[Noway]

I've been working on the taxes for 2013 and I'm not happy with the tax bill. What do you guys do to minimize the bill?

As of now we don't have any employees. It's just me and 2 buddies as equal partners/owners.

What strategies do you guys use to slash the tax bill?

I believe the taxes are going to be higher when I retire so I decided to fund my Roth IRA instead of traditional IRA.

I have a HSA account too which helps little bit.

What else can I do? Do you guys have 401k accounts as owners?
Do you buys tools and new trucks just because of taxes?

 

[rewire]

I use an accountant to give me ways to offset income to reduce our tax liability.

 

[sbrn33]

I just work really hard to not make any money.

 

[Noway]

I use an accountant to give me ways to offset income to reduce our tax liability.

I do too. I do the quickbooks and bring it to my CPA. How do you offset your income?

 

[Tiger]

I usually consider it a good sign to have a big tax bill. It usually means I had a very profitable year. Any good accountant should be able to answer your question in detail. I fund my retirement at the maximum and consider year end purchases. You are 60 days late in this consideration. You need to see this in December.

 

[Tonedeaf]

You can dump some money in a SEP account tax free for now. Sep is like an 401k for self employed

 

[macmikeman]

You can dump some money in a SEP account tax free for now. Sep is like an 401k for self employed

This. :thumbsup: Is part of what I do.

 

[Hack Work]

You can dump some money in a SEP account tax free for now. Sep is like an 401k for self employed

What's the benefit of that over a more typical IRA?

 

[LGLS]

What's the benefit of that over a more typical IRA?

A Simplified Employee Pension Individual Retirement Arrangement (SEP IRA) is a variation of the Individual Retirement Account used in the United States. SEP IRAs are adopted by business owners to provide retirement benefits for the business owners and their employees. There are no significant administration costs for self-employed person with no employees. If the self-employed person does have employees, all employees must receive the same benefits under a SEP plan. Since SEP accounts are treated as IRAs, funds can be invested the same way as any other IRA. The deadline for establishing the plan and making contributions is the filing deadline for the employer's tax return, including extensions. The most strict conditions for an employee to be eligible are as follows. The employee must: 1) be at least 21 years of age 2) have worked for the employer for at least three of the previous five years, and 3) have received at least $500 in compensation for the tax year SEP-IRA funds are taxed at ordinary income tax rates when qualified withdrawals are taken after age 59 1/2 (as for traditional IRAs). Contributions to a SEP plan are deductible; they will lower a taxpayer's income tax liability in the contribution year.

 

[Tonedeaf]

They are both very similar....I was sold on sep account because of the ease of setting up and maintaining over the years for a small company.....i manage mine online through Merril lynch.

The differences i know of are:
1. only the employer contributes in sep
2. the contribution limits are higher, up to 25% net income or 50kish (not sure of the actual limits the maybe slightly off)

 

[macmikeman]

They are both very similar....I was sold on sep account because of the ease of setting up and maintaining over the years for a small company.....i manage mine online through Merril lynch.

The differences i know of are:
1. only the employer contributes in sep
2. the contribution limits are higher, up to 25% net income or 50kish (not sure of the actual limits the maybe slightly off)

The trick is to not have any employee's. If you need assistance you can send your candidates to a temp agency to provide them back to you as a service. And that also counts as a deduction.

 

[butcher733]

just do what my buddy does. he doesnt pay himself. all of his expenses he just draws out of the business account and usually pays almost no taxes at the end of the year. Other than the fact that him nor his company can get any credit its the perfect situation. he only shows a profit when his company is in risk of becoming a "hobby". he says this is the best way.:whistling2:

 

[captkirk]

I put the maximum in my 401

But personally I think the OP works for the IRS

"I want to pay the least amount of taxes ;-)"

 

[brian john]

I usually consider it a good sign to have a big tax bill. It usually means I had a very profitable year. Any good accountant should be able to answer your question in detail. I fund my retirement at the maximum and consider year end purchases. You are 60 days late in this consideration. You need to see this in December.

So you do not mind working hard and have the government take it to fund massive waste (AND I AM NOT TALKING ABOUT NECESSARY PROGRAMS)
Depends on when his fiscal year ends.

 

[RGH]

Very important....you like me, are an electrician....the rest of the guys on here are electricians..........when it comes to your money hire the best accountant you can..... ask your friends, neighbors, family who they use. Its OK to ask us for general information but trust me one of the best things I ever did was hire a good one.....I can call him anytime and ask questions etc. I also have a financial adviser, he handles all my investments. These guys know their chit and have sent me in directions I didn't know even existed...Comfort, trust and partners in your life /business....:thumbup:

 

[chicken steve]

10-4 on the accountant, but if you only see him/her once a yr you need to keep more in tune with your P/E ratio , by whatever means

But no go on giving anything to wall street or the banksters

not wise, sorry....failed system....t*ts up again soon....

~CS~

 

[Noway]

You can dump some money in a SEP account tax free for now. Sep is like an 401k for self employed

Thank you. Didn't know about this one. How much can you dump in there?

 

[nrp3]

My funds did well this year. Concerned about Roth vs Conventional and feeling its time to get a financial advisor. We have both types. The fund thats doing well at the moment is in the Conventional IRA. Have a decent accountant and lawyer. Looking for a decent financial advisor. Most seemed to be tied to a certain brand. Though about Schwaab but thought you needed huge assets to be considered.

 

[Mrphil]

We have a simple IRA account and do some matching for employees.Hold all deposits at your end of year and roll them over .Buy any tools needed stud punch,A5 Belgium,Polaris for job sites,drills.Repair all vehicles.Training and company meetings in Orlando or Vegas Or Key West annually if possible.Some years you will need to show profit and some are loss this way you can build credit for larger purchases. However,I don't like to purchase anything that the business can't pay off in a year or so.This keeps us debt free personally and the bus.