How the 2025 Trump Tax Bill Changes Impact Law Firm Owners with Megan Robin

Melissa: The 2025 Trump tax bill is generating a lot of buzz, but what does it really mean for law firm owners? In this episode, Megan Robin will break down the biggest changes in the legislation and spotlight the specific areas that will impact small, midsize, and growing firms. Whether there is opportunity or chaos ahead, we'll walk you through the smartest plays to make now in response.

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Melissa: Welcome back, everyone, to The Law Firm Owner Podcast. I am here again with Megan Robin. Thank you for being here again. Are you sick of us yet?

Megan: No, this is great. It's been so much fun.

Melissa: So today, we are going to dive into the 2025 Trump tax bill, which I'm very excited that listeners will have and get to hear some level of expertise about what it means for them. But, uh, before we do that, just in case, for all listeners and viewers, if you have not listened to the episodes that I have had with Megan, those are a great place to start. So you can head to the links in the show notes to get those. They were just very recent. And then, Megan, I would love to have you introduce yourself briefly again for those that may this may be the first time seeing you here.

Megan: Yeah, so I'm an attorney. I own my own law firm. I'm based in California. What I do is I'm a tax attorney. I have my LLM in tax law. I help law firm owners optimize their personal and business finances through tax strategy, which is a long way of saying that I help my clients keep more of what they earn.

Melissa: Yes. Yes. We're all about that. So, okay, the 2025 Trump tax bill. Can you give us an overview and, I don't know, just high-level information about it before we dig into some questions that I have down for you?

Megan: Yeah, yeah. So this is a really big deal. It's the biggest tax legislation that we've seen since the 2017 Tax Cut and Jobs Act. It's very exciting because there was a lot of uncertainty. So the Tax Cut and Jobs Act was set to expire at the end of this year, so the end of 2025, which is when we're recording this. And so there was a lot of uncertainty, especially for small business owners and large business owners of how do we plan? How do we plan going forward?

And so this new bill that was passed July 4th of this year answers a lot of those questions. It offers, it makes a lot of provisions in the Tax Cut and Jobs bill permanent. So we're seeing things like an increased standard deduction, more set tax brackets or lower, I mean, tax brackets than what they would have reverted to, a higher estate tax limit, which is great for high-income earners. So the big picture is it's offering stability and the ability to plan because now we know, politics aside, I know people have feelings on both sides of the aisle about this act.

But for me as a tax planner, laws come and go, politicians come and go, the legislature changes. We have tax laws that favor some things and others. The important thing is just knowing what we have on the table and using those to our advantage as law firm owners. So this certainty and stability is huge for us right now.

Melissa: Okay, what are the most important changes in this bill that law firm owners need to know about?

Megan: So I'm going to hit on some of the highlights. The bill itself is 870 pages, so we're obviously not going to get into every single portion of it. But there's a few that I want to highlight. If you see me looking down, I took some notes. I want to make sure I don't miss anything.

So let's do the first one, which is one you might have heard about, is the qualified business income deduction, also known in the tax and finance world as the QBI deduction. This was extended, and they changed the rules around it a little bit to make it a little more friendly, which we can talk about more later. So that's a big one, especially for smaller law firm owners.

The next one is 100% bonus depreciation and higher expensing limits, which means that you can buy things for your office, like computers, new flooring, new phone systems, etcetera, and you can expense them now, which is great. So you can get that deduction for the money that you spent now, whereas if this rule was not in place, then you would need to use the older systems, where you depreciate really slowly over time. So this is great for cash flow for law firm owners because it lowers their taxes, and they can expense things right away.

Another one that will apply to some of our more forward-thinking and innovative law firms is there's some new R&D credits, which are research and development credits. So if you're doing something that is a technological innovation, you can get some really cool credits there. I know that there's a lot of innovation in the space for those of us who use like Thompson Reuters or Westlaw or some of those, they're doing new AI programs. I've seen some attorneys start making online courses and different ways of delivering the law in new and innovative ways. If you meet the criteria for R&D, you can get a credit there.

Another one is the rules for deducting business interest are now a lot more friendly. So we can talk about this more later as well. But if you're having a partner do a buy-in or you're financing things, this can help a lot, which is a big deal, especially right now with rising interest rates. It can help soften the blow of that a little bit.

The next one I want to talk about is there's some new rules around the state and local tax deductions. So that's really big where I live in California. The state and local taxes burden is really high for those of you in those wonderful no-tax states, you don't have to worry about this. But for those of us in California, New York, these kinds of places, this is big.

So then the last one I'll just throw in there, which is probably not a big one, but the 50% meal write-off for business lunches will, is now permanent. So that's exciting for those of us who like to eat and go to lunch. That's not going to change anyone's lives, but we get to go to lunch still and expense half of it at least.

Melissa: What do you mean permanent?

Megan: So it was going to expire. You wouldn't get a deduction for it. It's funny that food is very politically charged, I think. It was like, I think it was, uh, an abuse issue because for a while there was like big execs who were expensing and writing off like big vacations and trips, and they would go, you know, have their conferences in Hawaii and do all this.

So now the rules around food and entertainment are really a lot more strict, and a lot of times you only get half, like you can't write off the entire meal, you write off half. A lot of the entertainment stuff, like where if you take a client to a baseball game, that you can't write that off, you know, they've really reined that in. I think people were getting a little wild and woolly with their write-offs and going to big trips and grabbing a client to go with them every time so that they could write it off. So yeah.

Melissa: So what I guess, so this is me asking questions that might seem dumb, but when you say permanent though, because I mean the entire time I've been in business, it has been that's been the rule, right? Like the 50%. But when you say now it's permanent, you're saying it was set to expire.

Megan: It was this year. It was going to expire this year. So they kept it on the books. And that's an interesting thing that I had thought about talking. We can talk about it now or at any point, but I wanted to bring up on this, was that permanent's a tricky word in the tax law.

So permanent means that it's on the books for now, and there's no it's not marked as temporary; it's not expected to sunset on a certain date, so it's not, you know, expiring essentially. But the thing about permanent is when we do get a new administration or new legislature members, or there's a change in anything like that, they can change laws. So the legislature has the power to put new laws on the books. So nothing is really truly permanent, but you know, you have to those are the ones we rely on more.

So if we're doing a big strategy and something is a permanent provision, we can rely on it to last at least through this administration. And so it gives a little bit of certainty. But yeah, laws are never, they're always in flux, they're always changing based on the priorities in Washington, and so.

Melissa: Okay, thank you for clarifying.

Megan: So overall, this bill is very business-friendly. So, as a law firm owner, these are really helpful things and can help you plan and breathe a little easier, improve cash flow. So this is a good thing for a lot of business owners.

Melissa: Which parts of the bill do you think will have the biggest impact day-to-day for small and mid-sized firms?

Megan: I think for the smaller firms, especially, the changes in how the QBI deduction works are really for the smaller owners. So under the Tax Cut and Jobs Act, the QBI deduction had a cliff for what's called STB businesses, so specialized service and trades. So things like doctors, lawyers, anyone who's in kind of consulting, like professional roles, where it's their expertise, they were in this special category where once you hit certain income levels, you would fall off the cliff and not get the deduction at all.

And so it was really brutal, and we would have to do a lot of tax planning around that to say, okay, you're making this much, maybe we need to funnel money into retirement or shelter it in other ways so that you don't lose that because that deduction is incredibly valuable. It's a big 20% deduction. It's huge.

Melissa: Will you say more about exactly what it is?

Megan: Yeah, so it's a 20% deduction that you get on your tax return based on your business income, assuming your business is a qualified business. So if you're an SSTB, so if you're a restaurant, you're not an SSTB, meaning regular business, maybe you sell sweaters or food, then you get that full 20% deduction.

But if you're a professional like a lawyer, like your listeners, you're an SSTB, meaning that when you hit certain income levels, the deduction slowly gets phased out. So you get less and less and less till you hit a cliff and you fall off the cliff altogether, and you get nothing, no deduction at all. And so these deductions can be very valuable. It's a lot of money that you're reducing your tax liability by.

And so now it's still you still have a phase-out for income levels, but it's a little more gradual, and there's not an automatic cliff. So it's a slower, kind of more dragged-out phase out. So this will apply only to your smaller firms. The bigger firms are just making too much money, and they're falling off that, you know, they're it gets whittled down to nothing essentially.

Melissa: Okay. Do you think you could walk through an example? You know, when you're saying cliff versus gradual, what is an example? How would how would people see that in their own worlds of the gradual? What does that look like?

Megan: So let's say, maybe we can just use fake numbers to make it easy. So say your deduction was saving you $100 in taxes versus, yeah, at the next income level, you only get saved $50 in taxes. At the next higher income level, you only get a $5 savings. So the deductions have a dollar value.

So the way deductions work is whatever tax bracket you're in, it reduces your liability by that much. So if you have a dollar of income and you have a deduction and you're in the 37% bracket, for every dollar you make, a deduction is worth 37 cents. If you're in the 25% bracket, then a deduction is worth 25 cents to you because, without that deduction, you would have paid 25 cents in taxes because you're in a 25% bracket. Does that make sense? So it's reducing your tax.

Melissa: I did not know that. Yes. That's awesome. That's like just good knowledge to know. I didn't know that.

Megan: Yeah, a lot of people don't get into the nuance, so it's like on a vague level they understand. So deductions work that way. It's like, oh, it's sheltering that dollar, and you get to keep the whole thing. You keep the full dollar with the with the deduction. Otherwise, you're going to pay 25 cents in taxes off that dollar. You get to keep 75 cents, and that's how taxes work. It takes a percentage of what you earn. That's why when we talk about marginal brackets, if someone's paying 40% in taxes, then for every, you know, $100 they make, they have to give $40 to the government, and they only get to keep $60. And so that's what we're thinking about with these.

Whereas credits are a lot more valuable. Credits are dollar-for-dollar. So if you have a dollar credit, you keep a dollar. You get a dollar off taxes. It's like a coupon. Those are wonderful. Credits are my favorite. They're harder to get. They're not given out freely by the IRS.

Usually, like we talked about in previous episodes, it's because they're trying to drive certain behavior. So you might get an energy credit because they want people to invest in energy changes. You're seeing them now, there's new priorities in the new administration. So you're seeing a lot of credits for things like American-made or things like this. And so usually credits are used to drive behavior, and they're very valuable, and because of their value, they work. People align their business operations so they can get these credits.

Melissa: Mhm. Okay. Good deal. I want to understand. When you said, but the deductions are at the tax bracket? Like, you said the deductions are like 37 cents?

Megan: Your deduction is worth to you whatever tax bracket you're in. Okay. So if you're in the 25% tax bracket, your deduction is worth 25 cents for every dollar you make. If you're in the 37% tax bracket, your deduction's worth 37 cents for every dollar you make because when it's tax time, the government's going to take 37 cents from you if you're in that 37% bracket. Whereas someone in a lower bracket, the government will take 25 cents for every dollar you make.

Melissa: But the deductions, though, like if you, you know, your business expenses have a… that's where I think I misunderstood what you were saying.

Megan: Oh, I know what you're asking. Okay. Okay, okay. Yeah. So, say you make $100,000 in your business, the QBI deduction will shelter 20 grand of that.

Melissa: Got it.

Megan: I think that's what you're asking, right? It's like, oh, if I lose my QBI deduction, you know, it's not going to shelter all 20 grand. It's going to shelter a little less. It's going to be worth less and less. So, it's your QBI deduction is sheltering a portion of your qualified business income. And then when that flows through to your tax return, whatever your rate is what you'll pay on it. But you want to essentially shelter that money. Like hide it like, oh, this dollar doesn't count towards that, you know, like shift it over here.

Melissa: And then the where does eligibility drop for sheltering the 20%?

Megan: It's based on income levels. It's different depending are you married? Are you head of household? Are you single?

Melissa: Got it.

Megan: Yeah, it's different income levels. Yeah.

Melissa: This is something that I would love to have you back just to talk through this topic. I think it's a big topic, and I think it can be confusing for a lot of people, even if it's been explained to them; there's nuance. So if you're down to come back to have another conversation about QBI specifically, I would love that.

Megan: Yeah, it is a big area of confusion for a lot of people. There's a lot of rules around it. So, yeah, that could be something worth digging into.

Melissa: So what else do you think affects day-to-day from this bill?

Megan: The state and local, new rules around state and local tax deductions is a big one for the people in high-tax states. That will be helpful because it the cap was currently at $10,000 and it's being raised to $40,000.

So it used to be if you paid state and local taxes in your state, you couldn't get a deduction for those on your federal return. And so it's kind of painful. You're paying taxes at the state level and then again at the federal level. And there was a cap at $10,000. So if you paid more than that in state and local taxes, that was all you got. The $10,000 deduction, and that was it. Now it's raised to $40,000. And so that is really nice for people in high-tax states.

Sometimes, I mean, because California is such an aggressive state and New York and some others, you still have to do a lot of tax strategy around that. Certain states, depending on where you live, do have workarounds, and there's things you can do from a tax strategy perspective to help lower your tax liability in the state and local realm. But this new this new rising of that cap is very helpful for a lot of people and will make it a lot simpler to get that deduction.

The last one is 1099 reporting rules have changed, which is really nice. So under previous rules, if you paid somebody an independent contractor more than $600, you would need to issue a 1099 and report it. They've now raised that to $2,000, which isn't a huge jump, but it's enough to make like a little things a little simpler so that every time you pay some small amount, you don't have all this paperwork headache essentially. So it's meant to streamline that and simplify things. So I think that will be popular as well.

Payments through some of these payment apps like Venmo, PayPal, the limits on that have risen considerably as well. So they don't have to issue all these statements to you, or you don't have to issue, you know, it's just a paperwork nightmare, I think, with all these payments going back and forth in small amounts. And so this will clean things up and make the burden on small business owners a little easier.

Melissa: Nice. Okay. How does this bill affect larger firms or firms that are actively growing?

Megan: The business interest deduction that we talked about a little bit at the beginning of this episode is a big one for your larger firms because, as I mentioned, if you're doing partner buy-ins and leveraging their buy-in with debt, then the interest on that debt can be deducted, which is great. And then, if you're growing, if you are using debt again to grow for office expansions, etcetera, then you can deduct the interest on that as well. So it makes it a little easier to expand or do partner buy-ins with these new rules. There's also new higher limits for 401ks. And so that's great for retirement planning, so that you can save for retirement but also lower your tax liability at the same time.

Melissa: Are there any opportunities here for law firms to save money? I know the answer is yes because of what you just said. I'm kind of thinking, does this just introduce complexity to people?

Megan: Yeah, so this is an opportunity for strategy. So yes, there is complexity, but it's also enormous opportunity, which is exciting. So one example of this is the new bonus depreciation rules, meaning you can deduct things that you're spending money on right now immediately instead of slowly dragging that out over time. This can be really valuable.

So if you were planning on doing an office remodel or something of that nature, now is a good time to do it. So say, for example, you wanted to do all new floors and get a new phone system, new computers for the associates, redo your building, you know, whatever it is that you have going on. Say you have $200,000 allocated to that, you get to take that entire deduction right now this year, and that if you're in the highest tax bracket, that's worth around $74,000 in tax savings by being able to expense that fully and lower your tax liability. So these are things that are worth a lot of money.

Melissa: That's fantastic. I'm actually, we are going to be doing remodeling, and so that's that's great. I actually did not know that. So good news.

Megan: Yay. Yeah. Hopefully, all the listeners are getting big wins and like running to the take notes right now. Like, oh, I need to do that now. Yeah.

Melissa: Yeah. And also maybe just realizing opportunity that they can. They've been putting it off or whatever. Maybe this is a great time to actually do it, knowing that this is true.

Megan: Yeah, under older rules, you would have to deduct and expense this over years. You would get a little deduction every year over the useful life of the item, and it's not as big of an impact. And so this is really exciting. It can increase your cash flow.

There's also a lot of new rules around charitable giving. So being a lot more intentional about your charitable giving if that's something that you're already doing. So one of the kind of fun ones, interesting, is there's a new above the line deduction even if you don't itemize.

So normally, you don't get a charitable deduction unless you're itemizing. And so people who are taking the standard deduction don't get it essentially. And so this new one is if you're single, you get $1,000 up to $1,000 above the line deduction. And if you're married filing jointly, up to $2,000. And so this year it is worth it. Like a lot of times, you give things away, and you don't even track it or, you know, you're not paying attention. But now it's worth tracking because you will get that deduction, which is very valuable for a lot of people.

And then second, there's a lot of for those who do itemize, there's some stricter rules. So now there's both a floor and a cap. So it's kind of complicated, but essentially, they look at your AGI, your adjusted gross income, and then they create a floor, meaning you don't get a deduction until you reach above that floor.

So, say your floor based on your AGI is 10 grand, then even if you give $10,000 to charity, you don't get credit for any of that. You only get credit for stuff that you gave over your floor. So if you gave $12,000 that year, the $10k is ignored, and you get $2,000 worth of deductions for it. So that's the floor, which is a little bit of a bummer. So you need to be intentional. Make sure you're if you're going to do it, maybe batch things together that make sure you're over the floor. So if you were going to give $10,000 this year next year, maybe it's better to just give all 20 next year so you get a deduction for it.

And then same thing with the cap. So now you can't get more than, so say you're in a 37% tax bracket, you can't get more than 35% of a discount essentially. So, like we were talking, so with deductions, for every dollar that you make, depending on your bracket, if you're in the 37% bracket, for every dollar you make, the government takes 37 cents. That's how they work.

But now with charitable deductions, you can't get that lower than 35 cents. So you don't get, it caps how much credit essentially you get for your charitable giving. So you have to be a lot more intentional about your giving when if you're not itemizing, track your gifts because you now get credit for them even if you don't itemize. And if you are itemizing, make sure that you're not falling into the trap of being below the floor and not getting credit at all for them and not getting deductions. I guess I shouldn't use the word credit because a credit is a different thing in the tax world than credit as in, like getting credit on a homework assignment, you know. So, but yeah, you're not getting recognized for your giving in that way.

Melissa: Okay. Okay. Good to know.

Megan: Oh, tax law. Oh, nuance.

Melissa: Are there any hidden or less talked about changes in this bill that might surprise people?

Megan: One that is really struck me. I'm surprised more people are not talking about this is the changes in how federal student loans are being treated. Really interesting because I've been hearing a ton of things about the, you know, new standard deduction, no tax on wages or on tips. I mean, not wages. That would be nice. Um, no tax on tips, things like that.

But this is one that's kind of flying under the radar. I'm not seeing a lot about it. But essentially what's happening is there were under the old regime, anyone who a lot of law firm owners have student loans from law school, sometimes from college as well. And a lot of those, most loans in the United States are federal loans. Some people have private as well. But there was a lot of different regimes based on how those federal loans are structured.

So under the old regime, a lot of people are on what's called IBR, which is income-based repayment plans. And there's rules about how much you have to pay each year, how often, you know, sometimes there's special rules depending on, like, do you have kids? Do you have, you know, all these other issues that will determine how much of your loan per year you have to pay.

This is all being changed. It's everyone, depending on what they're in, is going to be in what's called the repayment assistance plan, RAP. Everything's being consolidated into that. It's a slow rollout. So if you take no action, then you will automatically be rolled into that. You have, but you have until 2028 to affirmatively elect that you want to stay in your old plan.

And so this is a huge deal because the new rules are a lot more strict, and obviously, we would have to look at each individual scenario. But under the new rules, a lot of times you're going to be having different repayment schedules. It could be a not as ideal situation because they have certain forgiveness dates. A lot of the new regime has you paying it back quicker and faster at higher rates. And so if that doesn't work for you for whatever reason, it's really worth checking. So that I think is kind of crazy that's flying under the radar. I haven't heard a ton about it. It's, I thought that there would be a big uproar about this. Oh, you're changing the terms of my student loan, you know, a lot of people have those. But yeah, it's been really quiet.

And then the other thing about that is huge in my opinion is they changed the borrowing limits on federal student loans. They lowered them considerably. And so there's now really strict rules about how much you can borrow, including that extend to your parents. So if your parents borrow money under your name for you to go to school, it limits how much they can borrow for you as well. And the intent behind this is good. It's trying to keep people from borrowing too much so they don't get these like out of control loans that are unmanageable, that they can't pay back. And so the intent makes sense.

But what I worry about is the numbers that I'm seeing in the cost of law school and cost of colleges, medical school, are significantly higher than the income limits that you can borrow. And so that's worrisome. So what do you do if you don't have the money, then you either have to get a private loan or say, you know, really push the 529 plans and savings. But it I'm curious to see what happens because, I mean, you wouldn't want it to get to a place where people who don't come from affluent families can't afford to go to school if they can't don't have the credit or whatever to get a private loan.

So it's a little bit worrisome there. Even for higher-income families, I have a client who has five kids. So, you know, we're going to there's going to need to be a lot of financial aid. So I'm curious to see, you know, it seems like it might, I don't know, it's still going to play out, but it might disproportionately affect low-income families having because if you can't borrow enough to cover the full cost, that's an issue. Same with large families, so people with a lot of kids.

Melissa: Yeah.

Megan: It's very interesting. I'm surprised there's not much of a fuss about this. And I think the way that it's being sold is to keep people from having these massive overwhelming payments. And there are some, actually, really good provisions that are new in this. Like, one of them is that institutions, private institutions that are eligible for financial aid, are going to be reviewed, kind of essentially audited. And if their students are not making more money than they paid for the school, then they'll lose their eligibility for federal funding. And so I think that's good.

It puts some onus on schools to have a program that credentials people to actually succeed as opposed to just having people have these kind of glamour diplomas that do nothing, and they can't actually get a job, and they can never pay off this debt. And so there's going to be some more stringent requirements on which institutions are eligible for federal aid.

Melissa: I mean, I'm so that's I'm glad to hear that. Just accountability, a bit. Like putting some accountability on the institution. That is interesting, though, that you wonder who that will affect, just to your point, who won't be able to go get the education that they want to get because of some changes here.

Megan: I'm curious to see. One kind of side thing. I don't think I've mentioned this yet, but another new thing is the Trump accounts. So there's these new accounts. They're they function essentially like a traditional IRA. And so you put money in them after uh, well, you don't get a pre-tax. So you put after-tax money in a Trump account, and then it can grow tax-free. And then when you take it out, you pay taxes. And so the Trump accounts are they're designed for children only. You have to be 18 or younger. And I think the idea is to help children grow tax-free investments and things that grow tax-free, and hopefully, maybe this will create incentives to create a nest egg to cover some of that shortfall.

They're actually doing a pilot program, or I don't even know if that's the right word, but essentially, kids that are born in the next few years will get a government funded a $1,000 into their Trump account paid for by the government, and it goes in their account and it just sits there for however long. So we'll have to see.

It's very it's fascinating to see how all of this plays out because right now, a lot of the tax advantage accounts, with the exception of 529s, are limited to adults. So, you know, IRAs and 401ks and all this retirement stuff. But it's cool, the idea of helping kids save, you know, especially not, you know, everyone has different, you know, parents or backgrounds, and so having them have a nest egg of their own that can grow tax-free, I think, might really help some people get a leg up, hopefully.

Melissa: I mean, it sounds generally like these changes are good. I mean, and you could see that there's some really great intention behind these things. And there's always this initial impact, and I wonder how it'll play out, but yeah, it seems like most of these things are generally good changes.

Megan: It's hard to say. Yeah, you never know, in like there's always push back on every side of the aisle of like, well, this could go wrong, or that could go wrong. And so it's fascinating because obviously my clients come in with various, um, political persuasions, and at the end of the day, like it doesn't matter really, none of that matters. At the end of the day, we have the law that we have, and it's what we have to work with.

And so, you know, despite personal opinion, it's just like, okay, well, currently the law says this, and so I stay impartial because it changes every few years, you know, we have different priorities, different laws. And so our goal, or my goal as a tax attorney, is to say, okay, this is what we're working with right now. How do we make the best of it? And how do we stay resilient when it changes? Because it's not an if, it's a when, you know, the tax law changes a ton.

If you look at any chart of like historical financial performance of our economy or of the S&P 500 or any of these indexes, it's a roller coaster. It goes up and down. And so my goal is to make sure that my clients can survive that up and down roller coaster and then thrive as well, like really optimize every aspect of their financial life.

Melissa: So, overall, what do you think the top two or three things that a law firm owner should do differently because of this bill?

Megan: This is one of those moments where we have a big tax change, and it's so important to pay attention, take a look at everything. It's kind of like when something large in your life happens of any kind, whether you have a baby or start a business, it's a moment to take inventory and look at what's going on in your business. I think one of the things to know is that some of the provisions are permanent, like we talked about, meaning you can rely on them at least for now. There's others that sunset and that are temporary. So we want to be looking at how do we take advantage of those before they expire. And so thinking about that as a when I look at planning, often, we're taking a multi-phased approach. So, breaking it up into short-term planning, medium-term planning, and longer-term planning.

So that's really important for law firm owners to remember that tax law, finances in general, it's never set it and forget it. You can't take your hands off the wheel. So paying attention, changing your plans as needed, as the laws change, as your personal circumstances change, is essential.

Melissa: Okay, that's great. That's helpful. That's helpful. It's hard to know sometimes when big changes like this happen. So I'm glad we're talking to you, is like, what are you supposed to glean? What are the things that you need to pay attention to? So it's nice to have you here, just sharing the bits that we should wake up to.

Megan: Yeah. Yeah, it's a lot to digest. I mean, the tax law in general is very complex. There's a lot going on, and then when you add significant changes to that, it requires everyone to kind of scramble. So the accountants who have been doing one thing a certain way for a long time, now they have to calculate things differently. They have to get really up to speed really quickly on all of the changes. A lot of this is especially challenging. So be extra kind to your accountants because a lot of times they issue the law, and then they don't issue guidance right away.

So the law is elaborated upon in regulations. And so they'll issue guidance, regulations, even specific forms. So there's accountants right now who are kind of gearing up, you know, it's starting to be the end of the year, and they may not have all the forms they need. They may not have, you know, all of the updated information. They may be still learning about some of these new provisions themselves. So it's incredible, like April, I think, is always stressful for accountants, but I wouldn't come if you have any questions, do it now or do it after April because they are going to be absolutely slammed.

Melissa: Yeah. Yeah. Yeah. This I mean, that's so frustrating. Like it's your job and you don't have what you need to do your job. That's frustrating.

Megan: Very, very. And I think that's good advice on every whatever professionals you're working for, like or working with, like get ahead of it. You know, don't ask them at midnight the night before something's due, you know.

Melissa: Yes, yes.

Megan: So if you want good answers, because otherwise you're getting no answer at that point.

Melissa: For law firm owners who are listening and rethinking or want to rethink their tax strategy, what is the best first step for them to be proactive with this?

Megan: The very first step is getting clarity around your financial situation. And as we've talked about in other episodes, we didn't touch on it as much today, but every professional that you work with, a lot of times, is working in their one realm of expertise.

So your accountants are doing the historical calculations, they're looking at what you made that year and documenting that. They're often very reactive. You have your financial advisors or investment advisors, as they're more aptly named, watching your stock and bond portfolios, but they may not know what's going on. They may not know how much money you made this year, or whether you have a retirement, you know, what kind of retirement plans you have in place, unless they're managing those assets specifically. They may not know what's going on with your kids or your plans for their education, etcetera. Your business and estate planning attorneys may have seen some of your contracts or built a will or trust for you, but they may not know what's going on the tax side.

And so the idea is bringing all of that together, which is what I do in my practice is I look at all of those different pieces and work together with those professionals, relying on their expertise as well, to say, okay, what if we did this, you know, move this over here and make sure that your tax plan makes sense from a comprehensive big picture perspective.

So, as I mentioned in some of our previous podcasts, I have a Keep What You Earn Checklist that you can download from my website, meganrobin.com/checklist, where it's a very big picture overview just to get an idea. So you can look and see where am I from an asset perspective, asset protection perspective, where am I from my business structure? Do I have retirement plans in place? Kind of giving you that bird's eye view. And then you can decide whether you need to bring someone in to be the quarterback, essentially, of your financial team who can look at things from that broader perspective.

But clarity is key, which I know in your business as a business consultant, you're probably always hounding your clients to know your numbers, to stay on top of their day-to-day. And you can't change what you're unaware of. And so a lot of it is clarity, both in my practice and I think in yours as well.

Melissa: Yes, absolutely. I think as owners, the best thing we can do is to have facts, not feelings, and numbers, not hunches, and have partners on our side that really understand the realms that are not what we are trained in.

So, yes, yes to everything that you're talking about. Just again, this goes back to how important it is to have people in your corner or on your team. I love the way you think about yourself as the quarterback from the financial perspective, like the quarterback of that team. I think that's, that makes a ton of sense to me.

I man, I really am so grateful that you've taken the time you've taken over the episodes that we've had to be here and to have some conversation. I'd love to have you back sometime and talk about QBI and other topics. So if you're willing to come back, that would be amazing.

Megan: Yeah, I would love this. Thanks for having me.

Melissa: Absolutely. All right, everybody, you should definitely check out Megan Robin. Please go, we have all the info in the show notes. We do for every episode that she's been on. But, you know, whether it's Megan or someone else, like, make sure that you have who you need on your team. All right. Thank you so much for being here.

Melissa: This content is for informational purposes only and does not constitute legal, tax, financial, or investment advice.

Hey, want to watch the video of this episode? Head over to Velocity Work’s YouTube channel. You’ll find the link in the show notes.

You may not know this, but there's a free guide for a process I teach called Monday Map Friday Wrap. If you go to velocitywork.com, it's all yours. It's about how to plan your time and honor your plans so that week over week, more work that moves the needle is getting done in less time. Go to velocitywork.com to get your free copy.

Thank you for listening to The Law Firm Owner Podcast. If you're ready to get clearer on your vision, data, and mindset, then head over to VelocityWork.com where you can plug in to quarterly Strategic Planning, with accountability and coaching in between. This is the work that creates Velocity.

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