Professional practice (PLLC) contracts with owner's Management LLC for admin, IP, real estate — shifts income to lower-rate entity.
Professional practice (PLLC/PC) provides professional services (must be owned by licensed professionals in many states). Separate Management Company (LLC/S-corp) — owned by professional AND/OR family members — provides admin, IT, HR, billing, IP, real estate to the practice at market rates. Benefits: (1) income shift to lower-bracket family members, (2) different QBI/§199A posture, (3) real estate held in mgmt co gets separate cap gain treatment on exit, (4) asset protection between clinical malpractice and operational assets. Watch reasonable pricing + kickback rules.
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Practice pays $2.85M/yr premium to owner-controlled captive; captive receives tax-free (small insurance co election).
Combine a defined-benefit cash balance plan with 401(k)+profit share — total deductible contributions $400K+/yr for older owners.
Practice rents from professional's own real estate LLC — rent flows to owner tax-favored, building appreciates outside practice.
At sale, allocate purchase price to professional's PERSONAL goodwill (patient/client relationships) — capital gain, one level of tax.
MSO owned by non-professionals contracts with PC for management — recapitalize practice with outside capital legally.
Pass-Through Entity Tax lets practice deduct 100% of state income tax federally, bypassing $10K SALT cap.
C-corp (or spouse-hired setup) can reimburse 100% of family medical expenses tax-free — bypasses 7.5% AGI floor.
Solo practitioner uses solo 401(k) with after-tax contributions + in-plan Roth conversion = $69K/yr into Roth (2024).