How To Pay Less Taxes Than 99% Of Business Owners

The whole aim of tax planning here is to reduce that income by taking legitimate expenses that the IRS is offering you. They have told you track this stuff and we will let you expense it and pay us less taxes like they've given you that option. Don't be fricking lazy and let this go by and volunteer more money to the government. The first thing in this, particularly if you're new to this, you got to change your mindset and you got to start thinking about, how do I knock this down to zero?

And we're going to give you a list here. So if you need to listen to this later, open notes on your phone, write this down somewhere. We want to give you the hot button items you're going to start looking for and then remind you of things you probably missed last year that you're going to do better this year. Welcome everybody, to another episode of the Main Street Business podcast. We are excited today to talk about what millions of Americans are getting in the mail this month. And that is the 1099.

Oh, damn. I thought it was tax refund checks.

That might come later if you're lucky. But no, the estimates are there are over 50 million side hustle workers in America. They're saying one out of three American workers now have an extra source of income as a subcontractor, as a 1099. And that, people, is a gateway drug to small business. And I love it. It is awesome. There's so many great ways to play with that 1099. You can hold it, you can pet it, play with it, you can save money with it. I mean, I just, I love that.

Okay, Tommy boy. Yeah, we could. I mean, that's the nice thing about the 1099 is, like you said, it's the gateway drug to taking some write offs. So a lot of people are you seeing it and there's not much you can do with that. It goes on my 1040. Maybe there are some tax withheld on the 1099. Whole different ball game. Whether this is your first year driving Uber, you started a small business side hustle, whatever it is, now you've got that 1099 that has income and nothing withheld. So you got to pony up some taxes and hopefully you've been preparing for this. But before you do that, make sure you're thinking about all the deductions you're going to be able to take on your tax return because it's a totally different ballgame than when you get a W2 and you can't write anything off. We got a Lot to work to do. We of opportunity for you to save.

Yep. So today's show, we want to go through the high income earner that might be doing some consulting on the side and get a 1099 going. Oh, what do I do with this? And they tell their accountant, just throw it on my return and don't take a second thought. And then you've got these poor middle income Americans. And I say poor and I feel bad for you. Working three jobs, trying to make ends meet, increase the cost of living in America off the chart, inflation, high interest rate, all of that. They're having to work this second or third job. What do they do with that 1099. So everywhere in between, there's some techniques, some strategies here. This could be an incredible podcast for many of you to help share with a friend or family member and yourself. Put more money on the table or in the bank, whatever, food on the table. It's just there's a lot of opportunity.

Yeah. Now on the other side of this, for you business owners that employ contractors or that engage people that are providing services to your business, or you have an obligation to Send out these 1099. So 600, is that still the 2023 numbers?

Yeah, yeah.

But I was just saying like we had, obviously so many of you are business owners listening here on the Main street business podcast is get yours done. I got mine done last week, which was nice to get done. It's a little early for me to get them done, but I just wanted to like get a little credit here. Little proud moment for me. Got them out early. And so we're gonna have up to January 31st to get these out. And I don't know if you want to get into the rules on then who gets them, who doesn't.

But no, and I, we've covered this on prior shows right now on my website. And if we could ask the producer to put this in the link right down below is I have in the last two weeks on the rules for issuing 1099s, who they get sent to. How do you handle the W9? When am I required to issue a 1099? There's the 1099 NEC, the MISS, the INT, the DIV. There's so many different 1099s in the mix. They're all there in my article. Check it out. But today's not about issuing the 1099. It's if I receive the 1099. And you knew. I'm glad that you brought it up.

Yeah. We got to say that because there's other people listening. Like, I got to get some 1099s out.

All right, so let's start with rule number one. Rule number one is, even if you don't get a 1099, you claim the income you made in your small business.

No, Mark, it was under the table.

Oh, it was.

It was under the table.

You mean if someone pays me in cash, I don't have to claim that? That's in the tax code?

Yeah, yeah.

Oh, really?

Yeah.

When the. When they come with the handcuffs, just go peacefully. I don't want you to get hurt. You know, when they shove your head in the back seat of the car.

You know, by the way, when you use the words under the table, you're like exposing yourself to saying, I'm doing something illegal. Can you pay me illegally? Just pay me under the table. Like, don't say that. That is. I know so many people do it. Let's be honest. There's probably someone thinking it, but I think that's the big misconception here. I just want to make sure reader stands. And like you said, well, you get a 1099 or not, you got to claim it as income, even if it was cash, even if didn't have your bank account. But no one's going to know. That's not how our tax code works, guys.

And they can find out. And any slight audit for any other reason shows this lifestyle, an income that doesn't match. You're going to have issues. And I was just so. A quick example. I was just so pissed about this. I was at a farmer's market up in Northern California in this little granola town. And. And I love farmer's markets. I'm walking around, I'm like, oh, I'm going to get an apple. I'm going to get this, you know, vegetable. I'm going to get a pizza. I mean, this had everything there. And half of the vendors I walked up to, I'm like, okay, where can I swipe? You know, I've got. You know, you got square. You got all these ways I can pay you. Oh, we only take cash. And I just. By the third vendor, I was like, why. Why are you only taking cash? It's because you don't think you have to pay taxes and you can use America, enjoy all these benefits and. And all these. I just. I won't get started here. And I just was so pissed that some people think that's okay. So if I'm offending someone out there, too bad. You live in this country, which I know has faults and weaknesses and problems. It's not perfect, but we have a wonderful way to live an American dream where we can make money, earn money, and we just have to claim that income and pay some taxes. Maybe that's the weird part. After these little vendors, we could have actually probably got them a tax refund and they wouldn't have to be scamming the United States. Taking cash under the table. So rule number one, whether you get to 1099 or not, own it, claim it. Whether you got it, via Venmo Zelle, PayPal, Apple Pay, cash, whatever.

Yeah, Uber sends it to you. Who cares?

All right, that's point number one. Let's talk reporting. Like. Like, where am I going to put this? And then we get into some strategies.

Yeah, most 1099s are going to go on your schedule C. Now you might have a 1099 div. Or a 1099. You mentioned those might have different spots here. But the primary 1099 you're going to get, if you're providing services or goods, the consulting, your typical 1099 you're going to get is going to go on schedule C. Schedule C is for your sole proprietorship, guys. Whether you think you have an LLC or a corporation or not, like your 1099s are typically going to go on schedule C. Now for those of you who have an S corporation or an entity even, I just want to make sure you guys know that. Make sure your 1099s are going to your entity for you to have an S corporation. You're going to pick that 1099 up in your s corporation. And you want to make sure when you fill out the W9, that's the form that they'll request. Hey, we need a 1099. Where do we send it? You're going to fill out a W9, not put your social. You're going to put your S corporation's tax ID on it. But if you're like, man, I don't have any entities and we're talking about like some of the side hustle people here, it's going to get to your personal social. That's going to fall on schedule C. Yeah, Self employment.

And for those out, and we're going to focus on that primarily today, is that what do I do with that rogue 1099 and what are my options there? If you have an S corporation, I just want to add to this that sometimes they're going, you're going to receive a 1099 in your personal name or social. You can essentially, 1099, your own s corp is called nominee income. You're going to claim the income on your schedule C and then push it right back out on page two over to your S corp. Very common strategy. The IRS recognizes it. As long as you're depositing the money in your S corp and using it in your S Corp and there's 1099, you know, inadvertently gets sent to your social, you're fine. There's a way to deal with that. And talk to your accountant about this. Make sure you don't try to knock this out on TurboTax yourself. It could end up costing you a lot in self employment tax. So anyway, that's the S corporation rule for those that have LLCs.

Yeah, if it's an LLC, and even if the LLC has an ein, but you didn't do an S selection to it, you're just an LLC that's still flowing onto schedule C. So even though that 1099, and it can sometimes even go to the EIN of the llc, if it's the single member llc, sole proprietorship, you haven't made an S election to it, that's going to fall on

schedule C. Okay, so let's review where we're at so far. There's no stress involved and really a lot of opportunity to save money which we're coming to. But number one, you claim all your income whether you get the 1099 or not. Make sure you report it on the proper schedule or form. Make sure you understand your entity structuring. We've just did a show two weeks ago on which entity to use. Please get back and listen to that show and that'll help enlighten you on what maybe what some of your plans should be for 2024 in that regard. But you're going to claim this on a form. Now here's the good part. You get to rub your hands together and go, all right, do I really get to take some write offs against this 1099? Because my W2 at work, I don't get to take write offs against that. Bend over, you're done. But with the 1099, it's a whole new world. Just come and see. It's your magic carpet ride, Jasmine. And so we're going to take you through this whole new experience through. What was the name of the little town? Flora? Benidorm.

Aqrabah. Aqaba.

Aqaba. So this is your Aqaba tour of all the write offs you can take. So this is. And I, and I'll just say you didn't have to have a bank account. Maybe you've spent for expenses on credit cards or different ways. But now it's about finding those expenses and putting them on the return. And that can seem a little daunting. Matt tips there and we can start talking about some specific write offs. But yeah, really kind of gathering data would be number three.

Yeah, I think the first thing in this, particularly if you're new to this, you got to start, you got to change your mindset and you got to start thinking about, all right, how do I knock this down to zero possibly, or how do I reduce this down? Because if you got a $10,000 1099, not only are you going to pay self employment tax on how this nets out, but you're also going to be paying income tax on this federal and state, depending on whether you're in a state with state income tax. So what the net number here is what matters most because that's what's going to be taxable. But before we get to that, we get to take expenses. There's a lot of stuff we're going to start deducting here that you might not have thought about as a W2 employee. Now on the 1099, I'm thinking about, did you do have any travel, did you have any auto, did you do any TR you paid for? Did you go to conferences, did you have business meetings? Is there any meals and entertainment? Did you buy any equipment? I'm going to start asking these questions. You got to think back through the year. If you weren't doing your bookkeeping and actually tracking this, which you need to do. But I know a lot of you haven't. You need to go back and be like, oh my gosh, I have a lot of expenses here. And now all of a sudden that $10,000 1099 is $3,000. Because I have $7,000 worth of expenses.

Yeah, $7,000 of expenses you were going to spend anyway, but now they're related to your business. And this is where tax strategy is very ethical. It's honest. The IRS and Code Section 62 says any expense incurred that was necessary to help your business grow and create income, that's a write off. And so how do you do this? I suggest, and I've talked to my kids for years as they've gone into adulthood and had small businesses and they're like, whoa, I didn't have QuickBooks, I didn't have a set of bookkeeping. What do I do? Open up a spreadsheet on your laptop and then Start going through your credit card statements for last year, your bank statements for last year, and just trying to find any expense you paid for that related to your business. And you may say, oh, well, I went to Costco and I bought a new printer. I was going to say fax machine, but many of you don't even know what that is. You know, I had to deal with the IRS this last week, and they're like, can you send us a fax? I'm like, what am I in 1987? I don't have a fax machine. Do you know they have the same on hold music at the IRS they had 23 years ago.

That's a classic.

I know. I even told the agent, I'm like, it brings back memories with this music. And it was funny. I had a great IRS agent this last week. So it's a hit or miss. I know, I know.

There's some good people there.

Yeah. She was like, I'm jamming to 70s music. You cool with that? I'm like, yeah, turn it up. So in the background, she was jamming 70s. I'm like, oh, my gosh. Anyway, the IRS spending their $80 billion on new workers. They're remote. And so I'm listening to dogs bark and 70s music with my IRS agent. That's great.

As long as they answer the phone.

Yeah, yeah, they're answering the phone. So here's the point. You're going to build a spreadsheet, go dig up any expenses you can, and we're going to give you a list here. So if you. If you need to listen to this later, open notes on your phone, write this down somewhere. We want to give you the hot button items you're going to start looking for and then remind you of things you probably missed last year that you're going to do better this year. So last year. Now, what would you. Let's start. What would be our list of, like, you're building your spreadsheet. I'm going down looking for expenses. What do you like? Okay, give me three.

Could I say something that might not even be going through your list here? Home office. That's something you're probably, like, not looking for in your statements and everything. But it should be an expense to you. If you had a designated area in your home that you use for your business, that should be definitely taken as a home office deduction, and you can take it on your tax return. That's going to give you a deduction.

Yeah. And don't be afraid of the home office deduction. Accountants that are still afraid of their own shadow. Talk about the audit risk of the home office people. There's a standard method, a simplified method. There are so many options there. You just need a reasonable approach to it. I've got articles on it on our website. On the Home Office. Just Google Kohler Home Office. Don't put Kohler and Plumbing. Stick with Kohler and Home Office and you'll. Yeah, you'll see. Good article. Okay, now give me number two. I said three.

Home office. Okay, Home office. I want to look at your cell phone. I love it. Your cell phone. Now in order for it to be an expense, you need to have another business number or a line or another phone in your household that you can be using for personal. But all of us are using our phones in our business. Let's, I mean, yeah, if even you just got a side hustle like incidental use. I mean, you're going to be using that phone particularly for anybody in this gig economy. You're going to be using the Nam phone. It's going to be used in the business. We want to take that as an expense because that could add. That's usually $1,000 a year just for the service, let alone was it a

new phone you had to buy cases, cords, supplies. Now let me throw out the exact rule because I like what Matt alluded to and we're just going to go through this quickly. We talk about all these write offs and different methods. And by the way, on my website, markjkohler.com I have a 30 strategy ultimate guide that you can download for free. And there are 30 different write offs there too. But on the cell phone, keep in mind, like Matt said, if you can show you have another line for personal use, that phone's now 100% write off. This is an IRS rule. The cell phone is 100% write off. Not as listed property and the cases, the supplies, the service, all the crap for your cell phone. You crack it, you break it, you go to cell phone repair. 100% write off. If you can show you have another phone for personal use, maybe your spouse, maybe it's just a home line plugged in the wall. A little Winona Rider, Stranger things phone. But the second option is if you're like, well, I use my cell phone for my personal use as well. Okay, then just divide it in half. Take half of that as business and half as personal so it's not all or nothing. So you can find that balance. And I like that on the cell phone. Okay, number, what's your Number.

Okay, I gotta go to number three. Do we need to edit that? Well, I should have been thinking of number three. I was actually listening to you. You know, let's see. Number three. Auto. Oh, I was gonna give you auto.

I was gonna say another non cash expense.

Yeah, Auto. This could be deceptive because again, it might not be showing up like, like a piece of equipment or the fax machine, for example. Example, you know, so now auto is a nice one because the IRS has given us another simplified way to do this. Just track your mileage. And for most of you that are doing a side hustle and you're just getting a 1099, it's not like you're a contractor buying trucks and driving around the job sites or, you know, but you're just getting an auto now. You could be even a realtor or something like that. I mean, you're probably have a lot of mileage you're going to take. And so the nice thing about the mileage deduction is you track your mileage. What's the mileage for 20? 23. Oh, I knew you were 65 or something.

Okay. Gosh. So my calendar.

So let's say you. Let's say you drove. You add up mileage. You're like, man, I drove 10,000 miles this year for my business. You're a real estate agent. You're driving to properties, you're showing them. Okay, you drove 10,000 miles. Let's say the mileage rate is 65 and a half cents.

That was your guess.

65.

You were right.

65 and a half cents in 20. 23.

Yeah.

Okay, so for 65 and a half cents, that means I'm going to. And I drove 10,000 miles. That means I'm going to get a $6,550 deduction. All right, that's huge. If I got that 10,000 and 1099 and I was really driving that many miles and maybe you are. You're a new real estate agent. Let me just give that example because that's one where you typically would see high mileage. You're driving a lot to properties. Maybe you had one property closed that year, but you went and showed a ton of properties. Well, we're going to take that 6550. Now you're down to whatever it is left. I can't do the math there, but you know what I mean.

Yeah, just give up on the 0.65. 6500.

6500.

Yeah. I'm just helping you out there on the 50s. Matt's the lawyer. I'm the accountant. We're good. Okay.

I thought it was 65 and a half cents. Well, okay. I don't know.

No, no, no. This is good. No, you're right. 65 and a half. Let's do our math here.

I mean, I don't want to. I mean, I don't want to leave 50 bucks on the table.

I mean, we got to do our math.

We could get that extra 50 bucks.

Yeah, no, you. You're exactly 6,550. All right, now I'd like. Okay, so another. By the way, I have an article on the site that I publish every January on 7 Ways to Write off your auto. So make sure you're looking at other actual methods. You might have an suv, you might have a truck, you might have an rv. You might be doing turbo. There's all these different strategies. All right, so we got home, office, cell phone, auto. I'm gonna go with dining. I think dining is very underrated. A lot of people are not taking advantage of dining. Because when you meet with a vendor, a customer, a partner, and you're talking about business, that's now a write off up to 50%. And that includes the bar tab, the tip, all that. The valet is 100%. That's going to be a travel expense if you're doing valet.

The American Valet association lobbied hard for that. They were out there on that. The aba.

Yeah, They're a big deal. Big deal.

So actually, I think ABA is something else.

American Valet Association. Yeah. They join the union. They have a union. So dining is a big one. And it's also going to reflect what your gross or net income is. If you brought in a $10,000, 1099. I don't think I want to write off $3,000 in dining, but could we write off 3 to $700? $800 for sure. So you want that tax return look like a work of art. Don't get overzealous.

All right, we got dining.

Okay.

Now, I'm not sleeper.

I like travel. Travel is 100%. And travel is different than dining and auto. They kind of go three and three in a. Because if you're driving to the airport to go on a business trip for your side hustle, meet with a client, vendor, go to a training. That's auto. Then you get to the airport and do. And you have parking. Okay, that's a parking expense. I don't even think I'd put that on travel. I might. But parking, then I've got 100%. Yeah, that's 100%. Then I get into the airport and I buy a sandwich. Now I'm traveling, so that sandwich is a write off. I normally don't eat at the airport, so I had to go to the airport to get on a plane. So that I'm dining at the airport's a write off.

Oh, 100%.

50%. Yep. Dining is always 50, but. So I have a dining expense while I'm traveling. But Mark, you didn't meet with a customer or vendor. Doesn't matter. You can write off dining by yourself if you're traveling. So I'm going to a conference all by myself. I'm writing off auto to the airport, my parking. Now I'm in the airport paying for food. Oh, I forgot my charger. Right. I have so many damn chargers in my car because I forget them when I'm traveling. So I walk down, down the way and I go buy a new charger for my business phone.

$75.

Yeah, yeah, that's right. They're cheap at the airport. Now, assuming my cell phone's 100% write off, I'm taking 100% write off of. Of any supplies while I'm at the airport. Then I pay for my airfare. 100% write off. I get where I'm going. Uber, 100% write off. Hotel, 100% write off. I go to a training for my business, spending at least four hours a day and doing business. 100% write off while I'm there. All my dining is 50%. That's a big deal.

Fricking love that. That was a great example. You just.

It's pieces and parts and so when you're building your little spreadsheet, you're gonna get those line items.

But Mark, what if I didn't use my business credit card or my business debit card for my bank account for my business?

That's regrettable because it's going to create more work for you digging these up. But it's okay. The IRS doesn't care if you paid for it personally or out of your business account or out of your business credit card. They want you to be able to show a receipt, you know, that you really did buy it. But the IRS is going to be annoyed with your mess. I think it's stranger than fiction. Such a funny show. And when Will Ferrell goes into audit, what's her name at the bakery, she just brings out this box of receipts. He's like, really? And she's like, tax man. I love, I love Stranger than Fiction. He's One of my favorite accountants, you know, Will Ferrell.

Yeah. So Ben Affleck, I mean, come on.

Well, Ben Affleck's a badass, an accountant. Yeah. But Will Ferrell, he's just.

Yeah, it was a great show. That was underrated.

Show it was underrated.

Well, let me know.

So keep your receipts, travel, and all the little pieces of parts. Go ahead.

Well, here's a lesson that's going to be learned as you hear going through this and this, particularly for anyone new to business or that's gone through the of this is use a freaking separate account for this. Even if you just have a side hustle or that's a single that's going on schedule. C. Obviously, if you got a corporation, an llc, an escort, you're going to have a bank account in the entity name. But even if you just have a sole proprietorship on the side, no entity, nothing, have a separate account. It could just be one in your personal name. A separate credit card. What it is, it will make your. It's so much easier that way. You remember, oh, I'm going to the airport. I'm using this card for park. I'm using this card for that charge. I'm using this card for dining. Oh, I need to order something on Amazon. I'm using this card that way, you know, every time you use that card, just pull up those statements. Easy peasy, easy to track this through the year rather than having to parse out in your personal bank account. Oh, was that Amazon charge the printer I bought or that fax machine I bought? Or was that some, you know, some shampoo and conditioner I bought at the house?

Love it. And I'm gonna give a shout out to my daughter Sydney, who is a realtor. And this last year I was like, I need your Excel spreadsheet. I need all because I knew she didn't have QuickBooks. And she's like, she's like, what are my write offs again? And I go, don't you go to my workshops? And she's awesome. She drummed up all of her write offs. But it was a pain. She didn't enjoy the process. And she just told me like two weeks ago. One of my New Year's resolutions, I am getting on QuickBooks. I'm going to have the online version. It's simple, it's easy. I'm going to stay dedicated to one credit card, one debit card, because at the end of the year I can go bink. And they're, for the most part, you're always gonna add Things.

Yeah, yeah. But sometimes you're at Costco and you buy $500 worth of groceries and 50 bucks of it was personal and so you got it on that card. So you gotta sometimes track some things separately. But and I do love quick with those days too. Like it'll automate a lot of the transactions for you. It's like, oh, that charge for the Internet, we know that's a business expense and how to categorize it. There's some automation to it too that it's not as hard as you think. So don't be scared of it.

Yep. Now my number three. So this will be a total of six, top six. This is the one that's easy to grab for last year too is equipment and supplies. Be thinking of anything you bought for your business. And if you have a business today, even if it's a little side hustle, you probably have a social media page. Do you have a camera, do you have tripods, do you have additional iPads?

A selfie stick.

A selfie stick. Pelican cases. I'm just looking around the office here like little switchboards or do headphones. Yeah, anything that would help, you know, mouses, iPads, fans, lighting. So anything you're doing to self produce content for your business, it's going to help your business in any way, shape or form. That's a freaking write off. I mean anything you buy at Best Buy or Apple Store, you should be thinking first and foremost how can I use this, my business write off. And so really go after those hard. I think those are very important on the return.

Okay. Man 6.

I love it.

We hit through 6. Yeah. Now you said that you have the guide with 30 and make sure you go to markjcoller.com you can download that because there's so much to this and what I'll say on those 30. I think the nice thing about those six is that's kind of like bread and butter. Everybody's gonna have those.

Yes.

It's weird if you don't have those six, you know, now when you get to the other 24, there might be half of those you take, you know, and everybody's tax planning is a little bit different. And that's why sometimes this can seem confusing. But what happens is I think in your business is you figure out what's an expense, what's not, what should I be tracking, what's deductible. And you're gonna get in a rhythm. And remember the goal here is to take that 1099 that we got and Whittle it down as little as possible. It's gonna keep us in a lower tax bracket. It's lesser taxable income, it's less self employment tax, you gotta pay less tax to your state. I mean that's the whole game of tax planning here is to reduce that income by taking legitimate expenses that the IRS is offering you. They have told you track this stuff and we will let you expense it and pay us less taxes like they've given you that option. Don't be fricking lazy and let this go by and volunteer more money to the government. I just think it's crazy that people aren't taking advantage of a lot of these write offs when like in the tax code it is offered up to you.

Yep, yep. Now before we give a couple of major takeaways in this whole process because you are now an entrepreneur when you have that 1099, love it or hate it, you're in the game. And you knowing the rules to that game is critical. Now. Don't hate me, don't hate Matt. We're just players. Don't hate the player. We'll just help you with the rules of the game. But moving forward, here's one of the easiest ways to wipe it out. The final, I think nail in the coffin. That's just awesome is that for any of you that have children, adult children, younger children, if you have a side hustle and you can incorporate the help of any of your family members that you're already supporting. So let's just go with kids under age 18 for a moment. We've got podcasts on this and articles and all sorts of good stuff that you could go back and consume on this. But let's just say hypothetically you have a 16 year old in your household and you're helping them out with school and soccer and music and supplies and clothing and all these, you're going to spend five grand a year just on basic necessities for your kid. Stop doing it. Stop doing it. And I didn't mean kick them out, let them pay for those things. So now you take the income from your side hustle and pay your 16 year old to help assist you in your side hustle. Whether it's marketing, social media, cleaning, the home office, whatever you can do. If you drive for Uber, have them wash the car every day, whatever it is, get that 16 year old involved. Now I could pay the 16 year old five grand, take a write off for that. And the 16 year old in 99% of the time in most states for five grand of income, they're not even going to pay tax. They don't even have to file a return. So now there's some nuances to that, but that's the general strategy that's very, very common. So get your kids involved. And then if you're helping a kid above age 18, you're going to 1099 them, they're in a lower tax bracket, they are going to get another bite at the apple with their write offs. So integrate your family moving forward. Now, I can't do that for last year. Got to be proactive for this year. And that's why listening to this podcast, embracing entrepreneurship is going to be one of my next tips.

Yeah. And I think if you're kind of transitioning in, I mean, we talked about one of the motivations is to whittle down the taxable income. But a lot of people that have a side hustle and this is going to be main hustle are like, all right, I've got a good income. I'm trying to build wealth too. Okay, well how do I do that in a tax efficient way? Are you contributing to your retirement account? Could you do a solo 401k in your small business here on the side, could you put in money to a backdoor Roth ira If you're high income, could you put money in your kids Roth IRAs and start those and get those going if they are working in your business? Now we're talking about taking this income you're earning, getting tax deductions or putting it into tax free vehicles like Roth IRAs to now build tax free or tax deferred wealth. And so that's again, that's next level on this. But that's probably the next step of this is not just getting down your taxable income with expenses, but utilizing that money that you are making in the business or from your side also to build wealth.

I love it. Here's my. And we could, we're, we're such huge proponents of this whole system and how wonderful it is. So I'll just finish with this and I'll leave. Taking off where Matt left off is if you're working that second or third job to literally just keep your head above water. I get it. Yeah. But it doesn't have to stay that way. If your mindset is I'm doing this to start to get above the water and be, get in the dinghy and then onto a bigger boat and be safe and really navigate those waters rather than just being out there floundering, trying to stay Afloat. The side hustle opens up a unique opportunity to be proactive, to do better planning to get out of debt and use the income first to get out of debt if you have a consumer debt issue. And then start building that wealth and also start learning how to blow up that side hustle. There are so many unique ways to make money with a business idea that can involve online sources and networking with others and joint ventures and embrace the opportunity. Think of where you'll be five or ten years from now if you take this side hustle and really let it marinate and become a part of you. And embrace this American dream aspect while you keep your day job. Keep the day job if you want. You know, that's cool. But this is such a neat opportunity to build more wealth, build your retirement accounts, get out of debt, and use it as a stepping stone to teach your children, teach your family, and just live a better life. It's exciting.

Dude, I love that. And I love that little analogy you gave, too. If you feel like you're drowning, we're trying to get you on the dinghy to get to the bigger boat. And if you're going to get on a boat, by the way, I just want to say I want you to get on suck my wake with Uncle Roman, okay? I don't want you in a pontoon boat with your dad. You want to go on a pontoon boat with your dad or you want to get on Sucking my wake with Uncle Roman? Stuck my wake. Sorry, dad. That's Dan Aykroyd, John Candy. Great outdoors.

That was a good one.

So that's the business I want you to have in the jet boat with Uncle Roman. Now we're ripping it, you know, now your business is going somewhere.

It's so exciting. And we use this last analogy. We use this analogy last week is that when you're navigating in an airplane or on a boat, one degree of change in your navigation software or you're using the old method, you know, some sort of whatever they call those things and come home. Well, there's not a comment I like.

We go back to the Boy Scouts orienteering merit badge where I horn blower

and they'd use those cool little gizmos they'd look through back in the days to navigate. But if you're off 1% or on 1% in the real direction you want to head, once we get you out of that water and you're into that little boat and you're starting to head in the right direction just a little bit of a change in where you're headed can have a huge result 5, 10, or 15 years from now. So don't think it's a get rich quick scheme. Don't compare yourself to others. We're not going anywhere. We want to be here every week to provide ways to build your business. We need to talk more legal. More legal issues that you might be facing. And then the tax issues are constantly integrated into this. So we wish you the best. Don't take that 1099 and use it in a productive way. Yeah, that's the takeaway for me.

Yeah, it's not a buzzkill to get the 1090. Think of this a tax planning opportunity. You got to do it. You made some income. Let's take all these deductions possible and make sure you're clicking on the articles that we have here on the show notes. There's a lot more detail there. And also, you might need a tax advisor. You might need an accountant to help you through this as you're getting into this. And you can get it markjclaw.com too. You've got your tax advisor network there. People are certified, working with small business owners, people on main street, real strategies to help you save money.

So it's crazy. We have over 500 enrolled agents and CPAs around the country now certified just in the last 18 months on every strategy Matt and I talked about on this. And they're a part of our community getting trained every week. Look, and many of them are looking for clients that respect them and want that help and support. They just don't want someone to punch the numbers in and pick it up later after you go grocery shopping at the strip mall. If you're looking for a real tax advisor and you want to build your wealth. Yeah. Get to markjcoh.com and the Tax Pro network. Interview a tax advisor around the country that could be in your local area or across five states from you. But they get you. They understand you. And a good tax advisor can save you 10 times what you're paying them. So check that out.

All right, guys, we'll see you next week. Thanks for being here.