Net Worth

If you’ve recently become a law firm partner, you may have received a Schedule K-1 and wondered, “what is this document and how does it affect my taxes?” Many new partners are surprised by how different their tax experience becomes. A K-1 (IRS Schedule K-1 Form 1065) is a tax document that reports your share of a partnership’s income, deductions, and credits. Some law firm partners receive a K-1 each year instead of a W-2, while others in hybrid or PC structures may receive W-2 wages in additio

Capital contributions, or buy-ins, are the funds or assets that a business owner or partner invests into a business. For new law firm partners, understanding capital contributions is essential, not just for partnership buy-in, but for long-term financial planning, tax efficiency, and wealth building. A capital contribution is money or property a partner puts into a business in exchange for ownership equity. In a law firm, this often occurs when you’re promoted to or buy into the partnershi

What Is Alternative Minimum Tax? Alternative Minimum Tax (AMT) is a tax system designed to ensure high-income individuals, corporations, trusts, and estates pay a minimum amount of tax. AMT limits certain deductions and credits that would otherwise reduce tax liability under the regular tax system. How Does Alternative Minimum Tax Work? People or organizations who may be subject to AMT must first calculate their tax liability under the regular tax system and then calculate their AMT liability s