How A Risk Advisory Partner Saved Over $30K Per Year With A Smarter Business Structure

The Challenge

Evan’s situation had three main friction points when he came to Gelt:

1. Growing equity, inefficient structure
   His compensation and ownership setup left too much income exposed to high employment related taxes and did not reflect the scale of his new equity position in the merged firm.
2. Multistate complexity from the merger
   The combination of two advisory firms into a new entity, with partners living and working in different states, meant the number of required tax filings was about to increase significantly.
3. A new home with business use but no framework
   The couple was building a new home funded by a mix of property sale proceeds and a credit line, with a dedicated office for Evan’s work, but there was no clear plan to capture any of that in a disciplined way for tax purposes.

Overlaying this was a set of local business and property related filings that were being handled reactively instead of as part of a coordinated system.

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The Gelt Strategic Approach

Gelt focused on designing principles and structure rather than one off moves. The goal was to give Evan a durable framework instead of a list of one year tricks.

1. Reshape How Income Flows From The Firm To The Family

Gelt recommended using a separate management entity for Evan’s share of the merged firm and designing a more intentional mix between salary and profit related income.

At a high level, this:

• Aligned Evan’s pay structure with his actual role in the business.
• Reduced the portion of income exposed to the highest employment related tax rates.
• Created a dedicated place to house his share of business related expenses, separate from the partnership.

The core idea was simple: the structure should reflect how Evan actually creates value in the firm, not just how the old paperwork happened to be set up.

2. Create A Multistate Partner Playbook

Instead of treating each state as a surprise at filing time, Gelt helped Evan and the firm step back and map a standard approach to partner taxation across jurisdictions.

This included:

• Identifying where the combined firm clearly has filing obligations.
• Clarifying what that means for Evan personally as a partner.
• Using existing state level regimes in a way that can be consistently applied as the firm grows.

The result is a simple playbook that can be reused each year and adapted as the firm adds more partners or states.

3. Turn The New Home Office Into A Structured Benefit

Gelt approached the new home as a mixed use asset that includes meaningful workspace for Evan, not just a personal project.

On a high level, the plan was to:

• Document how the build was funded, especially how much came from credit and from prior investments.
• Define a clear, supportable portion of the home that is genuinely dedicated to business use.
• Route the business share of ongoing costs through the new management structure rather than pushing personal detail into the firm’s partnership.

The specifics live in Gelt’s internal models, but the principle for Evan was straightforward: treat the office like a real business asset inside a clean structure, not a collection of scattered expenses.

4. Bring Local Filings Into One System

Gelt also rationalized several local obligations that had previously been handled in isolation.

In practice, that meant:

• Separating and sequencing property related filings so deadlines are clear and documentation is easy to find.
• Reviewing prior year business privilege exposure to decide if historical filings are warranted or if a clean start is more appropriate.
• Giving Evan a short checklist for what must be saved each year to keep online filing smooth.

Nothing here is dramatic on its own, but together it turns local compliance from a recurring fire drill into a simple annual process.

Results & Implementation Roadmap

Results At A Glance

With the new structure and framework in place, Evan and Maya can expect:

• More than $30K in annual tax savings, driven by a more efficient flow of income through the new management structure.
• Cleaner boundaries between business and personal finances, which reduces friction with firm partners and simplifies their own decision making.
• A repeatable approach to multistate filings, so new states or partners can be added without reinventing the wheel.
• Ongoing value from the home office and financing strategy, with business use captured in a disciplined way instead of as an afterthought.
• Lower compliance risk around local filings through better organization and intentional choices on prior year exposure.

Implementation Roadmap

Gelt and Evan agreed on a focused set of next steps to lock everything in before year end:

Client responsibilities

• Form the new management entity in Tennessee and share its tax ID with Gelt.
• Review and approve the drafted local property related return.
• Decide on the approach to historical business privilege filings and provide prior year information if they choose to file.
• Summarize the key inputs for the home office and construction, such as basic square footage and high level financing sources.

Gelt responsibilities

• File the appropriate elections for the new entity once its tax ID is available.
• Coordinate with the advisory firm so that Evan’s equity and compensation align with the new structure.
• Help recast the current year’s income into the new framework where appropriate.
• Finalize the home office and financing allocation model and integrate it into Evan’s ongoing plan.
• Prepare a concise multistate filing summary for Evan and the new entity.

With these steps completed, the structure is ready not just for the upcoming filing season, but for the next phase of the firm’s growth.

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Conclusion

Evan and Maya did not need more technical details. They needed a structure that made sense, a set of principles to guide decisions and a clear checklist to follow each year.

By reshaping how income moves from the firm to their household, putting a simple framework around multistate exposure, and treating the new home office as a real business asset, Gelt helped turn a chaotic transition year into a coordinated strategy.

The bottom line is clear. Less drag, fewer surprises and a structure that can grow with Evan’s career.

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We went from reacting to whatever the tax forms said to having a clear strategy. I know what I am responsible for, what Gelt is watching, and what the plan looks like over the next few years.

— Daniel, NJ Attorney