Law firm leaders face a unique set of circumstances in running their business, creating unique challenges when it comes to tax planning and compliance. Most law firms are set up as pass-through entities, requiring additional considerations when tax planning as the tax bill is paid by the firm’s owners. From determining the employment classification of ‘of counsel’ attorneys, dealing with remote work issues for both lawyers and support staff, to navigating apportionment rules for income derived from clients across states and more, leaders must understand law firm tax strategies and regulations.
Check out our Law Firm Tax Hub below with specialized content relating to the four major tax issues in the industry for information to help you and your firm.
Navigate to the different sections of the Law Firm Tax Hub by clicking the links below:
SECURE Act 2.0 Would Expand Incentives for Employer Retirement Plans
The SECURE 2.0 Act improves the credit for pension plans established by small employers. Law firms with less than 100 employees are encouraged to take advantage.Read More
Pass-Through Entity Tax Information for Law Firms
Taxation of Remote Work Information for Law Firms
Employee Classification Information for Law Firms
Market Based Sourcing Apportionment Information for Law Firms
Interactive PTET Map
In response to the TCJA’s $10,000 SALT Cap, many states have enacted pass-through entity taxes as a workaround.
- State has a PTET
- State does not have a PTET
- State does not have a personal income tax
- State has an entity level business tax
This map shows which states have enacted PTETs, which states have historic taxes on pass-through entities are effectively PTETs, and which states have not enacted SALT Cap workarounds.
Red Bank, NJ
Tax Solutions for Your Law Firm
Tax planning is essential in maximizing operating efficiency and maintaining a profitable practice. Withum’s seasoned state and local tax experts provide bespoke advice, helping your law firm identify opportunities, manage risks and plan for the future.
Contact us to schedule a consultation with our law firms tax specialists.
Disclaimer: Please note this is the information that is readily available at this time, it is subject to change so please consult your Withum tax advisor.