A March 13 article in Part B News, “The taxman cometh: File wisely, secure the most from practice deductions,” discussed tax tips for medical practices. Rivkin Radler’s Lou Vlahos was quoted in the article.
Lou discussed, among other topics, the common advice to practice owners that they should consider employing family members. Lou said, “You hear from so many accountants who advise doctors, ‘Why don’t you hire your spouse or your kids?’ You’d have another individual in the family who’s going to get the benefit of the 401k account. Why not hire your kids to perform some small functions after school and shift the income to someone who’s in a lower bracket than yourself?’” But, he cautioned, “these are in fact business functions, and they should not be paid more than what is reasonable for that function. So, if you’re a part timer who only comes in after school to take care of the filing system or return calls, you should not be paid something that is unusually large for the value that you’re providing. It has to be commensurate with
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