Which is your favorite team?

Whether you said Angels or Dodgers, Ducks or Kings, I hope your next thought was, “but I really love my team of financial and business advisers, too.”

Our uniforms aren’t as colorful, and we rarely serve hot dogs or peanuts, but if you’ve got a financial planner, an accountant and an attorney working collaboratively toward your goals, you’re ahead in the game. And you’ve got a team that’s rooting for you, which is a nice twist.

One or more

Often clients will feel they maybe only need one of these professionals, and then try to have that professional cover the other bases as well, perhaps thinking this is more cost-effective. But it makes as much sense as having a Major Leaguer play basketball and football and expecting him to be an All-Star in those sports as well.

Each professional has their own strengths, which should be utilized accordingly. Sure, occasionally there’s a Bo Jackson or a Tim Tebow-type who is both a CPA and a CFP or CPA and attorney; just be sure you know what position they’re playing for you.

I’m an estate planning attorney. I help my clients plan for death, disability and leaving a legacy. Often that involves trusts that last for several years to several generations. Sometimes the game plan calls for lifetime gifts, transfers of business interests, forming new business entities that bring in younger generations on the ground floor, and/or charitable gift planning. None of this can be done in a vacuum.

The team

This type of planning requires a thorough understanding of the client’s hopes, concerns, goals and values. I spend some time discussing just that with my clients. But I also need to understand a client’s current and future financial situation. Yes, the future — do you have an inheritance coming? Is there a lawsuit pending? When are you retiring? Have you earmarked certain funds for a lifetime goal?.

The person who may be most familiar with that is the client’s financial planner, and he or she should be involved in the discussion. This will save time, money, and frustration in the long run if everyone is working toward your same goal.

Discussing gifting of assets (whether to family or charity) or business succession planning can never be properly done without the input of an accountant.

For example, if I suggest a certain gift to descendants, the accountant will be in the best position to know the specific tax consequences of such a gift and perhaps suggest the assets that are best given to charities versus a family member.

Furthermore, it’s the accountant who will need to prepare future gift tax returns and income tax returns for you and any new entity. It’s best not to surprise them with that information on April 14th.

Likewise, if you’re talking to your CPA or financial planner about forming a new business entity, he or she may suggest, for example, an S corporation for tax reasons. It’s likely the estate planning attorney is going to advise the irrevocable children’s trust you formed and wish to have as a shareholder will not qualify as an S corporation shareholder, so perhaps we should look at a limited liability company.

Open lines of communication

Odds are good you meet with your accountant and financial planner at least annually. This is probably not so with your attorney. Thus, your CPA or financial planner is more likely to know when something has occurred in your life or business that should be brought to the attention of your attorney or another member of your team who can take it from there.

If those team members already know each other and work together, it’s more likely they’ll be sharing relevant information (with your permission, of course) regularly. This passing of the ball makes for a stronger game, with fewer fouls.

Around this time of year, I frequently hear from accountants I’ve worked with for mutual clients through the prior calendar year. Sometimes they need a copy of a trust, the appraisal we had done in connection with a gift or just a refresher on what entities were set up when and why so that tax returns can be prepared (or extended. (Hey, it’s 2021, and nothing is normal.)

Sometimes there are tax and business decisions to be made, and future plans to be discussed. I always think how nice it is to be part of a winning team that has the same strategy and focus. I think the clients feel that way too (even if initially they may have been worried about exceeding their salary caps).

Pick your team. Introduce them. Let them play ball together for you. Trade when necessary.

By the way, my dog’s name is Percival. Go, Angels!

Teresa J. Rhyne is an attorney practicing in estate planning and trust administration in Riverside and Paso Robles. You can reach her at Teresa@trlawgroup.net.

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