83 Minutes Of Tax Advice That Will Save You Thousands

The IRS is all over this like white on rice. They just got $80 billion last year to enforce more audits, more tracking, more collection of business owners and in cryptocurrency. And if you lie, you can go to jail. There's no easy button. I wish there was. I love Staples. I wish. I love that easy button. The side hustle is the method to save more in taxes and build more wealth and tax free cash flow. The number one tip in saving taxes. I have been saying for years, Let's get into it. All right, first, number one, the IRS is all over this like white on rice. They just got $80 billion last year from the federal government to enforce more audits, more tracking, more. More collection for business owners. And in cryptocurrency, they've got task force now that understand the blockchain, they can find your transactions. Oh, not on my, you know, defi wallet. No, they can. It's on the blockchain. That's what is great about crypto, is it's public, it's on the blockchain. Oh, but the IRS is not that smart. No, they are. They're that smart. So can I just show you the front page of your 1040 tax return? Okay, Jack, bring this up. This is the 1040 for 2023. Okay? See this right here? I don't know. Can I write on this? I might be able to write on this. Let's see. Nope, I can't write. Okay, let's look at here after your name, filing status, look at the first question right here. On your tax return, at any time during 2023, did you receive as a reward or award or payment for property or services, or did you sell, exchange, or otherwise dispose of a digital asset or financial interest in a digital asset? See instructions. Okay, did you catch that? If you received an NFT or any crypto via staking, mining, reward, award, payment, anything, or did you sell any crypto, yes or no? If you check the box, no. Okay, that's cool. Let's just go down here to. Oh. Under penalties of perjury, I declare that I have examined this return in the company schedules and statements, and they are true or correct. Wow. So if you lie on your tax return, it's not pretty, people. Can you drop that now, Jack, please? All right, so the IRS is onto this. You've got to sign your tax return, and if you lie, you could go to jail. All right, now some of you are like, holy crap. Taxes are due in four weeks. My 1040. I don't even know what I Did last year on my wallets or my, in my exchange. Then file an extension, people. An extension is okay. You actually reduce your chances of an audit with an extension. Some of you are like, extension, That's a bad thing. No, it's not. Now you need to estimate how much you might owe, send in a little money. If you don't send in any money, there might be a little penalty or some interest on that. But if you don't file an extension, the penalties are ten times worse. And if you file your tax return and it's wrong and you lie, then it's real ugly. So first point. If you sold traded any crypto last year and you think you cannot deal with it on your tax return, you're kidding yourself. I'm here to warn you. Now you say, well, Mark, all my money's in crypto. I haven't sold anything. I've just been trading crypto. I don't pay tax until it goes back to US dollars. Wrong. Let me tell you the law. There are three ways you, your crypto taxation. Your cryptocurrency is taxed. You buy cryptocurrency for, let's say you bought Bitcoin at 30 grand and now it's worth 72, 73, your money doubled. You sell it and go back to US dollar, you're gonna pay tax. You bought it for 30, you sold it for 70, you have a $40,000 gain. You're gonna pay tax on $40,000. And if you only held the crypto less than 12 months, you're paying short term capital gain which could be as high as 39%, 37%. These are my brackets right here. You look at our brackets. We have got to be extra, extra careful that we are not going to hit that 37% bracket. We might want to hold it 12 months and get capital gain which could be as low as 15%. We're 0, 15 or 20. So number one, if you bought crypto and you have sold it in 2023 for any gain and you went back to USD, you're paying tax on the difference. Number two, well, Mark, I had bitcoin and then I traded it for Ethereum. I didn't go back to USD, I just traded it for Ethereum. Taxable. Because whether you go to USD or you go buy a bunch of Ethereum, you got rid of your bitcoin in that example. I bought it for 30, I sold for 70, I have a $40,000 gain. Well, I just exchanged it for Ethereum. That's the same as Selling it. Now, if you don't hate the player, just hate the game. This is the game. You buy stock, you sell it, you pay tax. Well, I bought crypto when I left it in crypto. Exchanges or wallets, doesn't matter. If you exchange it, you pay tax on the difference of what you bought it for and the current US dollar value the day you exchange it for another coin. Well, I did it in my Metamask wallet. Okay, don't care. You're still paying tax. Mark, you have no idea. I do trades every day. Yeah, so you're going to need software. Coin Ledger. Coin Ledger is the number one software out there for individuals to plug in all their different wallets and, and get the reports on all of your gains and income for last year. And they do the defi wallets, they don't just do the big exchanges. Number three, you take any crypto of any current, of any type of token and you exchange it for services or buy something with it. Oh, you bought an nft. Taxable. Oh, I went and got some money out of an atm. Taxable. I used to go to a restaurant in San Diego. Taxable. If you use your crypto to buy something, that's equivalent to selling it. So if you go back to USD, you trade for another type of token or coin, or you use it to buy an NFT or service or product, you pay tax. I'm sorry, I know this is not fun hearing, but that's water under the bridge for 2023 and I can't save you taxes for 2023. It's over. It's over. Whatever you bought and sold in 23 is over. And if you just bought it in 23 and just sold it now, it's over. You have to call your tax advisor before you sell. If you just think, say you own a rental property and you want to sell it. If you go to closing and sell your rental property and then show up at your accountant's desk and go, hey, how do I save taxes? They're like, well, before you sell it, let's look at a 1031. Let's look at a charitable trust. Let's look at an opportunity zone. Let's look at an installment sale. Let's look at a dst. What? You already sold it? Well, what the hell can I do? You already sold it. Now we might be able to salvage a little opportunity zone if you want to go buy some real estate. Now I've got to figure out how to offset your gain with other investments. We have got so many awesome freaking strategies. We'd love you to do your crypto transactions in a Roth IRA and never pay tax again. The charitable remainder trust would allow you to sell all your crypto tax free and create a stream of income. We've set up hundreds of charitable remainder trusts for crypto traders. Have a consult with a real tax lawyer on Main Street. That's affordable. Our tax lawyers are super affordable. You can meet with them anywhere in the world. On Zoom, we'll have a strategy session and see what you need. But remember, this is part of your bigger equation. What are you doing with this money? Are you buying real estate? Do you own your home? Do you have a revocable trust? Do you have an S corporation? What's your day job? What's your side hustle? People, this is what a tax advisor should be doing for you. Anyway. Now I have a certified tax advisor network and any of you that are enrolled agents, CPAs, accountants, tax lawyers, financial advisors, and you want training on how to be a certified tax advisor and provide advisor services. I have a 12 module training program. One entire module is on crypto. NFTs, metaverse, staking, mining, trading, capital gains. All of that is in A section. So if any of you are looking for a certified advisor in my program, you go to markjcohler.com and you can find one right now that's taking clients. And by the way, I don't make any money. I just give, give the network away. I want people to find I'm a matchmaking service and I don't take any money from it. I'm taxmatch.com I want great tax preparers hooked up with tax filers. Let's get you some help. For any of you that are looking to become an advisor, one of 12 modules is just crypto. Whole module on real estate, whole module on asset protection, four modules on tax planning entities, the whole nine yards. Check it out@marcjkoler.com all right, now let me just hit a couple other points and then we'll. I'll take your questions. It's a big topic. Our crypto tax summit is a full day. A full day at the Crypto Tax Summit. So what I'm going to show you here is what I call the trifecta. The trifecta is where we organize your transactions. If you're doing mining or any type of staking that is not custodial staking. So staking, mining, or, or. I'm going to put some metaventures. You're going to want to run that through An S corporation because that's ordinary income. That's how it works. If you don't, your taxes are going to be close to 45, 45 to 50% on the first hundred to 150 grand. That's your tax rate if you're mining, staking or doing metaventures. Now if you're holding crypto, all right now I'm doing custodial staking, I'm buy and hold, I'm trading. That goes on the right side. Now we might use an LLC for asset protection or we just hold it in our revocable living trust. This all comes down to your 1040 and nets together. So people, if you're holding crypto, we're going to be over on this side and this is where I'm going to put your NFTs, all of your coins, tokens. Alright so we've got to decide are you doing operations with crypto or are you doing holding with crypto? And a lot of traders are doing both. I'm doing crypto mining and I'm going to pay higher tax rates on that. But as soon as I get my bitcoin from my mining it comes over here into a bucket. So you want to make sure you understand those differences. Now the last thing I want to point out is NFTs or a whole other animal and anybody that's doing crypto gets into NFTs pretty quickly. It's really the future of so much of our technology in this country. The blockchain technology is off the chart. NFTs, there's two types of NFTs. There's collectibles and then there's utility NFTs. If you buy and sell a collectible, you have to pay collect. The tax rate on collectibles is 28%. It's not pretty. If you buy and sell a utility token or nft then you can either get short term capital gain or long term capital gain which is going to be a lower rate based on your bracket and long term capital gain could be 0 to 15 to 20%. In all these situations you also have state tax and if you go, well Mark, I have my, you take, I have my server in Nevada or I set up an LLC in Tennessee or one of my nine tax free states, Washington or Florida or Texas. So I don't pay state tax because that's where my LLC is or my corporation. Whoa, whoa, whoa, you live in California, you live in New York, you live in Illinois, you're going to pay tax in California. There's no way around it you can't set up a Nevada LLC and think you're going to get around it. You won't. California is all over this and they have been for years. So it takes some planning. I am sorry to be the bearer of bad news. So get informed, get educated. Because you're going to be more educated than your tax advisor with training at our summit and any of you tax advisors out there, we got to know this now. I love Coin Ledger. I'll say that again. Coin Ledger is a good resource to start getting the data for 2023. File an extension 4868, get on my network and find an accountant, an advisor that can walk you through this when it's time to do your taxes. Let's talk about getting out of debt. Now an important concept here is there's productive debt and reductive debt. Now this is where Dave Ramsey and I part ways a little bit. And you know what, God bless him, he has changed the lives of millions of Americans. Helping him get out of reductive debt, which is bad debt. Credit cards, student loans, car loans, maybe even a home loan. A debt that doesn't make us money, we don't want debt that doesn't build our wealth. We can get into debt because of an emergency, we can get into debt because we gotta pay off other stuff and we consolidate and all of a sudden we're down a rabbit hole and it's hard to see the light. So that is the debt we want to get rid of. But you want to buy a rental property, do you want to get a business loan, do you want to get debt that can make you money? And I think debt to buy a home so you're not paying some landlord, not a bad thing. And then we want to pay down that home debt as fast as we can. That's productive debt to me. So I don't want you to think the sky is falling if you have some sort of debt. We got to analyze it. That's step one. Now step two, do not cut up your credit cards in this process. We want to pay off credit cards as quickly as possible and then use them for maybe $50 every couple months, pay them off. Now some of you may have the self control to use those credit cards more regularly and pay them off at the end of every month and build points. I love freaking building points. Taking advantage of the credit card companies and turning it on them. Points are tax free. So if I can turn in points and travel and all that, don't get me started, I love it. But also when we're in the hole of debt, it's a loaded gun. We don't want to play with it too much until we get it really under control. So I would recommend any of you that have credit card debt that you're struggling with life, let's get out of debt, not cut up the credit cards. Because when you get a debt, guess what's going to happen to your credit score? Man, your credit score is going to rock it. And we want a good credit score because we want to buy assets that make us money. We want to buy rental property in a better home and maybe get an SBA loan and start a business and all these other things that require a credit score. Having a credit score is not a bad thing. Having a credit card is not a bad thing. We just got to use it wisely. So let's analyze our debt. What debt do we need to get out of? Let's not cut up the credit cards. Let's have a pragmatic approach. And then we're going to implement the debt snowball. Now, some of you have heard this term thrown around so many different financial advisors around the country. Even Dave Ramsey, of course, himself teaches the debt snowball. It's super simple. And this is good review for all of you. I had to review the debt snowball equation myself before we started this live because. Because it can seem a little odd. You know, don't I want to pay off my credit cards that have the highest payment? Don't I want to pay off the credit cards that have the highest interest rate? Well, the answer to both of those is no. In the traditional debt snowball, which I am a firm believer in, once you find that reductive debt that we're going to get out of as fast as possible, and I wouldn't start with your home loan on that, or maybe even a fat car loan. Let's get rid of the credit card debt first. Because where we're going today is I want to get out of debt first. And then we're going to take that money we've been throwing at debt. Oh, and we're going to ramp up that Roth ira. We're going to ramp up our savings. Because the wealthy at age 40, 50, 60 years old, they're living on tax free money. The smart ones are, they've done it. They built that nut, they're growing it. And I want you guys growing it. And the younger you start doing it, the better. And for those of you that are listening to this, that might be 40, 50 or 60 years old. It's never too late to get started. You can always get started. And I'm not going anywhere with my weekly podcasts, my articles, my workshops, my blog articles. I'll be there for you. I'm going to continue to work my retirement account and my wealth and retirement real estate and investments, just like you are. So we're all in this together again. Now. That's where we're going. Okay, so you got your reductive, crappy debt. So what you're going to do is make a list. What's all this debt? And you're going to list it from the highest debt amount to the lowest debt amount on a spreadsheet. Now, spoiler alert, I'm going to give you the the link here or the procedure to get a free debt snowball video where I go through this in detail. And a spreadsheet already built for you so you can plug it right in, does the math for you. It's free. I have a weekly newsletter. That's all I ask to start following. Start drinking my Kool Aid, man, because I'm going to make you rich. All right, so what we do is we list out those debts, high to low, and then we're going to tackle the smallest debt first. I don't care about interest rates. I don't care about minimum payments. I care about the lowest, the least debt, the lowest balance debt first. Then what we're going to do is make minimum payments on all the ones above it. And then the smallest debt, we're going to make a commitment. We're going to say, you know what? I could do $50 a week. I could do $200 a month. Towards that, you're going to pay yourself. You're going to make an investment in yourself. And we're going to talk about where to get this money here in a moment, too. There's a bridge between getting out of debt and making a million dollars in your retirement account. And we're not talking Wall Street. You can invest this money wherever the freak you want. So don't think when I say IRA or 401k, I mean Wall street crap. You may want ETFs and mutual funds. We can go there. But it's bigger than that. So a lot of options. Okay, so we're going to get there. So you're going to commit maybe 100 a week. That could be $500 a month. Some of you may go, mark, I don't have $500 a month. And I'll tell you where it's at. You got it? I'll show you. But it can even be as low as $50 a week, 200amonth. So what you're going to do is make your minimum payments on all those debts above that small1, add $200 to the equation, bare minimum, to that last minimum payment, and you're going to double down, let's say that minimum payments $50 on that smallest debt. Now we're going to make a $250 payment. You might pay that debt off in three months. Maybe it's a $750 little crappy Visa. It could be a Macy's A card, it could be a Home Depot card. I don't know, some little crappy credit card you picked up along the way. That could be the lowest one. It may take you six months. So you're plowing $250 every month for six months of that debt. And the minute it pays off, you celebrate maybe a little Taco Bell night, something simple. I don't want to get crazy, go out and celebrate and go, I paid off the freaking credit card. And then you're going to take that $250 and combine it with the next debt up. That next debt up there might have a minimum payment of $75. Now you're throwing 325 at that debt, the 250 plus the 75, because you've been making minimum payments along the way. So you got the 325, blowing down that second debt. Then all of a sudden, six months later, four months later, eight months later, that one's gone, you celebrate maybe a little Red Lobster, maybe a little, you know, Olive Garden. Let's get out there. I love those breadsticks. Get out there. Maybe it's because it's January and I'm not eating carbs, so I'm thinking Olive Garden breadsticks. But you're going to take that extra payment and apply it to the next debt and then the next debt. And then all of a sudden you start feeling confident, you're feeling proud, you're feeling positive, and boom. Most debt snowballs create complete debt free and less than two to two and a half years, many times 18 months, sometimes eight, three years. We've seen incredible stories. And this, this is where I'd love again. Last plug, I'm going to say is Dave Ramsey's debt free days. And, and people celebrating on social media going, I'm debt free. Now, that may not mean your home loan. That's okay. I want you out of debt. Of all their crappy Reductive debt. That could be that student debt hanging over you as well. Now here's the transition. Let's say you, by the time you're on your last debt, you're like, holy crap, Mark. I've been throwing three, three grand, two grand, fifteen hundred a month at all this stuff. Now I got $1,500. I'm going to go get that BMW lease I've been looking for. Whoop, slow down, tiger. We are not going to go get a new lease on a luxury vehicle. We're going to take that fifteen hundred dollars and shift. You've been living frugal, you've been getting out of debt and now you're going to live like the millionaire next door. Because you can take that fifteen hundred dollars and shift it over to plowing it into investments. Investments. And maybe buying your first home investments into building a business. But at least $500 a month into that little retirement account called a Roth ira. That Roth IRA could buy Crypto. Boy, crypto's rolling this week. I'm loving it. You could be buying real estate. You could buy gold, silver, you could buy stocks, bonds, mutual funds, ETFs, it's all available. I've been teaching self directing your retirement account for years. So don't think it just means open up a Schwab account and buying something you totally don't even know what it is. So you're going to take that extra money that you've been doing and using to pay off debt and just start plowing it into investing. Now I was doing some math here right before we started, and if you take that $500, $500 a month from what you were using to pay off debt, now I've got another way to find that $500. We're going to come to it here in one minute, then I want to answer your questions. We can talk tax wealth building, legal, setting up entities, suing your brother in law, whatever you want. I'm a tax lawyer. I got you. But this fundamental principle is what's going to set you free. So that $500 a month, if you're anywhere between age 25 and 30, by age 60, you're going to have over a million dollars, tax free. Set it on autopilot. You know it's funny, Jack, my director here, I was walking down the hall, he's like, you got to go live. And I was, you know what I was looking at? My acorns. My little acorns. I love acorns. Acorns is an app that and we ought to put an acorns link in there, too for people to sign up for Acorns. I'll send that over to you right now. I love acorns. I'm full transparent. I got my acorns. I just put $50 a week in my invest and $50 a week in my later. And right now, over the last year, I've built up $11,394. I don't mind saying that that's why I'm little. But my little acorns, that, you know, you're like a squirrel putting away acorns. Do you get it? It's kind of cool. Okay, so you're going to use your acorns to build some wealth and just track your income and go there. Jack, I'm sending this over to you now. Here's the link. Pop that link into our chat. And when you sign up for acorns, you get to set that amount you're going to put away. And it could be out of sight, out of mind. You can round up to the nearest dollar when you're at 711 or Circle K, go to Walgreens, go to Walmart. You round up to a dollar, it goes into your retirement account, and you don't even see it. About $40 a month goes into my acorns. Just rounding up. So you're putting away a fixed amount, maybe $25 a week. Boom. And you're getting started, people. You don't have to be rich initially to get rich. Everybody that's rich didn't start out rich. They got there over time. And so as you pay off that debt, we're going to reallocate that money to building our IRA, to building a Roth. And just $500 a month. 30 years from now, you'll have over a million dollars. And you hear all the experts talk about this all the time. People don't worry about these influences that are talking about being a billionaire. And you're going to have $10 million. And you people, it's so out of touch for me, too. I'm not one of those types. I'm about slow and steady wins the race. I'm not the rabbit running around with their heads cut off. I'm just the turtle plugging along on the path, doing the basics every week. And I love my little Acorns app. Just go in there, boom, boom, boom. Putting money away. Now, where could you find another 500 bucks? Maybe some of you are like, mark, I'm not in debt, but I don't have 500 bucks. Let me give you some kick ass stats here. You know, 45% of working Americans, this is over 50 million Americans have a side hustle. I have multiple sources of income. I could very well fall into that category. I, because I've got multiple sources of income, I'd say I got side hustles. I might have two or three. Over 20% of those have with a side hustle make over $1,000 a month. The average time spent in a side hustle in America of this group that I'm talking about, five to 10 hours a week, that could be one day out of the week. On the weekend it could be one to two hours a day at most. The average side hustle income is $688 a month. Now let me give you some numbers. What are these side hustles? It could be uber doordash, selling a product online, doing turo with your car, renting out your car on the weekends, thumbtack, being an affiliate, Etsy Rover. What are some of the others, guys? I mean, all sorts of good stuff. I mean you could be making money on upwork, Etsy, get out there and sell a product online. Sell. What was the average income on Etsy? What we were saying? Almost all of them are $20, 20 to $30 an hour on almost all these. And if you do the math, one hour a day gives you 500amonth. Now for those of you that start to get a little more creative and you start selling products, ebooks, creating a little digital product and you're out there learning how to do this, this is where the real money's at. Because you're making money while you're sleeping. Now what are we gonna do with that money? Are we gonna go out and buy a bigger house? Get a Range Rover, go get a Beamer? No, we're gonna plow it into savings. We're gonna save money before we spend it. And people all of a sudden you get addicted to getting rich. And getting addicted to being rich is freaking fun. It's awesome. And it's doing the little things. I'm not out here telling you to go out and start a new business and invest 50 grand. By the way, there's no boot camp of mine. I'm selling for 10 grand in Vegas. I don't want you do not give me any money today. I do not want any money. I want you following, learning, drinking the Kool Aid, getting on your American dream path. Let's make 20, 24 freaking awesome. The American dream is real for Main Street. America and that's you and me. We don't have to be uber rich. We can be comfortable. So let's get out of debt. Let's analyze our balance sheet. What does our debt look like, the good debt and the bad debt. Let's not cut up our credit cards. Let's build our credit. Let's build a debt snowball. Start getting out of debt of the crappy debt we don't need. Then reallocate that money we're spending on debt to saving and investing. Final key to this equation, keep learning. Keep learning. Get some good podcasts you love. I'd love you to listen to my podcast, Main Street Business Podcast. We're talking about Main street business. I would love all of you have a side hustle that freaking changes your life and the next generation's life in your family. Leave a legacy so, so, so powerful. So that's it. There's no, there's no magic sauce here, no secret sauce that just. There's no easy button. I wish there was. I love staples. I wish I love that easy button. But it just doesn't happen overnight. We got to do these little things just over and over and over again and make it a habit. This year it is estimated over half of working Americans have a side hustle. That's a 1099. That's a little business on the side where someone's paying you to do something out of your regular 9 to 5 job or day job or night job, if you will. You're out there earning money in some other way now. By the way. This is the gateway drug to the American dream. The side hustle is a small business. It is and I want you to embrace it. The side hustle is such a wonderful way to break out of the insanity of just trading time for money and working for someone else. Not that that's bad. I have many, many clients that keep their technical training from a great college experience or vocational training or a career path where they're getting paid great money or reasonable money for their day job career, that's fine. You got benefits. Maybe you and or your spouse love it. I know, I'm okay with that. But if on the side we can build that side hustle and make more money. We're going to pay off debt, we're going to start saving more money, we're going to invest in assets that start making passive income people. The side hustle is the method to save more in taxes and build more wealth and tax free cash flow. We want to build cash flow so that we're not working our butts off every day. So, my friends, that's the beauty of the side hustle. I want you to embrace it, understand it, have passion for it, and go for it. So the five basic steps to begin with, and these are categories more than. I mean, There might be 20 or 30 things to do here, but I put them in five steps. Number one, launch the right side hustle. That's number one. Now there's really kind of level one side hustles and level two side hustles. Level one is Uber DoorDash. Maybe you're doing some consulting on upwork. You might be making 100 to $200 an hour on upwork as a side hustle. It's a great website for you to kind of sell your services if you have some technical training. Uber doordash, we get it. And I've got college students that are local area level two DoorDash. They're making 30 to $35 an hour in the evenings and weekends doing doordash. That's great. It's wonderful. And I'm hoping any of you that are on a level one side hustle, you're taking that money and you're getting ready to go to level two. You're getting out of debt. You're using that money not to just live week to week, month to month. And I know, I know it is tough out there. The cost of living has gone up dramatically. Wages are stagnant, People are struggling. My son here in the studio has been talking to me about just this ongoing suffocating feeling of our economy and so many middle to lower income, which you don't feel low income. But if you're making less than 100 grand, you're like, I'm broke. You're living week to week, month to month, and it is brutal. So you're doing this side hustle to make ends meet. That's level one. It's okay. And I get it. And I can save a lot of taxes on that because that little uber side hustle doordash, selling consulting services on upwork, that's a small business. So I want to write off cell phone, home office, auto dining, travel, all sorts of goodies. And we're going to pay less tax on that money. That's good, that's good. But that's level one. Level two, and this is how you get wealthy is that side hustle has to allow you to duplicate yourself or sell a product or service in the middle of the night while you're sleeping. That's when you Start to build real wealth, because now you're not trading time for money. You're taking your time and building something that you can sell when you're not there. Now, let's do a couple of quick examples. Let's say it's janitorial or landscaping. I've got a client that does landscaping, and he's got two crews. They do sprinkler systems and new builds, and they do lawn maintenance. And then he's also got two crews that do cleaning for Airbnbs. One guy, he and his wife. Wonderful couple. I love them. And they've got two crews out there every day cleaning airbnbs and two crews working on homes. Now, he could do it all himself, the landscaping and charge X, and his wife could go do all the cleaning and charge Y. But now if they have got two crews cleaning homes at $300 a house, and they're doing two houses a day with two crews at four different homes at 300 a home. Whoa. Now, I'm bringing in $1,200, but I'm only paying my crew $600. So if I can get a hundred percent markup on services I'm providing, I'm making money when I'm not there. Now, is that a challenge? Sure. You got to hire, you got to fire, you got to make sure your crew's where they're supposed to be. There's going to be administrative costs. But now you're not cleaning homes. You're managing cleaners and. And you're making money even when you might be at the soccer practice of your kids. Now, you could. And that's the same with the landscaping. Number two example. This is my daughter, Allison. I want to give her a shout out. She sells product online. She's been doing it since she was 14 years old. She would go buy used clothing, put it in the driveway, drive over it a couple times with my car, and then sell it online and call it the urban outfitter version. I'm more of a rural outfitter, Walmart. But anyway, she would take clothes, drive over it, and sell it, and she'd go into my closet and look for any old ACDC rock band shirts from the 80s and resell them. I'd be like, where the hell my shirt go? Well, I didn't know you wanted it. Yeah, I wanted it. And she'd sell it. But she's been selling clothes online for years now. She's selling patterns online. So she'll find. And she went on to school and learned how to be a designer and sew Clothing and so she can take patterns, show how to do them on YouTube and sell the patterns with her YouTube videos online in the middle of the night. She is making money online in the middle of the night. That's how we, that's how we start to build wealth. The next video I'll shoot is on scaling, but the first one is let's just choose the right side hustle and level one's okay, but let's be thinking while you're driving Uber or you're out there doing that consulting or driving doordash, you, you're thinking, I can do this better. What's my next side hustle where I can duplicate myself or a product or service and sell it online. Now, it's going to take some time. It's going to take some development. You should be watching Shark Tank every freaking night thinking of ideas and. But don't be beating yourself up. Take time to develop this idea and something that you're passionate about, something that you can make money at, that you love. All right, now I'm going to be filling questions here. In a moment, I'll give you some additional resources. I'm not going anywhere here. I'm. Every week we're helping small business owners around the country get started, structured. But it's not setting up an LLC first, it's not opening a bank account first. It's deciding your plan. What does that side hustle going to be now? Number two? Number two, Strategy or step? The basic steps. Okay, you want to go just do level one and take write offs. Great, I'll help you all day long. You want to go drive Uber, take write offs and put that money in the bank and pay off debt. That's great. You want to make money. I think that's why you're watching. Now we got to do step two. You're going to develop side hustle level two and you're going to write a business plan, a one page business plan. And you can get online and look over and over at all sorts of business plans and watch videos and do it. But don't pay anybody to do a freaking business plan for you. And don't think it has to be 30 freaking pages long. Just write up a page. What am I going to sell for how much? Who's my competition and how am I going to produce it? How much is it going to cost me to produce it? How am I going to sell it? And a timeline here. What's it going to take? 1 page, that's all I'm asking for. Bring me One page. Don't try to do it online or don't let AI do it for you. Don't pay someone else to do it for you. Take a real pen to real paper and pencil it out. Did I say pen? Take a real pencil and put it into paper and pencil it out. What are you going to sell for? How much? How much is it going to cost to produce? How are you going to produce it? And what's your marketing plan? That's it. Well, I talked to so many people that have a small business idea. I'm like, show me a one page. What do you got on it? Well, I got this. Great. No, no, no, don't tell me. Show me the one page because we got to see it on paper. Who's your competition? What are they doing? Secret shop someone. And it doesn't have to be super unique. You can be something doing something just a little different than your competition and blow it up by. Did you hear of Lowe's and Home Depot? It's okay. You don't have to be unique. There could be two of something. Number three, you're going to determine my capital needs. Am I going to have to borrow money from someone or partner with someone? You could be borrowing from a bank, an angel investor, someone that wants to get you. An angel investor means they don't want their money back, they just want to help you. It could be grandma, but you're going to borrow money from someone or institution or you're going to look for a partner. Stay away from the I word. Investor is a dirty word. Investor means give me money and I'll give you something. If I make anything, invest in my business, you lose their money, you're going to jail. That's an SEC problem. You don't want to look for investors and make promises you can't keep because you get in trouble. You want to say, hey, do you want to loan me money? And I will pay you back X in interest. That's a lender. It's a note. You borrow money, you pay them back. Or hey, do you want to partner with me? Don't call him an investor. Say, do you want to partner with me? You want to give me 10 grand and you can be a 20% partner, 30% partner. That's what they're doing when they go to Shark Tank. They're saying, give me money to help me launch this business and level up now if you need it. So I'm saying third step in this process is decide if you need money. You may not a lot of service Businesses, you don't need extra money. I started a janitorial business back in 1992 when I was started to go to college. And I ran it for six years and sold it for a profit. I had 25 employees. At one point, I was working in the middle of the night as a janitor. It took me $500 to start the business. I went and bought a vacuum, a wet dry vac, and a mop and a broom, literally. And I started knocking on commercial doors saying, I'll clean your building at night and I build a business that way. Sold it for $50,000, to be honest, is what I sold it for at the end of the day and went off to law school. That was a janitorial business. I didn't need investors, I didn't need partners. I didn't need to go borrow Money. Your Level 1 side hustle is you're saving money to be the capital you need to launch your level two side hustle where you can duplicate yourself a product or service. Now step four, step four is you're going, okay, Mark, I got my idea. I've got my business plan. I decided I don't need money or whatever. I've got the capital to do this. I'm going to go sell that piece of crap boat in my backyard or that RV I never drive, or I'm going to go sell this in my garage, or I'm going to sell something to get this launched. Step four, structure. Now I'm going to go to the whiteboard. You really have two options on this. And it's okay, don't think again. You have to run out and go set up an llc. You might. We're going to talk about that. So get structured because you have to. You can't build wealth if you don't build a structure to build upon. So option A and B. Option A is ghetto. We're just going to do a sole prop. We're not going to go worry about an llc. We're going to use your Social Security number. We're going to just start marketing it. We're going to test the product. We're going to make a little money. We're going to just make a little and we're going to see how it goes some. We don't need to rush out and get a formal thing going. If it's just, you know, we're just going to test out the idea. And I kind of like this idea because I don't want to spend a bunch of money getting organized if we're just in kind of that product development focus group level, you know, I'm going to just try this out and see how it goes. If you get any traction at all, we immediately go to option B. Option B is where you're going to set up an LLC in the state where you operate and live. Now I'm not going to. I'm going to maybe launch that into an S corp down the road, but that's later. I just want a basic LLC in the state where I live. Now be careful going online and click, click, click, click. And I'm just going to go set it up and watch Google and Lala. I'll tell you, my little law firm is very affordable and helps clients around the country do it right and ask a bunch of questions of a real tax lawyer on Zoom for a Main street business owner for around 1200 bucks. But if you want to go knock it out for 4 or 500 on some online site, go for it. Be careful. Make sure you check all the right boxes and it's not just one sheet of paper. Well, Mark, I can do it at the state for $50. Yeah, that's about a tenth of an LLC. There's a lot of pieces. You got the new BOI report to FinCEN has to be done in 90 days. You need an EIN, you need a corporate book, you need a bank packet. You got to go to the bank and open up an account, get it done right. All right, so you've got this llc, you're going to get an ein, like I said, and you're going to go get a bank account and you're going to start getting the platforms in for payment. You want to set up your stripe, your square, your whatever, Zelle, you're going to do all the things you need to. And by the way, as a person, you can get money on Zelle, but you don't tell them it's your business. But anyway, you start getting all these payment plan forms in place, your bank account, your ein, your bank, your llc, and you're going to look at your URL. What is your website name? I want your website to coincide with the name maybe of your llc. We always want to be looking for our URL on Godaddy. At the same time we're deciding on our business because we're ready to launch. We got to have all this structure in place. Now is there going to be more than that down the road? Sure, maybe we build some corporate credit and we start getting our logo down and we start designing our website and all this. But to Me. This piece brings us to step five. Step five is the marketing plan. And in the marketing plan, you're going to decide on the logo, the website, your colors, are you going to do paid ads or not? What are you going to do with social media posting and social media platforms? And you're also going to talk about your local market. Is there networking involved locally? How are you going to sell, how are you going to onboard, how are you going to bring in your clients and make your sales? So you've got this whole marketing plan that you can, that evolves, it grows, it evolves, it changes. It's okay that it has change. It's okay. So I carry my marketing plan around with me everywhere. So this step of getting structured could be super simple or at least enough to open the doors. Like I want to open the door and start making money. So if, if I can get these five steps down. Let's repeat these. I've got my level one side hustle. Level two is where I'm going to make the real money. Number two, I'm going to do a business plan for that level two idea. Number three, I'm going to determine what the capital is going to be necessary to launch this and if I even need partners or where I'm going to get the money. Level four, I'm going to get structured. Now I may do some market testing, staying as a sole proprietorship. I don't need to go out and spend for any legal or any banking or any major structuring. I'm just going to kind of test out my idea, secret shop it, if you will, amongst your competition. And then the real structuring, before I go to level five or basic step five is I'm going to get my structure done. An llc, a bank account and ein the payment platforms. La la la la la. And then boom, go to the marketing plan. And in the marketing plan, we're going to start checking off all these boxes. The last thing I want to say is, do not feel like you have to do this in the next three weeks. Don't compare yourself to anyone else. Compare yourself to you. There's no rush. It is not a race. I want you to love this idea. I want you to be passionate about the process. I want you to be excited about this. If you're having anxiety, waking every day up every day about this, you got the wrong approach. You know, I've got to do this. I don't want to do this. This is terrible. This is miserable. I hate this. Then don't do it. Let's find the thoughts that give us the right feeling. Like, oh my gosh, this idea is great. I have unlimited potential. I could make more money doing this than working for someone else. I could supplement my day job and in a powerful way I could build wealth. I could build a future retirement. This could be really exciting. Think of all the new people I'm going to meet. Oh, do I have to be perfect at it? No. Do I have to be super successful at it? No. Do I have to do it right away? No. Is there any pressure? No. You're the only one creating pressure for yourself. Think about the mindset you want to go into this with. That's half the battle. Setting up an LLC and tax write offs. Follow me. I gotcha. I gotcha. I'm doing this constantly. I got books, I got podcasts, I got video. I got a tax pro network of accounts that'll help you. It's this stuff that matters. On what you're going to do and believing in yourself, taking your time and going at it in pieces and parts. Now I'm going to do another broad. This is step one, this is part one, part two, which may be next week. It might take a couple of weeks. Let it percolate for some of you is I want to do scaling your side hustle. See, once you get this launched, that's one thing, but how do I hire employees and how do I expand, how do I grow, how do I scale this? That's a whole other set of tools. But let's just get the damn thing up and going. Let's make some sales. Let's figure out our product, our service, our pricing model and work out the system a little bit. It's okay. It could take you several months to do that. Could take longer, could take less. That, my friends, are the five basic steps to get your side hustle launched. And cranking the number one tip in saving taxes. And I'm going to throw down I don't know how many. I'm going to freaking rock it today. I'm going to throw down as many as I can. I've got a multiple lists here. I've been just figuring out what I want to cover. But the number one tax strategy that I have been saying for years is that you've got to have a little side business somewhere in your equation. Now I know some of you are like, well, Mark, you don't know. I am so busy. I work 50 hours a week already at my W2J job or I've got. I hate having a small business. You're just trying to create more work for me. People, hear me out. Put your guard down for just a moment. When you have a side hustle, you're generating additional income that is oftentimes tax free for the first 10 to $20,000 because I've got enough write offs that we can chew that up. So now you're making tax free money that can be used to pay off debt and then used to build passive income. I don't want you to have a side hustle to drive a nicer car, have a bigger house. Let's use our day income if you're married or have a significant other, let's use our combined income to pay our bills and live within our means. But if you have a side hustle that is the gateway drug to being wealthy, because that side hustle might turn into a medium hustle and then a big hustle. And then you get employees involved, you let it scale and you watch it run itself, maybe. Or you sell the business. Or if you're generating enough cash flow, you're using that to plow money into real estate and other investments that is making you money while you're sleeping. Now I'm going to hit 10 write offs for you side hustles that you have got to be thinking about before you file your tax return for last year. Many of you, they now estimate almost 50 million Americans have a side hustle. I've seen estimates as high as 50% of working Americans, certainly one in three Americans before COVID There are so many people running a little side gig just to make ends meet. I want us to shift that perspective and go, if I'm working so hard just to make ends meet, I need to be making more money with my main hustle or I need to expand that side hustle so that I can use some of those profits so I don't have to work too hard in the future. So here are some of these strategies. Many of you have already got a 1099 from last year. You've been driving Uber, maybe delivering doordash, maybe you sold something on ebay or on some sort of affiliate fee, any 1099 you might get. And some of you're like, well, then you give me a 1099, you still have to claim it. You will get audited. It is illegal. It is tax fraud. You think, well, they just paid me cash, I don't have to claim it. Who told you that? Whoever told you that you have handcuff yourself to them when you get arrested. People you have to claim the income you earn as a small business owner and it's okay, I want to give you 10 write offs here that you can use to whittle that 1099 down to nothing maybe. Depends on the amount of income and your lifestyle and where you live and how you're doing it. Okay, let's go through it. It's funny, I was just talking to a financial advisor today that inherited 400 new clients and he's been looking at their tax returns and he said, Mark, 90% of the tax returns I've been looking at have no home office deduction. It's crazy. And he's like, well, I talk and he says, I talked to this accountant who was like, well, yeah, well, my client has a day job. They work for a brokerage and they have an office there. So they can't write off the home office. Have you ever heard of the admin office exception which has been on the books now for almost eight years? People, there are so many ways to write off home office properly and ethically, honestly and aggressively. Do not listen to an accountant that tells you the home office is a bad write off. So we're going to do home office now. By the way, I've got videos, articles and books on all these topics. I can unpack home office for the next half hour. We're not going to do it. I'm going to give you a list. Number two, cell phone. Such a great write off the IRS rule. As long as I can show I have a separate phone for personal use, maybe even a phone plugged in the wall at home, or I use my significant other's phone for personal. Your phone can be a hundred percent write off. And when I say cell phone, I'm talking about the case, the charging cords, the phone service, anything related to that phone. That is going to be a write off in your side hustle. Now if you say, well, I use it for my home phone too, my personal phone, then let's cut it in half. We're going to take 50% of your cell phone costs. Number three, I want to write off auto. Auto is such a great write off. If you use your auto 50% or more in business and you have to kind of look at your mileage and what you're doing, 50% or more on your auto, you can take actual, which means you're depreciating the car, you're writing off fuel, repairs and maintenance. The rest of the time we're doing mileage. And mileage is great. You can write off mileage on multiple cars. That might be in your household. You can write off mileage on your rv, write off mileage on your motorcycle. If you use it for business, it's a freaking write off. Number four, dining. Oh my gosh, I love writing off dining because with a side hustle, you're going to meet with potential contacts, clients, partners, vendors, maybe even with your significant other on occasion. We're not going to write off Little Caesars every other night, but when you go out to a nice restaurant, what do you do? You talk about business. So we're going to, we're going to write that off. Dining is a great write off. Do not shy away from it. Number five, travel. Love travel. I was just talking to my son Dylan here. We're headed to Miami for The Grant Cardone 10X Conference here next month. So excited to go. He puts a great conference together. That is business training. We will be writing off that trip. When you go to conferences, when you go to travel and look on your in on your rental properties, meet with customers, meet with clients and partners and vendors, that's a write off. You can write off 100% of your travel and only 50% of your dining. So you got to be on it, which I just love. Number six, I want to throw in kind of these equipment and tools based on the type of business you have. Equipment might entail cameras, tripods, fans, lighting. I'm just looking around my studio here. It may involve drones or anything that you might be shooting social media video with. Also you might be in more of a kind of a construction or service type business where I'm writing off everything at Home Depot. Tools and supplies and equipment and air compressors and toolboxes and all sorts of goodies. So whatever your business is, you're going to be buying equipment over and above what you would be using as or calling typical office supplies. We want to be writing off equipment. All right, the next one that I think is so critical, I'm going to put it right in here now. So I'm going to say family members. I know some of you have kids, some don't. Some of you are single, some of you are married. But the point is, if you're helping any family member out financially and it's easy when you start talking about kids, kids under age 18 and over. Age 18, if you have a side hustle and your family's helping you at all, quit paying taxes and giving your kid money for T ball, music lessons, dance lessons or school clothes, pay them for helping you in the business. And it can be very Very legitimate to pay kids as young as 6, 7, 8 years old who are doing office cleaning or stuffing envelopes or helping out at the rental properties, picking up garbage or mow, mowing lawns. When you get your kids involved, you're going to take a write off for giving them money. I love it. It's a great write off. And if they're under age 18, you don't have to issue a W2 and they do not pay taxes on the first $13,000, approximately the standard deduction this year in most states. Some states have a lower standard deduction. Lots of strategies there. I've got additional reading material but I want to put family on the list. The next is I want to put medical on the list. Medical is a big deal and a lot of people don't realize you can write off medical expenses. They think it just happens. Young people are like, well my medical expense is a write off, right? No it's not. You've got to find a way to write it off. The hsa, the health Savings Account. You don't have to have a small business, but the HRA is a way to write off unlimited medical expenses. This is co pays, deductibles, eyes, dental, physical therapy, chiropractic, acupuncture, anything, prescription drugs. That all falls under what is called the HRA or health reimbursement arrangement. You have to have a small business to do it and a lot of people miss out on that write off. It's just so, so, so powerful. Now next on our list is I want to just kind of get into. I'm going to stick with the insurance issue because health insurance is a write off in a small business. Also, any other insurance policies you might be paying for your business, we want to be looking at your expenses like accounting, legal, insurance. These are all things that are going to come into play in a small business that a lot of people don't realize. Well, I don't pay for my employees so I can't write it off. Oh no, you can, you can. So we're going to look at kind of professional fees and make sure that we're getting a write off for all of those. The last thing I'm going to just throw out for fun and these are top 10. I've got a 25 point strategy checklist of my ultimate tax strategy deductions on my website for free. You can get over to markjkohler.com, click on my download my ebook and it's free. And I know just all you're signing up for is my weekly newsletter where I send you more strategies. And there's 25 over there. But number 10 and oh my gosh, it just escaped me and was I saying my number 10 was, you know what, I'm going to just throw down 10 as real estate. I'm going to use real estate. There's so many on my list. Just trying to think of my top 10. Real estate is an important one because real estate is a tax deduction waiting to happen when you talk about depreciation. And so if you have a small business, are you paying rent to anyone else? Could you own the building you're renting? Could you buy a little rental property, a single family home or a duplex? And when you partner with others to buy a rental, it's just as buying a rental yourself. Don't think you have to be rich to buy real estate. I want you to take that side, hustle money, be buying real estate. Because the write offs that come with real estate are unparalleled. It is the number one asset class out there for building wealth. And I'll just give you two quick reasons why. Number one, you can use leverage. If I take 100 grand, I could buy $100,000 of stock or I can use that 100 grand and the bank's money and on a 20% down loan buy a $500,000 property. So I could go buy a 4 or a 6 plex for 500 grand, or I could even though I only have 100,000 in cash or I could just buy paper for 100,000. Leverage is such a powerful tool in real estate and the Dave Ramsey's of the world may go, oh, you're using debt to buy real estate. Yeah, real estate that makes money. I'm not using debt to buy a new car. I'm not using debt for student loans. I'm not buying using debt to travel around the country on a cruise ship. I'm using debt to make money. Productive debt is very different than credit card debt. So don't go sucked into that argument. Number two, what's awesome about real estate is you can tweak it with small efforts and increase its value dramatically. Just slapping a coat of paint on a rehab can increase the value exponentially. Going into real estate and finding ways to save money can increase the value where if I just buy paper, I can't increase the value of my Walmart stock. I could shop at Walmart, but I'm not going to move the needle. But if I buy real estate, I could stop by there and put in better lighting. I could paint, I could do some landscaping. And I could increase the value of the property 10, 20%. That's a pretty powerful strategy. So there's 10 that I need you thinking about right now. A couple other strategies I want to throw out before April 15th. Do not forget, you can contribute to a health savings account. 3850 if you're single, 7750 if you're married or head of household. You can contribute to your Roth IRA and that money grows tax free. 6,500 if you're under age 50, 7,500 if you're 50 or older. You can put money in a Coverdell. That's like a supercharged IRA for college savings. Huge. If you're a parent, you could do a 401k. A SAP are simple. These are kind of little retirement accounts that you can add on top of an IRA in your side hustle. So these retirement accounts are super powerful in a side hustle to just throw money into them and get a tax deduction or Roth growth. I probably should have put that down as number 10. But again, real estate was so powerful people, so many options. There we go. Now, I want to mention a couple things about crypto. In fact, I'm just going to have fun here on Siri. How much is bitcoin trading for? How much is bitcoin trading for Bitcoin? US $67,507. Wow. Right. Well, they estimate again, over 50% of Americans own some sort of cryptocurrency. Well, I want to forewarn you that cryptocurrency is taxed when three, one of three things happen. Number one, I think you all know this. I buy a Bitcoin for 40 grand, which just a month ago it was in the 30s. But if I buy a Bitcoin for 30 something thousand a month ago and I sell it for 67,000 today, I pay tax. Right? It doubled in value. I'm going to pay tax. It's called capital gain. Now, if I trade that Bitcoin for Solana, I'm on my Metamask wallet. I'm in Coinbase. I'm whatever. And I trade my Bitcoin for Solana. Do I pay tax? Well, Mark, I don't because I just traded it for another crypto. Yeah, you pay tax when you trade Bitcoin for Solana. It's like a sale. It's like me selling Walmart stock for Tesla stock. Well, Mark, I still own stock. Yeah, but you sold your Walmart Stock, same point. You sold your Bitcoin. Now you have Solana. So whatever you bought the bitcoin for and whatever you sold the bitcoin for to buy Solana, that's going to be taxed. So whether I sell bitcoin or I trade it, I'm going to pay tax. Well, number three, I could take bitcoin and buy something. Isn't it pretty cool? Now, a lot. Some restaurants all over the country and others are taking the bitcoin as payment. At our law firm, we take cryptocurrency as payment. If you want to pay us to do an LLC for you or a corporation or anything. State plan structure. So using bitcoin in a transaction is also taxable because it says if you sold it, you're like, well, I didn't sell it. I just used it to buy lunch. And that's selling bitcoin. So how do you deal with this? I know some of you may be freaking out me telling you this because last year you were doing all sorts of transactions in 2023 in multiple wallets or on exchanges. You have to get a software program to just track it. Now, Coin Ledger and Tax Bit are my two favorites. Coin Ledger, I was just logging into it before I started this live, just to make, and I was like, oh, I already have a password. So what you do is you can upload your wallet and your transactions into Coin Ledger and it will prepare the tax forms for you and tell you exactly how much you owe in taxes for last year. People, the number one question, literally after your name, address, and social. Your number one question on the 1040 tax return is, did you buy, sell or trade or otherwise dispose of any form of cryptocurrency? That's the first question on the tax return. If you click no, that's perjury. You can go to jail. If you click yes, what do you think they're going to be looking for your transactions? Well, Mark, I don't know how to track them. Get the freaking software. So I would recommend Coin Ledger or tax bit. There's 15 others out there. Upload your transactions for last year and do your taxes. That way you're like, mark, oh my gosh, my taxes. I was going to do them this weekend. Yeah, you might have to extend your tax return. It's okay. When you extend your tax return, you actually reduce your chances of an audit. Now, you still need to send in what you think you're going to owe, but it's okay. People, if you extend your tax return on April 15, so you can do it. Freaking right. It's okay. The mega backdoor Roth. Now this is a big deal and it's a strategy only the wealthy use. And it's really important you understand that you don't get overwhelmed. If you cannot put away as much money as you'd like to in your Roth IRA or you're not sure how to invest it once in your Roth ira, I will help show you that it's a progression, it's a journey. The more money you make, the more educated you get, the more successful you're going to be. And everybody that's wealthy now didn't start out wealthy. They all started out with the same dollar amount in the bank generally. Now, maybe some people inherited it, but they had to build it. That's the American way. And you can do it. The Roth IRA is a structure that does not have to be in Wall street assets. It does not have to be in stocks, bonds, mutual funds and ETFs. You can invest your Roth IRA in real estate, notes, crypto, oil and gas syndications, your best friend's restaurant, they're opening up your sister's bake shop. You can put it into products that you want to sell online. There's so much you can do with your Roth IRA to get a big return. That's part of the key here. But to make money, you got to put some money in the tank first. You got to fill the tank with some gas. And then we start building it. We start building it. Now that's the key to the mega backdoor Roth. Because if I want to take my regular Roth ira, and I've been running numbers here for a bit before we started today, and I'm going to teach you the mega Roth ira. But the first level is just doing a basic Roth ira. I do it. I have my kids do it. I tell every one of my clients to do it. Your friends and family do it. This year you can put $7,000 in a Roth IRA if you're under age 50, 8,000 if you're 50 or older. And that's at any income level, do not get sold. Well, I make too much money. I can't do a Roth IRA. Yes, you can. It's called the BackDoor Roth IRA. And I have a link to that down in the description below. The back door says you're going to put money under traditional and convert it to Roth on the next day. So you can put money into traditional at any income level, not even get a write off, and then convert it to Roth on day Two, and since you didn't get a write off, the conversion is tax free. People, wealthy people, put money in a Roth IRA every year. It's called a backdoor Roth. So get that off the table. Don't listen to anyone crazy that says you can't do it. So level one is we're going to put money in a regular Roth ira. Now wonder how the wealthy do it. We start putting more than that into our Roth IRA and we start investing it in more strategic ways. Now, just so we have a baseline, if you take a regular Roth IRA and put in $7,000 every year, you don't even put money in a 401k. You don't save money in any other retirement account. Just in this one Roth IRA, you put $7,000 in a year. It is going to take you 27 years to have a million dollars, tax free. So if you're 30 years old and you start putting $7,000 away every year on a 10% rate of return, you're going to have a million dollars at age 57. That's it. Not bad. Sounds great. And the longer you leave it, the better it gets. I mean, we can have fun with this. If I say, well, mark, I'm a 20 year old and I want to know what I'm going to have at age 57. Oh, okay, so now you're going to have 37 years to kind of play with it. So you're going to start now at age 20, put $7,000 in a year, invest it in S P 500 ETF. You could start getting more creative down the road. Let's say we get our 10% return and then every year I put in that same 7,000. That's it. I can stick to that 7,000. Okay, here's the number. I want to show you what you got here. $7,000 will give you at age 57, 2.7 million. If you start at age 20 and just put $7,000 away every year for 37 years. Now, I know that's hard. 20 years old. Like I'm going to live forever and 37 years, I don't care about that. This is how the rich get richer. Just start practicing it. I'm working with my kids who are in their 20s, doing their funding, their Roth IRAs every year. I'm gonna ask the guys in the group to in the room here. You guys done your Roth this year? No. Yes. Okay. We're 50, 50 here in the room. These guys are in their 20s. I'm proud of them. We're shooting 50, 50 here. We got to work on this. You're in trouble. All right. Okay, so $7,000 a year is baseline. Now I promised you in this video I'm going to teach you how the wealthy do it. So if you're making money online, you're making money somewhere in a business selling a product, service, whatever, and you're making some good money. Please, I beg of you, do not go out and buy a frickin Range Rover or BMW. Don't go on trips all around the world every year. Don't go buy some mega house, mega apartment and blow money like it's water. Can you please consider what I'm about to show you with the mega backdoor roth. Under age 50, you can have a million dollars tax free in seven and a half years. Seven and a half years. Not 27, seven and a half years. But it requires you to use some self discipline and not spend every freaking dollar you make and start plowing it away right away. So I want to show you how this looks in a little diagram here. This is the mega backdoor Roth. I'm just calling it the Mega Roth because if you make more than a couple hundred grand a year, you're going to have to do the backdoor method. Doesn't matter, we're just going to call it the Mega Roth. It starts here. If you are under age 50 or then we're going to have different numbers if you're 50 or older, okay. Then we're going to have a different model. So if you're under age 50 this year, you can put $7,000 in your Roth and then your 401k. If you have a day job where you work at a 4 and they give you a 401k, you can put $23,000 in there and you can choose to have it Roth. That's how it works. You're going to put that away and boom, done. 23,000 plus you're going to get a match from the company. Cool. Now the next thing you do is, it's called an after. This is what the rich do, an after tax employee contribution. And you can do another 46,000 minus the match you may have gotten down below. Because the total you can put away when you add this whole thing up, the total that you can do is $76,000. Now if you put $76,000 in my calculator, 10% rate of return, seven and a half years, you're going to have a million dollars tax free. And my clients are doing this. I have clients with 10 million dollar Roth IRAs, you can do this. It, I know it sounds like a lot, but if you have a business that's successful and things are rocking, don't go buy a bigger house for seven years. Live lean and mean, pump the engine, pump the primer, get the snowball going down the hill, get more snow and let it continue to grow. I'll even just throw that out too. If you in. If we do that same amount every year and let's run the numbers here, $76,000 and I do it for the seven and a half years. We have a million dollars. Let's say you just do it for 15. You're like, Mark, I can keep it up. I can do it for 15 years. $3 million. You only did it for seven more years, but the money went up by 2 million because your money will double over time. It's called the rule of 72. So anyway, that's the power of the mega Roth if you're under age 50. Now let's go to the next age group for those that are 50 and older. So this year you can put $8,000 in a Roth IRA and then you get to. I'm going to go over my other slide here. 31,000 in the regular 401k. Now if you have a small business, you might do a solo 401k. So you. And that's fine. Whether you have employees or not, you can put away $31,500 and that leaves you a remaining 4,45,000 to do this after tax contribution. I'm going to give you a story here of some oil workers that you're going to love. After tax, employee contribution, you convert it to roth on day two because if you're 50 or older this year, you can put away 84,500. So if I do 84,500 versus the 76,000, it only takes six years. So six years, nine months, I got a million dollars tax free. That's how it works. Now let me tell you where I'm going to be totally honest here. I want to tell you where I learned this. I've been doing this for 25 years. We had some oil workers. These guys are working out of trailers up in South Dakota. And the employers up there recruit. These guys are tough. They're looking, they're grizzly, they're up there, big biceps. And they're working on these oil rigs up in South Dakota and they provide housing for them. They feed them the whole nine yards because they don't want to live up there anyway. So they have to entice them with free housing and room and board, and they get these big freaking six figure paychecks. Well, these guys, they can only party so much on Friday and Saturday night in the local town and then get back to work. So they're like, what do we do with our W2? We don't need the money right now. These guys are all in their 30s and they're just cranking up there. Well, several more clients of ours that we had from an Oklahoma relationship. And we got on, we were doing some tax planning with them, and they said, hey, look at my Roth IRA. I'm putting away $76,000. Now, this was about five years ago, but the numbers were a little different. And I'm like, what the hell? I mean, I get the contribution, the 23 and I get the 7. How in the hell are you doing another 45? And they go, oh, Mark, you didn't know? It said if you do an after tax employee contribution, what that means is you go to your HR department and you go, Hey, I can put up to 69 grand on my 401k. See a 76 when you add your Roth, but it's 69 grand in your 401k. Anybody this year could put 69 grand in their 401k. And you go, well, the employer's not going to match it. That's right. You can call up your HRA, I mean, your HR department and say, I want to put 46,000 in. And they go, okay, you don't get a tax write off for that. So you, because you could only do your initial contribution for 23,000 this year, but they call up and go, yeah, I want to do the extra 46 grand. Just take it out of my paycheck every month, because I don't need the money. I'm living in a trailer. So they're like, take it out of my paycheck that extra 46 grand a year. And they go, you don't get a write off. That's okay. Because on day two, they called him back and go, hey, would you convert that to Roth ira? You can convert as much as you want to Roth anytime you want. But since they didn't get a tax deduction, there was no tax to convert it to Roth. So at the end of the day, they had 76 grand sitting in a Roth IRA. I was like, holy crap. Matt Sorenson and I are talking on the phone. We start. He starts writing. He was in the middle of writing his book. The first edition. And he's like, I got to throw this in here. And we've been helping clients ever since. It's crazy. It's called the Mega Backdoor Roth if you make too much money, or the Mega Roth if you're under the limit. So it's. Anybody can do it. You just got to have that small business feeding the engine. So, my friends, that's it. If you want to know how to build a million dollars as quick as possible, there's two pieces to the equation. Get in as much money as you can and get the best rate of return. Now, on the best rate of return, I want to say a couple of things and I'm here to field your questions. Any of you with questions on Instagram, Facebook, Twitter, YouTube, throw in your question. I want questions about the Roth IRA and saving 401ks investing your Roth the stick to keep the questions on the topic, please. If you just call up Fidelity and say, I want to invest in a ETF S P500 fund, your average return is going to be between 8 to 10%, which is not bad. This is what Warren Buffett's been talking about. Tony Robbins has been talking about this. Just go to an E.T.F. s P500. Boom. Don't get all funky trying to trade it. Don't worry about, I don't know what stock to buy is called an exchange traded Fund S&P 500 index. Okay, I'll just do that. Just throw your money in there and let it ride. You're going to average 8 to 10%. Now fall. Sudden your, your buddy calls up and says, hey, I'm opening up a restaurant down the street and I'll give you 20% ownership. You throw in 50 grand. Well, what I get for 20%? Show me your numbers. What are you expecting to make in profit? Oh, dude, you're going to make a 20% return. Now, if you trust your friend and you trust the restaurant, by the way, very a very risky business industry. But let's say you're like, yeah, I can do it. It's the next best thing to slice bread. It's like the next five guys, you're like, all right, I'm in. You throp in your drop in your 50K and you get a 20% return. Now what's our rate of return? Now that 76,000 with a 20% return. What? Okay, all right, let's do a 20% return. How do, how fast? How quickly can I get my, my 1 million tax free? Wow. Five and a half years. Five and a half years. I have a million tax free. See, because your rate of return snowballs faster. So if you can invest in something, you know, you might invest in short term rentals, promissory notes, getting a 12, 2 12% annum, 2 points in interest. You might invest in oil and gas crypto. You're like I'm going to go buy some crypto. That crypto goes, goes to the moon. You pay zero tax, all drops in your Roth. Boom bada bang. So that's how it works. So start putting money away and then start self directing. If you want to know more about that, go to our Directed IRA podcast. I have a podcast with millions of downloads. Directed IRA podcast is down below and you can start learning how to self direct at the Directed IRA Trust company. We are setting up accounts every day. You can do it online on your frickin phone and set up a Roth IRA and start funding it. And just start with the basics. I said this at the very beginning of the video. Don't beat yourself up. Just start with 600 bucks a month. It's a big car payment, but that's your future. Start.