I pay over $100,000 per year in taxes. It's so crazy. If you are financially illiterate (or you dont want to start a business) your tax burden is 40 percent. You have to figure out all these strategies and loopholes or you are basically existing to make money for the government.
100% agree. My husband and I have worked our whole lives. He is a W2 employee that works every bit of overtime he can get because we have 9 kids. All are grown but many in college etc. Because he works sometimes 7 days a week he often gets into the 30's % tax bracket. So 30% of his income goes to pay for our terribly run system. The government incentivizes people getting on welfare and public aid. If he hadn't worked so hard we could have just lived off of your 100K a year while enjoying more time as a family. Taxation is theft.
I agree….grew the business to $2m and now my CPA hands me a $80,000 k1 and $60,00 1099 NEC Didn’t tell me anything about how to save using this information
We pay $38k /qtr estimates. Our acct is too conservative and gives us no advice. I’m here watching UA-cam to try to save some taxes because I feel we work to pay the irs. Btw, today the admin announced another $750m to Ukraine. 😂
You said it! I had a business for twelve years. The first three years were characterized by the entrepreneurial spirit and excitement. The middle six were dedicated to treading water. The final three were trying to figure out how in the world could I escape. Overwhelmed is exactly my experience. So busy keeping up with the “business of the business” I had no time to work ON my business.
Mark is right on the money. Here’s my current setup and timeline. 2017-Opened a small cafe LLC multi with wife. 2019- Cafe LLC “loaned” funds to our holding real estate LLC to purchase the plaza the cafe is in. With 4 other commercial tenants in plaza. All have leases with holding LLC including our cafe. Very important. Purchasing this lowered the tax burden of cafe for that year 2021. Cafe elects to be taxed as a S-Corp. 2022 to current… quit both W2 corp jobs wife and I have had for 20 years. Wife is “on payroll” taking a “reasonable comp” at Cafe. Me. I qualify for real estate professional status as I (on paper, but reality WIFE and I) self manage now 40 rentals. Because of this real estate professional status we are able to use the passive losses to offset wife’s w2 taxes from the cafe. We haven’t done the trust portion yet. Or the property mgmt LLC to do a solo 401K.
It would be a pleasure to learn. After 10 years of working at the bedside as a Nursing Assistant. Am ready to register my LLC. Please share some tips on registering and where did you register your LLC from.
Just stumbled upon your channel! Had no idea that you founded Directed IRA! I have a directed IRA account and started investing in fix and flips! Great team over there.
what are the ongoing annual filing fees for this multiple filing structures... seems there's more than 4 entities, got the initial startup costs to create but what about ongoing annual filing fees? approx. or range?
Not really….your business can generate losses which will eat away at your w2 tax liability but that’s about it. Ultimately you need a side business to unlock what you are trying to do…..look for anything that will give you a 1099
What I want to know is how to start a business. So apparently I can pay a lawyer like you or something to make me an LLC how do I go from there to owning real estate? I can go to a bank and get a loan but do I have to have like a huge down payment or something? Can I do this without a lot of money up front? I don't have any money
In California as in many states, if you hold your rental properties in LLCs then u need to hire a lawyer to do an eviction. I had to do an eviction once and cost me very little doing it myself. A if I had an LLC i would had need to pay 5-10k to a lawyer. Unless you are super rich, it is better to have a big umbrella policy to protect your assets (which you will need anywyas) and hold the rentals under your Family Trust. Isnt that right Mark?
The self-employment tax is part of social security payment you make. Aren't you having a negative impact upon your social security payout when you retire? Because from what I understand, you're suggesting eliminating the self-employment tax by doing an s corp and getting payments as a salary and putting it into an investment vehicle that defers the tax.
@@ChasHenry662 Good point. However, I don't mean social security as a safety net but as a supplement. Most people forget that social security is not meant as something to live off but meant as a last resort safety insurance policy.
So when you're 57 already this video is not for us?! I wish we had access to so much info when I was in my 20's (or even 30's). They need to teach some basics to everyone in high school, but they don't teach anything for life skills, etc - they just teach being a cog in the wheel at public schools.
Yep, the internet really changed the world... bringing information to peoples finger tips that previous generations simply didn't have. College is pretty much pointless now except for the piece of paper some people/business require. I'm a millennial so I got to experience this transition real time... from rotary/party phone lines to iPhone and internet mayhem. I still feel too old to take advantage of this as I have spent most of my life not having a business; but investigating options.
Planning ahead can really minimize taxes! I've made a smart reinvestments, especially with some great guidance from a pro for a half year now, and it's been a game changer. I was able to reinvest my RMD strategically, and I'm now pulling in about $25k a week, despite doing very little trading myself. It's a nice cushion against financial stress. Best of luck with your RMD decisions!
Hello Max, I live in Orlando Florida, I need your services, how can I find a local professional that can help me? You really opened my “eyes”, I’ve been paying taxes left and right like an ignorant. Thank you. Joe
With the guidance of my financial advisor, Monica Mary Strigle (my FA), I retired at 50, three years earlier than planned. Her advice to diversify beyond traditional retirement accounts like 401K and IRA led me to explore rental real estate. As a Limited Partner in a potfolio of 1500+ units, I generated passive income and accumulated wealth. Thanks to Monica expertise and tailored strategies, I now enjoy a fulfilling retirement without traditional employment. Her insights in real estate investment have been invaluable on my path to financial freedom.
Your operational earnings are invested into your retirement accounts (subject to limits). Once in those retirement accounts via self direction you can choose how to invest it. Whether it be in stocks, or other assets like other businesses (asset llc). This could potentially grow tax free depending on the sort of retirement account you use.
S-Corp & LLC have the same asset protection (corporate vail) provided you maintain the entity correctly….. In laymen’s terms S-Corp require a little more work (you must file quarterly dues & manage payroll as an employee and it will cost slightly more to file tax etc). For that effort however you get the ability to allocate a substantial portion of your income as a dividend payout rather than having to claim it all as w2 wages. Dividends taxes are much lower than standard payroll taxes, hence the saving. The sweet spot where the additional cost/labor of an s-Corp starts to make financial sense is when you consistently NET 40-50K or higher on an annual basis. Otherwise remain an LLC. Hope this helps
@@prcguy9953 Thank you, I watched more of your videos for a deep dive. I was told differently by a FL lawyer that unless I had a 6% partner in my LLC I would be treated as a sole proprietor. He said that the law changed federally in 2016.
which trust is better? revocable or irrevocable trust dont want to pay alot of taxes and dont want to own anything ..just want toanage it..any info would be appreciated
Do you also teach us to invest excess money to lower tax burden? Another financial youtuber I like makes 1.2 million but buys real estate in cash to lower his taxable income to 80k. Would this set up help to do such a thing?
I wouldn’t elect a s corp for real estate. Choosing what kind of entity depends on business. Election of S Corp saves money on t eh self employment taxes that sole prop and LLC have to pay.
Word to the wise, you’ll want to make sure you have exhausted all your options in the LLC that would keep you below netting 40K annually. Secondly you’ll want to ensure you are consistently going to NET a minimum of 40K going forward.
Don’t you need or shouldn’t you have a different trust for homes and diff one for education for kids and diff ones for stocks and crypto etc etc? What is the difference between a trust and an LLC ?
The trust will have to be depleted within 10 years of the owner’s passing, forcing the heirs to sell off everything in the trust and unwillingly generating huge tax bills.
Hi I have formed an LLC and I'm using the funds from my BLOC to invest in crypto in my personal crypto wallet accounts How do I Transfer my profits into a ROTH IRA or CRUT What's the ideal set up
Note I've only created an LLC as an avenue to get Funding for my crypto investments through acquisition of business credit cards so no real operation is taking place in my LLC
@@AvatarVirtualPostIs “made over 100K” in profits? Like everything paid? Or is that gross income for your business? Is that’s gross for your business. Probably not. If it’s net, like your profit yes.
Hey there! Check out our Main Street Tax Pro Certification program, you can get certified and start your own side hustle helping other people. Learn more and sign up here: markjkohler.com/the-main-street-tax-pro-certification/
invest in yourself .. goverements have been overeaching for to long RRR , if only i can find a MJK in Australia .. anyone know a MJK i will pay $100aus for that info.
As an lnvesting enthusiast, I often wonder how top level investors are able to become millionaires off investing. . I’ve been sitting on over $545K equity from a home sale and I’m not sure where to go from here, is it a good time to buy into stocks or do I wait for another opportunity?.
How can I participate in this? I sincerely aspire to establish a secure financial future and am eager to participate. Who is the driving force behind your success?
SS has been a bucket of IOUs for more than two decades. The promise when it was enacted was that it WOULD NOT tax new people to pay for old people. We were promised that it was a retirement investment account. You would get out what you put in plus investment gains. That promise was broken almost before the ink dried. Then they started raising the age of “retirement” extending the number of years you have to pay and decreasing the number of years they have to pay out. So yeah, we’re gonna do all we can to not pay into what amounts to the largest Ponzi scheme in history.
It’s so obvious to me you are absolutely living your purpose. It’s inspiring and refreshing to see. Thank you!
This is perfect info!
I pay over $100,000 per year in taxes. It's so crazy. If you are financially illiterate (or you dont want to start a business) your tax burden is 40 percent. You have to figure out all these strategies and loopholes or you are basically existing to make money for the government.
That’s me right now.
100% agree. My husband and I have worked our whole lives. He is a W2 employee that works every bit of overtime he can get because we have 9 kids. All are grown but many in college etc. Because he works sometimes 7 days a week he often gets into the 30's % tax bracket. So 30% of his income goes to pay for our terribly run system. The government incentivizes people getting on welfare and public aid. If he hadn't worked so hard we could have just lived off of your 100K a year while enjoying more time as a family. Taxation is theft.
I agree….grew the business to $2m and now my CPA hands me a $80,000 k1 and $60,00 1099 NEC
Didn’t tell me anything about how to save using this information
That sting..
We pay $38k /qtr estimates. Our acct is too conservative and gives us no advice. I’m here watching UA-cam to try to save some taxes because I feel we work to pay the irs. Btw, today the admin announced another $750m to Ukraine. 😂
Nobody's scared - just overwhelmed. Thank you for doing this.
You said it! I had a business for twelve years. The first three years were characterized by the entrepreneurial spirit and excitement. The middle six were dedicated to treading water. The final three were trying to figure out how in the world could I escape. Overwhelmed is exactly my experience. So busy keeping up with the “business of the business” I had no time to work ON my business.
Mark is right on the money. Here’s my current setup and timeline.
2017-Opened a small cafe LLC multi with wife.
2019- Cafe LLC “loaned” funds to our holding real estate LLC to purchase the plaza the cafe is in. With 4 other commercial tenants in plaza. All have leases with holding LLC including our cafe. Very important. Purchasing this lowered the tax burden of cafe for that year
2021. Cafe elects to be taxed as a S-Corp.
2022 to current… quit both W2 corp jobs wife and I have had for 20 years. Wife is “on payroll” taking a “reasonable comp” at Cafe.
Me. I qualify for real estate professional status as I (on paper, but reality WIFE and I) self manage now 40 rentals.
Because of this real estate professional status we are able to use the passive losses to offset wife’s w2 taxes from the cafe.
We haven’t done the trust portion yet. Or the property mgmt LLC to do a solo 401K.
Tks a lot for sharing your experience Mike!
It would be a pleasure to learn. After 10 years of working at the bedside as a Nursing Assistant. Am ready to register my LLC. Please share some tips on registering and where did you register your LLC from.
@@ArtfulAfricaYou have to consult a lawyer/CPA
Just stumbled upon your channel! Had no idea that you founded Directed IRA! I have a directed IRA account and started investing in fix and flips! Great team over there.
So, how is the accounting for moving profit from scorp to LLC, a loan?
So the asset LLC is a holding company. The trust part can be quite complicated and only seem necessary for a personal home or bank account.
Shawn, that's not the point of the RLT. When you put your assets into the trust, they stay in an Irrevocable Trust at your death. Tax-Free Wealth.
It’s easier to transfer assets as well as hide them from others (but not the government) when in the trust.
Great video Mark!!! 🎉🎉🎉
You ' re good man!!
Thank you for sharing this with us
How do you move the money from the operations landscaping part over to the assets account
Good God! This is great but it's a ton of info!!
what are the ongoing annual filing fees for this multiple filing structures... seems there's more than 4 entities, got the initial startup costs to create but what about ongoing annual filing fees? approx. or range?
I make good money on my W2 as a healthcare provider. Is there a way to transfer my W2 to an S-Corp to take advantage of all of these tax strategies?
Not really….your business can generate losses which will eat away at your w2 tax liability but that’s about it. Ultimately you need a side business to unlock what you are trying to do…..look for anything that will give you a 1099
Can you ask to be a 1099 employee? Are you working PRN in various healthcare settings?
this video is incredible!
If only we didn't have so much bureaucracy and overly complicated tax-codes, we wouldn't need to play these stupid games :(
It’s all a game, play to win, don’t wish, hope & complain
I'm in love 😂😂😂 just kidding. Great content...top-tier...the best of the best. Thank you sooo much!
What I want to know is how to start a business. So apparently I can pay a lawyer like you or something to make me an LLC how do I go from there to owning real estate? I can go to a bank and get a loan but do I have to have like a huge down payment or something? Can I do this without a lot of money up front? I don't have any money
Thanks for posting
Who should own the S corp? Trust vs. Individuals? Thanks
On a basic level, a trust gives privacy and separates your name from the entity.
Mark..what tablet..electronic device did you use for your whiteboard..and what was the setup so that you could see it onscreen...Thanks..Richard
Looks like an iPad
In California as in many states, if you hold your rental properties in LLCs then u need to hire a lawyer to do an eviction. I had to do an eviction once and cost me very little doing it myself. A if I had an LLC i would had need to pay 5-10k to a lawyer. Unless you are super rich, it is better to have a big umbrella policy to protect your assets (which you will need anywyas) and hold the rentals under your Family Trust. Isnt that right Mark?
The self-employment tax is part of social security payment you make. Aren't you having a negative impact upon your social security payout when you retire?
Because from what I understand, you're suggesting eliminating the self-employment tax by doing an s corp and getting payments as a salary and putting it into an investment vehicle that defers the tax.
I would assume if we grow our wealth, we wouldn't have to depend on social security.
@@ChasHenry662 Good point. However, I don't mean social security as a safety net but as a supplement. Most people forget that social security is not meant as something to live off but meant as a last resort safety insurance policy.
SS is supplemental keep the $$ in your pocket
How do I speak to someone to set this up?
Follow the Link in the description and you'll be guided to my website! We'd be happy to help.
So when you're 57 already this video is not for us?! I wish we had access to so much info when I was in my 20's (or even 30's). They need to teach some basics to everyone in high school, but they don't teach anything for life skills, etc - they just teach being a cog in the wheel at public schools.
Good point - my take now, is to pass the right info on to my kids so they can get the jump I was never apprised of.
Yep, the internet really changed the world... bringing information to peoples finger tips that previous generations simply didn't have. College is pretty much pointless now except for the piece of paper some people/business require.
I'm a millennial so I got to experience this transition real time... from rotary/party phone lines to iPhone and internet mayhem. I still feel too old to take advantage of this as I have spent most of my life not having a business; but investigating options.
I'd love to hire you but I live in PA and your site says you don't work in PA... Any recommendations on who I can work with that does this?
Planning ahead can really minimize taxes! I've made a smart reinvestments, especially with some great guidance from a pro for a half year now, and it's been a game changer. I was able to reinvest my RMD strategically, and I'm now pulling in about $25k a week, despite doing very little trading myself. It's a nice cushion against financial stress. Best of luck with your RMD decisions!
Hello Max, I live in Orlando Florida, I need your services, how can I find a local professional that can help me?
You really opened my “eyes”, I’ve been paying taxes left and right like an ignorant.
Thank you.
Joe
Is it the same for other businesses like handyman/home services
Any business that NETS over 50K should be an s-corp
With the guidance of my financial advisor, Monica Mary Strigle (my FA), I retired at 50, three years earlier than planned. Her advice to diversify beyond traditional retirement accounts like 401K and IRA led me to explore rental real estate. As a Limited Partner in a potfolio of 1500+ units, I generated passive income and accumulated wealth. Thanks to Monica expertise and tailored strategies, I now enjoy a fulfilling retirement without traditional employment. Her insights in real estate investment have been invaluable on my path to financial freedom.
Hi Mark, could you do a video on what advice you would give for fresh accounting graduates?
He has courses for new graduates and how to acquire new clients etc
what if you're buiness is trading under an LLC? could you make a video for traders who change their captical gains tax into regular income?
Enjoyed the video. Thanks for sharing
How do you move your profit from your Operational LLC to your Asset LLC?
Your operational earnings are invested into your retirement accounts (subject to limits). Once in those retirement accounts via self direction you can choose how to invest it. Whether it be in stocks, or other assets like other businesses (asset llc). This could potentially grow tax free depending on the sort of retirement account you use.
So you're giving up LLC protections for s-corp savings? Is suppose if you are a single member LLC, that doesn't really matter anyway.
S-Corp & LLC have the same asset protection (corporate vail) provided you maintain the entity correctly…..
In laymen’s terms S-Corp require a little more work (you must file quarterly dues & manage payroll as an employee and it will cost slightly more to file tax etc).
For that effort however you get the ability to allocate a substantial portion of your income as a dividend payout rather than having to claim it all as w2 wages. Dividends taxes are much lower than standard payroll taxes, hence the saving. The sweet spot where the additional cost/labor of an s-Corp starts to make financial sense is when you consistently NET 40-50K or higher on an annual basis. Otherwise remain an LLC. Hope this helps
@@prcguy9953 Thank you, I watched more of your videos for a deep dive. I was told differently by a FL lawyer that unless I had a 6% partner in my LLC I would be treated as a sole proprietor. He said that the law changed federally in 2016.
which trust is better? revocable or irrevocable trust
dont want to pay alot of taxes and dont want to own anything ..just want toanage it..any info would be appreciated
Do you also teach us to invest excess money to lower tax burden?
Another financial youtuber I like makes 1.2 million but buys real estate in cash to lower his taxable income to 80k.
Would this set up help to do such a thing?
quick question if ya have a s-corp if ya buy a business should ya put it in a s-corp because it is active income
I wouldn’t elect a s corp for real estate. Choosing what kind of entity depends on business. Election of S Corp saves money on t eh self employment taxes that sole prop and LLC have to pay.
I'm an llc right now. Can i add an s-corp mid year?
Yes, and you can back-date to the beginning of the year.
Word to the wise, you’ll want to make sure you have exhausted all your options in the LLC that would keep you below netting 40K annually. Secondly you’ll want to ensure you are consistently going to NET a minimum of 40K going forward.
Why LLC for tax deferred accounts?
Do you have an office near San Francisco or Miami where I can speak with someone to create an account with?
So which link do I use to find a CPA?
Hey there, find a Tax Pro here: taxadvisornetwork.markjkohler.com/
Why don’t you do trifecta in Virginia?
Don’t you need or shouldn’t you have a different trust for homes and diff one for education for kids and diff ones for stocks and crypto etc etc?
What is the difference between a trust and an LLC ?
thank you
Thanks.
The trust will have to be depleted within 10 years of the owner’s passing, forcing the heirs to sell off everything in the trust and unwillingly generating huge tax bills.
In addition, the trust is generally taxed at a higher rate than personal tax rates which the owner has to pay every year.
A correctly drafted ''trust deed'' can mitigate that for generations
How bout 1099b is 1099b a good
Can you do a video on windfall $$$
Thank you jelpinhknowingmore
How to pay low taxes when every company have profit
Hi I have formed an LLC and I'm using the funds from my BLOC to invest in crypto in my personal crypto wallet accounts How do I Transfer my profits into a ROTH IRA or CRUT What's the ideal set up
Note I've only created an LLC as an avenue to get Funding for my crypto investments through acquisition of business credit cards so no real operation is taking place in my LLC
Should I convert to an s-corp if I made over 100K/year
@@AvatarVirtualPostIs “made over 100K” in profits? Like everything paid? Or is that gross income for your business? Is that’s gross for your business. Probably not. If it’s net, like your profit yes.
How do I get started as a business doing what your doing. Seems fun. Former Civil Engineer
He said he’s a CPA and a lawyer so go to law school and CPA school to do what he does…
Hey there! Check out our Main Street Tax Pro Certification program, you can get certified and start your own side hustle helping other people. Learn more and sign up here: markjkohler.com/the-main-street-tax-pro-certification/
😂 this is why you don’t let lawyers sell you shit
invest in yourself .. goverements have been overeaching for to long RRR , if only i can find a MJK in Australia .. anyone know a MJK i will pay $100aus for that info.
Trifeca sounds so diddy
As an lnvesting enthusiast, I often wonder how top level investors are able to become millionaires off investing. . I’ve been sitting on over $545K equity from a home sale and I’m not sure where to go from here, is it a good time to buy into stocks or do I wait for another opportunity?.
How can I participate in this? I sincerely aspire to establish a secure financial future and am eager to participate. Who is the driving force behind your success?
🎉❤
While the strategy is legal, it’s a bit disingenuous to avoid paying SS taxes and then exclaim “You can’t count on it!”
SS has been a bucket of IOUs for more than two decades. The promise when it was enacted was that it WOULD NOT tax new people to pay for old people. We were promised that it was a retirement investment account. You would get out what you put in plus investment gains. That promise was broken almost before the ink dried. Then they started raising the age of “retirement” extending the number of years you have to pay and decreasing the number of years they have to pay out.
So yeah, we’re gonna do all we can to not pay into what amounts to the largest Ponzi scheme in history.
Amen
Good lord the IRS should scrape these comments come audit season.