income.

Investment losses. Don’t cry about those losing investments. Sell them and sell investments that have increased in value to offset the capital gains. If you have more losses than gains, you can deduct up to $3,000 of the excess losses against income other than capital gains. You can carry-over unused capital losses. If you have losses in investments that you want to keep you can buy them back, but you must wait more than 30 days for the loss to be effective under tax rules.

Investment interest. If you have investment interest such as margin interest you can deduct it to the extent of net investment income. I can show you how to use long-term capital gain and qualified dividends to deduct the margin interest.

I could go on. Come in for a free 1/2 hour consultation to find out what will help you

Posted in What's New?

Estate Planning 2017_11

Let’s talk about Tax Reform and then talk about what you need to do the rest of this year. Tax Reform proposes to END the federal estate tax. Finally, estate planners can concentrate on family concerns instead of taxes. When I do estate planning I follow my motto, ease and effectiveness. That means it is quick and economical for you. How can I accomplish that? I am an Accredited Estate Planner. I have taught Microsoft Word and Excel professionally. As corporate counsel for a national software company, I earned certificates in Visual Basic, the software that runs Microsoft Word and Excel. So I program Word and Excel to produce documents to do what you want. I do not send you home with two inches of documents that you don’t understand.  My approach benefits and protects you. 
I create your documents quickly and accurately, using provisions some of which I developed with my father, a former Probate judge. Using VBA programming, I enter client information and with the mere push of a button, the program enters clients’ names and information almost magically into Trusts and other estate documents. With the programming, I search out keywords and replace them. I check documents for spelling and grammar.  I don’t use a paralegal. That means you don’t have to pay for a paralegal and you don’t have to put up with their mistakes. As a licensed lawyer and Accredited Estate Planner, I understand my documents and the law.
Some lawyers pay high prices for document assembly programs created by out of state “experts.” Their paralegals use these programs to create massive documents designed to work under every possible circumstance. This means that you end up with language covering a business whether or not you have a business. These documents come in large notebooks with large prices.
As large and expensive as these documents are, they are only as good as the person that makes them. If most of the work is done by a paralegal, it is tempting to rely on the paralegal and not review the document carefully. For example, I reviewed one of these impressive notebooks in which a child with mental disabilities was to receive half of his mother’s estate outright when she died. This was not communicated to her and she did not intend it. She intended that his share remains in trust where it could be protected by the trustee. I corrected it for her. Don’t let this happen to you!
If you are ready to design your estate so that it is easy and effective for you and your family, select RLT Organizer.
Posted in What's New?

Mind your Business 2017_11

Again, let’s discuss Tax Reform and then I will tell you ways to help your business the rest of this year. As a former corporate counsel and former IRS attorney, I can be your one-stop professional. I can draft your contracts and advise you on their tax consequences. Right now, I am working on business purchase contracts for clients.
I am forming LLC’s and telling clients why not to form an LLC. Purchases and sales of businesses or equipment should be carefully planned to avoid unfavorable tax and legal consequences. Find out more.

TAX REFORM. Under Tax Reform, most likely in 2018 there will be a 25% maximum tax rate on sole proprietorships, partnerships, and S corporations. There is a chance of an unlimited deduction for depreciable assets other than buildings effective in September of 2017. If you have this option, you will have to decide if you are better off deducting it now or later. It will be wise to get a professional tax forecast so you will know your effective tax brackets this year and in the future.

Purchase or Sale of Business or Equipment. If you ell equipment and you have written off all of its cost, you will have tax consequences. Think about instead making a tax-free exchange. Or you could delay the tax with an installment sale. If you are buying or selling a business, I could easily write a book on it. Think about noncompetition provisions, non-solicitation provisions, confidentiality, warranties and more.

YEAR-END PLANNING. Check with your tax professional and do some year-end planning. If you are a cash basis taxpayer and will be in an equal or larger tax bracket this year than 2018, pay some of your 2018 expenses, like insurance premiums, this year. Delay some billing.

WILL YOU BE AUDITED? What are your chances of getting audited? My TaxMastery© program tells you the average deductions for taxpayers in your income range. The IRS has announced that it is an audit red flag when taxpayers have lots of wage income but report lots of Schedule C losses especially if the loss activity sounds like a hobby. A recent Tax Court disallowed losses from film festival marketing where the taxpayer had no business plan and poor records.
My advice: act like a business if you want to be treated as one for tax purposes.

Give me a call. Get a free 1/2 consultation.

Posted in Business Law, Taxes, What's New?

Individual Tax Tips 2017_11

Let’s talk a little about Tax Reform and then get into some things you should do this time of year. Tax Reform should overall benefit individuals with lower tax rates and higher standard deductions although specifics are uncertain. It looks like many taxpayers in 2017 will be able to turn sales tax, charitable contributions and employee job expenses into GOLD. I am talking about saving thousands
of dollars in taxes. My Tax Mastery© program identifies these deductions for you and tells you how to get them. Once you have secured these deductions, you can adjust your withholding or estimated tax payments so that you have more take-home pay.

TAX REFORM: Under Tax Reform larger standard deductions will benefit many taxpayers, $24,000 for married taxpayers filing jointly, and $12,000 for single filers. The initial tax reform bill would eliminate itemized deductions other than home mortgage interest and charitable contributions. This means no deductions for medical costs or employee expenses, Fedex pilots. I predict that Congress will keep the deduction for state and local taxes but phase it out for larger incomes.

Tax season is never over. You have to act this time of year to get tax benefits. There are many deductions that you cannot use at all unless you are “Itemizing your deductions.” You can itemize if your Schedule A deductions (medical, tax, mortgage, charitable, employee, and investment) exceed your “standard deduction” ($12,700 for joint and $6,350 for singles). See my TAX SUMMARY_2017.
Once you pass this threshold the effect of these deductions starts to add up.

My advice: Don’t be lazy. Keep records to support your Itemized Deductions. My Tax Mastery© program identifies deductions and tells you what they will save you.

The IRS “gives” you an estimated sales tax deduction from a table, but my experience shows that it is often less than half of what most taxpayers actually spend. So keep receipts for all your sale taxable purchases, especially vehicles or home improvements. The State of Tennessee has a sales tax on just about everything.

For example, one of my favorite clients came in with receipts for over $200,000 for an addition to their house. They saved more than $7,000 in taxes! You don’t have to add up these receipts. Use your credit card and bank statements to estimate a conservative amount. Save the receipts in case you are audited.

Keep receipts for charitable contributions, especially clothing and household items. If you were recently married or moved, don’t keep everything you both owned and don’t tell me you gave only $450 to charities. I can show you how to value and record these items. Use my Charitable Contribution Record.

Miscellaneous Deductions.You cannot deduct Miscellaneous Deductions unless they exceed 2% of your Adjusted Gross Income. With Tax Mastery I can show you the additional employment and investment deductions. Are you missing investment fees hidden at the back of your investment adviser’s statements?

Once we find and get proof of all of these deductions, it is Christmas time! Want some tax free cash? I can show you how to adjust your federal withholding so you take home those tax savings between now and the end of the year in the form of more take-home pay.

Posted in What's New?

WealthWISe updates

In my e-letter, WealthWISe, I report on the latest important items in my fields. Be sure to sign up for WealthWISe so you will receive your personal copy as soon as it comes out.

Posted in Uncategorized



Avoid gain on older stocks. One of my new clients, Serena Stockholder, is a Federal Express employee and loves to buy Federal Express stock. As a result, she has stock that has been purchased over a number of years.

One day as we sat and reviewed her tax return, which I was preparing, she bemoaned the fact that she needed to sell some of that stock but the older purchases had low costs so she figured she was going to have to pay some capital gains taxes. I tipped her off on two easy ways to lower that gain. Read more.

First, normally the first-acquired shares are treated as sold first. However, if you identify the shares sold, you can select the shares with the highest cost to minimize gain. For this to work, you must tell your broker and get confirmation of what shares to sell receive in writing. You may also issue a standing order to always sell the stock with the highest basis.

Second, under a little-known rule, if she contributed appreciated shares with a low basis to her favorite charity, she would be entitled to deduct the current value of the stock and would not have to pay any taxes on the gain.

My Advice: It is almost always a good time to make an appointment with me and do a little tax planning. Had Ms. Stockholder sold her stock without knowing what I told her, she would have paid way too many taxes. The best thing to do is to send me your most recent tax return and let me put Tax Mastery© to work. That way you can assure that you pay the least legal taxes in 2017. If you are considering any significant transactions, I can use my Proseries software to tell you exactly what your 2017 taxes will be and how we can reduce them. If you are not yet a tax client, you are entitled to a *Free 1/2 hour Consultation.*

Next Wealthwise: I will tell you how to avoid the passive activity loss (PAL) rules without being a real estate professional. Hint: most Airbnb hosts avoid PAL.
Posted in Real estate, investing, What's New?


Summer is no vacation for you or is it?

Tax season is never over. You have to be vigilant for tax benefits. For example, one of my favorite couples, Dr. and Mrs. Med, live in Nashville and they have three kids. Mom and Pop are employed as MD and pharmacist, so they must find something for the kiddies to do while the parents work. Summer camp is expensive. They typically owe taxes with their return. What can they do?

Here is how it works. If your child is age 12 or under and attends summer camp (not summer school) so you can work, you can take the dependent care credit. The credit is 20-35% of the cost on up to $6,000 with two or more children. The percentage drops as adjusted gross income increases over $15,000. So even in this case where the parents make good money, they get to take a $1,200 tax credit – that is a credit, which directly reduces their taxes.

Withholding trap. Let’s look at another TRAP faced by Dr. and Mrs. Med and many hardworking couples. They can’t trust their employers’ withholding. There are two traps:

First, where a couple is both employed, their combined incomes push their taxes up but each employer is not aware and doesn’t withhold enough leaving them owing a sizable amount on their tax returns.

Second, on the other hand, a taxpayer that is deducting sizable itemized deductions, like real estate taxes, mortgage interest, contributions and more, can end up with a large refund, which you could have used to increase your monthly checks.

Tax advice: Try my Tax Mastery© program. With it, I can show you how to lower your taxes with those deductions and adjust your withholding so it matches your taxes. Likewise, my Tax Mastery© program tells you what the average deductions are for your income so you can avoid an IRS audit.

Posted in Uncategorized



As a former in-house counsel for a 65 man company, I can help you with many tax and legal questions that your tax adviser cannot. For example, recently a client who owns a real estate business came to see me because he received a notice from the Tennessee Secretary of State saying that the State had revoked his LLC status. This loss causes a variety of disadvantages, including the inability to borrow or use the courts. What to do?

My father once wrote the corporate questions on the Tennessee Bar Exam, and I learned from his experience. The rules for LLCs and corporations are very similar, and in my 35+ years, I have handled this revocation problem many times. First, I researched the Secretary of State website to find out the grounds for the revocation. I discovered that the LLC had failed to file two “Annual Reports.” This is grounds for revocation. Further research showed me that the LLC had failed to file some Franchise and Excise Tax returns, a second failure that would cause revocation. As a lawyer who used to work with government employees, I called the Secretary of State and asked their advice as to the easiest way to take care of these multiple problems. The person I dealt with instructed me to file the FAE returns first and then approach the Secretary of State. This simplified my tasks. It pays to have government experience!

Following the Secretary of State instructions, I first filed each missing Franchise and Excise Tax return for the LLC. Since I do tax preparation, I have Proseries Professional, Intuit’s flagship tax preparation software. With it, I can file tax returns in all fifty states for individuals, LLC’s, partnerships, corporations, trusts, and estates.

My Advice: Whether you are forming or buying or operating an LLC or corporation, use an experienced lawyer, not a non-lawyer or internet form.

Tax Tip: Add a little pleasure to your business travel. If most of your days are for business, you can deduct air fare. If your trip includes business activities on a Friday and the following Monday, the cost of the weekend is deductible even though you spend it on pleasure.

Posted in Uncategorized



I discussed in the last WealthWISe how my approach to estate planning is a quicker less stressful process. So there is no reason to put it off. In fact, if you have a will or a trust designed to save estate taxes prior to 2010, I should be able to greatly simplify your estate and reduce the cost. For example, if you have an insurance trust-run, don’t walk to my office.

For example, a client recently came in. I will call him Mr. Smart because he came in to review and update his estate plan. In 2005 he and his spouse obtained wills from a prominent estate planner. Because the Smarts’ estates were worth roughly $3,000,000, they expected to owe estate taxes upon their deaths. They wanted to use life insurance to pay the taxes, but unfortunately, the life insurance itself was estate taxable.

They were advised to use to form an irrevocable life insurance trust (ILIT) to own the life insurance to pay the estate taxes. That way the life insurance would not be included in the estate. Of course, they had to pay for the trust, and every year they had to pay for the Trustee, the life insurance, and so on.

Now that there is no Tennessee inheritance tax and the first $5,490,000 of your estate is not subject to federal estate taxes, this ILIT is expensive and unnecessary. I was able to terminate the trust and save the Smarts a lot of money.

My Advice: Review your estate planning, especially if it is older or your beneficiaries or property have changed.

If you are ready for estate planning, get started with ease. Download Wis’ Estate Package

Make a difference! Clients often fail to say what happens to their estate if they and their immediate family pass away.  Instead of giving your estate to distant relatives I suggest that you make a difference! Give your estate to a charity that means something to you! For maximum effect, work with an organization like the Community Foundation of Memphis.

Posted in Estate Planning & Probate, What's New? | Tagged ,

Accredited Estate Planner® Designation

The Accredited Estate Planner® (AEP®) designation truly embodies the core value of NAEPC, excellence in estate planning.

To Win the AEP designation a member of the NAEPC must be

  1.  designated and active as an attorney, CPA, insurance professional and financial planner , philanthropy, or trust officer.
  2. have a minimum of 5 years of experience in estate planning,
  3. Have reputation & character recognized by professional references;
  4. successfully complete 2 graduate courses from The American College or similar or a minimum of 15 years of experience in estate planning;
  5. abide by the NAEPC Code of Ethics;
  6. maintain Continuing Education of 30 hours in estate planning, every 24 months.
Posted in Uncategorized