There’s A “Bright Side” To This Pandemic – Seriously!


Downtown Phoenix by sunset

In case you’re living under a rock, the whole world, including our country, has been taken over by COVID-19, better known as coronavirus. This virus came crashing down, in what felt like the blink of an eye, and it has altered how we live, how we think, and how we interact with our loved ones. The way we grocery shop has changed. The way we greet neighbors has changed. The way we celebrate holidays, the way we run our businesses, and the way we practice law have all changed.

It has been drastic for some, but the impact is being felt by all. Some are living in constant panic, while others believe it to be an overreaction. Some of our lives have been turned upside down by this new way of living, while others are angered that they are living in restriction. No matter how you feel, or what you believe to be right, one thing is certain: we can all choose to look on the bright side of this pandemic.

We are being forced to slow down. What’s the bright side? You finally have time to breathe. Life is full of chaos and stress, even without a pandemic. Many of us live our whole lives in a stressed state of mind, which leads to physical illness and overall lack of enjoyment of life. Pre-pandemic, if you wanted to slow down, you might have been criticized for being lazy. Now is an opportunity, without any judgment, to be slow, be present, be grateful, and breathe.

We are being forced to change the way we work. What’s the bright side? We are making significant modern-day changes to an old-time profession. Most attorneys do not work from home. Most attorneys do not videoconference their clients. Most attorneys are not cloud based. In a world where traveling the county and printing more paper than you can carry is on most of our job descriptions, these over-due changes may be the start of something new, and efficient, for our profession even after the pandemic has passed.

We are being forced to spend time with ourselves. What’s the bright side? You finally have the time to think about what actually makes you happy, what doesn’t make you happy, and to adjust your life accordingly. Before the pandemic, we took many things for granted. We made commitments we did not want to make, we spent time with people we did not want to spend time with, and many of us (especially if you are an attorney) put ourselves at the bottom of our priority list. Now is the time to make the change. Make self-care a priority. Make yourself a priority.

We are spending more time with our families. We are going outside for exercise instead of the gym. We are putting less pollution in the air. We are focusing more on our health. We are learning new things. We are reading more books. Some of us are undoubtedly living better lives.

This does not mean we are living at the expense of others. Those that have lost their lives due to this virus, and any virus or disease for that matter, are loved, respected, and remembered always. And what better way to honor those that have lost their lives than to appreciate and implement the knowledge, growth, and positive changes that came along with the loss?

This is still a pandemic. There is still great concern of what is happening in our world. And there is still the choice to be positive. There is always a bright side. And you can choose to ignore it if you want. But imagine how you can transform yourself, your happiness, and your way of life during these unprecedented times.

Hanna Amar


Hanna Amar is a partner at the Law Firm of Gary J. Frank P.C.  Both Gary Frank and Hanna Amar are strong litigators and compassionate counselors. Gary Frank is a Family Law Attorney with over 30 years of experience as a litigator and mediator. He has also acted in the capacity of a Judge Pro Tempore in the Maricopa County Superior Court, and served on the Governor’s Child Abuse Prevention Task Force. Hanna Amar is a highly-skilled attorney with a passion for Family Law and children’s issues. She has extensive courtroom experience, and is also a certified mediator. Hanna is the President of the Young Lawyer’s Division of the Maricopa County Bar Association.  Our firm handles Family Law cases in the areas of divorce, custody (now called “Legal Decision-Making and Parenting Time), relocation (move-away), division of property, spousal and child support, modification actions, enforcement actions, grandparent and non-parent rights, and all other matters pertaining to families and children. If you are in need of a consultation, call us today at 602-383-3610; or you can contact us by email through our website at   We look forward to hearing from you.

Business Owner Comp: More Than Just A Wage


By Guest Columnist:

Laura S. Leopardi, CPA/ABV/CFF/CGMA, MBA


Family law cases involving community businesses inevitably require an analysis of business owner compensation. Privately-held (also referred to as closely-held) business owners tend to compensate themselves in a variety of ways— not just a W-2 wage. Additional sources of compensation may include potential wages paid to a spouse/party not actually working in the business, dividends or distributions, shareholder loans, corporate perquisites, deferred compensation (401k plan contributions), or payment from affiliate entities (such as holding companies).

Wages— are they reasonable?

The issue with W-2 wages paid to community business owners is whether or not they are reasonable. The Internal Revenue Service uses a two-prong test for payroll deductions— the pay must be 1.) reasonable and 2.) it must be for services performed.  I.R.S. Publication 535 (2013), Business Expenses, states “To be deductible, your employees’ pay must be an ordinary and necessary business expense and you must pay or incur it.”  Reasonableness tests consider efforts contributed, the level of wages paid commensurate with duties performed, and industry standards. In addition, wages paid to spouses of business owners not actually working in the business but intended to earn social security and Medicare credit are disallowed by law and can be treated as compensation of the working spouse.


Distributable— not just distributed, income should be assessed. When valuing a business, dividend paying capacity is assessed. Dividends or distributions authorized can be traced to corporate resolutions approved by the Board of Directors. Undistributed earnings should be analyzed to assess whether such monies are truly necessary working capital needed to fund business operations or potential owners’ compensation— especially in businesses solely owned by the community.

Shareholder Loans

Some business owners tend to borrow money from their company. A key consideration here is the intent to repay. The Internal Revenue Service looks for a fully executed formal promissory note with the principal amount borrowed and terms of repayment, including a stated rate of interest, payment schedule, and maturity date. Applicable Federal Rates are published monthly by the Internal Revenue Service for debt instruments used in property transactions between related parties— including shareholders []. Often, there is no note, no interest rate, no historical payments, and…no intent to repay. Look for increases in shareholder loans reported on the balance sheet from year to year. The annual increases may very well be treated as business owner compensation. Shareholder loans typically represent community obligations— monies payable to the business. However, the disposition of such monies is often investigated in a forensic accounting or business valuation.


Travel, meals, entertainment, health insurance, vehicle loan or lease payments, and club membership dues are all examples of expenses that can be material and construed to reduce personal living expenses. Consequently, discretionary expenses paid by an employer can be attributable to the employed spouse’s compensation. 

Deferred Compensation

Business owners can establish deferred compensation plans whereby part of their compensation is deferred until retirement age. Nonqualified deferred compensation plans are an employer’s unsecured contractual commitment to pay employee compensation in future tax years to a select management group or highly compensated employees. Certain plans have both a salary deferral and profit-sharing portion to deferred compensation. According to plan documents and as allowable by law, employers may match part of employee contributions. Some plans allow loans against deferred assets— another source of income. Other forms of nonqualified deferred compensation include incentive stock options, restricted stock, stock appreciation rights, and phantom stock.

Payments from Affiliate Entities

A typical scenario in Arizona is a community business that is an operating company paying rent (which may or may not reflect market value) to an affiliated holding company— another community business. Such rents reduce the operating company’s taxable income and value. A property management fee can be taken, which minimizes the holding company’s taxable income and value. Payments from affiliate entities for services rendered may be treated as compensation.

Child Support Guidelines

Arizona Child Support Guidelines are an excellent resource when analyzing gross income from self-employment. Determination of the Gross Income of the Parents delineates components of income from self-employment including income from rents, royalties, proprietorship of a business or joint ownership of a partnership or closely held corporation. Regarding perquisites, expense reimbursements or benefits received by a parent in the course of employment or self-employment or operation of a business shall be counted as income if they are significant and reduce personal living expenses. Permissible deductions from gross income include ordinary and necessary expenses required to produce income, which include one-half of self-employment taxes actually paid.  Concepts of unemployment or underemployment are addressed and are also pertinent considerations as is a productivity adjustment to business owners in relation to their industry counterparts.


Laura S. Leopardi, CPA/ABV/CFF/CGMA, MBA is Managing Member of Laura S. Leopardi, CPA, pllc and is a credentialed and experience business valuator and testifying expert witness in family law cases including business valuation, income from self-employment, lifestyle analysis, and commingling issues. Laura can be reached at 602.595.3962 or [email protected]

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