I am not a financial advisor. Building a tax business with a day job in equity compensation. Focused on optimization, health, taxes, personal finance & growth.
The reason I got into taxes was to help people play the tax game by implementing tax strategies
A full tax season taught me that almost no small business owner even has a good set of books
I don’t really see how I can give tax strategy without first getting books right
Sometimes I feel bad about not being a CPA, but then I see something like a CPA having $30k of "bad debt" expense on a cash basis tax return (1120s)
That's got to just be waving a flag asking for an audit
I feel pretty confident I'm bringing the average up
@girdley
Born in 98.
1) When people want to have a call that could have been settled with a message
2) Autonomy. I don’t want to be hovered over or have more contact than needed
@ tax twitter:
What would you charge for the absolute easiest return of all time:
Single filer
W2
Refund due
E-file/DD
I told this family friend they could TurboTax themselves bc it was so easy but they wanted my price
They said it was too high $ for how easy the return is
Note to any college students getting a business admin degree:
Do yourself a favor and change to accounting
Was looking at my transcript to see if I had credit requirements for CPA and was disgusted at the amount of useless general business classes I took and learned nothing
Everyone thinks their CPA sucks if they aren’t proactively reaching out with tax advice:
I’m putting a massive effort in May to push tax advisory services for all existing clients
They won’t be able to leave and say I didn’t give them an opportunity to plan
Big differentiator
I made it through tax season. Hardest I’ve ever worked
In the end, I prepared about 45 returns - mix of biz and personal. Spent tons of time learning as I went
Next steps:
Finish EA
Process improvement for next year
Sell recurring services
Happy to have time to tweet again
Good things come to those that do something.
Was too nervous to tweet for years, and now after about 25 days of making an effort on X:
- Added 200 followers
- Made 2 really solid business connections
- Consistently engaged with interesting people and topics
Thank you all
@sweatystartup
The average employee also doesn’t have something inside them that makes them feel useless if they don’t have their own business
For some people it’s not really a negotiable thing at a certain point
@meetmikehiggins
Also I have nothing to back this up but I think children raised there have more of a work ethic/drive to work than I’ve seen in other places
After careful consideration I am re-entering the Twitter gauntlet as an active user. I fully expect to gain much fame and notoriety from this venture. I apologize to past followers who will have no interest in the content to come
My first hire is starting tomorrow.
I hired sooner that seemed absolutely necessary but think it will speed up business growth and my own development in running a business
Primary duties:
Bookkeeping/payroll
Client communications
Personal assistant type tasks
Any tips for me?
Starting a business is easy. Not quitting in the first year is hard.
Everything is exciting when you start when you think you have a great offer and haven't had to do any of the real work yet.
Here are 5 things I've told myself in the last year that have kept me going:
Is credit Karma a complete POS product?
I had to migrate from mint (can’t believe they shut it down) and was optimistic but this is basically just 4 different pages of ads for loans. Garbage
For example, how can I tell a client that they can save $10k by paying their 3 children when I know there’s no way in hell they will do it properly
Thinking I need to wrap bookkeeping into any service that I offer - everyone thinks they do it right but it never is close
A friendly chess match during the lunch hour to keep the mind fresh! Who ya got in this one? Manager of Athletic Operations Nick Sailer or
@MBUMensSoccer
coach Jake Alvernia?
@hedgefundmafia
I always feel bad when a college kid tells me their summer internship is with Northwest Mutual.
I’m sure they didn’t want to be the worst type of human but here they are
Arbitrage opportunity: burnt cheese
Purchase scrap cheese from all your local restaurants for pennies on the dollar, burn and package the cheese, and upsell. Potential for huge margins
@cbriancpa
So many people want their taxes done for the same cost of self filing on TurboTax- and with that means they’ve been doing their taxes wrong for years. Not worth the hassle for the already low fee they want to pay
I see QSBS listed as a tax strategy on here all the time but rarely is a massive limitation ever listed:
You must be a qualified small business.
This excludes services business like:
Health
Law
Engineering
Consulting
The definitions can be a grey area, but important to note
If you're a business owner, now is such a crucial time for you to get your taxes right.
Not for your 2023 filing, but for doing 2024 the right way.
You set yourself up for much more stress and taxes paid if you ignore 2024 taxes til next tax season.
Get set up and stick to it.
@LoganGrafTax
@seattle_tax
It's hard because tax filing has become so commoditized. It really feels like a race to the bottom at this point.
So many 30 min "consults" I can tell are completely wasted when they ask the price at the end of the call.
Small business owners will open a QuickBooks account, connect bank accounts, and auto-categorize every transaction and send their PNL, BS, and GL at the end of year
It’s a mess. Just found $35k of business loans categorized as income in a clients GL
~$8k tax savings right there
Finding the balance between hustling vs building a business is hard
My biggest challenge right now is not seeing a path to being able to delegate what I do
When you are the product, your “business” isn’t scalable
Glad I am identifying this early and can adjust
@jamestheright1
@camp_wealth
When RSUs vest, they are subject to ordinary income tax on the value of the vested shares
The price at vest date becomes your cost basis if you hold the shares
So selling right away at vest takes away the chance of capital gains/loss because your paying tax on the full value
A goal of mine in 2024 is to get more comfortable spending to earn more. Frugality is good to a point but I’m learning that it kills you when trying to ramp up a business
An important lesson I received at 21:
A few of your buddies from college will randomly call you in the next 10 years
If they work for Northwest Mutual, they are not your friend anymore
They unfortunately are now detestable and you are about to be sold whole life insurance
Remote is life changing IMO. I have no doubt that I'd thrive in an office M-F.
However, when you work in an office you have to build your life around work; when you work remote, you can build work around your life.
That's the best way I can explain it.
I'm in my mid 20s. I work a W2 in the office 8-5, five days a week.
I tell this to friends/family members under 30 years old and they can't imagine working in the office full time. Some have recently been called back in and are looking to quit because of it.
Can't decide if
I use Tax Planner Pro as a tax planning/estimate tool for small business owners
It's great, but there's something I love about building a custom tax calculator in Excel for specific clients...
Nothing beats quick inputs and instant results
I’ve seen a lot of people get smoked by this:
- Make $100k in first year of biz
- Owe $30k taxes
- Get overwhelmed and not file
- Realize at end of year you need to file
- Owe another $30k for current yr
- $60k in hole
- Money stress
Pay you estimated taxes
There is a tax trap I see novice business owners fall into-
The first year they make good money they get HAMMERED with taxes for the first time
They have a great year where they make a lot of income. They have to do three things-
1. Use the profit of the business to capitalize
The 3 big tax strategies you hear far too often:
Bonus depreciation on vehicle
Augusta rule
Paying your children
Here’s my Top 3:
1. Optimizing S corp salary / QBID
2. HSA/401k
3. Don’t buy crap that won’t help you make more $ than it costs for “write off”
I got an MBA immediately after my undergrad
I honestly don’t know if I learned a single useful thing. If anything it would be:
- I don’t hate HR
- Some useful financial accounting/finance topics
Still was worth it because my employer paid for it and it helped me land next job
Guys after 6 months of barbell bench:
My shoulders are shot and you feel it more in pecs from dumbbell so I’m switching to db
Guys after 6 months of dumbbell bench: I want to feel something again so I’m switching to barbell
@DailyTaxMemes
Thank you. Are you in a larger metro area? I’ve heard from multiple people from my small town that they pay literally like $200 for itemized deductions, rental props etc. it’s insane. almost like competition hasn’t made its way there yet.
You don’t need to re-invent the wheel or do anything magnificent
My outlook on life/achievement has boiled down to this:
Seemingly insignificant, accurate actions taken consistently over time will compound into something great
Let time be the factor on your side
@indexnforgetit
Equity compensation - become an expert in stock plans and awards that companies give their employees/contractors. CEP certification opens doors
@bhallcpa
Great post - follows the idea of don't let the tail wag the dog.
Some clients are so interested in tax deductions that they want to make negative ROI purchases.
I ask if that purchase will help them grow their business/personal wealth. If not, it's not worth the tax savings.
There’s a big difference between building a business and a side hustle
I find myself taking on too many freelancy type projects outside of my core services
It’s worth it for now cause l learn/gain reviews with each new project, but at some point, the transition must be made
@InvestWCayden
I’m working on the same right now. For onboarding realized the best resource is the sheet the QB gives you and wrote some SOP on it.
Will be on to COA/client training next. Shoot me a dm if you’d like to share notes. Following for other recommendations too
What does this mean?
It means if you have a high paying W2, you will take home a higher % of your self employed earnings
It probably also means that an S-corp election wouldn't make any sense
Make sure your accountant is aware of this when filing and planning
END
One of the best tax saving strategies is having a W2 job. What??
Everyone knows that your W2 job has Social Security and Medicare taxes withheld.
The employEE pays a rate of 6.2% SS and 1.45% MED.
The employER also pays a rate of 6.2% SS and 1.45% MED.
This totals 15.3%
👇
The juiciest tax saving/wealth building strategies is buying real estate (residential or commercial biz) and bonus depreciation
Unfortunately, to do this right I want to know where I’m going live for the next 30 years and I’m not ready to commit to that yet
IF YOU HAVE AN S-CORP:
Make sure you have an accountable plan set up right now to reimburse yourself for personal expenses like:
Home office
Vehicle expenses/mileage
Internet
I have talked w several biz owners this month who want to deduct like before they filed for an s-corp
@noahkagan
Do anything possible to reduce the time from idea to first sale.
Learned this lesson when I built website, ads, etc for a virtual tour biz a few years ago then was too scared to sell.
Did not make this mistake w my tax biz last year. First thing I did was sell to 2 people.
The best part about owning a business is that you get to make the big decisions instantly
In a 9-5 career, it might take 10 years before you’re even in a position where you can make a strategic decision that would impact business success/failure
It’s fun to have ownership
- Leadership in free enterprise
- Consumer behavior
- Communication strategies in business
- Management concepts
- Business in global environment
All complete garbage - Knowing I could have taken all sorts of accounting makes me kick myself
I have BS in business and MBA
I need a business attorney to partner with to send business for my accounting clients on things like entity formation, operating agreements, business transactions etc.
DMs open if interested.
Any accountants have recommendations on how they handle these things?