Taxable Cases: How Plaintiff Attorneys Can Double (or Triple) Their Client's After-Tax Net Recovery

Since the Tax Cuts and Jobs Act of 2017, plaintiffs have been taxed on the full gross recovery in cases not based on personal injury (including the attorney fees). We call this the Plaintiff Double Tax Trap.

This video shares a powerful tax planning strategy that can help clients avoid paying the Plaintiff Double Tax Trap — which can double or triple the client's after-tax net recovery.

To schedule a 30-minute call with Greg Maxwell, please visit: https://go.oncehub.com/Greg30MinCall

Please contact Greg Maxwell at (801) 683-5998 or at [email protected] if you have any questions about this video.

00:12 - Goals for This Training
01:08 - Types of Cases These Strategies Work For
02:03 - Types of Cases with Different Planning Needs
02:53 - Who I Am
03:15 - Why You Probably Haven't Heard of This Before
03:53 - What This Webinar Will Cover
04:29 - Part 1: How to Spot the Plaintiff Double Tax Trap
04:36 - When is a Legal Recovery Taxable to the Client?
05:00 - Deductibility of Attorney Fees
06:15 - The Plaintiff Double Tax Trap
07:15 - Example: $10M Recovery, 40% Fee, 40% Tax Rate
08:16 - Example: $10M Recovery, 40% Fee, 50% Tax Rate
08:54 - Example: 40% Fees + 10% Costs, 40% Tax Rate
10:03 - A Real Life Example: The Kobe Bryant Lawsuit
11:19 - How to Estimate the Plaintiff Double Tax Trap
11:50 - Why Haven't I Heard About the Plaintiff Double Tax?
13:29 - Failed Alternatives to Avoid the Double Tax
15:47 - Reducing the Client's Tax Bill Through Annuities
16:40 - Example of How an Annuity Can Help a Client
18:42 - Annuities Don't Avoid the Plaintiff Double Tax
19:15 - Part 1 Recap
20:14 - Part 2: How Your Clients Can Avoid Paying the Plaintiff Double Tax
20:29 - Introduction to the Plaintiff Recovery Trust
21:07 - How the Plaintiff Recovery Trust Was Created
21:53 - About Eastern Point Trust Company
22:47 - About Faegre Drinker
23:02 - How Does the Plaintiff Recovery Trust Work?
23:55 - Plaintiff Recovery Trust: Flow of Funds
24:26 - Case Study: Examining How Much the Plaintiff Recovery Trust Can Save the Client
27:14 - Comparing After-Tax Recoveries to the Client
28:30 - PRT: Increase in Net Recoveries by Tax Rate
30:02 - Common Questions About the Plaintiff Recovery Trust
35:53 - Part 2 Recap
36:16 - Part 3: How to Get Started With This Strategy (and Protect Yourself From Upset Clients & Potential Liability)
36:20 - How to Get Started: Process Overview
37:09 - Reminder
38:11 - Your Next Step: Book a 30-Minute Phone Call

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