Archive for the ‘Tip Of The Day’ Category

What’s Your Type of Income?

There are three types of income: taxable income, tax-deferred income and tax-free income. In the case of taxable income, there are four main ways you can reduce your taxes: #1: Change the character of your income. If you change it from taxable to tax-deferred or tax-free, you’ll pay less tax. And, at least under current ...

Real Estate Dealer Status

If you buy properties as a wholesaler to later retail or if you buy properties to ‘fix n flip’, the IRS does not consider you a real estate investor. You are considered a real estate dealer. A real estate dealer has a business. If there is a loss, it’s a business loss. If there is ...

Employees or Independent Contractors?

If you want to save on taxes, look for ways to turn your employees into independent contractors. If you are an employee, look for ways to become an independent contractor. If you’re an employer/business owner, you won’t pay payroll taxes or have to provide benefits. If you’re an employee, you will lose most deductions. The ...

Got a Form 1099-MISC?

If you receive a Form 1099-MISC for services you’ve performed for one or more businesses, then you have a business too. We talk to people all the time who say they don’t have a business, but just happened to get this form for some side business. If you receive a Form 1099-MISC, make no mistake, ...

In Business Just For the Appreciation

In this case, the appreciation we’re talking about isn’t the raving reviews from your fans, customers and clients. This appreciation comes from assets that your business collects, builds or enhances. Appreciation means these assets go up in value. If your business invests in assets that have a reasonable expectation of appreciation, you’ll have a much ...

The Right Business Loss is Money in the Bank

A business loss can be used to offset your other income, creating lower taxable income and less taxes. For many business owners just starting out, there can be losses as you build the business. Plus, of course, you’ve often got expenses that previously were not deductible that become deductible if there is sufficient business purpose. ...

Start a Legitimate Home-Based Business

There are five secrets to using a home-based business: #1:  Make sure your home-based business passes the 9 Factor test. #2:  Keep good records. #3:  Identify all of your business deductions. #4:  Calculate your tax savings. #5:  Change your payroll withholding so you have more money in your pocket. A home-based business puts money in ...

Separate Tax Facts From the Tax Fiction

A legal tax loophole is a government incentive to promote policy. Loopholes are legal deductions and strategies you can use to save on paying taxes. You then get your money working for you faster. Look for legal business deductions. Keep good records. Make sure you’re in the best tax structure. Hire the best tax adviser ...

Put Velocity of Money To Work For You

In the go-go days of real estate, a lot of people used leverage to build assets quickly. Leverage is not good or bad by itself. It’s an amplifier of whatever you’re doing.  If you have cash flow coming in and the underlying business and/or investment is sound, then leverage will make the cash flow come ...