414: Home Office Strategies

Just give me an address so you don't know where the heck I am. And I'm not going to really have mail go there.

So that's one level.

That's one level where you're just give me the privacy. I'm getting my bank statements online. I'm not using that address on anything else besides the state filing. I'm using my real address on stuff that doesn't get public on the web and such.

So.

But if you're like, no, I actually want some of my business important mail to go there, I'm going to use that address in certain instances. Okay, we have a service for that where we scan the mail, get a virtual mailbox and such where you can access it and you get pinged when new stuff arrives. And there's different levels of that based on how much mail you get. But that's the way you get the

privacy and the write off. And still the write off and your expense for privacy is a tax deduction, See, because you're setting up your entity for your business with the privacy and the mail and the convenience and the write off at home. All 100% tax deductible. Boom, baby. See? So if you know, then you can go.

Then you can go.

Yeah, you got to know. But I think this is super fun for people to know. This is an option. And it can be regrettable because some clients are like, well, when I checked the box at Legal Zoom, I didn't know any of this. So you may have to do what we call a cleanup. So you'd work with the law firm kkos. Christie's got two paralegals that all they do all day long is just clean up entities. So call the office and go clean up my entity. Let's change all this. So moving forward, it's tight. Sometimes it's better to just dissolve the entity and start first fresh, because sometimes there's a paper trail on the web and this and that. So do it. And if you're concerned about the privacy, have a consult with one of the attorneys and say, hey, I want to. I want to do kind of a whole review here. I want to look at my trifecta. What are my tax strategies I'm implementing? And what privacy could I do better? And it doesn't have to be tens of thousands of dollars. It can be very affordable. Welcome, everybody, to this week's episode of the Main Street Business Podcast. Yours truly, Mark Kohler with the amazing Matt Sorenson.

Love it. Yeah, I'm here.

We're here together for those that are watching on YouTube. We've got the beautiful, picturesque Teton mountains behind us from the Jackson Hole side. I've got a good story about that.

Yeah, I've been warned. There's a story today about skiing at Jackson Hole.

Yeah, it's death defying. Yeah, I'm not kidding. So we'll come to that in a minute. But our topic today, home office. How do you feel about that?

I'm feeling homey today. You know about the home office. I don't know what the.

Do you take the home office deduction?

Absolutely. And you really do.

And you've got an office in an office building and you still take the home office deduction, Matt? Sort of.

There's something called the administrative exception. We'll get to that. You can use, obviously, home office for your principal place of business, but also you got a place for administrative management stuff. That's a hot tip right there, by the way.

Yeah, you mean. Hold it. You might have other business interests like rental property, and you need a home office to support them.

Yeah. Even if I didn't, even if I had another, just I was in my one business with my regular office, and I come home or my store, whatever front, whatever it is, I can still do a home office.

Okay, now, everybody, I'm going to hit some highlights. We're going to hit the typical home office deduction strategy. The admin exception that Matt just talked about unlocking the auto deduction with home office.

Now you're a locksmith, too?

Yeah, I'm a locksmith. Okay, we're going to unlock the home office. You know, there you go. Then we've got the S Corp strategy with the home office, which is a different strategy altogether. The Augusta rule for some of you that are trying to rent out your home for big events or your company. And we'll hit a little privacy. How can I hide my address for public purposes but still write it off? Yeah, that's sexy.

Yeah. It's like having your cake and eating it, too.

Baby, baby, baby. So we got so much to cover and let's get into it. And then I'll share an important principle I learned from the top of the Teton Mountains. Death defying experience.

Okay.

I just want to. But so that's coming, folks.

Okay.

All right, that's.

That's gonna keep everybody on. I know. Okay, well, I think the first thing on the home office I want to say is you gotta have a business if you're W2 employee, even if you're like. But I work from home. But if you're a W2 employee for someone else's business. Home office doesn't work. I know there's lots of confusion as everyone went remote. I think they set up their desk at their house or they have an office. They were working from home. No dice.

Yeah, there's no help there now. There used to be under the schedule A back in the day, so you're not crazy to think that, but under the tax cuts and jobs act, when the gov. The man increased the standard deduction, they took away the unreimbursed home office deduction that used to be on a schedule a up until 2018. You could do this unreimbursed home office. But when Covid hit, everybody's like, no. What happened to that write off? Oh, it's gone. So you have to have a business just being an employee and having a home office. There's no write off in there. So. That's a great comment.

Yeah. But business includes rental property. It includes your side hustle, you know, includes a main hustle type business with a separate office location or store, whatever it may be. So I think really every self employed person should be having the home office deduction somewhere. If you're not, you're leaving money on the table. You're doing it wrong.

Yeah. And some of you CPAs out there are cringing right now because you'll say this. First of all, oh my gosh, the home office deduction, that's a red flag. Really? Really. I've been doing this for 20 plus years. We've had thousands of clients file tax returns with thousands of home office deductions.

People.

Back in the 90s when the home office deduction came out, there was a few audits that scared the hell out of these older CPAs. It's over. It's okay. The home office deduction is well established. There's clear rules. Don't violate them. And the admin exception gets around this exclusive and primary place of business issue. So we're going to come to that in a minute. So don't freak out. You old accountants. I hate to say that I'm older. I'm over age 50. I'll tell you, I was brainwashed. But you can, you can. There's therapy.

Yeah, you can. You can see the light. And Mark has a program for it too. For you old CPAs that don't know what the heck you're doing anymore and are scared of your own shadow and you need like a, you know, wake up call.

Yeah, yeah.

Welcome to 2023.

Yeah, we take you to Trembling Hills.

Which, by the way, did you know in Back to the Future, when they went into the Future, it was January 19th, 2023, like, four days ago.

Really?

Yeah.

So they were all on hoverboards. What the. I know.

Where's my freaking hoverboard?

I'm a hoverboard. Geez, I didn't know that. That's a nice little tid tip.

Elon Musk, stop making rocket ships and electric cars. Can you just at least get a hoverboard out?

Yeah. I mean, let's give up on the Mars thing, can we? I don't want to take a trip to the moon. I just want a hoverboard. I like that. You know, and you notice my reference to Trembling Hills?

Trembling Hills?

What movie is that? For those out there? My Certified Tax Advisor program takes you to Trembling Hills where Marge took some time.

Marge.

Fletch.

Oh, okay.

Yeah. When Ben. The Ben Dorfman had to go to Trembling Hills March.

Well, I thought that was the other one. I was thinking Arrested Development, because that's like sudden. Sudden development or sudden.

Yeah, there was a retreat there. But anyway, my Certified Tax Advisor program is for any of you that want to up your game on the street. Skills of saving, taxes that are legit, honest, aicpa, IRS approved, and let's get into the weeds stuff. Get over to markjcohler.com and check that out. Okay, so now back to the home office. You need to have a business. You want to be taking the home office. No matter what type of business you have, you're not going to be afraid of it. It's not an audit risk. You just need to know the rules. Okay, that's point one.

Yeah. I like it.

Love it.

Okay, now, the tax code works.

Yeah? Yeah.

Find it. Follow the rules. Do it.

Yeah. Now, before we go to the admin exception, which I know you're. You're very savvy with that. Can I explain? Just the basics. Love it.

Yeah.

Okay, here's the basic. When you take the home office rule, which has been on the books for years, in order to take the home office, you have to show that it's an exclusive area that's measurable and used only for your business. And it has to be your primary place of business. So back in the day, everybody freaked out because I might go sit in that space and have a bowl of cereal and watch Netflix, or I might have an office across town. That's really my primary place. So if you. An accountant was nervous, they go, is it exclusive and you have another place, forget it and they just walk away. And so that, that was the old. That's the rule primarily on the books. We'll come to an exception. The second issue is what do I take? What is the write off? So there's a traditional and a simple method. The traditional is you're going to take that square footage, divide the house, come up with a percentage. That's the space. You're going to multiply it by rent, mortgage interest, property taxes, whatever. We're going to come up with the number that's. We can dive more into that. I know you got some notes on. That's traditional. And then simplified method is up to 300 square feet, 500 bucks a foot. 1500 dollars fruit. Yeah, 500.

Yeah.

Oh, it's 500 square.

I love that write off by the way. At 500 a foot. It's five a foot, right?

Five dollars a foot. 300 square feet for 1500 dollars. That's not monthly, that's annual. So that's low hanging fruit. Fifteen hundred dollar write off. All of our clients at least take that. Yeah, so does. That's the numbers. There's the rule.

The regular though, just keep in mind, let's say you have a 3,000 square foot home and 300 square feet is what you use for the, you know, your office, that's exclusive and you use for the, for your business. Now that means 10% of expenses for the home, whether it's a mortgage or even if you're renting the property, it still counts. But we're gonna take in utilities and all the other costs of owning that space. You need to take 10% of it. That is your deduction.

And it's separate from your furniture, cell phone, Internet, all that. Separate. This is just the use of that space. How do we craft a number there? There's worksheets and blah, blah, blah, and you come up with it and yada yada, and. And we'll come to some of those more technical. But yeah, but anyway.

Yeah, so the old issue was, for the old timers that we were referencing earlier was well, if you have another office where you go to do your business, that's the bathroom. No, but if you have a, you know, a storefront. Let's say you're the dentist, you know, and you have your dental office where you see patients and everything. Well, you're expensing obviously that rent and that dental practice, you know, maybe you own it and you're paying yourself rent. We love that strategy. But you're like, but I come home and I'm doing my paperwork in my office at home. So it's not my principal place of business because I see my patients at the office at the dental practice. Can I still write that off? Yeah, baby. Because if you're using that office space at your home for your administrative and management stuff to where you're doing your paperwork, maybe doing some billing, your strategy, your plan, you know, whatever it is that's in your business now that home office deduction is available as administrative or management function.

Love it. And even if you have an S corp, we'll get into some technical procedures there where you would put it and good stuff. Now again, I. If I can avoid the administrative exception, I want to. So when we have a client that says, well I have rental property or I have a separate side hustle, then that's easy schmeasy right there. Cause I don't have to come up with this admin issue and play with it. So I kind of like most of our clients have rental property. So we want to go there and try to use the schedule E and put the home office in schedule E. Now I know you accounts out there go. Well, there's no line for home office on a schedule either. Yeah, there is. It's called other other expenses. Home office reimbursement done. It's not the end of the world. It's fair. A rental business is a rental property is a business and it can be on page two, other expense schedule E. It's all good. Don't. Well, it's going to be a statement to page one on schedule E. One of you guys might appreciate that if you're accountant. But anyway, so.

All right.

Very common.

Well now one thing I'll say on the simple because isn't there some depreciation recapture on home office? If you're doing the regular traditional method, which, you know, if you've been writing that off, you know that that's recapture at 25%.

Yep.

But does that get into the whole thing you're deducting or is this just like, you know, if I'm. If that calculation includes like my utilities and some other things like what am I recapturing? Is it the whole thing or a piece of it?

It's a piece. So when you do your home office under the. The proper worksheet. Yeah. If you're going to go that mess it up. Yeah. It breaks out the depreciation allocation if you own the home. Now if you're just doing. If you're a renter you're just going to take a percentage of rent, percentage utilities, hoa, blah blah, blah. But if you do own the home and you do the traditional home office, not the simplified method. Yeah, it's the accountants will keep a worksheet that kind of shows what that depreciation is. Now when you go to sell your house five years, ten years from now,

how many people remember to go back on that?

I know this is such a highly ignored, abused area, whatever, but, but the

simple option, there's no depreciation recapture. If you're just doing that simple, five bucks a foot, 300ft, 1500 bucks a year, no recapture, you got to worry about it.

That's, that's, they simplified it now see, just that what we've covered so far in just 10 to 15 minutes here, that's more than most accountants are willing to learn or accept. And so you are the captain of your ship. If you are a small business owner, a rental property investor, you need to know that because when an accountant starts to push back and say we're not going to take it, you say whoa, whoa, whoa. Will you just listen to Mark Cloramat Sorensen's podcast on this? I'm going to send you a link. Well, these guys are Yahoo. No, we're not, we're not Yahoos. We have a real law firm, a real accounting firm and I'm signing your frickin tax return. We're licensed under the bar, we're licensed under the aci, aicpa. We're doing this. We're not out in right field. I work for kpmg. Our other accountants on the team have been at Arthur and Deloitte and we've been.

And the IRS. Yeah, the IRS.

We have ex IRS auditors as clients, I mean as partners and 10, 15 lawyers here. We don't take risks on this. It's legit. So if you don't know, don't go. Just learn the strategy, learn it.

Don't know, don't go. Is that your lead in here?

That's my lead in. You ready?

Okay. I did see a little social post, so I got a teaser on this.

You did, you did. All right, so go to Jackson Hole. I worked like 10 days straight, 12 hours a day. I was ready for a break. We went up to Jackson Hole to ski for two days. Now here on my laptop, if you're seeing here on YouTube, I've got my icon sticker at Icon Pass Works at Jackson.

Putting a sticker on your laptop, that's kind of like, you know, putting A sticker on your bumper of your car. You're, like, really owning that I'm owning. I am proud of this.

Yes. I am an icon pass holder for those that you can go, probably ski at 30 different resorts a few days here and there. It's pretty cool.

The Epic's the other one.

So Park City is Epic, Deer Valley's icon Whatever. So you guys that are skiers, it's. It's a really cool pass. You can use it worldwide. There's ski resorts in Europe that accept icon. You want to go this weekend?

Do you have an affiliate link for the icon pass?

No, I don't. I'm not making any money off this. Okay. So anyway, we went to Jackson. So we get there, and we're at the ski valet getting headed out, and they're like, now you guys are okay, right? You're pretty good skiers. We're like, we're okay. They're like, this is. This is known as an expert resort. And I'm like, what, you don't have bunny hills or beginners? They go. We only have two lists where beginners can go. Everyone else, we won't let them go. It is. It's too scary. I'm like, really? Jackson's that technical. Whatever. And I'm a little cocky.

Okay.

Yeah, I want to go skiing for a day. I. If I fall, it's because, you know, some snowboarder cut me off. You know, at the best. At best, you know, I can usually still dodge them and push them down at the same time. But anyway, so. So. So there. So we. I'm like, whatever. So we go on a chair, and we're like, man, this is pretty. The blues are like black diamonds.

You're really building this up.

Yeah, I know. Really?

Okay, I'll move along.

I'll move along. So anyway, we get on the tram. Now, everybody should know the iconic Jackson Hole tram is that box, you know, that just kind of goes up 4,000. 4,100 vertical feet in one lift. Yeah.

And it's like. I don't know if Snowbirds is better, but Snowbirds got the pretty killer tram, too.

It is cool. Anyways, they fit 100 people in this tram.

Got it.

100 people in this little box. It's swinging as you're going up. Now, if you're watching on YouTube, literally, we are parallel with the top of the Tetons up here. When you get off, you're looking at the Teton. I mean, you're up there, and we're coming up on the tram up to the. Is starting to slow. Lock into this little platform. And all of a sudden, we didn't realize there's a little resort host on the tram with us. And he goes, okay, everybody, if you're not an expert, you're going to take some pictures and get on the tram and come right back down. We do not need you getting hurt up here. Blah, blah, blah. And they're just giving us this lecture. We're like, oh, my gosh. And then he says. And the whole tram is in on it. Like, we didn't know. We just thought, oh, that's just. Regular people take this all the time. And he's like, so everybody's in this. In the zone. And he goes, if you don't know. And he pauses. The whole tram yells, don't go. And we're like, how come we didn't know the chant? What's going on?

A bunch of noobs or a bunch of noobs.

So everybody on the tram's like, beard on himself.

Yeah.

Little backpacks. You know, their skis are tied onto their back. I'm like, something's not adding up here. I'm like, I'm gonna. Anyway, so. But you get off. You feel a little adrenaline. I know you met Sorensen.

Yeah.

You'd have been like, I'm going. Yeah, I'm going.

Yes, I am.

Yeah. I'm up here. If I have to fall down the mountain, I'm doing it. So. So they're like, the only way down is a double black diamond. I mean, it is like. It. I'm not kidding. It is, like, straight down. And the moguls were, like, eight feet deep. And I mean. And I'm like, what the. This is the only way down. And I was the point of no return once. I like. And so.

Well, you're here. You made it.

I made it. But, I mean, if I learned it was. It was challenging. I mean, I was traversing that. That bowl. It's. I don't remember the name of it. Those that have done Jackson. But I'm not kidding. There were so many runs where. Right off the cat track. It was straight down. Yeah. I mean, I could not believe it. It is extremely technical. I don't know if I enjoyed it as much.

Yeah.

Because I was scared for my life half the time.

Okay.

But a little icy here and there. No new snow. But I'm gonna say this. The takeaway was. And it really hit me hard. I don't think I'll ever forget it was that. If you don't know don't go. And it was really poignant because I think just like with any tax strategy or legal strategy or whatever, it's like if you don't know, don't go. But it doesn't mean you can't know. You can study it, you can learn it, you can captain your ship, you can, you can learn the path down. And so as soon as we got off the tram, we went over to the cool little map, looked at the mountain. What's our path? We figured out our path and even though it was technical, we had a path so we knew where we were going.

I love it.

You feel inspired. I like it.

I mean, I think, you know, let's, I mean, don't want to unpack this too much, you know, but, but you know, tax planning, legal planning, building wealth even. It is, it's about self education. Like you've gotta, you've got to take the time to learn and what can you do? Follow other people who have done it before. You know, why? Just guess. You know, other people have figured it out, do what they're doing. But then you got to know now when, now when I say that you got to follow the right people because there's a lot of people going, they're just not going the right way. So that's the hard part, knowing the right people to follow.

Yeah, I like that. I got off the tram.

These are tax planning.

Yeah, yeah, I got off the tram and I saw these couple guys. They look pretty smart, technical. So I followed them. They went into the shack and they had brown sugar waffles. So I thought those guys know what they're doing. Yeah, we had some waffles before we took off. I thought if this is my last time on earth, I'm going to go down with a waffle. You know, I even went with whipped cream. I wanted to take it next level. So. Okay, yeah, but, but. And I burned those calories off with just sheer fear.

Yeah, the adrenaline was just flying.

I mean like I could have eaten three waffles and I would have been.

Thousand calories.

Thousand calories. Right, okay, all right, so all right now back to the point here.

Okay, there was, okay, there was a point.

Well, I mean, back to the topic.

Oh the topic.

The point was, you know, you guys are self educating here on the home office. I hope you appreciate the show people. But we would try to ham it up. Car talk. There are, there are leaders. We follow those guys. Click and tat. Okay, so do you want to talk about unlocking the auto s Corp? A guest I'll let you choose. I've been talking here.

What are you feeling? Let's talk about the S Corp.

Okay.

You know, because I do that and I've learned that one from you. So, you know, I have an S corporation, guys and I have a place of work, but I also have home office that is used. So. But, but how do I take that? Because a lot of people are like,

well, an S Corp doesn't have a home, Brad.

There's no home office on there. If it's a sole proprietorship, it's a lot easier. So now that still gets taken. You know, this is again an other type line. What schedule is it?

Well, what we've done over the years is we put it in office expense. We don't want it on the rent line. Yeah. Because if you put it on the rent line of the S Corp, the IRS is like, who's claiming that rent.

Yeah, where's that going?

Yeah. So we'd like to put it in other expense is a employee home office reimbursement. Yeah. Just in. In office expense. And now you still do the same calculation.

Okay, but same methods.

Same methods. But it goes on the S Corp. And this is where company maintenance comes into play because you have the accountable plan. You know that.

So yeah, so you, that's, you know, and if, by the way, if you don't have your company maintenance done, someone's doing your annual minutes, which part of that could include. Should include an accountable plan that's going to pick up stuff like this.

It's included in our standard.

Yeah, it's already built in. It's baked in to the minute so you can use it when you need it. So, but so you do have to have a little bit of a document trail there. And by the way, company maintenance, we have our Main street business services company where we're offering that now. Many of you have used it in the law firm. Got a little separate company going. Just a little side note there. But, but this is part of the no part on how to do it. And I think sometimes these tax strategies might seem like, oh my gosh, okay, how do I do that, guys? You can tell I freaking barely know this one. But I use it every year. I just know enough. It's on my return. I know I qualify. Still use the home office getting the deduction.

Yeah. And this is where I just want to reiterate. A lot of people get, well, I could do it, but I have an S Corp. No, there's a backdoor method. I guess one could say where you're going to do the calculation, you're going to pop it into office expenses, you're going to put it in the S Corp return. Now you're not going to see this is where people can get greedy because they're going to say, well, I'm going to ramp it up to a higher level because it's tax free to the employee owner, but I'm going to ramp it up the write off in the S Corp. Well, that's where you're getting in trouble. Be honest, be ethical, do the math. Here's what the write off would be. Put in an off expense and just know you got it. Yeah, yeah. And the chance of an audit on this is so infinitesimal because you're not going to put it on a schedule C or schedule E. So now, locksmith,

you want to talk about unlocking the auto.

Yeah, because here's the thing. A lot of people want the auto deduction, you know, because when you're traveling or, sorry, when you're driving for business in your vehicle, multiple vehicles, it's from point A to point B. Well, where's point A? If you don't have a home office, where does point A start? And so the home office. And this has been some really fun court cases where people have a home office that's like 20 square feet. This is a little home office. And the IRS at first was like, why are you taking the home office for $82? Well, because now whenever I leave the house, I'm in my business vehicle with business mileage.

This isn't commuter miles anymore.

This is very true. But you got to still, if you're commuting to a day job, that's commuting. But when I'm leaving to go to Staples, Apple Store, meet a client, go to projects, real estate deals, conferences, that mileage really adds up. And so the auto really enhances, I think the home office. I like it. Augusta, you know, Augusta comes up because of golf. And we got a PGA tournament coming to Phoenix here soon.

Yeah, yeah. Phoenix Open, baby. This is the party tournament where you could still use the Augusta rule.

That's true.

You could still use. It doesn't have to be. For what is Augusta? The Masters, huh?

In Georgia. Yeah.

So, you know, so what's the Augusta rule? Because this is one I do see a lot of like, I think people go a little too far on this one. A little greedy too, here.

Yeah, this is a lot. People are using the Augusta rule also for World Cup, Super Bowl, Olympics. And here's the Deal. The IRS says if you want to rent out your personal home, this is where it all happened. Back in Augusta, Georgia, when the Masters was a big deal. It's been around for what, 80 years, I don't know how long. But what happened is down in Augusta, people would say, I can rent out my home to these huge corporations in New York that come in on their private jet and they'll pay out the butt for my house, like 20 grand a week or 50 grand a week. And so people would say, do I claim that on my taxes? Well, the irs under the Paperwork Reduction act said, hey, if you only rent out your house for 14 days or less, we don't want the paperwork. We don't need to hear about it, we don't care. You are not committing tax fraud. If you don't claim that income, we're cool with it. So under two weeks, rent the hell out of your house. We don't care. Paperwork Reduction Act. Well, little did the IRS know that, that these huge corporations will pay 10, 20, 30 grand a week for these homes in Augusta. And then, oh, we have the Olympics in Salt Lake. Oh, we have the super bowl in Phoenix or down in Tampa or wherever, you know, and so all of a sudden, families are like, I'm going to rent out my house, go hang out at grandma's and I can bank on my house five to ten grand and it's tax free.

Yeah.

So that became known as the Augusta rule. Renting out your home, taking it in tax free income.

What if I want to do it for my business, though? What if I.

Boy, you are a gamer.

This is go next level on this. Because what if you want to have a board of directors meeting at the home and have the company pay the rent and expense it?

Oh, yeah, maybe it's rent that would have been equivalent to the Hilton down the street. Or maybe I'm going to have a monthly meeting for my friends and talk about some lotions or some soap and, and explain my downline. You want to come over this weekend? I've got a downline for you.

Yeah,

Mike, I love it in the office when he explains his downline.

That looks like a pyramid scheme. It's not a pyramid scheme. See, I'm up here and if you just get a few of your friends and then they get a few of their friends, they get a few of your friends, we're make a pyramid.

He's like, damn. Yeah, so anyway. But no, it's true. You could have regular marketing type functions and meetings and barbecues and have Customers and I. In a situation where a client wants to take this strategy and pay themselves from their own company, you better have good records. Yeah. Keep a roll call of what you discussed, who came, what business was conducted. I mean, a home office. I mean. Sorry, A board of directors meeting once a year. Fine. Don't abuse it. But some companies are small business owners are saying, I'm having a regular kind of a recruiting meeting for either employees or clients in my home once a month. That's 12 days. Yeah. I'm gonna pay myself a thousand of rental. There's 12 grand.

Yeah.

Tax right off of the S Corp. Yeah. Zero income to you.

Yeah.

Augusta Rule 101. Yeah.

That's awesome.

So.

And that amount you're gonna take is kind of what you'd have to pay somewhere else in that area to, you know, to hold that meeting and that function, you know, and meeting rooms are not cheap. They're not. You call the hotel. I mean, Mark and I run events, you know, and you'd be shocked at

how much a gallon of coffee. 120 bucks.

Yeah. Like, drink up, you know, best cup of coffee you'll ever have. Most expensive.

So.

So, so those things are. That's a great strategy. But check in on the numbers. I kind of like, you know, maybe printing out that little search you did to see what the rooms were just. You have a good idea if you do get audited on the amount, so you can demonstrate that. But I think even a thousand bucks could be reasonable. Like, you go see what it takes to get a boardroom at a hotel or a meeting event center.

I've been to your house. I mean, Matt's house is pretty bougie. Yeah. I mean, I think you could charge a little bit more. Scottsdale. I mean, it's Paradise Valley. Oh, sorry, pv. You know, for the.

Speaking of privacy here. Wasn't that our next topic?

What was your address again, everybody? We're going to be there at 2 o' clock on Saturday playing pickleball. Come on over. Challengers are welcome. So. No, the privacy is a good one. I'm glad. I joke around. Thanks for. Let me joke around. My life's an open book. But. So this brings us back to Main Street. So one of our. This is our exciting project this year is we've not only am I doing the certified tax program, we've really launched our Main street program of doing maintenance minutes, registered agent services and privacy where people are like, I want mail forwarding. I don't want people to know where I live. But can I Still take the write off. Yes.

Yeah.

So tell it. I mean, you've been knee deep in this privacy topic.

Well, I mean, first thing is think of you business owners, right. Like your entities and registering them and using an address. Particularly for people that have a side hustle or a lot of our rental property clients, they don't have a separate business location, but they have a home office. But I don't want to throw that on. On my company filings. Right.

So what do I do? Matt Sorenson.

Well, you need some address you can use. Oh, you know, now here's. It's a little tricky because when you have an entity, you have to have what's called a registered agent, but you also have to have a separate mailing address. And these are two different things when you're filing with the state because most states you can look up any company and you can see who's their registered agent and what address is that at.

And there's a.

If you're your own registered agent for your entity and that's your home office you're using, well, they know where you're at.

Screwed.

Yeah. Now you have people at your house, some tenant that you know not paying you rent come and try to shake you down to your home, whatever, you know. So you know, and I don't know if that's how in Christmas vacation how they found Clark's boss was.

Yeah. Uncle Eddie did some sweet. Yeah.

He probably just googled, you know, or maybe it was Ask Jeeves back then.

Yeah.

You know the company filing I love. Yeah. So. But so you have registered agent, but most states also make you designate a separate mailing address with which does not have to be in that state. So let's say you have a. Let's say you live in Arizona and you got a rental property in Missouri. Okay. You have your Missouri could be in Branson.

Yeah.

You know, if you're in. If you're into Branson, I'll be more Kansas City, probably.

What's in Kansas City? Well, the Chiefs are in the playoffs.

Yeah.

So. So there you go.

So there you go.

Okay.

All right. But you got the. Okay, where was I going?

You're in Arizona. You got a rental. You live in Arizona, but you're a Chiefs fan.

You got a rental in Missouri.

Okay.

With your Missouri llc. You have a registered agent in. In Missouri. And we provide registered agent services.

That.

That is basically says, hey, if there's any lawsuits, serve the papers on this person or company at this address.

And in Missouri. Yeah.

And that has to be in Missouri. But they're also going to say, hey, what's the mailing address? Well, registered agent companies don't let you use their address for mail. So you got designated separate mailing address. Now you're back at your home.

Yeah, but those are super cheap. I mean, I can go down to the post office and get a. Oh, are they cheap?

Go check what it is in the post office. Yeah, you're like, how's the post office not staying within their budget?

We're definitely trying to make it up on P.O. boxes. Yeah, that stamp's not cutting it. Yeah, the P.O. box, we're nailing it.

Exactly, so. Or a UPS store, you know, but then you gotta go there and pick it up. So if you're like, hey, I just want some privacy, we have a privacy service where you can use our address, our law firm address, which is now Main Street Business services address, and we'll get your mail for you. Now if you're like, hey, I actually want that mail now, some clients are like, I just need an address. Just give me an address. So you don't know where the heck I am and I'm not gonna really have mail go there.

So that's one level.

That's one level where you're just like, give me the privacy. I'm getting my bank statements online. I'm not using that address on anything else besides the state filing. I'm using my real address on stuff that doesn't get public on the web and such. But if you're like, no, I actually want some of my business important mail to go there. And I'm going to use that address in certain instances.

Okay.

We have a service for that where we scan the mail. You get a virtual mailbox and such where you can access it and you get pinged when new stuff arrives. There's different levels of that based on how much mail you get. But that's the way you get the

privacy and the write off. And still the write off and your expense for privacy is a tax deduction. See, because you're setting up your entity for your business with the privacy and the mail and the convenience and the write off at home. All 100% tax deductible. Boom, baby. See, so if you know, then you can go.

Then you can go.

Yeah, you gotta know. But I think this is super fun for people to know this is an option. And it can be regrettable because some clients are like, well, when I checked the box at LegalZoom, I didn't know any of this. So you may have to do what we call a cleanup. So you'd work with the law firm. Kkos. Christie's got two paralegals that all they do all day long is just clean up entities. So call the office and go clean up my entity. Let's change all this. So moving forward, it's tight. Sometimes it's better to just dissolve the entity and start fresh because sometimes there's a paper trail on the web and this and that. So do it. And if you're concerned about the privacy, have a consult with one of the attorneys. Attorneys and say, hey, I want to, I want to do kind of a whole review here. I want to look at my trifecta. What are my tax strategies I'm implementing and what privacy could I do better? And it doesn't have to be tens of thousands of dollars. It can be very affordable. So yeah, I don't know anything else. On home office, you can't write off the fridge even though keep your soda.

What if it's your soda for business? What if it's your rock stars?

Well, if the rock stars in the soda at your home office are for valid third party customers or employees that come by the home office, it's deductible if it's for you while you're home. Not a write off. It's the IRS that can clear on that.

Nobody gets to drink those rock stars.

So yeah, yeah, you gotta. So food for customers and employees is actually we ought to do the dining. Do a whole thing on dining because that's changed. It's changed the rule for employees and customers are two different rules. Boy, you throw the home office in there, that's next level. So.

Well, all right. Well, thanks everybody for tuning in to the Main street business podcast. Get over to main street businesspodcast.com you can get more information on the show prior episodes if you're still listening. You like this show, you learn something about the home office. You know, subscribe, share it, give us kudos or five stars, whatever. We'd appreciate it helps other people find the show. And we'll be back next week with another amazing episode. Tax strategies, legal strategies. Helping you build your wealth. Live the American dream.

Yes. I love it. And down in the description there will be a link to my article on home office. There will also be a link to the law firm and the main street business services. So if any of you are like, hey, how do I get there quickly to get some of this done? You're like in the mode, in the moment. It could be after five. Our websites all have abilities to make appointments schedule and get services going, even after hours. So make sure you get over. Yeah.

Just remember, if you don't know, don't go.