Ilyce Glink and Samuel J. Tamkin
Q: I hope you can help me find a tax attorney in Los Angeles who can guide me and my fiancé. We’re both about to finish our residencies as doctors and then we’re going to get married, start our careers, and buy a house, which is a substantial purchase in LA.
We want to start off on the right foot in terms of planning, so we wanted to meet with a tax lawyer first and discuss investments, inheritance, insurance, etc. Can you recommend someone in Los Angeles who we could pay by the hour and who would simply have our best interests in mind when giving us advice? Thanks!
A: Thank you for your e-mail. And congratulations on all that you and your partner have already accomplished. It’s no easy feat to finish medical school (probably with some debt), start your career, and get married all at the same time. And now you want to buy a house, which, as you rightly point out, will be a significant cost in Los Angeles (the median sale price recently topped $1 million, according to Redfin).
Financial planning is a smart decision. And, you’ll need some tax planning tips to be sure. This is an important element, especially when building your career and accumulating assets, but that’s not where we would start.
Let’s explain. A tax lawyer can help you plan for all the tax ramifications of the investments you make. But a good financial planner will help you see the broad outlines of your financial life, set short and long-term financial goals, and understand what you need to do to get where you want to go and become an owner.
Depending on the type of practice they have built, a Certified Financial Planner (CFP) or Registered Investment Advisor (RIA) can help you develop a financial plan that will benefit you now and in the future.
Since you both have significant earning potential, it helps to put together a finance team. But a tax lawyer will not be the right person to advise you on the purchase of your home, unless you plan to do something special with it. What you might need is an estate lawyer, who can advise you on legal issues related to your work as a doctor and whether you might need to protect your assets from future liability.
What we suggest is that you build a team of professionals who can advise you as you, your business and your family grow. A team would help you buy a house or any commercial or investment property. Another team would focus on your investment assets and the growth of your long-term assets.
When it comes to buying a home, you’ll likely need a real estate agent, mortgage broker or lender, a professional home inspector, and possibly a real estate attorney. (Hiring a real estate attorney for a home purchase is location specific. They are generally not used in California unless you are buying an extremely expensive or legally tangled property, while (these are quite common in Illinois and New York.) While hiring a tax expert is recommended for any commercial real estate or investment purchase, now is the time to find a good certified public accountant (CPA) or Enrolled Agent (EA) who can help manage federal and state income taxes.
As your assets begin to grow, you’ll want to speak with a CFP or RIA, who can work with you to devise a plan that will protect you and give you a high chance of achieving your long-term goals. including retirement. You will also likely need an insurance agent. Your CFP or RIA can probably recommend a few people they work closely with, including an estates lawyer (who can guide you on estates as well as trusts) and an accountant.
If you decide to go it alone and set up your own practices, you will need additional professional advice from lawyers with different types of expertise, insurance practitioners, business owners and perhaps technologists, who can ensure the proper functioning of the back office.
At some point, you may need additional advice from a tax attorney, who can walk you through high-level planning and may be able to help you take advantage of deductions, credits and exemptions available to those with a level of auspicious assets. They will also be able to help you if you have a tax dispute with the IRS. They handle tax disputes and can be helpful in international tax planning. Some have degrees in accounting and law.
As your lives get more complicated, there will be experts who can step in and help you. But for now, as you’ve just started, focus on building your home buying team. Good luck.
Contact Ilyce Glink and Samuel J. Tamkin through their website, BestMoneyMoves.com.