Like most people, many attorneys fail to plan for their own retirement, disability, or death.  Developing an effective succession plan can be time consuming, but doing so will greatly benefit your family, clients, employees, and professional reputation.

There are two primary types of succession plans:

• Intrafirm succession, which requires finding a successor who may be an existing associate or partner, or an outside attorney brought into the firm to take over the practice; and
• Sale of practice to a third party.

Either type of plan should be in writing, tailored to the specific practice, and act as a progressive guide to managing transition issues.

The events that trigger succession of a law practice vary, which in turn affects the type of plan needed. For example, an attorney’s unexpected disability, disappearance, or death requires an emergency plan to be in place so that another attorney can come in immediately to manage the practice. By contrast, an attorney’s retirement plan should be developed years before retirement, and often includes the sale of the practice to an associate or another attorney, or simply a winding down of the practice by transitioning clients to other attorneys.

For a complete guide to the critical succession planning every attorney should do, go to CEB’s book Business Succession Planning: Strategies for California Estate Planners and Business Attorneys, chap 17.

© The Regents of the University of California, 2010. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.

The following is from guest blogger Helen Leah Conroy, an Internet and commercial transaction lawyer who since 2001 has built a successful small firm practice.

It turns out that law school doesn’t teach you everything you need to know about how to make a law practice successful. Here are ten important — but sometimes overlooked — things you should do:

1. Become your client’s trusted advisor. Look for opportunities to provide useful information and insights, especially on points or issues the client has not considered.
2. Be a pleasure to work with, always.
3. Be responsive. Even if you cannot address an issue or question raised by a client right away, respond to email or voicemail messages immediately, if only to let the client know that you received the message and will be back in touch by a particular time. Then, always follow through.
4. Thank your clients for the intangible qualities about them that you enjoy or appreciate. Do this often and sincerely, with specific examples of how they are terrific clients.
5. Give as much as you can without charging (but note on your bills, where appropriate, advice given at “no charge”).
6. Let your clients know how much you enjoy the work you do, and more importantly, how much you enjoy working with them.
7. Show examples from other deals, cases or projects (without names or identifying details) and the good results you obtained, or the clever ways that you solved problems, so your clients understand and appreciate that they are not just paying for your skill, but for your experience and judgment as well.
8. Remember that everyone, including the person “across the table,” is a potential client. Treat everyone you meet with the utmost courtesy and respect, even in adversarial settings.
9. Develop a network of trusted other attorneys with different (or with the same) expertise. Enthusiastically refer those colleagues to prospective clients, not because you expect or want referrals back, but because making that referral provides a valuable service to the client needing a good lawyer.
10. Figure out exactly what kind of work you want to do and for whom — and define very specifically the work you don’t want to do and the profile of clients who are not a good match. Turn away and refer to other lawyers any work that does not meet your criteria. Aim high, accept nothing less than the best, and enjoy tremendous success!

For more tips on setting up a successful solo practice, check out CEB’s complimentary program Suddenly Solo—Are you Ready?, available On Demand — and you’ll even get 1.25 MCLE credit in ethics! Also check out CEB blog post Should You Go Solo?

© The Regents of the University of California, 2011. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.

Being new to law practice can be scary. The first time you enter a courtroom, or even a deposition, can be very intimidating.

Practice is so much easier for new attorneys when they have the tools and support that they need. That’s where CEB comes in!

• The Basics Conference offers practical guidance on issues from setting up your law office to formulating your tactical strategies.
• The California Client Communications Manual: Sample Letters and Forms provides sample letters and essential forms, practice tips, and succinct discussion of issues to consider in evaluating and representing clients.
• The free and discounted resources, including access to OnLAW, CEB’s online library, make getting up to speed affordable.

We are proud to be a valuable resource for California attorneys on all levels of  experience — CEB is Your Partner in Practice!

© The Regents of the University of California, 2012. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.

The following is a guest blog post by Benjamin Scott. Ben is a solo estate planning attorney, a graduate of Concord Law School, a former high school physics teacher, and a father of three.

When starting a law practice there are no guarantees of success, and going solo is a huge risk. Keeping another job while starting a part-time practice can allow you to lay the foundation for a thriving law practice while maintaining the security of a steady paycheck and benefits.

That’s exactly what I did for the first year of my practice. Before becoming a lawyer, I taught high school science for 10 years. When I realized that most entry-level attorney jobs were paying less than my teaching job, I decided to open my own practice while I taught for another year.

Here are 5 of the biggest benefits of starting a part-time practice that I experienced:

1. You won’t be desperate. One of the biggest mistakes new lawyers make is accepting clients and cases that end up losing money and creating headaches. As new lawyers, we’re tempted to accept everything that comes in the door because we are desperate for paying clients. Having a steady income from another source means that you won’t feel a need to accept every potential client that walks in the door.
2. You have something to talk about at networking events. Whenever I started talking with other lawyers at networking events, I would talk about my other job. This made our conversations more memorable, and they always started asking me questions about how I managed to do both. In fact, at one event, a lawyer that I had never met came up to me and said, “You’re the guy who’s both a teacher and a lawyer. I’ve heard about you.”
3. You’ll have a great referral base. When people look for a lawyer, they usually look to someone they trust. Most of my clients during my first year were my coworkers and their friends. They already knew me and trusted me, and whenever their friends or family asked for a lawyer, I was their go-to lawyer. If you continue to work in your “day job,” you’ll keep getting referrals from your coworkers.
4. You’ll have a steady paycheck with benefits. Do I really need to say anything else about this benefit?
5. You’ll have time to put together a good plan for when you do quit your day job. I recognize that keeping two jobs is probably not a good long term plan. You’ll eventually want to decide if you’re a lawyer or something else. Working at another job can help you take the time to develop a solid plan. I was able to slowly develop a marketing plan and experiment on a small scale before making huge marketing investments. It takes time to design business cards, set up an office, get supplies, design a website, etc. If you work another job while starting your firm, you’ll have the freedom to build up your practice without the fear of losing everything.

Does it make sense for you to work as a lawyer and as something else? For those disillusioned by dismal job prospects and daunted by the risk of hanging out a shingle, a part-time practice might be the way to go. But it’s not for everyone. In my next post, I discuss the drawbacks of starting a part-time practice.

Think you’re ready to start a full- or part-time practice? CEB’s California Basic Practice Handbook will help you handle cases in a wide array of practice areas. And for a grounding in the fundamentals and practical details you need to get started in practice, come to CEB’s The Basics Conference, September 19 & 20, 2013 at the Hilton Santa Cruz/Scotts Valley.

For attorneys in their first five years of practice in CA, CEB offers a free year of OnLAW and other discounts!

Related CEB blog posts:

• Starting a Solo Practice – Step 1: Getting Office Space
• Nice to Meet You: Getting Your First Client Contact Right
• Attorney-Client E-Communications

© The Regents of the University of California, 2013. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.

The following is a guest blog post by Benjamin Scott. Ben is a solo estate planning attorney, a graduate of Concord Law School, a former high school physics teacher, and a father of three. 

There are advantages of working another job while starting a solo law practice, but after a year of trying this experiment, I see the mistakes of trying to work two jobs.

As I discussed in my previous post, there are some advantages of working another job while starting a solo law practice. For a year, I worked as a teacher by day and a new lawyer by night, holiday, weekend, etc. Although it was wonderful to have a steady paycheck and great benefits, I experienced some significant drawbacks to dividing my time and attention this way.

Here are my 5 reasons not to work another job while launching your solo practice:

1. You won’t have time to become competent. One of the biggest struggles of being a new lawyer is the realization that I actually knew very little about the practice of law. It takes time to learn everything you need to know, and having another job eats away at that time. I couldn’t regularly take days off of my other job to attend CLE conferences (such as those provided by CEB) and local bar association lunches. Because of my limited schedule, it was harder to meet with more experienced lawyers when I needed their help on a matter.
2. It will be harder to work with other lawyers. New lawyers need to rely on a solid network of experienced lawyers who can help them out or give them meaningful work to do. Many lawyers that I spoke to said that I should come watch them in a trial or deposition, but this never worked well with my teaching schedule. When your schedule is determined by your other job, it will be harder to make time to learn from and network with other lawyers.
3. You will severely limit your practice areas. The biggest disadvantage to keeping another job is that you’ll limit your practice areas. Because the hours of my other job were the same as the court’s hours, I couldn’t seriously pursue a practice that involved actually going to court. This ruled out family law, criminal law, personal injury law, products liability, bankruptcy, immigration law, or any other type of litigation. For anyone interested in a practice area that involves going to court, a part-time practice is probably not for you.
4. You won’t have much time to spend with your family. I suppose that this problem isn’t unique to lawyers working two job, as many lawyers work long hours and have little time for their families. But I found that this problem is exacerbated when working both jobs. I taught an early class at school, showing up 6:30 a.m., then usually wouldn’t get to my law office until 3:30, working there until late at night. With so many things competing for my time, I realized I would never be happy if I sacrificed time with my family just to work two jobs.
5. People may not take you seriously if you’re only a part-time lawyer. As lawyers, we need to be able to tell our clients that we have the time and ability to represent them well. If our clients see our work as a lawyer as a side-job, it will be more difficult for them to believe that you can really dedicate all your time to their case. You also have an ethical obligation to represent your clients diligently. When potential clients come with a time consuming case, you won’t be able to ethically accept it if you can’t devote enough time.

After working two jobs for a year, I’d had enough with the drawbacks and decided to choose one of them. I am now working full time in my law practice and still learning what it takes to be a lawyer.

Client communications are vitally important and often suffer when you try to practice part time. CEB’s California Client Communications Manual: Sample Letters and Forms makes these communications so much easier with over 65 sample forms to help you effectively communicate with your client from initial contact to the conclusion of the case. And if you’re taking the plunge, don’t miss CEB’s popular program Launching a Successful Law Practice, available On Demand.

For attorneys in their first five years of practice in CA, CEB offers a free year of OnLAW and other discounts!

Related CEB blog posts:

• Should You Go Solo?
• New to Practice?
• Advertising Yourself Ethically

© The Regents of the University of California, 2013. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.

Thought law practice was all about the law? Think again. Your practice is like any other business—you need to offer excellent customer service to be a success. Here are some tips to help you master the art of customer service.

In this short video clip, attorney Galia Aharoni of HG Business Law, LLP explains the why and how of attorney customer service, including having a client communication policy and telling your client what’s going on—even if it’s nothing.

This video clip is from The Basics: The Business Start-Up End of a Private Practice, one of several On Demand programs from The Basics: Personal Injury, a CEB conference that provides grounding in the fundamentals and the practical details every new and retooling practitioner needs.

To help you establish and maintain effective communications with your client—from initial contact and retention to the conclusion of a case—CEB offers the California Client Communications Manual: Sample Letters and Forms, which includes over 65 sample letters and essential forms.

Related CEB blog posts:

• Attorney-Client E-Communications
• Communication Is Key: 4 Steps to Better Client Communication
• Don’t Get Paralyzed by the Fear of Mistakes

© The Regents of the University of California, 2014. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.

When starting your own law practice in California, one of your first decisions is what business form to use—should your practice be a sole proprietorship, a partnership, or a corporation? Don’t underestimate the importance of this choice!

The form of business you choose for your law practice can make a big difference. Each form provides varying levels of personal asset protection, tax advantages and disadvantages, and complexity or simplicity of business operation.

Here are some of your choices, along with their pros and cons:

• Sole proprietorship. Going solo, by using the sole proprietorship form of enterprise for your practice, offers the most freedom to an attorney but has potential drawbacks. As a sole proprietor, you’ll bear all risks of loss, thereby subjecting both business and personal assets to potential liability—which can be mitigated largely by appropriate insurance. Also, if you don’t employ support staff, you’ll have to devote time to the administrative tasks associated with operating your practice (e.g., bookkeeping, photocopying, and mailing documents).
• Limited liability partnership (LLP). If you choose to enter into a partnership, you should consider forming a limited liability partnership (LLP). The main advantage of operating as an LLP is that partners don’t have joint and several liability for all partnership obligations; rather, the partners in an LLP are protected from vicarious liability (as long as they have a currently effective certificate of registration from the State Bar of California and maintain minimum security for the benefit of injured parties). See Corp C §16306(c). The State Bar website has information about how to receive a certificate of registration and the applicable rules. Make sure not to confuse an LLP with a Limited Liability Company (LLC); generally, an LLC can’t render professional services, as defined in Corp C §§13401(a), 13401.3, 17375.
• Professional corporation. If you decide not to practice as a sole proprietor or in a partnership form, perhaps you’ll want to conduct your practice as a professional corporation. See generally CC §§13400-13410. The primary advantage of a professional corporation is the amount of money that can be put into qualified retirement plans from pre-tax dollars from the net profits of the practice and from the excess left over after meeting operating expenses. Also, you’ll be able to adopt medical plans that allow increased deductions and contribution limits. You’ll need to consult with a tax advisor on threshold income or distribution levels for these benefits to be realized. If you’re just starting out and won’t yet reach these thresholds, incorporating probably isn’t a good choice because of the start-up expenses, the added taxes and accounting fees that accompany incorporation, and the administrative requirements that go with practicing as an employee-shareholder.

Still feeling undecided? CEB has you covered by devoting an entire chapter in its California Basic Practice Handbook to opening your law practice (including discussion of business registration and tax matters). And get help on drafting a partnership agreement in CEB’s Selecting and Forming Business Entities.

For everything you need to know about setting up your law practice, including practical advice on which business form to use, turn to CEB’s On Demand program Launching a Successful Law Practice with  Carolyn Elefant.

Related CEB blog posts:

• Should You Generalize or Specialize?
• You’re a Lawyer, Not a _______! 5 reasons Not to Work Another Job While Starting Your Law Practice
• Should You Go Solo?

© The Regents of the University of California, 2014. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.

The following is a guest blog post by Anabella Q. Bonfa. Ms. Bonfa is a litigator with Wellman & Warren LLP and has built a reputation for handling business and partnership disputes, theft of trade secrets, and unfair competition. She lectures extensively on trade secrets, networking, and using social media to develop business.

The legal job market is fiercely competitive. Learning to network can mean the difference between success and failure. Developing your networking skills can help you advance your career and grow a steady book of business that will give you constant job security. Here are 7 tips to help you become a networking star.

1. Meet attorneys in different specialties. Get to know attorneys in every legal specialty. Aside from being potential employers themselves, attorneys will know other attorneys to whom they can introduce you (if they like you). Attorneys are a great source of referral business for other attorneys. Look for lawyers who you think your clients will like. When your clients need a specialized attorney in a different area of practice than yours, you want to make sure they will be comfortable with your referral.
2. Meet professionals in diverse fields. Potential clients come from all walks of life. The people you meet may become potential clients, a lead to a potential client, or someone with whom you will work in the future, e.g., as an expert witness or consultant. Knowing different types of professionals will help you introduce your business connections to other people who will be helpful to their respective businesses. A good stress-free way to meet people is to offer your time to a community service organization, public law center, or charity.
3. Do something nice for people you like. Are you afraid to network because you don’t want to “sell” yourself and you can’t stand the idea of being rejected? Forget about “selling” yourself. You’ll get business from others when you’re focused on what you can do for them, not what they can do for you. Consider making an introduction, sending information of value, or helping market your new contact.
4. Do what you say you’re going to do. If you promise to send an article to your contact or to make an introduction, do it at the same time you send a thank-you note. Nothing is more impressive to a new contact than consistent follow-up. It establishes immediate credibility with your new contact.
5. Regularly follow up with your new contacts. Now that you’ve met some really great people, don’t leave them for dead. You’ll have an idea whom you really enjoyed meeting. If you liked them, chances are they liked you too. Make it a point to follow up quarterly. Call, schedule an in-person meeting, and find out what’s happening in their lives, whether they have the same goals, what projects they’re currently working on, and continue to develop your personal relationship. It takes time and effort to establish relationships.
6. Write an article for a legal blog or website. A well-written article will get your name out there in a positive light. And the more you write online, the better chance your name will be located on Google. You can write about a new legal development or give a practice tip. If you’re a new attorney and feel too inexperienced to share practice advice, consider the expertise you do have, e.g., in conducting a legal job search, starting a law practice, or using a new technology. Don’t forget to tap your expertise in a completely separate field (e.g., sales, management) which would complement your work as an attorney. You can either maintain your own blog site or offer to author a guest blog for a well-received legal blog. Legal blogs are always looking for relevant, well-written content to post.
7. Be yourself and be sincere. People hire other people who they like and trust. Be willing to share some personal information, and you’ll find more often than not people you meet will reciprocate. And be honest; people know when you’re trying to be something you’re not or when you’re trying to exaggerate your background or accomplishments.

Establishing relationships with other people is not an overnight process, but if you stick with networking, you’ll be successful and the professional rewards will be great.

For more on acquiring clients through marketing and other methods, check out CEB’s California Basic Practice Handbook, chapter 1—a great book for anyone starting out in law practice.

Other CEB blog posts you may find useful:

• Could Your LinkedIn Profile Lead to an Ethics Violation?
• Don’t Quit Your Day Job: 5 Reasons to Keep Another Job While Starting Your Law Practice
• Blog, But Blog Ethically

© The Regents of the University of California, 2014. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.

You’ve decided to open your own law office and are ready for your clients’ cases, but are you also ready to handle the tax issues that go hand-in-hand with running your own business?

Here’s an overview of some tax issues to keep in mind when starting your law practice:

• Withhold from employee pay. If you hire an employee for your practice, you’ll have to follow all the special provisions of the tax laws on employees. As an employer, you’ll be required to make deposits of withheld income tax, Social Security contributions, and backup withholding on reportable payments. The Employment Development Department administers the state’s personal income tax withholding functions.
• Don’t withhold from independent contractor pay. Unlike for employees, you don’t withhold California income tax, unemployment insurance contributions, or disability contributions for independent contractors. See Un Ins C §§926, 1275, 2652, 13005. In fact, the withholding of such amounts generally indicates that a service provider is actually an employee, not an independent contractor.
• Make federal and state unemployment tax deposits. The Federal Unemployment Tax Act (FUTA) (IRC §§3301–3311) imposes a tax of 6.0 percent of payroll on all employers, including attorneys. IRC §3301. But if the Secretary of Labor certifies that the law of a state meets certain criteria (IRC §§3301, 3304), then employers in that state are entitled to a credit of 5.4 percent against the tax, leaving a liability of only 0.6 percent of payroll. Not surprisingly, to escape this tax on employers, all states have passed laws conforming to the federal requirements for certification.
• Note extra requirements for corporations and limited partnerships. In deciding the form of business enterprise by which to conduct a law practice, keep in mind that corporations and limited partnerships must pay fees on formation. An annual minimum tax is also imposed on these entities (no minimum tax in the first taxable year for corporations formed after January 1, 2001). Rev & T C §§17935(a), 17941(a), 23151, 23153(d)(1). For corporations, the minimum tax is a credit against income taxes, whereas limited partnerships must pay the minimum tax for the privilege of doing business in California.
• Make any required estimated tax payments. In addition to filing an annual income tax return, corporations, partnerships, and individuals operating a business as a sole proprietorship may need to make quarterly estimated tax payments. These payments are due April 15, June 15, September 15, and, with respect to the last quarter of the year, January 15 of the following taxable year. IRC §6654(c).
• Pay your payroll tax. All employers, including attorneys, must comply with federal, state, and local payroll tax and withholding tax laws. Failure to pay tax withholding to the state or federal government will result in imposition of a penalty equal to the amount of the taxes not paid. On the federal penalty, see IRC §6672. The IRS aggressively asserts the 100-percent penalty against corporate officers responsible for the payment, and the entire 100-percent penalty may be assessed against each such person. See IRC §6672. Criminal sanctions may also be imposed. IRC §7215.

Opening a law practice is like opening any other business. Always consult with a certified public accountant (CPA) or other tax adviser before you decide on the form of enterprise (i.e., corporation, partnership, or sole proprietorship), set up an accounting method, or hire employees.

For more on these tax matters and everything else you need to know about opening a law practice, turn to CEB’s California Basic Practice Handbook, chapter 1, a must-have for anyone new to practice or going solo. And although you may not think of yourself as an employer, once you start a practice and hire someone to work for you (e.g., legal assistant, administrative assistant), you’ve stepped into that role and need to be up on employment-related issues with CEB’s Advising California Employers and Employees.

If you’re new to practice or going solo, check out CEB’s Basics Conference coming up in September with a session on how to get your law practice up and running.

Other CEB blog posts you may find useful:

• Employee Versus Independent Contractor: Get It Right, or Pay the Consequences
• Before You Get a Website, Get a Development Agreement
• Contracting for Contract Attorney Work: Reap Benefits and Avoid Pitfalls
• Should You Go Solo?

© The Regents of the University of California, 2014. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.

The following is a guest blog post by Jeremy M. Evans, Managing Attorney at California Sports Lawyer, representing sports and entertainment professionals in contract drafting, negotiations, licensing, and career growth.

“Those who never try or quit too early end up working for those who tried and never quit.” True in any business and life in general, even more so in the solo practice of law—going solo requires you to step out and charge ahead.  

Starting a law practice is hard, and you will feel stretched in every direction. Time management is difficult. Your clients want everything from you. You also never want to neglect your friends and family. And everyone, including your clients and the State Bar, expects the best from you.

It can be overwhelming, but take it step-by-step:

1. Do your Research. Before you start your practice, read materials, books, blogs, and meet with established and newer attorneys for informational interviews to gain insight into going solo. Choose your preferred practice area and try to specialize. This wisdom gathering exercise will save you a lot of time and money.
2. Handle the transactional items. Take care of the foundational transactional tasks first, including tax requirements, entity formation (DBA, LLP, etc.), and malpractice insurance.
3. Sales and marketing. You will need to build your brand, e.g., by creating business cards, a law practice website, and social media accounts. Make sure to be consistent and ethical in all of your marketing activities.
4. Join legal and non-legal organizations. Being involved and being present is everything in life and business. People need to be reminded of who you are, what you do, and how well you provide those services. Serving in the community is the best way to create and maintain genuine relationships.
5. Continue to learn. Going solo can be lonely, so take the opportunities to get out among other people and learn at the same time. Continuing education is required by the State Bar, but it also helps grow your knowledge, business, and ability to connect and stay relevant with your colleagues and your clients.

In coming upon four years in practice, my life and law practice have gotten better and more exciting. This is not to say that working for someone else, a company or lawyer(s), for example, is all bad. Of course not. However, in going solo you have the freedom to choose much more in your life and practice.

When you are solely responsible, you have the opportunity to rise to the occasion and work more efficiently. As a solo, you are the last line of defense. No one else is going to take care of it. The human response to being challenged can showcase our best strengths as well as our greatest weaknesses, which can and should be addressed and understood so that we can constantly improve.

If you have been debating on whether to take the leap to go solo, let this serve as an encouragement to do so. Start with CEB’s series on How to Hang Your Shingle, available On Demand.

Other CEBblog™ posts you may find useful:

• Ten Things Every New Lawyer Should Know (Part 1)
• Do You Have What It Takes to Go Solo?
• 7 Tips to Becoming a Great Legal Networker

© The Regents of the University of California, 2016. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.

The following is a guest blog post by Laura Boysen-Aragon, a former practicing attorney and now a legal recruiter at Solutus Legal Search, LLC. This blog entry is the first of a two-part series. Please submit your questions as a comment below or by email to blogQ&A@ceb.ucla.edu and Ms. Boysen-Aragon will respond in her next installment.

Whether you’ve been practicing law for 2 or 20 years, you may reach a point when you want to make a major change in your practice area. Maybe you’ve realized the type of client or the type of work isn’t the right fit, or perhaps the market has changed and you want to try something new. Whatever the reason, if you’re unhappy in your current practice, you can make a change.

Here are answers to common questions attorneys have when embarking on a practice transition:

How can I figure out what it’s really like to practice in this new area of law?  You could read an article or crack a practice guide—and you should—but you really need to know what it takes to be successful in a new practice: Are clients looking for fixed fee arrangements? How much will it cost to work up a case or a project? To get this type of information, you need to talk to people. Start with your network of former colleagues and classmates, and then branch out. Do you know anyone who already practices the type of law you want to pursue? Check LinkedIn, maybe a connection or a friend’s connection does what you want to do. Ask to have a phone conversation, coffee, or lunch to talk. Maybe the new practice area has an organized group of practitioners and you can attend one of their meetings or CLE events to learn more and meet the community. Do your homework before one-on-one meetings and events—have detailed questions prepared so that no one’s time is wasted.

How do I find a job if I don’t have the relevant experience? This takes time, perseverance, a positive attitude, and humility. First, you need a compelling story. Why are you making the switch? What skill set or experiences will you leverage to be successful in this new area? Remember those people you spoke with to answer question one? Get back in touch with them. Are there temporary positions you can take to get training in this new area, or can you take on cases or projects in your current role that will help you gain experience? The ideal scenario would be finding a mentor to train you, but that could be very difficult, so you’ll likely have to apply for several jobs or go out on your own to make this transition work. Being flexible on compensation and title as you transition to something new will make you a more compelling candidate.

How can I set myself up for success in this new career? Learn the law: Attend CLEs, put in the time to learn the practice, and work toward becoming an expert. Continue to build a network of practitioners you can rely on to ask questions. Seek out advice and feedback, and be open to the responses you receive. Give yourself at least six months to a year to start to feel comfortable in your new role. Celebrate small victories along the way and learn from your challenges.

Want to ask Ms. Boysen-Aragon your own practice transition questions? Leave them as a comment below or in an email to blogQ&A@ceb.ucla.edu.

And don’t miss CEB’s The Basics Conference, Sep 15 & 16 in Newport Beach—it’s a terrific opportunity to learn the fundamentals of a new practice area and to network. There are four tracks to choose from: Business Litigation, Employment Law, Family Law, and Trust & Estate Administration and Litigation. And CEB’s California Basic Practice Handbook is a great resource for new practitioners in a wide variety of practice areas.

Other CEBblog™ posts you may find useful:

• Need Change? Take Inventory of Your Legal Career
• 7 Tips for a Successful Networking Lunch
• Starting Your Law Practice: Taking the First Steps

© The Regents of the University of California, 2016. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.

The following is a guest blog post by Laura Boysen-Aragon, a former practicing attorney and now a legal recruiter at Solutus Legal Search, LLC. This blog entry is the second of a two-part series, in response to questions submitted by our readers after our first installment.

So you’ve decided it’s time to make a change in your practice area, but change can be hard and you still have a lot of work to do. You’re not alone! Here are responses to questions we got from your colleagues in the same boat.

I’m a litigator, but I want to transition to commercial/transactional work. Is this possible? Yes! Here are a few things for you to consider:

• The earlier in your career that you decide to make this change the better. If you’re working for a large firm, they may be more receptive to a transition if you’re junior; if you’re more senior they may still allow the transition, but you may need to take a cut in seniority. If you work for a smaller firm with more flexible billing rates, it may be easier to make this transition regardless of seniority.
• Find a mentor to supervise your work, provide feedback, and give you opportunities for transactional experience.
• If you’re looking for a role with a new firm or company as a transactional attorney be able to explain clearly why you want to make the transition and why you believe you’ll be successful in the practice. For example, explain that as a litigator you’re already trained to think strategically, advocate for your position, and identify key issues and liability risks. Also leverage your experience in counseling and advocacy. Emphasize that litigation requires you to quickly get up to speed on new concepts, making you ready for this new challenge.

I am a solo practitioner. I’ve noticed demand for e-Discovery attorneys. How can I get this experience and what sort of job options will I have in this practice area? As the rest of the world advances technologically, so does the legal profession. You’re right, e-Discovery opportunities are much more widely available than even a few years ago. The first step is educating yourself on e-Discovery practices and becoming familiar with common software. Assuming that you’re a litigator, you have a few different options:

• Look for firms dedicated to e-Discovery work where you can get the necessary experience. You may have to start at a lower level or billing rate, but you’ll get training and new marketable skills.
• Apply to project-/contract-based firms that staff attorneys for several months to a year on a temporary basis. They may bring you in at a junior level, but it’s an opportunity to cut your teeth and learn the issues.
• Incorporate e-Discovery work into your current practice and begin to offer e-Discovery services as a solo practitioner.

I’m an employment attorney for a government agency. I will qualify for retirement soon, but my pension won’t be enough to cover my expenses. What are my options? Employment law remains a hot practice area, and what I’m seeing in the market suggests that there aren’t enough good employment attorneys to go around. But, if you like your current role or at least are content enough, why not stay for the extra few years to earn the money you need to retire comfortably? A job search takes time and effort; at the very least, you could take the extra time to look for something that’s very appealing to you.

If staying isn’t an option, you could become a solo practitioner and offer employment counseling or consulting services. Given your experience in government, you would have a hook with public entities and could seek them out as clients. But a solo practice requires a lot of hustle to build business as well as do the actual work. If that’s not appealing to you, look for opportunities with an established law firm or in-house opportunities in employment law or human resources.

If you’re ready to make a switch don’t miss CEB’s The Basics Conference, Sep 15 & 16 in Newport Beach—it’s a terrific opportunity to learn the fundamentals of a new practice area and to network. There are four tracks to choose from: Business Litigation, Employment Law, Family Law, and Trust & Estate Administration and Litigation. And CEB’s California Basic Practice Handbook is a great resource for new practitioners in a wide variety of practice areas.

Other CEBblog™ posts you may find helpful:

• Find a Mentor!
• The Bare Basics of Networking Events
• Should You Go Solo?

© The Regents of the University of California, 2016. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.

Under new IRC §199A, business entity owners may be able to deduct 20 percent of passthrough income. This tax boon, which is set to sunset after December 31, 2025, has many lawyers wondering whether they might personally benefit.

Almost any business can benefit from this new passthrough law: sole proprietorships, partnerships, limited liability companies (LLCs), and S corporations. These passthrough entities include a law practice organized as a limited liability partnership (LLP) or professional corporation (PC).

The deduction for passthrough income is subject to three limitations:

• Deductible income doesn’t include “reasonable compensation” for the business owner.
• Deductible income doesn’t include income from personal services, including legal services.
• The deduction is limited to 50 percent of wages paid to employees of the business.

But the second and third limitations are phased in over $100,000 of annual income above $315,000 for married taxpayers, and $50,000 of annual income above $157,500 for single taxpayers. So a married partner or shareholder with annual income of less than $315,000 may deduct passthrough income from the law practice without regard to these limitations.

Here’s an example of how it would work: Jody is the sole shareholder of a law practice with two associates, a paralegal, and an administrative assistant. Jody earns $200,000 per year from the practice. Her spouse earns $100,000 from an unrelated occupation. Because their combined income is less than $315,000 per year, the limitations don’t apply. As a result, it doesn’t matter how much she pays her employees. But if Jody and her spouse made more than $415,000 per year, they would be out of luck.

Assuming Jody’s reasonable compensation for her own services as an attorney is about $125,000 per year, she can deduct 20 percent of the remaining $75,000 of law practice income, or $15,000. This should save her about $5000 in state and federal income taxes.

For more on professional corporations, check out CEB’s Organizing Corporations in California, chap 6. On limited liability partnerships, see CEB’s Advising California Partnerships, chaps 9–10. Also check out CEB’s Selecting and Forming Business Entities, chaps 7–8 and 10.

Check out this other CEBblog post on the recent tax law changes: The Times They Are A-Changing (for Estate Planners). An overview of the new tax law changes is in the January issue of CEB’s California Business Law Reporter: Barrett, A Summary of HR 1 (aka the Tax Cuts and Jobs Act). And check out summaries, resources, and a free webinar and videos on the 2018 Tax Cuts and Jobs Act on ceb.com.

© The Regents of the University of California, 2018. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.