EPISODE DESCRIPTION:

Jess Skubal has a unique perspective. She has a deep understanding of what it means to be married to a professional baseball player - her husband, Tarik Skubal, is a pitcher for the Detroit Tigers. She is also familiar with the most significant financial mistakes athlete families make due to her professional background working as a tax CPA for Deloitte, one of the world's top 4 public accounting firms. Jess is passionate about making sure every dollar is maximized, and as we state in the conversation: Investments are a matter of opinion, and taxes are a matter of fact.

Jess gives great insight on both the "WHY" and the "WHAT" related to tax planning and the importance of being able to take advantage of every opportunity available to the athlete.

Jess defines "WHY" as "having more money to do what is important to you.”  Jess shares a personal story about how their own proactive tax planning led her and Tarik to fund their niece's college education.

Jess then also gives excellent advice on the "WHAT" by discussing three specific tax planning strategies that are available to the professional athlete and are unfortunately commonly missed:

• Opening an Individual 401(k) plan for the player's off the field income
• Recalculate your W2 received to ensure the player "pays where he plays."
• Executing a 'Back Door Roth IRA' strategy for the player and wife for $12,000 of tax-free investment growth annually.

To ensure you are taking advantage of every opportunity, Jess' simple yet profound advice to other baseball spouses going through similar circumstances - do not be afraid to ask questions of your advisor, and better yet, find an advisor who will answer and accept your questions.

EPISODE HIGHLIGHTS:

• 2:51 - Jess shares the story of how she in Tarik met in High School in Kingman, AZ
• 4:00 - Jess discusses Tarik's journey to the big leagues - including not being highly sought after or recruited out of high school.
• 4:55 - Jess worked as an accounting clerk while they did long-distance dating in college.
• 6:29 - Jess chose accounting as a major because she saw an opportunity to help people who were important to her.
• 8:01 - Jess began her post-collegiate career as a CPA working for Deloitte, one of the Big 4 and most prestigious accounting firms in the world, while Tarik was a Top 100 prospect in the minor leagues.
• 9:49 - While at Deloitte, Jess worked on many clients, primarily as a tax preparer.
• 11:24 - Jess later in her career worked on closely held and family businesses, but as she quotes, her "pride and joy" client was the tax planning work she performed for a family office.
• 12:53 - While working for her family office client, the 'Patriarch' of the family passed away, which generated an almost $40m estate tax liability. The importance of the family's tax planning surfaced by saving "a generation's worth of wealth.”
• 15:00 - Josh and Jess expand on the importance of general estate planning and the importance of estate tax planning to the athlete.
• 16:31 - One of Jess' overarching beliefs is to "ask the question." Often, advisors are not asked appropriate questions by their clients, which causes critical tax planning strategies to be missed.
• 18:07 - Jess expands on the definition of tax preparation vs. tax planning.
• 18:56 - Proactive thinking and tax planning are how you arrive at the most advantageous tax outcomes.
• 19:35 - Tax planning should happen 365 days out of the year - not just when you file your return in April of the following year.
• 20:46 - Players have two streams of income: W2 income earned as an employee from the team and 1099 income earned from all trading cards and endorsement money. Those two different income streams have different tax planning strategies available to the player.
• 21:06 - Jess talks specifics on W2 vs. 1099 strategies, including the importance of estimated tax payments.
• 21:45 - Players can set up a separate retirement called an individual 401k, which, as Jess says, has a 'triple benefit' to the family if done appropriately.
• 23:11 - The individual 401k is different than the MLB Vanguard 401k - because of Tarik's the field income, Tarik and Jess were able to receive a tax deduction for the money that went into the account; the money in the account is invested for their retirement, and with the money saved on taxes, the Skubals were able to fund a 529 plan for their niece's college education.
• 24:18 - Jess expands on the purpose of money and why appropriate tax planning gets you to do 'more of what you want to do.’
• 25:50 - The W2s generated to players could potentially be wrong - which is not well known, even amongst baseball players. Real dollars in tax savings could be missed if the family's CPA does not recalculate the player's 'duty days' schedule.
• 30:46 - Josh and Jess discuss the importance of a Roth IRA and why all players and families should take advantage of this tax-free account.
• 32:40 - Jess discusses the importance of taking advantage of every little opportunity every year to maximize a family's wealth.
• 33:45: Jess's advice to other families - don't be afraid to ask your tax and financial advisors questions. If you do not ask, real dollars could be missed.