Donna Genie walks through legal tax deductions: business mileage at roughly 50 cents per mile (100 miles saves about $50), a home office simplified method at $5 per square foot, and medical expense reimbursement plans for spouses on Schedule C to avoid payroll taxes.
You want to know how to pay zero taxes legally, not go to jail for it? Well, I'm going to tell you if you want to get to that point where you pay zero taxes, you've got to take advantage of multiple strategies. You can deduct the standard mileage allowance or actual if it's better each year that rate changes a bit. I think our current rate is about 56 cents a mile. Let's round it off and call it 50. So for every 100 miles you drive for business purposes, you're going to get $50 in write off of your business. Now again, if you figure that taxes you're going to save about 30 to 45% of that. That's a pretty big chunk. Number two, home office can be complicated, but it doesn't have to be. There's a SIMP method. If you use less than 300 square feet in your home, you can automatically deduct $5 per square foot for your home office deduction. So if you rent a thousand dollars a month for rent and you use 10% of your space, that's a $100 deduction per month. Number three, if you're taxed as a sole proprietor, filing on a Schedule C on your tax return and you are married, your spouse can be reimbursed for their work in your business instead of a salary and running it through Penrol, they can be reimbursed for medical expenses, a medical expense reimbursement plan.
