Tax Planning
The written, year-round strategy: practice structure, owner compensation, retirement design, and the timing decisions around fees and estimates.
Learn moreWho we serve
Tax planning for attorneys, built for how lawyers actually earn.
Partner K-1s, professional corporations, contingency-fee spike years, multi-state filings. A Torrance CPA firm that plans and prepares taxes for solos, partners, and plaintiff firms across California.
Book Your Free ConsultationLaw practice income breaks normal tax advice
Most tax guidance assumes steady income flowing through a simple business. Attorneys get the opposite: profit that arrives unevenly, entities the state regulates differently than every other business, self-employment tax on partner shares, and a federal pass-through deduction that phases out for law specifically while other owners keep it.
California narrows the menu further. Attorneys here cannot practice law through an LLC. The available structures are a sole proprietorship, a partnership or registered LLP, or a professional law corporation registered with the State Bar. Which of those fits, and how it is taxed, is the single biggest lever in most attorneys’ tax bills, and the one least often revisited after the practice is formed.
A solo, a newly admitted partner, and a plaintiff-side firm living on contingency fees each face a different version of the problem. What they share is timing: the decisions that move the number close months before anyone opens the return.
We build written, year-round tax plans for attorneys and prepare the returns that execute them, with the California layer - franchise tax, the pass-through entity election, State Bar entity rules - handled natively rather than as an afterthought.
The four problems attorneys bring us
Different practices, but the work concentrates in the same places.
- 01Practice structure
Sole proprietorship, LLP, or a professional law corporation with an S election, re-tested against your actual profit each year, with the employment-tax math and a defensible owner salary behind it.
- 02Partner K-1 income
Guaranteed payments, self-employment tax, the gap between your taxable share and the cash you actually received, and quarterly estimates recalculated from live firm numbers instead of last year’s K-1.
- 03Contingency-fee years
Fee deferral decisions made before settlement, retirement designs sized for a spike year, correct case-cost treatment, and safe-harbor estimate strategy so the cash stays working for you.
- 04Returns and filings
Business and personal returns prepared by the same team that built the plan, including multi-state K-1 obligations, composite elections, and California’s pass-through entity election deadlines.
Structure health check
Your entity was set up once. Is it still right?
Most attorneys we speak to already have a professional corporation or an LLP. What goes stale is the sizing around it. Four questions, and it will name the parts worth revisiting. Educational, not tax advice.
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$150K$3M+
Likely still open
Two or three worth discussing
The structure itself looks settled. What tends to drift is the sizing around it, and your answers point at a couple of specific places to look.
- Owner salary review
- Retirement plan design
- Pass-through entity election
What attorneys most often leave on the table
Case costs advanced on contingency matters are among the most commonly mishandled items in a plaintiff firm’s books, and how they are recorded changes when the deduction lands. Getting that treatment right is worth more than most of the line items attorneys ask about.
Retirement plan design is the most under-used lever we see in law practices. A plan chosen for the profit you will actually book, and funded before its deadline, does more for a spike year than any single deduction.
The rest are elections rather than deductions: owner salary in a professional corporation, California’s pass-through entity election, composite filings and state credits when a K-1 crosses state lines. They get missed for the same reason. Nobody is looking at the year while it is still open.
Who we work with
Law practices at the point where structure and timing start deciding the bill.
- 01Solo practitioners
Owners running the practice and the business at once, where entity choice and owner compensation are still set the way they were on day one.
- 02New and existing partners
Attorneys whose W-2 withholding has been replaced by a K-1, guaranteed payments, and personal quarterly estimates they now have to manage themselves.
- 03Plaintiff-side and contingency firms
Practices where a single resolution can define the year, and where deferral, case costs, and estimates have to be handled before the funds arrive.
- 04Firms practicing across state lines
Multi-state K-1 obligations, composite elections, and state credits coordinated against the California resident return.
Fee model timing
How your firm bills decides when the decisions close.
A contingency year turns on a single settlement. A flat-fee immigration or trademark practice turns on trust money and when a fee counts as earned. Pick your model and the timing to see what is still open. Educational, not tax advice.
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Fee deferralOpen until the fee funds
Retirement plan designRuns to the plan's own deadline
Case cost treatmentCorrectable while the books are open
Estimate strategySafe harbour still manageable
What this means
Where the room is
Most of this year's decisions are still available. Deferral, plan design, and case cost treatment can all be handled deliberately rather than reacted to.
How the work fits together
One plan, and the services that carry it out.
Tax Preparation
Firm and personal returns prepared by the team that built the plan, so the elections it calls for actually get made on time.
Learn moreCalifornia Law Firms
How the same work runs for practices outside the South Bay, including multi-state K-1 obligations and the pass-through entity election.
Learn moreFrom the blog
What we find ourselves telling law firm owners most often.
Good lawyer, no tax plan: 6 costly mistakes California law firm owners make
You can be an excellent attorney and still have no real tax plan. The six gaps we see most often in California law practices, from tax-time-only accountants to an S corporation that was formed but never implemented.
Learn moreWhen should you start tax planning?
The honest answer is now, whatever today’s date is. Why waiting closes options one by one, and what a plan can still do late in the year.
Learn moreFind out what a plan would change before your next K-1.
Book a discovery call with a Torrance CPA firm serving attorneys across California. If planning will not pay for itself in your situation, we will tell you on the call.
Book Your Free Consultation No pressure, no obligation. Just clarity.Questions we hear most.
01Can my law firm be an LLC in California?+
No. California does not allow attorneys to practice law through an LLC. The available structures are a sole proprietorship, a partnership or registered LLP, or a professional law corporation registered with the State Bar, usually taxed as an S corporation, which is where most of the planning value lives.
02I just made partner. What changes for my taxes?+
Your W-2 withholding disappears. K-1 income, guaranteed payments, self-employment tax, and personal quarterly estimates replace it. Your taxable share of firm profit is also not the same number as the cash you received. The first partner year is when attorneys get surprised, and it is the best year to start planning.
03Does Astute Advisors work with contingency-fee practices?+
Yes. Spike-income years are one of the main reasons attorneys need real planning. Fee deferral decisions, retirement plan design, case cost treatment, and estimate management all have to happen before the settlement funds, not at filing time.
04Does Astute Advisors handle multi-state K-1s and filings?+
Yes. If your firm practices across state lines, your K-1 can carry filing obligations in several states. We coordinate composite elections, state credits, and the California resident return so nothing is filed twice or missed.
05What do attorneys most often get wrong on their own returns?+
Four things come up repeatedly: case costs advanced on contingency matters recorded the wrong way, a retirement plan that was never resized as profit grew, an owner salary in a professional corporation that was set once and never revisited, and California’s pass-through entity election missed on its deadline.
06Can Astute Advisors prepare the returns as well as build the plan?+
Yes, and we prefer to. When the same team writes the plan and files the firm and personal returns, the elections the strategy depends on are made on schedule and the K-1, the estimates, and the personal return all agree.