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In this video, Donna Genie advises business owners on how to correctly set aside money for taxes. She emphasizes that the tax reserve should be calculated from profit—not revenue or the current bank balance—explaining that profit is what remains after all expenses. Using a flat 30% rule can lead to either over‑funding (starving the business) or under‑funding (leaving a large tax bill in April). She illustrates the mistake with a $200,000 revenue example where only $50,000 profit exists, showing that taxes should be based on that $50,000. Donna also notes that there is no single “magic” percentage because each owner’s effective tax rate is a combination of many individual factors, making personalized calculation essential.
