How Do I Use the S Corp Strategy?Jan 25, 2023
All too often, I come across business owners who have their S Corp set up but they don't understand why or how to actually use it to their advantage. It's super common for accountants to file the paperwork without explaining your new responsibilities or the new strategies that come with being an S Corp owner.
The main way that the S Corporation saves you money is by decreasing the amount of self-employment tax you have to pay. You effectively separate yourself from the business and become an employee so that you only have to pay employment taxes on the portion of income you take in salary.
However, often missed are the ways that an S Corp can indirectly save you money. You can leverage accountable plans and the Augusta rule. These are tax-free transfers of money that keep cash in your control.
"You can now engage and transact with the business in strategic ways as well. Most people associate the S Corp with the self employment tax savings, but often neglected are the indirect savings from strategies and ways to utilize the S Corp. To your advantage."
In this episode, you will learn the following:
- Discover how to save money in taxes through setting up an S Corporation.
- Learn about tax strategies to transfer money tax-free and keep cash flow in your control.
- Find out how much you could save in taxes with a free calculator and questionnaire.
What you'll hear in this episode:
- The main way that an S-Corp saves you money in taxes.
- You can now get reimbursed directly from your business for the business portion of rent, mortgage interest, utilities, and other home expenses.
- The biggest part of a tax strategy is to lower your taxes without actually spending more money.
Here are some brief snippets from this episode:
Most people associate the S Corp with the self employment tax savings. But often neglected are the indirect savings from strategies and ways to utilize the S Corporation to your advantage. Start taking advantage of these strategies through the small group S Corp Success program.
You could be missing out on massive tax savings that you get from making the escort tax election. I put together a completely free calculator and questionnaire to see if this tax election may be a good fit for your business. Click on the link in the Show Notes to find out more and compute your estimated tax savings.
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See how much you can save with an S Corp: https://www.keepwhatyouearn.com/keep-what-you-earn-s-corp-calculator
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The information contained in this podcast is intended for educational purposes only and is not individual tax advice. Please consult a qualified professional before implementing anything you learn.
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