Wife joining physician group as partner — W-2 vs K-1 at our income level. What should she choose?
My wife is transitioning from a salaried associate to a partner at an orthopedic group in Washington State. The group is giving her the option to stay on W-2 or switch to K-1.
Our situation:
- Her income: ~$400K as a physician partner
- My income: ~$350K, W-2 only
- Combined: ~$750K
- Washington State (no state income tax)
- Heavy retirement investors — maximizing tax-deferred space is a priority for us
Questions:
- At our income level, is W-2 or K-1 clearly more favorable, or is it genuinely close?
- Given our focus on retirement investing, does K-1 become more attractive purely for the higher contribution limits?
- Any physician-focused CPAs you'd recommend who specialize in partnership tax structures?
Thanks in advance!