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]

Originally Posted by 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?

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.

[Mike Mercury]

[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]

Originally Posted by 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?

Yea, hire a CPA or certified tax preparer

[snide]

Originally Posted by Mike Mercury

Didn't realize an XT6 crossed 6001lbs.

[BayouCountry]

Originally Posted by kylebuck

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]

Originally Posted by BayouCountry

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!

[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.

[Frankie the Fink]

Originally Posted by BayouCountry

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]

[Yadkin]

Originally Posted by 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.

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]

Originally Posted by KenHorse

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.