Why Your Law Firm Isn’t Anywhere Near As Profitable As You Think

, The Am Law Daily


Conventional metrics significantly overstate law firm profitability.

This premium content is reserved for Texas Lawyer subscribers.

Continue reading by getting started with a subscription.

Already a subscriber? Log in now

What's being said

  • Bruce C. Lyon

    While not a measure of profitability per se, I favor gross revenue per full time equivalent attorney as least susceptible to differing interpretations.


    As an Attorney and CPA (now retired), I enjoyed your article and agree that changes should be made as you suggest. It would be hard to get firms to agree on exactly how it should be done since it is really no one‘s business except each firm‘s with respect to its own accounting. Guaranteed payments are those made by a partnership to a partner that are determined without regard to the partnership‘s income. A partnership treats guaranteed payments for services, or for the use of capital, as if they were made to a person who is not a partner. This treatment is for purposes of determining gross income and deductible business expenses only. For other tax purposes, guaranteed payments are treated as a partner‘s distributive share of ordinary income. Guaranteed payments are not subject to income tax withholding. The partnership generally deducts guaranteed payments on line 10 of Form 1065 as a business expense. They are also listed on Schedules K and K-1 of the partnership return. The individual partner reports guaranteed payments on Schedule E (Form 1040) as ordinary income, along with his or her distributive share of the partnership‘s other ordinary income.


    jermiebancoco is simply advertising s trading service, not commenting on the article His comment had no place here

  • jermiebancoco

    Enjoying life in the other side of the world! Since I started trading and quitting my day job I now am enjoying what I love the most, travelling! I can be at any part of the world and still make income. This is all made possible because of trading. Learn how to trade with the help of Superior Trading System. Google them and start your journey now.

Comments are not moderated. To report offensive comments, click here.

Preparing comment abuse report for Article #1202799861132

Thank you!

This article's comments will be reviewed.