As the firm’s chief financial strategist, Mark Witaschek applies his decades of experience in financial planning to tell you what you don’t know. A few strategies examples are provide below, to give you a feel for the breadth and depth of our planning capabilities.
Designed support trusts for children of adult clients with mental health challenges.
Mark worked with a wealthy client, with a history of episodic mental health issues, to set up irrevocable trusts to fund his child support payments for his five young children, to the age of 18. These trusts were referred to as “third rail” trusts to ensure that the support cash flows were secure. That, along with traditional (529 and UTMA) accounts for education funding, as well as other irrevocable trusts, assured all the stake holders that the needs of the children were cared for, regardless of any future mental health lapses on the part of the grantor.
Developed a partnership exit for an business owner diagnosed with early onset of Alzheimer.
Mark had a client, a prominent business owner in her late 50s, who was diagnosed with early stages of dementia. The client was a founder of a firm in which she was the creative force. Word of the medical issue might have affected positioning on the sale negotiations including pricing of the significant asset.
Mark assisted in negotiating her exit from the business, keeping the medical diagnosis extremely confidential, as well as negotiating an exit strategy and sale of the client’s interest. He worked through the successful claiming under the client’s disability insurance policy, and then moved to a Social Security disability claim, which allowed her Social Security retirement benefits to continue to increase until that claim at age 67. Mark helped the client convert a large term insurance policy used to fund a business buy-sell agreement into a personal, permanent insurance contract. Mark helped the spouse work through all of these issues, and convert assets to generate cash flow, as he funded their children’s college educations, and in-home nursing care for his wife. Eventually Mark and his team assisted him in working out the funding for his wife’s long-term institutional care. Finally, Mark helped him with the management of his live-in elderly father’s assets, income and estate planning.
Assisted a widow in negotiating with an unscrupulous business partner of her late husband.
A client in the final stages of a terminal illness, made a very bad business deal with an unscrupulous, and financially challenged, partner. We assembled an expert team of specialized attorneys and accountants to sort through the issues, developed and negotiated the outline of a first bailout strategy, and then a dissolution of the resulting note and businesses. All this was done as Mark attempted to protect the non-business experienced widow from capitulating to the aggressive and predatory ex-partner. Mark acted as liaison between the expert team, the widow, and her family in resolving the complex and contentious issues and negotiations. In the process, he uncovered hidden assets and sources of income through a forensic analysis of the adversary’s financial position.
Consulted with attorneys, providing them with draft stock option settlements, draft Qualified Domestic Relations Orders (QDROs), letters of instruction and other similar documents.
In a number of client divorces through the years, Mark has:
Coordinated the consolidation of client assets and also expanded and maximized the client’s retirement plan savings strategy using a solo 401(k), a Medical Expense Reimbursement Plan (MERP), 403(b), and 457(b) plans.
A client we took on through an acquisition had approximately $175,000 of assets, with funds spread out into various cash value life insurance policies, annuities, load mutual funds, and more. The issues with this client included high fees within the investment products, a disjointed portfolio, retirement within a few years, very high federal and state taxes due to poor asset location, and lack of fully funding their qualified retirement plans.
We consolidated the client’s assets, established a new solo 401(k) for one spouse, which he funded at a rate of approximately $45,000 per year, and substantially increased funding for the other spouse who was an employee of a school district, to maximize her 403(b) and 457(b) plan contributions to a current $48,000 per year.
Previously non-deductible medical expenses were funded by a MERP we set up for the business owner’s spouse, paid for by the closely held corporation. As the couple approached retirement, Mark carefully questioned the school employee spouse about her long work history and had her “buy up” missed work credits from leave of absences she took decades ago, resulting in about a one to five ratio of annual payout for the buy-up dollars she will pay to the county and state for the missed credits. Client assets grew to more than $2.0 million in a little more than a decade.
Created a “synthetic annuity” as a gift to a client’s former significant other.
Mark had a long-time client with substantial assets, who used Mark as an intermediary to negotiate a “synthetic annuity” from an irrevocable trust as a settlement with a long-term partner. Mark negotiated the arrangement with the partner, made funding recommendations for the client’s approval, set up the deal and document draft with the client’s attorneys and accountants, and completed the funding before the expiry of changing gifting rules and limits on December 31st of that year. Complexities included the funding of legacy trusts for the couple’s adopted, but then adult children, at the time of the settlement.
Recommended a change of residency, then established a Domestic Incomplete Non-Grantor (DING)/Asset Protection Trust (APT) for a large tax savings.
A long-time client bought an ocean-front home in Massachusetts soon after Hurricane Sandy hit the east coast. A great purchase price did not mitigate his pain when he received his first annual flood insurance premium bill for roughly $35,000. However, if he became a Massachusetts resident, he could avoid the high insurance bill, but would now be subject to Massachusetts state income taxes of about $10,000 per year.
We had the client set up a Domestic, Incomplete Gift, Non-Grantor (DING) Asset Protection Trust (APT) in the state of New Hampshire. By domiciling a significant amount of his non-qualified assets into this trust, the income from those assets is no longer subject to New Hampshire or Massachusetts state income taxes. This client also uses a Donor Advised Fund we established for our clients to make his substantial gifts of appreciated assets to charities each year.
The surviving spouse of a successful business owner had several accounting firms miss significant issues in the income and estate return filings, that would have resulted in substantial overpayments if the errors were not found.
A partner in a successful advertising agency structured a multi-part deal to sell part of her interest in the firm, and then suddenly passed away. In a subsequent negotiation to sell the balance of the firm, the three accounting firms involved all missed the step up in basis that should have applied to the deceased partner’s basis. Returns were filed, but when Mark pressed hard to sort through the errors, the firms involved pushed back and resisted. Mark referred the client to another tax reporting firm, and amended returns were filed, days before the expiry of the deadline.
Leveraging assets for collateralized lending as an alternative to a margin loan.
Working closely with 1st and 2nd generations of a family business, accounting, and law firm to structure the transfer of control to the children and fund the buyout to the selling and retiring parents.
Developing relationships with lenders, monitored rates for refinance and reverse mortgage opportunities.
Providing patient and attentive support as clients transitioned from savings to spending mode into retirement. Provided guidance on when to start collecting Social Security and reviewed health care options (Medicare). Provided opportunities for Roth Conversions, home ownership vs. renting, and when to take IRA distributions. Provided detailed analysis and tax projections to help with this transition process.
Advising on the gifting of assets to Medicaid Income Only trusts to benefit the non-long term care spouse of couples with moderate non-qualified assets.
Identifying and pushing to recognize tax-deductible health-related expenses at retirement communities.
Proposing gifting to an irrevocable trust to avoid, if applicable, state estate taxes in your state of residence. Retitling owned real property to a trust/LLC, saving on probate costs.
To reduce clients’ costs, provide backup for their tax advisor when responding to the IRS.
Mark Witaschek and his experienced team have assisted many clients with estate settlements, including:
Aurelius Family Office, LLC (“AFO”) is an SEC registered investment adviser. Registration with the SEC does not imply a certain level of skill or expertise. This communication is for informational purposes only, and is not intended to provide specific investment, legal, tax, or other professional advice. The case studies presented are designed to illustrate AFO’s approach to specific client situations. The client(s) for whom the case studies apply have not endorsed or otherwise provided testimonials for the firm or its staff. The case studies are based on specific client situations which may not apply to your particular situation. Please consult with an AFO professional for guidance. Information regarding AFO’s services, fees, conflicts of interest and related matters can be found by clicking the following link https://adviserinfo.sec.gov/firm/summary/323016 and viewing the latest Form ADV, Part 2 Brochure and Part 3 Relationship Summary. Please visit us at
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