Physician Services

Physician ServicesWe offer  advanced strategies in tax reduction, asset protection, and wealth accumulation for physicians and small to medium size medical practices:

Save 20% and more on your Malpractice Insurance

  • Cost Effective and Customizable
  • “A” rated

Special Physician Disability Income Program

We can secure a number of guaranteed issue insurance items for the high income physician.

  • up to $25,000 per month additional LT disability (without offsetting other LTD coverage)
  • Pension Rider – protect your profit sharing contribution up to $48,000

Tax Reduction Strategy

We can help you set up a Cost effective Turn Key Captive insurance company

The IRS has provisions (under IRC 831b) that allow a business owner to own your own reinsurance company.

This type insurance company is called a captive insurance company (CIC) because it is captive to you, meaning your company (or a trust for the benefit of your heirs) owns the reinsurance company and it provides insurance specific to the needs of your business. Your business files claims, pays the premiums and you as the owner can direct the underwriting profits.

Captive legislation is currently enacted in over 30 of the U.S. 50 states and many international jurisdictions also have legislation compliant to the U.S. tax code.  All 30 DOW Industrial Companies and over 80% of the fortune 500 companies have CICs.

Typically, the risks covered are those that are particular to you company and your business and ones that you control. As an example, currently if your company were to be audited your company would have to pay various expenses to engage your attorney or CPA to represent you, etc. If your company received a cyber attack on your computers or software you would incur other expenses, etc. As opposed to paying the potential expenses associated with these risk areas as they arise from the cash flow of your business, you could purchase insurance from a third party insurance company or you could pay premiums to your own captive reinsurance company.”

Premiums paid to a captive are deductible as “ordinary and necessary business expenses” and since you own the insurance company, you realize the tax benefits afforded captive insurance owners regarding the underwriting profits. There is no taxation on the underwriting profits until you chose to withdraw them from the company and only then would you pay the taxes on the investment gains realized on these profits. The investment gains are taxed on a stepped up basis because they are at C-Corp. rates.

Financial example: for every $100,000 paid in premium, you save approximately $33,000 in taxes and realize underwriting profits of approximately $88,000. In other words, if the $100,000 were taken as income, you would retain about $56,000 after all taxes as opposed to $88,000 less any claims if paid as premiums. The essence of this structure is that you are trading taxation for an insurance cost. Even after set-up fees, the results can work to your benefit the first year and provide even greater benefit in subsequent years. For a business owner to take advantage of a captive, they must have valid risk applicable to themselves, their company, and the premiums must be determined on an actuarial basis.”

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