Year-End Wrap-Up Part 2: Proactive Tax-Saving Strategies for Business Owners

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Mike Jesowshek continues his 2-part episode on year-end tax-saving strategies. In this episode, Mike covers specific strategies including hiring your kids for tax benefits, setting up a family management company for S corporations, and funding Roth IRAs for children. He also delves into the advantages of short-term rentals for offsetting income and utilizing health insurance premiums as tax deductions. Additionally, he advises on purchasing necessary business items for depreciation benefits and using a Section 105 plan for high medical expenses. 

[02:00] The Strategy of Hiring Your Kids

Roth IRAs are beneficial for your childrenEnsure compliance and fairness when hiring your kidsHiring strategies for kids over 18

[06:30] Understanding State Standard Deductions

Medical expenses and tax deductionsThe short-term rental loopholeMaximizing deductions through purchasesIf you're in startup mode, make a sale before the end of the year.

[13:38] The Importance of Bookkeeping and Preparing for 1099 Season

Rushing in January or February will make you miss some deductionsIf you're paying contractors that qualify and need a 1099 sent to them, you're going to need to start prepping those starting January 1st

[16:09] Recap and Importance of Implementation

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Key Quotes:

"We talk so much about how learning is so key as business owners, as individuals in general, but implementation is just as important." - Mike Jesowshek, CPA

"Hiring your kids, especially those that are under 18 is a great way to get a business deduction and those children potentially pay no income taxes on that income." - Mike Jesowshek, CPA

"If you're self-employed and you're paying for health insurance premiums, it's a tax deduction." - Mike Jesowshek, CPA

"An HSA is one tool that the IRS does not give out too often. You get a tax deduction going into it, there's tax-free growth and tax-free withdrawals." - Mike Jesowshek, CPA

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Podcast Host: Mike Jesowshek, CPA - Founder and Host of Small Business Tax Savings Podcast

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