Client Profile
Meet Jonathan and Lisa:
- Ages: Jonathan (56), Lisa (54)
- Status: Married, filing jointly; two children (18 and 21, both full-time students)
- Location: New Jersey (high-tax state)
- Occupations: Jonathan, Senior Executive at a Fortune 500 company; Lisa, Pediatrician in private practice
- Household Income: Approx. $650,000 AGI (Jonathan: $425,000; Lisa: $180,000; plus investments and rental income)
- Assets: $1.8M in 401(k)s, $180K in IRAs, $850K in brokerage, $1.4M primary home, $700K rental, $140K in 529s, $30K HSA
- Liabilities: $400K mortgage (primary), $220K mortgage (rental)
- Goals: Maximize tax savings, optimize investments, manage real estate tax efficiently, fund education, enhance retirement, and build a lasting estate plan
Analysis & Challenges
Client Challenges: From TCJA to OBBBA
Jonathan and Lisa were proactive—under their CPA’s guidance, they previously implemented a comprehensive, multi-year tax plan specifically designed to address the sunset of the Tax Cuts and Jobs Act (TCJA). Their strategies included accelerating income, bunching charitable giving, leveraging higher estate exemptions, and optimizing deductions while TCJA provisions were still in effect.
Now, with the passage of the One Big Beautiful Bill Act (OBBBA), everything has changed:
- Many of the anticipated TCJA “sunsets” have been replaced with new, complex rules.
- Previously recommended moves—like income acceleration, charitable “bunching,” and lifetime gifting—may no longer be optimal or could even trigger unexpected tax or compliance issues.
- AGI thresholds, deduction limits, and planning opportunities have shifted, making their old roadmap obsolete.
- The couple is concerned that without an updated, OBBBA-compliant tax plan, they could miss major tax-saving opportunities—or worse, face new risks.
Jonathan and Lisa need their CPA to re-examine every facet of their strategy, ensure compliance under the new law, and restore their peace of mind with an expertly updated, multi-year plan.
Professional’s Challenges: The CPA’s Perspective
Even for an experienced CPA, this case presents extraordinary complexity:
- Ever-Changing Legislation:
The shift from TCJA to OBBBA (One Big Beautiful Bill Act) created a moving target. The CPA must re-evaluate prior strategies and confirm that all recommendations are compliant with the latest federal and state law—including new deduction caps, phaseout ranges, and retirement limits. - Multi-Layered Income Streams:
Jonathan and Lisa’s income comes from W-2 wages, self-employment, rental, investments, capital gains, and inherited assets. Each source interacts differently with federal and NJ tax law, complicating bracket management and deduction optimization. - Multi-Year, Multi-Strategy Interactions:
Strategies such as bunching deductions, managing 529 plan contributions, and using defined-benefit plans or cost-segregation studies must be precisely timed across multiple years and coordinated to avoid adverse phaseouts or lost benefits. - State vs. Federal Mismatch:
New Jersey’s high-tax environment and unique rules (such as treatment of retirement plan deductions and disallowance of certain itemized deductions) require careful integration with federal planning. - Estate Tax and Wealth Transfer:
Projected growth in assets means today’s “safe” estate plan could become obsolete if the federal exemption falls or asset growth exceeds projections. The CPA must balance current strategies with future-proofing (e.g., SLATs, ILITs, revocable trusts). - Documentation & Audit Protection:
Complex strategies like mega-backdoor Roth conversions, cost segregation, REP status, and annual gifting require flawless documentation. One misstep or missing record can trigger audits, penalties, or loss of deductions. - Keeping Up with Compliance:
Regulatory changes, IRS updates, and shifting case law (especially around real estate, compensation planning, and investment income) mean the CPA must constantly monitor for changes that could undermine previously sound strategies.
How does Hive Tax AI Assistant help Jonathan and Lisa’s CPA
Hive Tax AI Assistant in Action:
- Seamless Data Ingestion: Instantly parses tax returns and complex fact patterns—no manual data entry or rework.
- Automated, Current Law Strategy Generation: Applies up-to-date IRS, state, and OBBBA guidance across all relevant strategies, automatically updating for new thresholds, phaseouts, and limits.
- Multi-Year Scenario Modeling: Identifies, coordinates, and sequences strategies for maximum savings year over year, reducing “leakage” from phaseouts or mistimed deductions.
- CPA-Centric Workflow: Delivers actionable, client-ready reports, freeing the CPA from time-consuming research and manual planning so they can focus on client relationships and high-level advice.
Total Savings & Benefits
Estimated First-Year and Long-Term Tax Savings
| Strategy | Estimated First-Year/Annual Tax Savings | 10-Year / Future Value |
| Max-out 401(k) & Mega-Backdoor Roth | $28,500 | +$40,000 for tax-free growth |
| Adopt Cash Balance/Defined Benefit Plan (Lisa) | $65,000 | $650,000+ over 10 years |
| Backdoor Roth IRA Contributions | $2,700/year (≈$27,000 over 10 yrs) | $27,000+ (tax-free future growth) |
| Max Fund HSA | $4,400/year | $44,000 over 10 years |
| Charitable Bunching/Donor Advised Fund | $28,800 (one-time) | Multi-year giving, no new cash out |
| Systematic Tax Loss Harvesting | $17,700/year | $177,000 over 10 years |
| Asset Location Re-Allocation | $7,400/year | $74,000 over 10 years |
| Annual Gifting of Appreciated Securities to Children | $13,600+ (timing-dependent) | $20,000+ |
| Superfund 529s via 5-Year Averaging | – | $78,000 in future tax saved |
| SALT Deduction Timing/Management | $3,500–$9,600 (in key years) | |
| Accelerated Rental Depreciation (Cost Seg, Bonus, REP) | $12,000–$64,000+ (strategy-dependent) | |
| Employing Children in Practice | $15,500/year | $155,000+ over 10 years |
| Advanced Estate Planning (Trusts, ILIT) | – | ≈$2,000,000 estate tax saved |
Total Estimated Multi-Year Tax Savings:
Over $3 million in cumulative income, estate, investment, and family tax savings, with $200,000+ in first-year savings aloneTax Planning Sample und….
Qualitative Benefits
- Reduced Risk: All recommendations include compliance checklists and documentation guides.
- Improved Compliance: Hive AI automatically monitors regulatory changes and adjusts plans.
- Significant Time Saved: What took days of manual planning is now generated in minutes.
- Peace of Mind: Both CPA and client gain confidence that the plan is up-to-date, tailored, and audit-ready.
5. Download the Full Tax Plan
Ready to see the details? Download the complete, OBBBA-updated tax plan generated by Hive AI Tax Planning Assistant.]
6. Conclusion
With the passage of OBBBA, tax planning just got more complex—and more valuable. Hive AI Tax Planning Assistant empowers professionals to deliver multi-year, personalized, and compliant strategies in a fraction of the time.
Jonathan and Lisa’s case shows how even the most sophisticated plans require ongoing updates—and how the right AI-powered tool can deliver both substantial savings and total peace of mind for both CPA and client. Discover how Hive AI can transform your tax planning process—Schedule a demo or upload a client return to get started.