Stick Like Glue Radio #124 On this episode of Stick Like Glue Radio I interview entrepreneur and tax coach Diane Gardner, which works with entrepreneurs and small business owners all over country. This is a nugget rich and money saving show - do not miss it!
Stick Like Glue Radio www.getjimpalmer.com
On this episode of Stick Like Glue Radio I interview entrepreneur and tax coach Diane Gardner who works with entrepreneurs and small business owners all over country. This is a nugget rich and money saving show - do not miss it!
Main Questions Asked
- What is a tax coach and why do small business owners and entrepreneurs need one?
- What are the biggest mistakes you see entrepreneurs and small business owners make when it comes to tax?
- How would a small business owner work with someone like yourself?
- Are there any general rules about LLC versus S-CORP?
- How does a business owner decide what type of business they should have?
- If someone is a solopreneur, how do they decide at what point to get financial help?
- What is the difference between tax preparation, tax projection and tax planning?
Key Lessons Learned
- Billions of dollars are overpaid each year by small business owners due to not taking advantage of deductions
- Less than common deductions can mean thousands of dollars each year on tax
- A tax coach takes a look at your tax and financial information, conducts analysis and identifies areas where you are possibly overpaying taxes
- Businesses often outgrow their initial entity type e.g sole proprietor, LLC or S-Corp
- Having the wrong entity for your business is a big tax mistake that can cost you
Deciding on your Entity
- An LLC is very flexible and can act like a sole proprietorship or a general partnership, S-Corp or C-Corp
- LLC are state controlled and some states don’t recognize or ‘like’ it
- When deciding on what kind of business you should be, it pays to do an in depth analysis from a liability and tax standpoint
- Ask yourself how much liability exposure you have in your business, how important is continuity of life and fringe benefits?
When to Get Assistance & How It Works
- Its best to have a professional assist with your tax return from the beginning
- When you have employees is a good idea to have a book keeper as some laws are federal and some state
- These days you can work with a professional easily; Email, phone, skype, mailing, Dropbox is all part of working with a remote tax assistant or tax coach
Tax Preparation, Tax Projection and Tax Planning?
- Tax Preparation - Recording history of what happened in the previous year
- Tax Projection – A separate engagement and takes historical data and have consultation on what business is doing in the current year
- This estimates the business expenses as well as gross and net income
- This gives the business an idea of how much tax they owe in the coming year
- Tax Planning – Working into the future 3-5 years
- Takes an all encompassing look at the personal and business life
- Look for money already being spent that could potentially be a tax deduction
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Links to Resources Mentioned
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