# SavingsMax Tax Strategy Planning
## Fee Proposal — CLJ Plumbing

**Client:** CLJ Plumbing
**Plan year:** 2026
**Plan reference #:** SM-CLJ-2026-001 (Rev. 2)
**Prepared by:** Rex (Tax Strategist) for Jimmie Needles, J2 Bookkeeping
**Date prepared:** 2026-05-23
**Companion document:** `SavingsMax_CLJ_Strategy_Memo_2026.md` (Rev. 2)

> **Revision history:**
> - **Rev. 2 (2026-05-23):** Owner profile corrected to Single, age 30. Strategy savings rebuilt at 32% marginal bracket. Solo 401(k) replaced by SEP-IRA (non-spouse employee disqualifier). Added: §45E Retirement Plan Startup Credit (one-time, $15,500 of credit), Backdoor Roth IRA (annual). HSA strategy kept conditional. All fee figures updated.

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## Engagement summary

The accompanying Strategy Memo identifies tax planning opportunities estimated to deliver **$36,000 – $48,000 in recurring annual federal tax savings** plus **$18,500 – $23,500 in one-time savings/credits** (primarily the §45E Retirement Plan Startup Credit and vehicle depreciation catch-up).

This Fee Proposal sets out the SavingsMax fees that apply when you engage one or more of the recommended strategies.

**Fee structure:** SavingsMax fees are **12% of the estimated tax savings** each strategy is projected to deliver.
- For **recurring strategies** (those that save tax every year): fee is 12% of projected annual savings, billed annually for each year the strategy is in place.
- For **one-time strategies** (catch-up credits, one-time depreciation moves): fee is 12% of projected one-time savings, billed once at engagement.

Fees apply per strategy accepted. The full fee is charged regardless of which professional (your CPA, EA, attorney, plan administrator, or other partner) ultimately executes the strategy.

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## Strategy-by-strategy fees

### Recurring strategies (annual fee)

| Strategy | Estimated Annual Tax Savings | SavingsMax Annual Fee (12%) | Net Annual Benefit |
|----------|------------------------------|------------------------------|---------------------|
| **1. S-Corp Election** (Form 2553 + payroll setup + reasonable comp study) | $28,000 – $29,000 | **$3,420** *(based on midpoint $28,500)* | $24,580 – $25,580 |
| **2. SEP-IRA Retirement Plan** | $6,000 – $9,000 | **$900** *(based on midpoint $7,500)* | $5,100 – $8,100 |
| **3. Backdoor Roth IRA** (current tax-equivalent value; massive lifetime value at age 30) | $2,200 | **$264** | $1,936 |
| **4. Accountable Plan** (paired with S-Corp) | $1,600 – $3,200 | **$288** *(based on midpoint $2,400)* | $1,312 – $2,912 |
| **5. Augusta Rule** (§280A(g) home rental to business) | $1,300 | **$156** | $1,144 |
| **6. HSA Contribution** *(conditional on HDHP enrollment)* | $1,400 | **$168** | $1,232 |
| **Recurring subtotal (full package)** | **$40,500 – $46,100 / year** | **$5,196 / year** | **$35,304 – $40,904 / year** |
| Recurring subtotal (without HSA conditional) | $39,100 – $44,700 | $5,028 | $34,072 – $39,672 |

### One-time strategies (single fee at engagement)

| Strategy | Estimated One-Time Tax Savings | SavingsMax One-Time Fee (12%) | Net Benefit |
|----------|--------------------------------|--------------------------------|-------------|
| **7. §45E Retirement Plan Startup Credit** (claimed over first 3 plan years) | $15,500 total | **$1,860** | $13,640 |
| **8. Vehicle Depreciation Review / §179 Catch-Up** *(if applicable)* | $3,000 – $8,000 | **$660** *(based on midpoint $5,500)* | $2,340 – $7,340 |
| **One-time subtotal** | $18,500 – $23,500 | **$2,520** | $15,980 – $20,980 |

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## Total package summary

### Year 1 (full package)
| | Estimated Savings | SavingsMax Fee | Net Benefit |
|---|---|---|---|
| Recurring annual (Strategies 1–6) | $40,500 – $46,100 | $5,196 | $35,304 – $40,904 |
| One-time (Strategies 7–8) | $18,500 – $23,500 | $2,520 | $15,980 – $20,980 |
| **Year 1 total** | **$59,000 – $69,600** | **$7,716** | **$51,284 – $61,884** |

### Year 2+ (recurring only)
| | Estimated Savings | SavingsMax Fee | Net Benefit |
|---|---|---|---|
| **Annual** | **$40,500 – $46,100** | **$5,196** | **$35,304 – $40,904** |

### Effective "return on fee" to client
- **Year 1: 6.6x – 9.0x** (gets $52K – $62K back for $7,716 in fees)
- **Year 2+: 6.8x – 7.9x** (gets $35K – $41K back for $5,196/yr in fees)

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## Strategy acceptance

Please indicate which strategies you wish to engage. Each strategy is an independent decision.

### Recurring strategies (12% of annual savings, billed annually)

| Strategy | SavingsMax Annual Fee | ☐ Accept | ☐ Decline |
|----------|------------------------|----------|-----------|
| 1. S-Corp Election | $3,420/yr | ☐ | ☐ |
| 2. SEP-IRA Retirement Plan | $900/yr | ☐ | ☐ |
| 3. Backdoor Roth IRA | $264/yr | ☐ | ☐ |
| 4. Accountable Plan | $288/yr | ☐ | ☐ |
| 5. Augusta Rule | $156/yr | ☐ | ☐ |
| 6. HSA Contribution *(if HDHP-eligible)* | $168/yr | ☐ | ☐ |

### One-time strategies (12% of one-time savings, billed once)

| Strategy | SavingsMax One-Time Fee | ☐ Accept | ☐ Decline |
|----------|--------------------------|----------|-----------|
| 7. §45E Retirement Plan Startup Credit *(paired with Strategy 2)* | $1,860 | ☐ | ☐ |
| 8. Vehicle Depreciation Review | $660 | ☐ | ☐ |

**Total accepted recurring fees:** $______ /yr
**Total accepted one-time fees:** $______
**Year 1 total fees:** $______

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## Signatures

**Client (CLJ Plumbing):**

Signature: ____________________________ Date: ___________

Print name: ____________________________

Title: ____________________________

**SavingsMax Tax Strategy Planning (J2 Bookkeeping):**

Signature: ____________________________ Date: ___________

Print name: Jimmie Needles

Title: Principal, J2 Bookkeeping / SavingsMax Tax Strategy Planning

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## Disclaimer

> Estimated tax savings shown in this Fee Proposal are projections based on the assumptions stated in the accompanying Strategy Memo. Actual savings will be determined by the final filed tax return for the engagement year and may vary materially based on facts, circumstances, or tax law changes not currently known to SavingsMax.
>
> **SavingsMax fees are billed based on projected savings, not actual realized savings.** The fee structure reflects the value of the strategy work — research, analysis, modeling, and recommendations — provided by SavingsMax. Implementation of each strategy is performed by your CPA, EA, attorney, plan administrator, or other professional of record. The full SavingsMax fee applies regardless of which professional executes the strategy.
>
> SavingsMax is operated by J2 Bookkeeping. SavingsMax does not prepare tax returns, render tax advice as a return preparer, or represent clients before the Internal Revenue Service. All tax positions recommended by SavingsMax must be reviewed and implemented by your CPA, EA, or other licensed tax professional of record.

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## §A — Internal Notes (Not for Client)

### Pricing math (Rev. 2 vs. Rev. 1)
| | Rev. 1 (MFJ assumed) | Rev. 2 (Single confirmed, age 30) |
|---|---|---|
| Year 1 fee | $4,074 | **$7,716** (+89%) |
| Year 2+ recurring | $3,156 | **$5,196** (+65%) |
| Net benefit to client Y1 | $22,926 – $36,826 | **$51,284 – $61,884** |
| Return on fee | 5.6x – 9.0x | **6.6x – 9.0x** |

The Rev. 2 numbers reflect the higher absolute savings unlocked by:
1. S-Corp election restoring QBI deduction (worth ~$15K alone at Single phase-out math)
2. Higher 32% marginal rate amplifying all deductions
3. §45E Retirement Plan Startup Credit (one-time but real)
4. Backdoor Roth IRA added

### Fee status tracking
Per Ledger §5.3:
- **Identified** → recommended in memo
- **Proposed** → in this Fee Proposal (current state for all 8 strategies)
- **Accepted** → client signs the strategy line
- **Declined** → re-pitch candidate
- **Executed** → implementation partner confirms

### Re-pitch opportunities (if declined)
- **S-Corp election** if declined for TY2026 → re-pitch immediately for TY2027 (election deadline Mar 15, 2027)
- **SEP-IRA + §45E credit** if declined → §45E credit window closes after 3rd plan year — every year deferred is one fewer year of the $5K credit
- **Backdoor Roth IRA** if declined → re-pitch annually; pure time-value loss for each missed year
- **Vehicle depreciation** if declined → MUST be claimed in the catch-up year; cannot re-pitch later
- **HSA** if not HDHP-eligible → revisit during fall 2026 open enrollment; HDHP enrollment is an annual decision

### Template observations for other 4 pilots
- The fee proposal grew 89% in Rev. 2 driven by tax-bracket math. Single owners above $250K AGI are the highest-value SavingsMax clients — significantly higher per-strategy savings than MFJ owners at the same income level. Worth flagging in pilot prioritization.
- §45E Retirement Plan Startup Credit should be a default add-on to any retirement strategy recommendation. Easy upside.
- "Strategy 0" — Filing status + age confirmation — is the most important intake step. Mistakes here propagate to every number in the memo.

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**End of Fee Proposal (Rev. 2).**