FAQ | SimpliMD

Frequently Asked Questions

Business Formation

How do I decide on the type of entity to form?

One of the first decisions you’ll make is the type of business you will open. You have several options to explore, including where you’ll do business, how you will structure your business, and how you will conduct business. Email us, or give us a call, and we can discuss the various types of entities, and what works best for your situation.

Do I need bylaws or an operating agreement for my company?

While bylaws are not required by law, they do need to comply with state law and are essential to the success of your company. Bylaws list membership requirements, duties and responsibilities, and other operational procedures that allow your company to run smoothly. Articles of incorporation and bylaws must be adopted by the majority of your members according to most state laws. Operating agreements are not required by most states and are not filed at your state office. However, an operating agreement is highly recommended for multi-member LLCs because it structures your LLC’s finances and organization, and it provides rules and regulations for smooth operation. Percentage of interests, allocation of profits and losses, member’s rights and responsibilities, and other provisions are usually included here.

What is a fictitious name?

The legal name of your business is required on all government forms and applications, including your application for employer tax IDs, licenses and permits. However, if you want to open shop or sell your products under a different name, then you may have to file a “fictitious name” registration form with your government agency.

A fictitious name (or assumed name, trade name or DBA name, which is short for “doing business as”) is a business name that is different from your personal name, the names of your partners or the officially registered name of your LLC or corporation.

For example, let’s say Mary Smith is the sole proprietor of a catering company she runs out of her home. Mary wants to name her business Seaside Catering instead of using her business’ legal name, which is Mary Smith. In order to use Seaside Catering, Mary will need to register that name as a fictitious business name with a government agency. The appropriate government agency depends on where she lives. In some states, you have to register fictitious names with the state government or with the county clerk’s office; however, there are a few states that do not require the

Does my business need a tax identifiation number (EIN)?

Employers with employees, business partnerships and corporations, and other types of organizations, must obtain an Employer Identification Number (EIN) from the U.S. Internal Revenue Service. The EIN is also known as an Employer Tax ID and Form SS-4.

Why do I need a registered agent?

Most businesses are not individuals but instead business entities such as corporations or limited liability companies (LLCs). This is because there are substantive (and substantial) liability protections as well as tax advantages to being “incorporated” as opposed to being “self-employed”. Most jurisdictions in the United States require that any business entity that is formed or doing business within their borders designate and maintain a “Registered Agent”. This person may be known as the “Resident Agent” or “Statutory Agent”, depending on the laws of the individual jurisdiction in which the business entity is registered. The purpose of a Registered Agent is to provide a legal address (not a P.O. Box) within that jurisdiction where there are persons available during normal business hours to facilitate legal service of process being served in the event of a legal action or lawsuit. Generally, the registered agent is also the person to whom the state government sends all official documents required each year for tax and legal purposes, such as franchise tax notices and annual report forms. It is the registered agent’s job to forward these suit documents and notices to the entity itself. Registered Agents generally will also notify business entities if their state government filing status is in “Good Standing” or not. The reason that these notifications are a desired function of a registered agent is that it is difficult for a business entity to keep track of legislative changes and report due dates for multiple jurisdictions given the disparate laws of different states. Penalties for not maintaining a registered agent.

Do I have to file anything to dissolve my company?

In most states, you essentially have to file your corporation in reverse. This typically involves filing articles of dissolution, in addition to a public notice requirement.

Business Accounting

How does the structure of my business impact my taxes?

Different types of entities are taxed differently. Email or call us, to discuss your specific situation.

What expenses can my company pay?

You can deduct the cost of operating your business. These costs are known as business expenses. These are costs you do not have to capitalize or include in the cost of goods sold. Contact us to discuss your specific situation.

Why should I keep records?

Good records will help you monitor the progress of your business, prepare your financial statements, identify source of receipts, keep track of deductible expenses, prepare your tax returns, and support items reported on tax returns.

What kinds of records should I keep?

You may choose any record keeping system suited to your business that clearly shows your income and expenses. Except in a few cases, the law does not require any special kind of records. However, the business you are in affects the type of records you need to keep for federal taxes.

How should I record my business transactions?

Purchases, sales, payroll, and other transactions you have in your business generate supporting documents. These documents contain information you need to record in your books and will be necessary when time arrives.

Payroll

Am I required to take payroll?

As an officer of your company, you are an employee and the IRS and Dept of Labor say that you are required to take a reasonable salary.

What is a reasonable salary?

As is the case with most government requirements, they do not explicitly tell you. We say that a reasonable salary is sufficient to fully fund retirement plans and allow you to make monthly rather than quarterly payments for your taxes.

Do I have to make quarterly estimated payments?

You do have to make some tax payments during the year. These can be either monthly or quarterly. We prefer to make tax payments via payroll to allow for greater flexibility during the year.

Financial & Tax Planning

What is financial planning?

Financial planning is our process to help you identify and quantify your objectives, so that we can organize and execute a system with your finances to accomplish those objectives.

How much should I invest?

Once we identify your goals, we start with understanding and analyzing amount of assets needed for your goals, review current progress, and determine the amount needed to invest towards them.

What type of account should I invest in to maximize tax efficiency (IRA, SEP-IRA, Solo 401k, etc.)?

We help business owners open the most efficient type of accounts to accomplish their goals and maximize the tax benefits associated with various types of accounts based on their financial picture.

Do you help with investing?

Yes! SimpliMD is an institutional investment firm that manages investment assets for other professional investment firms as well as individual investors and families.

How much risk should I take with my investments?

This is unique to each investor and their needs. We have an innovative process to identify your goals and quantify your risk profile, which enables us to construct the appropriate investment portfolio tailored to you.

How Do I Know If

SimpliMD is Right For Me?

We hope these FAQ’s help tell you more about our services and culture.

My employer worries that a PSA is not a safe harbor from Stark Laws. Is it safe?

Both your business entity and the associated PSA must be legally formed properly in order to be compliant with all state and federal regulations. This is why it is important to use an experienced agency like SimpliMD to do this. A white paper on PSA’s and their federal and their federal compliance can be found at both of the following links. A white paper on PSA’s and their role in physician contracts can be found at:
https://simplimd.com/wp-content/uploads/2018/07/PSAs-as-an-Alternative-to-Employment_March-2016.pdf
https://simplimd.com/wp-content/uploads/2020/10/PSA-Progression_Whats-Next-In-The-Evolution-of-Professional-Service-Agreements_2022-Update.pdf?ref-blog

Do I have to have income sources from more than my primary employer in a PSA?

Although additional income from sources other than your job is helpful, it is not required for a PSA.

Do I have to change my practice site or location if I join this agency?

No, this does not involve changing anything in your group or practice location. The primary change you make with SimpliMD is to form your own company who becomes the contracting company with your current employer. This is typically called Dr. “X” PC. Your own company then pays you to do the same job. Buried within this transformation are a host of programs and structures that favor you, rather than your employer.

What if I already have a set of professionals I trust to do this for me?

Great! If that happens to be the case then we can help you build the structure and leave the rest to you!

This seems complicated, why are you called “SimpliMD”?

While the full model of this practice model is robust and mildly complex, our agency is committed to creating an individualized program in which we do all the heavy lifting for you.

Why the name “SimpliMD”?

Dr Stillson has an Irish heritage and “Simpli” is an Irish word for balance and simplicity. Our company is committed to being a physician-owned agency that helps fellow physicians find the right balance in their personal and professional lives.

How will this help me?

You will be empowered to work for yourself while maintaining virtually every element of your current contract. With SimpliMD you will have more net income, have a robust tax strategy, have greater freedom to build your enterprise your way, all with the support of a team of professionals who help you create the architecture.

Will this cause problems with the IRS?

SimpliMD has assembled a team of professionals who make sure every element of our program is compliant with federal and state laws in your locale. We then provide on-going compliance meetings that monitor veracity of your program with the IRS. By providing this important structure in our program, we make sure that our clients only operate within the annually changing US Tax code.

What are you trying to sell?

We are aware that physicians are often targets of a many financial vendors, we are not trying to sell you anything. What we do want you to understand is that you are highly valuable to the healthcare system, and due to this, you would be wise to let an agency represent you so that you can maximize your value, your freedom, and your life balance.

If I like the simplicity of an employment contract, why should I consider this program?

The primary reason is that our “employment lite” program gives you all the features of being employed, but allows you to keep more the income that you have earned. This is not about working harder, it’s about working smarter.

What would be consider the biggest challenges of this program?

Timing: It takes about 12-18 months (one tax cycle) to see the full benefits
The up front costs are high: Costs to set up the program, coupled with the paying for your own malpractice insurance, health insurance, and benefit plans do require some planning.
It requires some discipline to document elements of business management. We will provide you with a tool chest for this process
Spouse employment in the business model/company may not work for everyone, but typically is a strong positive element of this model
Some employers/companies may not fully understand the safety and ease of transitioning one’s contract to a PSA/PC agreement. SimpliMD and their legal team will work with them to assist you in this process.
Benefit plans: For some the transition will include severing your benefit plans with your current employer. SimpliMD will assist you in setting all of this up for you through our highly skilled team of professionals who will give you personal care and attention

Testimonials

“As a medical professional myself in the field of nursing, I have certainly witnessed the emotional strain that many physicians feel. I accepted this as “the norm” for how physicians intrinsically feel about their career structure, but as I observed how those professional limitations affected my husband’s satisfaction, I knew it was time for a change.

The concept of change was intimidating. This was largely fueled by the uncertainty associated with taking a new path. With our family of five children and the natural chaos inherent to that dynamic, starting our own fully operational independent practice seemed like an impossibility. I was worried that we may not be able to keep up with the demands generated by the development of our new company. However, we have organized an amazing team of professionals to assist in managing the legal, accounting and other logistics of our company making the transition and maintenance truly simple. In fact, I have been able to transition from full time nursing to full time mom at home providing me invaluable time with my kids. We are now able to secure our retirement much sooner through the financial freedom we have gained by becoming a PC. The time my husband spends at the office is validated even more by the opportunity that SimpliMD provided by working on our behalf with his employer.

With SimpliMD there is a simple way to transform the lives of other physicians and their families. We have worked through the bumps and along with our team, we are excited to help navigate the road for others. Please contact us so that we can help guide you down a path to professional satisfaction and financial freedom.”

-V’ronica Binfet

“I knew that my husband worked hard everyday and dedicated himself to taking care of both our family and his patient population. In our small community, he was accessible, personable, and dedicated to quality care. This made his practice successful and also helped his employer be very successful. When we both began to feel his employer was not valuing his work ethic by placing caps on his productivity pay, it caused us to search for solutions.

In that process, we took the brave step of forming our own corporation and began the journey within the small business world. We were able to not change jobs, or employers, but simply transitioned to an alternative employment contract called a PSA. Regaining control of Tod’s professional life, and making sure he was paid at Fair Market Value brought a peace to both of us.

I became our book-keeper for the business, while I remained a stay at home mom. We joined arms in running a business together, and jointly made decisions that would affect our family, finances, and our lives. It was refreshing.

Although there were some moments of uncertainty as we started out, we were smart enough to surround ourselves with a team of legal, business, accounting, and investing professionals who worked as a team to support our transition. This was invaluable, and is the heart of what we want to share with others.

Spouses know of the demands of medicine, and understand as much as anyone the sacrifices needed to do it well. To that end, we know that our physician spouse often undervalues themself. This transition has revitalized our sense of togetherness in practicing medicine.

We want others to experience what we have learned, and want to make simple and accessible.”

-Ellen Stillson