Illustrative 1099 CRNA case study
Plenty was going right. The pieces still needed to work together.
Ann and Alan had a good income, more than $1 million saved, and several professionals helping them. Nobody was lighting money on fire.
The problem was that their business, payroll, retirement accounts, taxes, and investments were being handled separately. A decision in one area could create a problem in another.
Ann and Alan are a hypothetical composite, not actual clients. The numbers below are illustrative inputs. This example shows how we would approach the planning, not a client result or a tax-savings forecast.
The starting point.
| Illustrative household input | Amount |
|---|---|
| Ann’s gross CRNA practice revenue | $340,000 a year |
| Alan’s W-2 wages | $215,000 a year |
| Household assets | $1.12 million |
The assets sit across taxable investments, two rollover IRAs, an employer 401(k), and cash.
The missing number is Ann’s net practice profit. Gross revenue is what the practice brings in before business expenses. It is not the amount available for household spending, taxes, or retirement contributions. We would need those expenses before projecting any tax benefit.
What we would work through.
1. Business structure and payroll.
An S-corporation may be worth comparing with the current structure. That comparison needs a defensible wage for Ann’s work, employer payroll taxes, benefits, tax effects, and the cost of running the entity. A smaller payroll-tax bill means little if the added costs consume the difference.
2. Retirement funding that the practice can support.
A Solo 401(k), after-tax contributions, and a cash balance plan are possibilities to test. Plan terms, employees, other retirement plans, actual profit, and cash flow determine what fits. A cash balance plan also needs actuarial review and a funding commitment the practice can maintain.
We would protect operating cash and tax reserves before chasing a contribution limit. Putting money into a retirement account is a use of the household’s money, not a new source of savings.
3. Each spouse’s IRA position.
The rollover IRAs matter if Ann or Alan wants to use a backdoor Roth. The pro-rata calculation is separate for each spouse. Existing pre-tax IRA money does not prevent a conversion, but it can make much of it taxable.
If an employer plan accepts a rollover, we would compare its costs, investments, access rules, and protections before moving anything.
4. Health coverage and benefits.
We would check the actual coverage before recommending HSA contributions. Eligibility, other coverage, and ownership-related reporting rules matter. The contribution limit alone does not establish eligibility.
5. Investments across the household.
We would review the holdings together: fund expenses, advisory costs, risk, account location, and the tax cost of making changes. Tax-loss harvesting may help when the right circumstances are present. It does not create a predictable annual tax benefit.
The goal is a portfolio the household understands and can stick with. Here is how we think about investing.
The order matters.
- Get the facts. Gather tax returns, business expenses, payroll, benefits, account statements, and plan documents.
- Test feasibility. Establish net profit, reasonable compensation, cash needs, and any retirement-plan funding requirements.
- Compare the choices. Include setup and ongoing costs, taxes, access to money, and the work required to maintain each option.
- Coordinate the work. Put the advisor, CPA, payroll provider, and plan specialists on the same assumptions and calendar.
- Follow through. Confirm what was completed and revisit the plan when income, work, family needs, or rules change.
What the planning should make clear.
Ann and Alan should be able to see what we recommend, why it fits, what it costs, who is responsible, and what needs to happen first.
They should also know what each number means. A current tax deduction may shift taxes into a later year. A lower recurring expense can improve cash flow. A retirement contribution moves existing money into an account. Those are different outcomes, and adding them together would overstate the result.
See the sample roadmap.
This three-page example shows the household inputs, decisions to test, and order of work. It does not include a personalized tax projection or promise a savings amount.
When a strategy would not fit.
A large retirement contribution may be the wrong move when cash is tight. An S-corporation may add more expense than benefit. A rollover may solve one tax issue while creating worse investment choices. A lower-cost portfolio may still be expensive to reach if selling triggers a large tax bill.
Good planning includes deciding which ideas to leave alone.
You should not have to coordinate this between shifts.
A high income gives you options. It does not organize them for you. Our job is to help you understand the tradeoffs, decide what matters, and get the right work done in the right order.
It’s my pleasure to help keep your financial life on point.
Ben
Reviewed October 2026. Educational illustration, not individualized investment, tax, legal, payroll, or actuarial advice. Sources: IRS S-corporation compensation, one-participant 401(k) plans, defined benefit plans, Form 8606, and HSA guidance.