How Did Your Business Evolve Into Tax Planning?

Todd Mardis: As I started in the financial services industry in 1993 and during all aspects of financial planning; retirement planning, disability, long-term planning for death, disability, and retirement, really were the 3 topics that we covered. We started evolving into taxes, but more in the state tax level. And when I was working with a number of different Tax attorneys across the South-East, and really, across the country, it became very evident that my success with business owner clients who get their state tax planning paid less taxes.

And so, it kind of became evident, as we all know planning, having a plan is better than not having a plan. And so, over the years, you know there was a frustrating level that I felt, and the biggest liability that my clients had was taxes, right? 01:08 (inaudible) biggest liability is at home because it is the biggest purchase most of us would ever make.

And so, I was introduced to a group of attorneys and CPAs and advisors, who felt like there were ways to mitigate these taxes by doing the same thing that I’ve been doing with my super-successful business owners. And we started doing planning on a yearly basis to reduce income taxes, very much the same way we did planning to reduce the state taxes. And what is fundamentally different about the planning is very little. There is a negative persona in the public when you talk about tax planning, meaning you’ve got to be cheating or doing something illegal or risky. However, those same parameters aren’t applied to a state tax planning, right? Someone has a $20 million estate, and they do some planning, they owe $2.5 million in state taxes. Same business owns $20 million net worth, they don’t do tax planning, and they owe $10 million in the state taxes or their family owes $10 million in state taxes. Well, no one would consider the family that owes $2.5 million having done anything nefarious right? They just did planning. We are very much using the same types of models and planning processes just more gear to income tax on a yearly basis versus a long-term state tax problem that you may not have for 20 or 30 years.