Good business owners work hard to grow their companies---but when tax season rolls around, many find themselves in panic mode. The truth is, most businesses are overpaying in taxes without even realizing it. What if you could legally save tens of thousands of dollars with the right tax strategy?
On this episode of Become Sensible, we’re diving deep into the essential tax strategies every business owner needs to know. I break down the most common mistakes that lead to overpaying taxes and share a step-by-step playbook to ensure you're maximizing deductions, choosing the right business structure, and paying yourself in the smartest way possible. Plus, I reveal the key retirement and savings accounts that could significantly reduce your tax burden.
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Timestamps:
- 3:33 - Why understanding your tax return is crucial
- 5:00 - Step 1: Tax assessment---how to get a clear snapshot of your finances
- 9:39 - Step 2: Choosing the right business structure to minimize taxes
- 13:18 - S Corporation benefits and when to use it
- 14:51 - Why rental properties should not be in an S Corp
- 15:42 - When a C Corporation makes sense for your business
- 17:24 - The impact of business structure on raising funding and selling a business
- 19:57 - Step 3: Maximizing deductions and the importance of bookkeeping
- 21:51 - Home office deductions, travel write-offs, and depreciation strategies
- 23:30 - Step 4: Paying yourself strategically to avoid over-taxation
- 25:48 - The dangers of W-2 salary miscalculations in an S Corp
- 27:18 - C Corporation taxation and dividend strategies
- 29:09 - Step 5: Leveraging retirement accounts and HSAs for tax benefits
- 31:15 - How retirement contributions can save 20-25% on your tax bill
- 32:57 - Why an HSA is a "triple tax benefit" and how to use it
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