Tax deductions and investments.

[kylebuck]

Happy Sunday everyone.

Getting ready to do my taxes for the business and personal. I'm getting obliterated due to the level of profits I'm turning. Can't buy any more 6001 gvrw automobiles, don't have enough drivers in my whole family and the company. Looked at IRA and 401k but let's be honest that's just kicking the can way down the road for me to deal with in 20 years.

Suggestions?

[DAB]

Pay what you owe, stay out of jail.

[ratflinger]

Send me a box full of cash, I'll hide it for you.

[Bruze]

Happy Sunday everyone.

Getting ready to do my taxes for the business and personal. I'm getting obliterated due to the level of profits I'm turning. Can't buy any more 6001 gvrw automobiles, don't have enough drivers in my whole family and the company. Looked at IRA and 401k but let's be honest that's just kicking the can way down the road for me to deal with in 20 years.

Suggestions?

Suggestions for what? Paying less taxes for 2023?

Buying "stuff" you don't need or want just for the tax deduction is not brilliant; financially you'd be better off keeping the money and paying tax on it. Otherwise that money is gone and all you have left is "the stuff." And it's too late to do that for 2023 anyway AFAIK.

What you can do for 2023, and still retain and control the money (although you can't use it til age 59½) is open a tax-deferred retirement account which you say you don't want.

I'm not a tax guy, so I don't what else might be available for a previous tax year.

But, in the future, here's a few tricks for paying zero taxes:

- Have zero income

- Have income at or below the poverty level. Used to be $10k, probably 20k
or so now.

- Commit a serious felony so you get a prison sentence. Free food, no taxes,
free buggery.

[LATB]

Good mornin Joey.

My CPA told me years ago (decades actually), that if you are paying taxes you are making money...Keep doing that. :seasix:

[Mike Mercury]

https://photos.dealerimagepro.com/lib/cadillac-las-vegas/01.05.2024/USED/%28Cadillac%20-%20XT6%291GYKPCRS2MZ140587/1GYKPCRS2MZ140587--32.jpg?ver=1704481577






https://i.redd.it/3r075eoolbk81.jpg

[Kevin68]

SEP-IRA. 25% of compensation or $66K max, whichever is less. Then backdoor Roth after you stop making so much money or retire.

Invest in an oil well(s). Large deduction initially and smaller, but not insignificant, deductions annually thereafter.

[donuts]

I agree w Kevin , create a SEP or similar and load it up and if you have cash leftover build something that can be depreciated. Buying vehicles simply for depreciation is dumb , been there done that.

[KenHorse]

Happy Sunday everyone.

Getting ready to do my taxes for the business and personal. I'm getting obliterated due to the level of profits I'm turning. Can't buy any more 6001 gvrw automobiles, don't have enough drivers in my whole family and the company. Looked at IRA and 401k but let's be honest that's just kicking the can way down the road for me to deal with in 20 years.

Suggestions?

Yea, hire a CPA or certified tax preparer

[snide]

https://photos.dealerimagepro.com/lib/cadillac-las-vegas/01.05.2024/USED/%28Cadillac%20-%20XT6%291GYKPCRS2MZ140587/1GYKPCRS2MZ140587--32.jpg?ver=1704481577


Didn't realize an XT6 crossed 6001lbs.

[BayouCountry]

Looked at IRA and 401k but let's be honest that's just kicking the can way down the road for me to deal with in 20 years.


Not really. The investments in a tax deferred account grow faster using the tax savings as part of the growth strategy. This offsets a lot of the future taxes.

In my case, my income is less now that I’m retired. Running a tax calculator showed no significant tax advantage for me to rollover money into a Roth this late in the game. Your mileage may vary.

Edit: I’ve heard of some people using insurance policies to get tax breaks. They borrow against the policy tax free.

[Bruze]

Not really. The investments in a tax deferred account grow faster using the tax savings as part of the growth strategy. This offsets a lot of the future taxes.

In my case, my income is less now that I’m retired. Running a tax calculator showed no significant tax advantage for me to rollover money into a Roth this late in the game. Your mileage may vary.

Troof! :seasix:

[LATB]

When you write a 6-fig check to the IRS that means that you are doing something right and it’s time to get back to work. :Jeff '79:

[Frankie the Fink]

Not really. The investments in a tax deferred account grow faster using the tax savings as part of the growth strategy. This offsets a lot of the future taxes.

In my case, my income is less now that I’m retired. Running a tax calculator showed no significant tax advantage for me to rollover money into a Roth this late in the game. Your mileage may vary.

Edit: I’ve heard of some people using insurance policies to get tax breaks. They borrow against the policy tax free.
Same here with the ROTH conversion, at a certain point it no longer gets you any benefit.

[VITE1]

Look into SEP!

Also get input from your accountant. I assume you are an LLC.

[roadpilot]

Someting is not right. You are making soooo much money legally, that
you need tax advice from strangers on a Corvette Forum.
If you being truthful, it's time to pay a CPA and get information you
can really use.
Good luck.

[GTOguy]

Waiting for Yadkin to chime in. Or Big Bob.

[Big bob]

95983

[Yadkin]

When you write a 6-fig check to the IRS that means that you are doing something right and it’s time to get back to work. :Jeff '79:

This. Every time I'd complain to my fiance guy/ tax preparer that's more or less what he'd say. It sucks, but it's better than the alternative.

[Taurus]

Yea, hire a CPA or certified tax preparer

This, the CPA firm I use for our taxes also have a team of financial advisors. They tell me how much to invest and how much to take out and when to do it in order to limit my tax rate. The goal is to get the investment accounts converted to post tax as much as possible before the RMD's kick in about 7 years from now.

[Yadkin]

This, the CPA firm I use for our taxes also have a team of financial advisors. They tell me how much to invest and how much to take out and when to do it in order to limit my tax rate. The goal is to get the investment accounts converted to post tax as much as possible before the RMD's kick in about 7 years from now.

Explain why you vote Democrat.

[Bruze]

This, the CPA firm I use for our taxes also have a team of financial advisors. They tell me how much to invest and how much to take out and when to do it in order to limit my tax rate. The goal is to get the investment accounts converted to post tax as much as possible before the RMD's kick in about 7 years from now.

They're making nice fees from you, and it's probably not needed unless you have some unusual tax situation.

I let my SEP-IRA continue to compound, tax free, until my first RMD kicked in on January 2022.

I have 1/12 of my RMD taken out of my SEP each month (I'm at Schwab). If I need some of it I take it, the rest gets re-invested in my taxable account.

My SEP continues to compound tax free. :shrug:

[Taurus]

They're making nice fees from you, and it's probably not needed unless you have some unusual tax situation.

I let my SEP-IRA continue to compound, tax free, until my first RMD kicked in on January 2022.

I have 1/12 of my RMD taken out of my SEP each month (I'm at Schwab). If I need some of it I take it, the rest gets re-invested in my taxable account.

My SEP continues to compound tax free. :shrug:

Nothing I’ve invested in through them carry fees, they’re paid a commission from the firms we have the annuities with.

[Yadkin]

Nothing I’ve invested in through them carry fees, they’re paid a commission from the firms we have the annuities with.

No fees. Annuities. Now I know why you vote Democrat.
:Jeff '79::Jeff '79:

[Kevin68]

Nothing I’ve invested in through them carry fees, they’re paid a commission from the firms we have the annuities with.

...in exchange for a lower, but guaranteed, return.

I doubt they're doing this work for free.

[Rob]

Roth is the way to go since you are young - you pay the taxes up front. But a great accountant will help you take care of all that.

[LATB]

Explain why you vote Democrat.

"protest vote" :D

[Taurus]

...in exchange for a lower, but guaranteed, return.

I doubt they're doing this work for free.

Yup, I have several annuities with one maturing every year to either roll over, cash out or reinvest. They have a hard floor but the highest yield is capped at 9.75% which works well for me in retirement. I have a couple larger investments I manage myself.

Again, I've gone over the fee structure and their compensation comes in the form of an annual commission, no fees to me. That was part of the decision.

[Yadkin]

"protest vote" :D

Zero common sense. :yesnod:

[Big bob]

I always took care of my own money. And let the tax man pay me. I never understood why others give their money to strangers and hope for the best. Then pay capital gains if they are lucky enough to make anything.:confused5:

[LATB]

Zero common sense. :yesnod:

Liberals don't have any of that.

[Taurus]

I always took care of my own money. And let the tax man pay me. I never understood why others give their money to strangers and hope for the best. Then pay capital gains if they are lucky enough to make anything.:confused5:

I take care of my own money but know when to get help. I am not a trained tax accountant, CPA or investment professional and as such I don't have the knowledge to sort through all the laws concerning such. Also, I don't have the network to know what the best investment opportunities are and why.

I don't practice medicine on myself for the same reason. I have done very well enlisting the help of trained professionals, I'm guessing many here have. But if you have the knowledge good for you, I know my shortcomings and are smart enough to as for help.

[Big bob]

I take care of my own money but know when to get help. I am not a trained tax accountant, CPA or investment professional and as such I don't have the knowledge to sort through all the laws concerning such. Also, I don't have the network to know what the best investment opportunities are and why.

I don't practice medicine on myself for the same reason. I have done very well enlisting the help of trained professionals, I'm guessing many here have. But if you have the knowledge good for you, I know my shortcomings and are smart enough to as for help.


I always get someone else to do my taxes as they are always changing the laws. But as far as investments I learned from ones that lived through the depression. So if I can't hold it or stand on it I'm not buying it. And if the government will give you up to a half million dollars every two years capital gains free. Why would you let someone else use your money at your risk?:confused5:

[Vette40th]

I never thought make six figures I would not have enough deductions to meet the standard deductions. But a retirement and a regular job has done that.
I owe this year.. again.
But, after being told that I figured out what to do.. just put extra away till I need to pay next year. The longer Uncle Sammy cant use it the better.

[Egnalf]

Sep-IRA, max it out.

Vacation property in a good place, buy an expensive one and rent it out. Take the depreciation and other deductions, watch values grow while the giverment helps you pay for it. Sell it later in life, or better yet, live off rental income.

Not sure what your business is, or how many employees you have....a personal assistant does wonders for a guy. One who is crazy orgranized, smart and pleasant. Take some of the load off things and get a better quality of life. you ca get a good one for about 80k all in.

[ZipZap]

Right on time...:rofl:

[kylebuck]

Good mornin Joey.

My CPA told me years ago (decades actually), that if you are paying taxes you are making money...Keep doing that. :seasix:

But I'm tired Grandpa.

[kylebuck]

Roth is the way to go since you are young - you pay the taxes up front. But a great accountant will help you take care of all that.

He is a stangkiller.

[kylebuck]

Someting is not right. You are making soooo much money legally, that
you need tax advice from strangers on a Corvette Forum.
If you being truthful, it's time to pay a CPA and get information you
can really use.
Good luck.

We needed a topic other than new balance, colonoscopy and Joe Biden

[Raazor]

Real estate
Hire a guy
Don't be cheap

[Vette40th]

My daughters taxes, poor kid, W2 had her tips in the social security tips section. She ended up having to pay in taxes this year, in Federal. Reality hurts.

[Yadkin]

Picture of daughter's tips? :o

[Vette40th]

Picture of daughter's tips? :o
Nope.
The tips were quite a bit, over 8% of her pay. But they had it in social security tip box.