Case Study 2

A private client of a large Wall Street investment bank once claimed to have the best of “everything,” including the best Investment Advisor (IA), CPA and estate planning attorney. However, his team never convened to communicate about his wealth. Due to the lack of collaboration, the IA invested in a tax-loss harvesting strategy and municipal bonds, while the client had negative taxable income and $1.7 million in tax loss carryforwards. The IA also invested heavily in limited partnerships with very complex tax reporting which did not produce the projected investment returns. Their trusts were unfunded, accounts were not titled correctly, assets were left exposed to creditors and future estate tax liabilities were not addressed.
With simple, transparent and thoughtful planning, retitling of accounts, different investment vehicles and swapping taxable for tax-free fixed income, we were able to increase cash flow, reduce fees, improve transparency, simplify tax reporting, protect exposed assets and mitigate future estate tax liabilities. The estimated present value of current and future savings was in excess of $4 million.

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