Open Forum Show - Answering Difficult Tax and Legal Questions for Business Owners

Foreign. Welcome, everybody, to another episode of the Main Street Business podcast. My name is Mark Kohler, yours truly, and I'm here with the amazing Matt Sorenson here talking about small business, legal, tax, business strategies, self directing a little bit because we have a sister podcast that focuses on you investing your retirement account and what you know best. But today's open forum, our special day, man.

Yeah, this is, this is the special day for the listeners. This is where we talk about what you want to talk about when you're like, guys, stop talking about this dumb stuff. Okay, then submit a question@mainstreetbusiness.com submit a question. You can go right there on the homepage to submit that. And you can see we've got a lot of questions in there. We've had a lot posted through social media. Mark and I are just going to try and have some fun, say something smart, maybe give you a tip that one of the fellow listeners has put in. Or maybe you've got your own question in the queue you're waiting for us to get to. So thanks for everyone for submitting all those. We do have a lot. This might be a record number of questions. I can't say we'll get to all of them. Yeah, there's been a record number of submissions.

Yeah. I'm going to say we're not going to get to them all, but we're going to try to do is combine, divide, conquer whatever generals would do on the line of a battle. You know, they're just going to say, let's knock out.

We're gonna outflank it. Yeah, we're gonna call these questions.

That's right. I'm just gonna nuke some of them. Just do them all at once. Let me help out. Buy low, sell high. There you go. That just solved at least half the questions.

Yep, yep.

All right. A couple current events. Yeah. News in the news. First of all, April 15, usually April 14 is a nutty day. Tomorrow would be tax day. Normally it is not for those that have been living under a rock or on a boat traveling across the world on the ocean and you're just tapped in, it's going to be May 17th. That's the day.

Yeah.

So if you normally make a deposit with your taxes or you're worried about filing an extension, you're not prepared. There are no penalties, no interest. If you wait till May 17 for what you would normally deposit for your 2020 taxes. However, if some of you are still making your. For those of you that need to make your regular 2021, first quarter deposit. Those are due tomorrow. So those that are doing payroll reports for first quarter 21, 20, 21, those are still due by the end of this month. So it's just your 1040 stuff, really, that you need to.

Yeah. And I had my number, my number one client call me and ask me about the tax deadline today and actually ask those two exact same questions.

Was that my mom?

That was my mom. Oh. I mean, it's so funny because it's like, you know, she sends me your tax return. My mom.

She.

She actually went did accounting in undergrad before getting married, and she later went back, became a nurse, but. And so she's always, like, loved doing taxes, if you can believe that. Like many of our listeners, I presume they like to do their own taxes. And she always has. They got rental properties and stuff. And so I have to review it every year. And I asked. And I just, like, I asked the same questions every year on her return. Why are you doing this? What about this? You should really buy some new rental properties. Like, they've owned rental properties so long, they depreciated them to zero. Like, literally over 30 years. It's like, no more depreciation. These. But there's anyways. So, yeah, you got till May 17 even to pay. I thought that was generous. The delay to file. I thought was. That made sense. But even the pay, it was just a little unexpected from the irs.

Thank you. Yeah, they're all. You're welcome.

Yeah.

Now, a couple other final notes. I need to give an important disclaimer on a regular basis because on our show, we love to share strategies ideas like, mattress said, mom, buy another rental. We've never been sued from a client or a listener or a reader, knock on wood. That has said, you told me to do this, and I lost money because I think we do make this clear enough. But it's always an important reminder when we're talking about buying real estate. Cryptocurrency, investing, trading gold. I'm buying some cows. I'm excited to give a report on my cow purchase since I've been watching Yellowstone. I am buying a herd. I don't know what. Really a herd. How many cows you need to qualify as a herd? But yeah, I'm gonna have 10. 10 cows.

Okay.

Yeah.

Yeah. That's at least like a men's basketball team.

Yeah.

It's not a football team, but, you know, you could feel the. Get a team on the court.

I could get a team on the court. So with the. They're not going to be in my backyard, people. But I've got a sweet plan. We'll be talking about that more. So anyway, the point is, as we talk about strategies and investments, we do that because we want you, the small business owner, to feel empowered that you work so hard on your business and you take that money. Where do I deploy it? We don't want you to always drive all your profits right back into your business, and certainly not into buying a sports car or a bigger house or living large. We want you to save your money, pay off debt, prepare for any recessions in the future, and invest. But what do you invest in? Well, I hate to say we're a little anti Wall street in the sense we are pro Main Street. So I'm not saying a little bit of etf, stocks, bonds, mutual funds, all those things aren't inherently bad. And to have a little bit of your portfolio in. That makes sense. But we would encourage more of our clients to have the far majority of their investments in stuff they know. Invest in what you do best. And so if that's precious metals, small business, private equities, a restaurant down the street, your brother's carpet cleaning business, crypto, we teach how to do that. So. So disclaimer heard and stated.

Okay. Yeah.

You want to add to that, Matt?

No, I would just. Let's just put that letter to the editor out there and maybe it'll get published. Thought. Thought it was very, you know. Okay. This had to be said, though. Thanks for doing that.

So get into questions. You choose first. Let's get going. Some people are like freaking a. Quit screwing around. Okay.

Yeah, okay. Okay. I liked. I like this question from Glenn.

Okay.

He said hello.

Now, Matt, tell me, is this on our website or on the website?

Submit a question.

Okay. Because I'll mark it as red.

Hey, Glenn. Glenn says I'm a partner in a small llc. Part of my expenses this year have been for travel as part of a podcast production.

Cool.

What is the best way to have the company reimburse my expenses? He says PS Lawyers or Liars is a great book. I've been searching for the OJ information for many years. That's Mark's first book.

So yeah, I have the whole chapter. Be like oj. I will recommend the AMC OJ Trial miniseries.

Oh, my gosh.

You can get it on Netflix, I believe. Okay.

That's the one with Cuba Gooding Jr. And John Travolta.

No.

Oh, that one's awesome.

Hold it. Is it Kuba?

Yeah, he plays oj and you got Ross from Friends plays.

Yes.

Yes.

That's the good one. Yes. Yeah, that is excellent.

Travolta is the legal zoom guy. What's his name? Robert Shapiro.

Yeah. And I would say this. Anybody that I even had my kids. This is. This is crazy. This is over. I mean, how many years ago now is this?

Yeah, like 20 years, maybe.

Oh, no, no, no, it's more than that.

25. Yeah. High school for me, that's 25.

Yeah. I had my kids watch this. It was 1994. And so that's just crazy. So 30 years ago, where this was the trial and I had my kids listen to this show or watch the show and they were blown away. They're like, this is real. And so. Yeah, okay, so go ahead.

All right. Okay. So let's hit this question. Now, the nice thing is, is Glenn is a partner in this business. Now, presumably he's been paying for these expenses himself. If the company was paying for all these expenses, the company's just going to expense those things. But if Glenn, if you've been paying for those expenses, what we would do is you would have the. You would want to submit evidence of those expenses for your own record keeping and for tax purposes, because the company is now going to take an expense for it. It's going to cut you a check of reimbursement for those expenses that you'd paid. And then the company is going to take those expenses on its books, which means all your partners, of course, are going to share in that cost and expense by that happening at the company level. So I think that's the best. Have the company cut a check to you as reimbursement. Give the company or whoever in your group is doing the accounting or records of those receipts and travel expenses, and the company will take those expenses on your partnership LLC tax. And I presume you guys are filing as a partnership. 1065.

Okay. And if I may add quickly, and I'm sorry, folks, we love to keep this light and joke around a little bit. So we'll burn through some heavy topics real quick here and help get you some content that'll help you. This is so important, what Glenn's asking, because think about this, everybody. He's working for a business as a partner and wants to be reimbursed for expenses. The company is willing to reimburse him for. Well, frankly, Matt's answer would work in any situation. I don't care if you're an employee, an owner, an officer. If you've got expenses and the company said, we'll pay for Them, you submit your receipt. That's tax free income to you. So you paid for it personally. The company's going to reimburse you. The company gets the write off. It's tax free to you. Here's where the problem comes in. When you're a partner in an llc. Let's say Matt and I are partners in an llc. We're not. I'll explain why. But Matt, if we're partners in an LLC and I go down to Florida and I shoot some video for our podcast, like this situation Glenn's doing, and I go, hey, I'm going to get reimbursed. Matt's like, screw you, I'm not paying you for your trip to Florida. That was half play.

Well.

I go, I want to get reimbursed. And he goes, well, I'm not going to reimburse you from the company. You write it off on your own return. Can I? Well, in a partnership, I would say

that this is, this is live true example. I would say that.

Jerk. You would, I'd say it to you. I know you are, but what am I? That's where you say, shut up, Richard. Tommy Boyd. Okay, so if Matt says I'm not going to reimburse you, then I have to write it off on my personal return. Can I? In this situation, I can. It is classified as an unreimbursed partnership expense. It's on page two of the schedule E as an echo. Make sure you bring that up with your accountant. You should go to your accountant, go, hey, I was in an LLC and I got a K1. And here's a list of all the expenses that I wrote off that are related to my business, but my frickin partner, Matt Sorensen would not reimburse me. And they go, oh, and the accountant is going to put those on your tax return. Now here's the third issue though. Let's say that Matt and I are making so much money we're paying self employment tax. What are we going to want to do? Try to solve it with an S corp? Well, if we create an S corporation between the two of us and we're not going to reimburse each other, there's no way to write that off. That's an unreimbursed employee expense because we're now an S corp. We're not a partnership anymore. There's no line for this on the tax return any more. Now some of you may go, well, I itemize. I get to write off on reimbursed employee expenses. Not Anymore that got taken away with the Tax Cuts and Jobs Act. So what do you do? You're toast. So this is a chapter in my book, the Tax and Legal Playbook, where Glenn, when you start making too much money in that partnership, you've got to each set up an S corp to be partners in an llc. Now, you get the best of both worlds. You can reimburse each other for expenses. You can write off your expenses even if your partner doesn't want to reimburse for them. And the S corp partnership in an LLC is a solution. We teach it every day. We have clients setting the structure up all the time, and it's so important that.

Yeah.

Is the takeaway there.

Yeah. Love it. Okay, man, that was some good detail there. I didn't know that. I learned something today. I mean, I. I knew we would always use the S Corp there, but I didn't know the difference between the unreimbursed expenses on the 1065 versus the S Corp 1120s.

Wow. Okay, I'm gonna fill the question here and then, Matt, I'm gonna give you a little lead on the next one. This was a question that came through our firm this morning. This is tricky. In Tennessee, if I'm setting up an llc, there is a franchise tax that I need to pay for my llc. Even though there's no state income tax, I've got this franchise tax for my llc. Well, I can get around it with what's called the fonts exemption. That's a family owned company. So if I own the company, I can get around it with a fonts exemption. Matt, the question is, and you're going to get to answer this here in a minute with the fonts. Does do I. Can I do that with an LLC owned by my IRA or solo 401k. So think about that. Okay.

I thought about it before. Okay.

I've had Susan. I was gonna have Susan look into it before the show, but I didn't have a chance. So I'm hoping you can answer it for us. Okay, everybody. Do you know last year over 4.4 million new businesses were created, LLC and corporations. That's why a lot of people are having these questions, because people like Glenn, maybe Glenn that says, oh, I have an LLC with a partner. How do I do this? He's never had to deal with that before. And a lot of people went and set up their entity, all legal, Zoom or some online setup. And they now are like, how do I run this thing? And that's why our podcast has been Booming. We're grateful many of you are here. Okay, this is a question from DJK Buys Homes. I want to rent my home to my child and write off the depreciation just like a rental. Oh my gosh, I just got chills. I'm just not. And I'm not kidding. DJK Buys Homes. I preacher to the choir, buddy. I love that. We've been doing that for years now. I just give a quick tip here. A lot of people, yeah, a lot of people say, well, Matt said buy a rental. I don't know where to buy a rental and I live in Southern California and rentals are too expensive and they're not going to cash flow. The first place I like clients to buy rentals is if your business is running commercial space. Buy your own building to rent to your business. Convert a home into a business. If it's commercially zoned for that, quit paying rent to someone else. That's first. Number two, I got a kid going to college. I got a kid that needs money. I got a kid that's freaking renting somewhere. Buy the rental, make them the property manager and the tenant and you get the write offs. And even if you're like, well, I'm still supplementing the rent, that's okay. We'll claim the rent as a gift to the child who's now paying rent back to you. And so now you've generated a rental property with your child going to college. That's number two. Number three, maybe you're helping a parent that needs to rent from you so they can qualify for elder law type planning strategies of Medicaid or Medi Cal. You could own the home and rent it to your mom or dad. And finally, Matt Sorenson, who has been a wonderful example of this, is every time Matt buys a home and moves to a new place, he doesn't sell the home, he turns it into a rental. So Matt has garnered several rentals that used to be prior residences. And I think that's a great strategy. There's three or four just right off the so DJK homes do it, earn more. Call our accounting firm, law firm, have the lawyers set you up an llc. Get your kids in there.

Yep. My other tip on that is now keep in mind, if this is your prior residence, this is something you want to do. And Mark mentioned I've done this a number of times is the sale of home exemption. So you're going to lose the sale of home exemption. So this is a property that has a lot of appreciation in it and you start renting it to a child, you've got three years from the time you've been out of it for it to still get the sell of home exemption. So if it's highly appreciated, you may want, you know, and maybe that's a great time for your kid to rent it and then get on their own feet and get to their own place, you know, but just keep that. That's another consideration in mind is the sale of home exemption. So, and I've is even on some of mine that Mark's mentioned, I've sold some. I've turned some into rentals and sold one within three years about a year ago. And I have others that I've passed the three years and I just gave up the sell of home exemption. But it's good, it's a good, they're good rental properties. Mortgages are there. Easy peasy. Cash flows. Don't let the tax tell Wag the Dog on it too. So. Okay. All right. Okay. Ready for me to take one here? This is another font question. Oh, Tennessee fonts. Oh, yeah.

Okay. I was dying to know.

Yeah. All right. The Fonz question. Yeah, this is family owned non corporate entity. That's the full, you know, acronym there.

Family owned non corporate entity. So. So Tennessee says if your family owns a rental property in an llc, you file this exemption, which you have to file yearly. Yeah. The company doesn't pay any franchise or corporate tax, for lack of a better word. Okay, so who gets it? Matt.

Okay, this is my. I don't know how to say this. I'm couching my answer here because I've looked into this before, many times actually, and I did find one person who had asked and there was published information on a sep, I believe as someone that had a SEP IRA who asked that owned an llc. And I believe they gave positive guidance on that, saying that would still qualify. Here's the thing to think about though. This is how I look at it. An IRA is a trust that you're the beneficiary of. If and the family owned non corporate entity works. If you have your revocable living trust and you're the beneficiary of it that owns the llc. Don't you still get it in that instance? So that's all the IRA is. The IRA is a trust. And that would be our argument for anybody that has to get in that battle is my IRA owns this, I'm the beneficiary of it. My IRA is a trust. Give me the same treatment. But I don't know that the state of Tennessee has put any specific guidance out there? I haven't looked in the last couple years, so. Sorry.

Okay.

That was a tough one.

Yeah, I'm sorry. Well, okay. See in the exemption for those that are wondering, the general rule is at least 95% of the entities ownership must be directly held by family members. And that would be a revocable living trust, which one could argue is a retirement account substantially. And number two, substantially all, which is 66.67% of the activity of the entity must be the production of passive income, which is a rental property. So we're off to the races. Then the research begins. You know, what is the definition of a family member? So I might play with this a little bit as we're answering questions here too.

But. Okay.

Your question, Matt. All right.

This was from Elizabeth in Florida. This was on submitted on the website says hi Matt and Mark. Greetings from Florida. We're 1099 self employed with individual health insurance policies. As you might imagine, our premiums are very steep and we're hoping that we might qualify for the under 65,000 modified adjusted of gross income for 2020 as we've worked less most years and we left some of our rentals unoccupied, yada yada. And he's basically saying since we're under the 67,000, we would get subsidies for the health insurance. How and when does one calculate the modified adjusted gross income to determine if you're eligible for discount rates under ACA? Also when we need to calculate the 2020 earnings, 2021 earnings. See when we might not be no longer be eligible, health insurance has become such a burden. I'm thinking about leaving the country until Medicare age. Do many of your clients take this approach? Okay, couple things here, Elizabeth. First you, when you apply for any subsidies as being any, you know, self employed or just, or you know, just a W2 employee, you're stating your income from your prior year tax return and you're making representation that it's going to be similar. So if it's changing, you do want to notify the health insurance cooperative depending on your state or if you're in a state that goes under the Florida system, because you will and we've had this with clients over the years. If you no longer Qualified in 2021 because you ended up making more money in 2021, but you got the subsidy all year or even a partial subsidy, you will get a bill or you know, you have to pay that difference. Now here's an idea though that I,

if some of you Are like, I don't want to notify him. I want the discount and I'll just pay the, pay the credit back later when I get that bill. You could do that?

Yep.

Just, just know what's coming. So some of you may say, hey, stop.

Make sure you're setting the money aside.

Yeah, set the money aside. Because you. Yeah. People have to pay this back when they make more money in the current year based on the projection that you provided.

Yeah. So one thing you may want to look at though, and I did this in Arizona a few years back because Arizona's ended up getting like the first few years of the Affordable Care act, we had like one health insurance provider left. For any self employed or people getting individual policies. There's literally one company willing to provide those policies. It was a joke and it was super expensive. So I said screw it and I did a cost sharing ministry. That is one option here, Elizabeth. If you guys don't have large medical, you could look at a cost sharing ministry instead of the health insurance. This is an exemption from ACA and Obamacare so you don't get the penalty. And the cost sharing ministry, basically you still pay. It's not a premium, but you're paying in to this cost sharing arrangement with other people and then you submit your expenses. Now most of these, the one I did, I really liked actually it was not like insurance, you're paying cash for the doctor. But if you had a one single expense over five grand, you could submit it to the cost sharing ministry to pay. But you're not submitting stuff to go to the doctor. You get the flu shot or whatever, you're paying for that out of pocket. Your regular prescription drugs, like you're paying for that out of pocket. It's a single medical thing over five grand you can get reimbursed for and that's how they keep the cost low and how those work. I actually frankly like the process does. To me, that's more insurance than what our actual health insurance is. I think our health insurance system is totally broken because you use it for everything. It's like, like your car, like if I get my car gets in an accident, I'm using my car insurance to fix the whole car. Right. But I'm not going to use my car insurance to go get the oil changed to get new tires on it. But we treat health insurance like that. It's insane. That creates. Anyway, so check out the cost sharing ministry.

And I would just add different cost sharing ministries have different policies and procedures. That was Matt's that, you know, he could submit an expense over 5k. You're going to see different types of cost sharing ministries. Also, if you do a cost sharing ministry, you cannot fund a health savings account. You could. So there's different strategies out there. I've discuss this in an entire chapter in my book, the Tax and Legal Playbook. Also, we've had podcasts dedicated just to health care. So I'd recommend you go back into our podcast history and look at the healthcare shows, which we usually do in the fall when you're in the middle of selecting providers and enrolling and things like that. Also, this healthcare sharing ministry was fun because Matt became a minister and he was able to marry one of my kids. And I thought it was just fun, you know, it was just a lot of fun. We did it at a bar.

Anybody got some. Anybody got some weddings coming up? I will officiate your wedding. I'll give a sweet tax tip and talk about how you can. Guys can, you know, contribute to your retirement accounts and all that, deduct the wedding cake.

I mean, it's a big deal. No, you do not have to become a minister to join a cost sharing ministry. That was a joke. Okay, next question from Nick. I love this one. He says $50,000 w2 job a side hustle making $10,000. I rent in the Bronx of New York. No rental property. How much can I write off? Now Nick has quickly become a quintessential example and byproduct of the 2020 Covid year. More and more. In fact, millions of Americans picked up a little side hustle to make ends meet. And some of them we've heard from thousands of you through our show and our workshops and through our law firm and accounting firm. People are thrilled by this. They're like, I didn't realize how what I was missing out on the side hustle is the gateway drug to entrepreneurship, which we love to say. And so I want to welcome all of you to the show. If you have a side hustle, a side gig, or you know someone that does, tell them to come and listen to the show. Because now you're going to have to report that on your tax return. And the question is, what do I do? So here's a couple points. Nick says, how much can I write off any expense related to the side hustle. Whoo. I love this. So let's just use an example. Let's see. Let's say. Sorry about that, folks. Let's say that Nick is driving for Uber. He cool. He's going to Write off some auto expense. He's going to write off boy, cell phone, probably a home computer, a laptop, all sorts of Bluetooth devices, some office expenses, supplies, equipment. He may even have some dining expenses out collaborating, working with other Uber drivers. Probably has some Uber direct expenses. There's a ton there. And the list goes on and on depending on the type of small business or side hustle you have. So there's no limit on the expenses. It's any expense that related to your business. We have Uber drivers that show a loss. He made $10,000 on his 1099 from Uber and he's got $12,000 in expenses. Now, we don't want to show a loss every year that would help offset the W2, but for the first couple years you can, and then in the years to come, I'm going to write off at least 10 grand, Nick. That's 10 grand is going to be tax free income. So many of you continue to study up on this. The schedule C, as in Charlie, is where you're going to report all this, nick. I've got YouTube videos on how to write off expenses as an Uber driver, as a small business owner, my workbook, the tax eight steps to start and grow your business. Look at that workbook on Amazon. Those will be very, very helpful and very affordable resources.

Cool. All right, I got a doozy of a question here. This is submitted by Instagram. This was Edwin Gutierrez says purchasing a business from my father, which he will finance. Best way to pay him back.

Don't.

All right.

Your dad will let you off. Seriously, your dad's gonna go after you. Don't pay him back. Just walk out the door. Sucker.

Yeah, now you want to buy it. Because later down the road, when dad's no longer here, if this business is successful, all your siblings will come after you and hate you. So, okay, here's. Even if you are the one that made it totally valuable, first let me just walk through a few steps here and just. Buying a business.

Oh my gosh, it's a whole show, by the way. Go back to our prior shows.

Here's first thing I'll say, don't buy his company. If he has an LLC or S Corp or anything, don't buy that company. Buy the assets of the business. It's called an asset purchase versus a stock purchase. Set up your own new company. This is an operating business. We're usually doing S Corp. So you have your new S Corp. Buy the assets of his business, his name, his customers, any equipment or inventory. Okay? You're going to buy all that stuff, you're gonna start running all that income into your business. I would have a promissory note that you're paying him the agreed price of the business over time. He's loaning you the money and you know, negotiate hard on the purchase price. Don't overpay for it. But you've got to get a fair price because there could be some gift tax consequences if you're underpaying and it effectively becomes a gift for gift tax purposes. So. But I just document it with the note. You pay them over time and that way, if there's any, the business has a lot of success and you grow it. Any siblings or other family members that may make claims to it, you guys had a contract for it, you had a promissory note to pay them back over time and you did it. And if dad wants to forgive you the money later, he can. There might be some gift tax issues to that. As I mentioned, he could forgive pieces each year without, under the gift tax exemption, about 15 grand a year. But that's what I do. Just do an asset purchase. Use your own entity to start. Don't get, don't buy his entity and deal with all the tax mess and stuff he might have in his own entity. Start from scratch, freshly yourself and buy and document it with a note on what you're going to owe him.

Next question. Oh, sorry, I'm going to say this, Edwin. Anybody out there thinking of buying a business from your family just because it's family, do not cut corners on the legal side of this. Make sure you get a consultation with a tax lawyer especially too that knows what they're doing. It does not have to be expensive. But there are critical things you're going to miss out on. There's ways to save taxes over time. Are you doing an installment sale? How much is capital gain? How much is ordinary income? Is there going to be a balloon payment? How are you going to value the business? I'll tell you right now. Dad's going to think it's worth more than it really is and. Yeah, yeah, every time. And good.

I think. Let me give you a good metric for what a small business is worth. Usually four to five times of profits. So if that business has 100,000 in profit every year, it's going to be worth 400 to $500,000. Now that's taking into account that if dad works in the business, dad is taking a salary. If dad drives that business, that's he's taking a fair salary of what he'd have to pay someone to run that business. So this is after any just income he's making. Right. This is the true profit. So that's just a very rough sketch of, of how to value that.

All right, there's some really good questions here. I'm going to hit an easy one. Okay, we're going to hit easy and hard throughout this. By the way, any of you that have questions that are related to self directing your retirement account, we're going to be primarily taking those questions on our sister podcast, the Directed Ira Podcast right there in whatever you're listening portal you're using, Spotify, Stitcher or itunes. Yeah, just search Directed Ira Podcast. You'll it'll come right up. Start from the beginning there. We have a lot of beginning podcasts that really take you through the process, basics of getting going. And then we have an open forum to show every three weeks there as well. Okay, here's a question from I am Leo Delgado. I'm just going to put Delgado now. This is a great question. It brings back, I don't know if I want to say fond memories. He says we are starting a commercial cleaning company. Should I hire W2s 1099s first? I owned a commercial cleaning business for seven years when I went through undergrad and my master's program sold it for a profit. Was excited about that. Had 20, 25 employees on average the last couple of years of business. Carpet cleaning, van window cleaning, stripping waxing floors, grocery stores, all that sold the business went on to law school. I was in the trenches of small business, learning how to close a sale, learning how to hire and fire and how to do the books. It was great learning experience for me. While Matt whizzed through undergrad and law school and five to seven years, I took the long path of being an entrepreneur through most of my schooling. I actually didn't graduate from law school until age 30, but it was a great learning experience for me. So I love the cleaning business industry. It's a great way any of you out there can make money on the side quick, quickly. It is a wonderful side gig. Side hustle, pick up cleaning a little office, building a restaurant, take the family out. I cleaned my dad's offices as a kid. Every Wednesday night and Saturday my mom would load us in the car. We'd go in and clean the offices and on Saturday we clean the offices and then we go out for pizza. And that was a huge part of my growing up was being there doing janitorial. So hence when I was in College. I thought I'll start in a cleaning business. I know how to scrub a toilet. It is a business. You got to treat it like one. You're going to want an entity. You're going to have self employment tax. Ultimately you'll probably have an S corp. There's a lot to learn there. Get my workbook. Eight steps to start grow your business. The one that really opens the door for a lot of you is his question by Mr. Delgado here. Should I hire W2s or 1099s? It depends and frankly you don't have much of a choice. It depends on how you treat them. The law is going to make you treat them a certain way. And the states around the country, especially California in the last two years has really gone hard. After those trying to claim 1099 status for the workers, Uber in particular is in a big lawsuit. They're saying our people are 1099s. State of California goes, we want to make up W2s because it's better for them. I haven't met an Uber driver yet that wants that. It's just California imposing their frickin crap on Uber drivers. But, and I don't want to get too political here, but the issue is this.

This is the former California resident speaking.

Yes, and a former janitor. Okay, if you. Here's the story in a nutshell and I have an article on this. I've got a YouTube video on this. Here's the deal. If you're treating them like an employee, you provide the equipment, you tell them when to work, how to work, what to do. They look like an employee, they smell like an employee, you fire them like an employee, then you have no choice. They're a freaking employee. I'm sorry, that's the way it is. If they bring their own equipment, they can work when they want. You sub out the work as if you're subbing out to them as another janitorial business. And you're just a middleman and you have the right legal paperwork involved, you might be able to get away with a 1099 scenario. It is difficult. It is tricky. Even hair salons around the country are having to put their stylus on as W2S. Every business is facing this issue. Truck driving companies, all these people are like they're 1099. Prove it. So be careful. I'm going to tell you 95% of the time, you're going to want the employee relationship anyway. It gets you workers comp insurance coverage. If anything happens, doing while they're working. Tough topic yeah, yeah.

I just want to let you know I, my first job actually was as a janitor at the elementary school I went to as a kid. I was in junior high, so I used to clean the old elementary school I went to. Okay, I've got a question from Beau who's in Phoenix. So I gotta, you know, give a shout out to, to those in Phoenix says hey guys, love the content. Bo from Phoenix. Question on entity structure. We want to start investing in real estate with our daughter and son in law. Should we form a holding LLC partnership to define ownership and have a own sole member of rental LLCs or somehow use my existing S Corp? All right, great question. First, if you're doing rental real estate here, which it sounds like what you're planning to do as you mentioned, rental LLCs, your S Corp is not going to be in the mix at all. Don't just it's not going to be involved, period. Okay. S corp is for operational business or maybe you're flipping a property or doing a real estate development or you know, building a home like that's S Corp rentals are not going to come in the mix. S Corp should not be in the mix at all. Now as to a partnership entity with son in law and daughter in law, that could work. And we generally do a partnership LLC and we can get to the holding company and sole member rental LLCs here in a second. But let's just talk about, let's just say you want to buy one property. Let's just start small here. Let's see, the three of you want to buy a rental. Well in this partnership llc we would want to know, well what's everyone doing? Are you putting in the money? And your son in law and daughter in law are doing the work? Are you all putting in money and all equally doing work? Who's doing what? So that's what we want to know first. Then we're going to set the terms of the holding company. Now here's the hard thing. If you're going to keep using this entity over and over as the holding company and you're going to have additional properties you're buying, let's say every year, it's going to get complicated because if this same entity is the holding entity and is every deal gonna be the same, are you guys all putting in money on every deal? Are you the only one putting in money? What are they doing in the mix if they're not putting in money? I don't know. So let's keep, let's say it's Easy. Like even Mark and I with us, like if we were 50, 50 on LLCs that own real estate. Well, we know we're both gonna put in money, we're both gonna do an equal amount of work to make that happen. It's cut and dry. We're doing the same thing and we have an equal responsibility and obligation between each other to do the same thing. Is that how you do it with your son and daughter in law? Is it the three of you doing this? Is this you 50% and your son and daughter in law taking the other 50%? Are you? You know, I just don't know. So you want to talk through that and make sure there's a clear understanding. And the first thing I would think of before you start figuring out how to structure this is is this going to be the same way we're going to do it on every property? If you're not sure on that, I wouldn't get into thinking this is a one holding company strategy and then adding the property LLC is on top of it. So start with what you've agreed to. I think the holding company strategy can work and you can do the sole member rental LLCs for individual property for asset protection. Um, but I'm, we're assuming of course that every one of those deals is going to be the same. If you're like now each deal is going to be cut different, we might have different ownership based on who's putting in what. Then you're just going to do separate LLCs for each separate property. And that's sometimes how partnerships have to work out.

Okay, so I want to tackle a very controversial topic and I just actually jumped off to make a phone call to one of our accountants in the accounting firm to make sure I had our policy before we, we put this on the public airways. And I want to talk about forex trading, crypto trading, equity trading, any sort of stock trading. And it's instance where people think they're a day trader and this could be precious metals, currency, anything like that. Now I want to make this clear for everybody out there. Do not search for an article on the web that says you can do something that is not allowed. And I'm going to tell you what the rule is right here. And as a very aggressive law firm and accounting firm helping small business owners around the country, we want you to get the best tax write off. Matt, do we want people to pay more taxes?

I mean, yeah, that's like our, our mission is to make you only pay as much as you absolutely have to and this drives tell from listening to our podcast.

Yeah. And so we're out there. Matt, I want you to echo in on this everybody. This is part of an article I'm working on right now too. If you are a day trader, first you have to show that it's your primary source of income, whatever you're trading and you now have a business which is now earned income and subject to self employment tax. People go, oh no, no, no, I'm a forex trader. It's passive. Oh, oh, it's passive. Okay. Then it goes on a schedule D and you get to deduct what you bought the stock for and that's it. Oh, well I was reading an article here on this website that said I get to deduct my business expenses because I'm a forex trader. No, hold it. Which one are you? Are you a passive trader where it's capital gain schedule D as in David, or are you a business and we're schedule C where you better have an S corp and you're going to pay self employment tax? Well, no, but look at, I'm looking at a website right now. I won't even say what company. It makes me so mad. Well, use the market to market accounting method. Take advantage of wash sale rules and all that. Okay, cool. Deduct your expenses involved in your trading activity. Oh, so your business. Okay. And then the next line says, reap the benefits of not being subject to self employment tax. Unlike schedule C taxpayers, you are not. Hold it. This article is a lie. It is wrong. Now I'm hoping this article is over four years old because before the Tax Cuts and Jobs act, you could take an investment expense against trading that's no longer available. That's a schedule A item that is now long gone. So I'm going to repeat this for everybody. You cannot have your cake and eat it too. Either you're a day trader of crypto or whatever you want to do and that's a business and you better pop it on an S corp and you get expenses and. But it's also subject to self employment tax and you better not have some other day job or you're a passive trader and you do not get to write off all these business expenses because you're not a business, you're a passive trader. Ooh, do I look bad? I'm sorry, Matt, what would you add? Bring us back to the earth. Bring us back to earth. Save our.

Well, I actually want to challenge you on something you said here. Okay, okay.

All right.

I mean what good is Cake. If you can't eat it, you can't have your cake and eat it too. I never understood that saying.

Well, I'll explain.

What else am I gonna do with it?

Cake was made for eating. Well, that's right. See, that's what's happening here. Matt, you've got to look at this importantly. They want their cake and to eat it too. Meaning they want the business write offs and they want capital gain. You can't have that.

I know, I know how the. I know how the analogy works. I just never understood it.

So. Yeah, so when you say you can't have your cake and eat it too. Yeah. So what good is it?

Everything else you said, I'm totally in agreement with. Yeah, yeah. And it is, it is that. That's the hard thing is, you know, particularly day traders and stuff. You know, they're, they, they Google everything to death. And careful what you find on the Internet, all right? Just, just because someone threw it out there doesn't mean it's legit legal. Look up the person or place who submitted that. What credentials do they have? Yeah, behind their name. Are they an attorney? Like, are they just some guru with the website that acts like they know what they're talking about? So consider the source of your information.

Yeah, and I hate this. This article tells you just what you want to hear. Oh, I do get my cake and eat it too. And at the top it says the content of the. This article is based on the author's opinions and recommendations alone and is not intended to be a source of investment advice. It has not been reviewed, commissioned or otherwise endorsed. By that means, if you go do this and get audited, you get screwed and the IRS takes away, you know, penalties and interest out of your bank account. It's not their fault, but they threw an article out there that sounded great.

Oh, yeah.

So mad. All right.

Okay, next. All right, Laura. Laura asked question says, oh, hello, Mark. Okay. Oh, well, I should have skipped that one. Laura. Okay, let me read this for Mark.

Okay.

Hello, Mark.

Okay.

I recently got my PPP loan about a week ago. Congratulations. We presume this is your first one. I want to be sure I do the disbursement correctly. I'm a 1099 sole prop and file under my own name. I want to be clear. When I take the distribution for paying myself, do I take the amount I received and divide it by 8 weeks, then pay myself that amount for 8 weeks? Weeks in a row. Thanks for your help. Well, Laura, I gotta.

You want to answer that first?

I mean, she really didn't care what

I thought she said she didn't.

She wanted to know what Mark thought.

I like how she put hello, Mark and then the little heart. That was really nice.

Yeah, no she didn't.

Okay, I'm sorry, Laura, I'm just messing around. Okay, Laura, everything you were saying is pretty good except you have 24 weeks, not eight. So everything else I'm good with. So anybody that gets a PPP loan, it is tax free. It's automatically forgiven. It's a very easy one page form at the end of the process. But you've got 24 weeks to take the money. Now, Laura, you could do it in eight weeks. Great. You could do it in two weeks. But you don't have to do it that religiously. Yeah.

And I think the that's our recommendation on PPP in general is obviously pay yourself, you know, actually write checks out rather than transfers if that's what you typically do. Notate what it's for, you know, weekly payment, you know it's not technically payroll, right? Because you're a sole prop. So you're not paying yourself payroll technically. But yeah, I like actually having a record of payment because you do need to show that it went from your separate bank account you use for your business to your personal account. Now if you've never had a separate bank account for your business and your personal account, well, you better start now. And let's show that this is coming from a separate business bank account into your personal account. The other thing I would say is Laura, if this was under 50,000, you don't even have to show this when you go submit your application for forgiveness. So you're going to be able to just check the boxes and said I complied with the rules, I used it properly and and give me my forgiveness. So I don't know. Most sold props are under 50,000 so in total PPP loan amount. So you might have the easy route anyways but still just for audit protection and just have good records. I like. And you know, you could cut it over every two weeks, just cut yourself a check or maybe monthly for the next couple months, just cut yourself two checks. But I like having an actual physical check rather than just a transfer.

Okay, I'm gonna. Let's stick on this government assistance topic for just one moment. This is from Andrew. Question that flew in today on the website says hey guys, thanks for doing your show. It's helped my many businesses, including ours, in ways you probably couldn't even realize. Thanks so much Andrew. That means a lot. We do have a lot of people that share stories that really make our job rewarding. We love it. He says on the ertc now this is the employee retention tax credit. Oh boy. So this is very complicated. This is what you can do in conjunction with ppp. You have to have payroll to do this. So Laura, who is a sole proprietor doing her little PPP is not going to qualify for the ERC. For those that have a S corp with W2 pay, this is another opportunity. Now let me pose the question and I'll tell you the controversy. He says our business is an S Corp with four owners who are all family members. However, none of them own 50% or more of the business. It's 30, 30, 30, 10. Can we claim the ERTC tax credit and if allowed two could we then claim any other employees who are family members since no one is over 50% threshold. So Andrew, this is the controversial point. It is out there on a lot of the accounting websites. The Board of Accountancy people are coming out with opinions on both sides of the aisle on this. Some are saying very strictly that the owner is not allowed to take the ertc, period. Some are saying, well, if their ownership is under 50, they can. Some are saying like at least I can pay family members and they can I get the ERTC on them. And then there's a strict interpretation that says, no, you can't. Here's what I'm just going to say. We are not publicly coming down on a policy on this from our firm on which side we're taking. It's a case by case analysis and you have to make sure that the person advising you on your payroll tax return preparation that they're going to stand behind that advice. There are accounting firms out there that are saying, hey, we'll get the credit for you and we take a percentage. 2%, 5%. I've seen as high as 10, which I think is very, very exorbitant. But if you use a company to prepare and apply for the credit on your behalf, they should be standing behind their recommendation. Make sure they do. Anybody says, yeah, you could or you couldn't, but it's not our fault. If you get audited, then what the heck are you paying them for? So Andrew, get out there, talk to your professional that's going to be doing your quarterly payroll reports and tax return to make sure they will stand behind the advice based on your particular set of circumstances. I wish I could say more. Andrew, I apologize. Get out. I'd start with your current accountant right now, see where they stand because they got to sign off on it and their malpractice insurance should cover it if they're wrong.

Yeah. All right, cool. All right, this is from rajpmec and this has some retirement stuff in it, but it's not self directed here. It's just some, I think some good things I'm going to hit. It says hi Mark and Matt as I work on a strategy of taking 401k taxable income either at 55 or 59 the latest. Can I invest in real estate during those years, keep my earnings under 100,000 and qualify for the real estate professional rental losses if I have any, to help with the tax deduction tax reduction strategy with depreciation and passive income pass through losses. Meanwhile, I can roll over income into Roth IRAs as well and try and reduce any taxable income until 70 or 72 when I'll be required to take an RMD. Okay, not exactly sure what you're trying to get at here, but let me walk through capability. Yes. I mean you can start taking money from a 401k. Some 401k plans allow it to be taken out at 55, but rather than 59 without a 10% early withdrawal penalty. That's a little nuance there. Usually it's 59 and a half though, to be safe. But let's say you're 50, it's 59 and a half. In your instance, you're taking it out. Can I keep my earnings under 100,000 and qualify for real estate professional losses? Yes. Now if your earnings are under 100,000, you may get the active real estate ability to take up to 25,000 in rental real estate losses without even being a real estate professional. So only those who are making over 100,000 and actually a little bit more. Do you want to be a real estate professional to then take all your rental real estate losses against your other income? But let me say this. If you don't have the ability to take rental real estate losses and use them against other income, is really only valuable if you're high income. If Your income's under 100 grand, your tax saving, like your effective tax rate at a hundred ousand might be 10 or 20%. Like you're not getting a huge tax savings when you're making under 100,000 or less, particularly if you're married. So I don't, I wouldn't focus too hard on getting rental real estate losses to offset income at that income bracket. Now, if you're in the 37% tax bracket, you're Making a couple hundred, Few hundred thousand a year. Yeah, Those rental real estate losses are much more valuable because you're paying at a much higher rate on that top end of the income. And then of course, yes, you can be rolling funds over and I presume, I mean converting to Roth so that that money is going to grow and come out totally tax free over time, which, Remember with Roth IRAs, there's no RMD that you have to take the money out later. So I hope that helps rise. I'm not entirely certain I hit the nail on the head on what you're trying to do there, but hopefully that that detail helps you work through the question.

Okay, I'm going to try to answer two or three questions really quickly without a lot of explanation so that in our last five minutes or so here we can cover a number of questions that came in. First one, investing Young Love. That handle says, does everyone that invests in bitcoin have a physical bitcoin? Actually, it's the opposite. No one has a physical bitcoin. No such thing exists. We joke around it all the time that I hold up a gold bitcoin here, but there's no such thing. It's an algorithm, blockchain technology. It's an equation. It's very technical. Matt himself has recommended to understand bitcoin, probably the best. If you want to do a deep dive one night, put on your thinking cap, have a Diet Coke and some popcorn. There's a class offered online through mit. Is there a cost for that, Matt, or is it free?

It's on YouTube. It's free. MIT has tons of stuff up on their website that's just on YouTube. It's free.

Who.

Any class on MIT for free.

Wow. Who was the professor you liked at MIT that gave that. Do you remember that?

No. I'm in about. I'm about halfway through it. I forget his name. I'll get it here.

Okay, next question.

Gensler.

Yeah, Gensler. G E N S L E R. Anybody interested on a quick tutorial? We've heard a lot of good about that. Matt himself is watching it. Okay, would another question.

This might be part of the question though. Let me just say this is. Some people think you have to buy a whole bitcoin because people like a bitcoin is, you know, $62,000 right now is like the price today of one bitcoin approximately. Well, you don't have to buy one bitcoin at a time. It's not like you're buying in $62,000 chunk chunks like you can buy 0.000 piece of it. You could buy a thousand of Bitcoin and you're buying a piece of one bitcoin. So it's not like you have to, it's not like you have to buy the whole thing. Maybe that's part of the question. Yeah, no, I like it.

And there's also, I thought you were going to say cold storage strategies where you actually hold the coin on a flash drive. Don't lose it. Okay. Edwin says own an S corp with brother. Are we allowed to pay our kids tax free income up to 12k? Edwin, bless your heart. That's the southern term for what's coming next. You're not going to like own an S corp with my brother. First of all, I would never recommend you own an S corp with your brother. Not because I don't like your brother, but because we talked about this at the beginning of the show. You do not want an S corp with anyone but your spouse. Period. I don't care if it's kids, mom and dad, an S corp. It's very tricky to write off expenses that don't want that are not going to be reimbursed entirely for both parties. And you're going to have all sorts of write offs that you're going to want, like paying a kid that one of your other partners are going to not want to do or do at a different level. So the first issue is reorganize the structure of your business so that each brother has their own S corp. That's point number one. Next, you're not allowed to pay your kids tax free 12 grand. What you're allowed to do is pay your kids for legitimate services in their business to any amount. I've seen clients pay their kids 45 grand. I've seen them pay their kids $450. It just depends on what the kids do to earn that wage, for lack of a better word of that pay in the business. Now they don't pay taxes up to the first 12,550 this year on earned income working for the family or anybody for that matter. So it's not just this, oh, I can write a check to my kids for tax free income. No, they're working in the business, it's legitimate. And if they're over age 18, it's a whole different structure. If they're under age 18, it's a different structure. I've got books and podcasts, Matt and I've covered how many times this on our show. Please go back into the history, history of how to pay children in the business. You will love it, but be careful with that. And the answer is no, you're not going to pay the kids out of the S corp with your brother's kids. Your kids. You're talking about a mess right now. So get a consultation on that last quickie then. Matt, I'm going to let you do two or three quickies. Is can I reimburse myself for home office expenses out of my S Corp? Yes. And this is kind of easy by Tati. Yes. When you have an S Corp, you actually don't take the home office expense. You're reimbursing you, the employee for the benefits of using your home office. You're going to use a lot of the same calculations to get there. But that's for home office use now. But when you say home office expenses, that makes me concerned because we're going to write off cell phone and Internet and computers and equipment in different space spots than the home office expense. So kind of. Kind of easy by Tati. Make sure you talk to your accountant. I've got articles on all these different topics in other YouTube videos. Matt Quick, two or three you want to knock out?

Yeah. This is Tina from website. Hi, Mark and Matt. I own and live in a condo for five years now. I want to move to a different location and rent out my. Rent out my condo. Can I convert it to a property primary, from a primary to a rental and still Capture the Section 121 Section 121 is the sell of home section. I was told to set up an S Corp and sell it to my S Corp on an installment basis. Is there an easier route? Okay. Do not sell it to your own escort. All right, first of all, the sell of home exemption is going to get blown up because only individuals can qualify for the sell of home exemption. So the S Corp is going to blow that.

Well, well, but what she's saying is I'd sell it to the escort, capture my sale of home exemption as an individual and then re. And then reestablish a new basis under the escort.

Yeah, the escort, which you cannot do because you can't. The sell of home exemption does not allow you to sell it to a, you know, yourself or a company you own. That's just not going to work. So, so the easier route, you could put it into an LLC that you own. You could still get the sale of home exemption if it's a disregarded entity for tax purposes and we wouldn't want an S Corp For a rental anyways. But the sell of home exemption is going to die in three years. So you have three years to rent that out and still keep that sell of home exemption for any gain you've gotten that property from since you've owned it until now. So I think that's your best route. I'm not aware of a way you can use an installment rule or some way to sell it to yourself in a legit strategy where you'll still get the sell of home exemption. If you read that section 121, there are restrictions in there on the buyer of this and it's going to restrict it being a company you personally own.

I agree with Matt wholeheartedly and would say you can capture the 121 if you sell it to a family member, but it's got to be an arm's length transaction. The IRS will use what's called the step transaction doctrine that if you're just trying to create a sham where you're selling it to one of your kids to get it and then the kid sells it back to you if you're audited and that you're caught, you're not going to go to jail, but they're going to want the tax and penalty. Back with tax, back with penalty.

If you think about it, that's an easy one for the IRS to catch because you're going to sell the property that's been this address has been on your tax return. Then it's going to. You're going to get the gain and claim to sell homes and then it's going to pop back up on your return as a rental property. It's just you're kind of, kind of thumbing your nose, so to speak, or giving the finger to the IRS and being like, did you see this? See what I did here? I don't like it.

What I'd like to do is if you're going to keep the property longer than three years, see how it goes for three years. You might find out this is not a great rental. You may find out it's you've found other rentals that are a better experience and you want to cash out. That's a great opportunity to sell. You could do an installment sale at that time to someone else or just sell and pay the tax. You could do a 1031 exchange and still capture the 121 on the amount up until the point you converted it. You also might do a seller refi. You say it is a good rental, but I'm going to Just refi. So not a seller refi. I'm sorry, owner refi. You're going to refi it, strip out some cash and go buy another rental and just say, you know what, I'm going to walk away from the 121. It's just too good of a rental to sell. So I like Matt's idea of just wait and see, make it a rental for three years and then reevaluate.

Yeah, yeah. And you could use the LLC, like I said, for asset protection. So that's turning to rental and it's still going to. It's going to be single member disregarded. You'll still get the sell of home exemption and you'll get the liability protection as it's now turned into a rental. All right, one more. I get the final one?

You get the final one.

All right. This is Eric. He says, I'm a general dentist. I was advised to title my dental practice in my trust. I thought a dentist has to be the owner of the corporation. I was advised to title my boats in the trust. I was also advised title my boats in my trust. Enjoy this show. Thank you very much. Mark and Matt David from Michigan. Okay, this is a good question. We generally want your assets, your companies, your LLCs, your S corporation to be owned by your trust for estate planning purposes so that when you pass away, the trustee of the trust can come in and just divvy up the assets as you indicated in your estate plan, in your trust. If you don't have a trust or your trust or you have a trust and it doesn't own your companies, those are gonna have to go to probate. And a probate court judge is gonna have to decide how the ownership's gonna get moved around and approve those things. You don't want to be doing that now for certain professionals. And this is the same for me and Mark, or for a dentist, doctor, anyone who's a licensed professional who's providing professional services. Most states require that to be provided in a professional corporation or a pllc. Now you would want those to be an S corp. Like, I have a PC, that's an S corp. Mark has a PC professional corporation, that's an S corp. So you would probably have something like that, Eric. That's what we'd recommend. Now, when you set up the corporation and for licensing purposes, you would be the owner of it, but we are going to transfer that ownership by a stock transfer or membership transfer data PLLC to your trust because we want, for estate and legal planning purposes, your trust to Be the owner of it. Now, now, we have never seen Department of licensing agencies care of that. If you ask them, you're going to get convoluted responses about how the individual does have to be an owner because that's what's in the code and most professional corporation sections. But you're still the owner in your trust even if you have a spouse in the trust. Frankly, if you're in a community property state, your spouse owns half the company anyways, even if it is a professional entity in most states. So I wouldn't stress too much on that. Now, the boats, titling the boats into the trust, maybe I don't know that like on boats usually have a title. Of course those aren't as difficult to transfer over. You could. But those typically don't have to go to probate. You usually can show a death certificate on boats and cars and the trustee can usually move those without being on. But I don't know. Do you recommend that put your boat in the name of trust?

I do. I think when in doubt, move assets into your trust. It's something that can easily be done when you're at the DMV doing your annual renewal. If you don't have liens against property, that's even easier. If you've got a loan at the bank for bank for boaters, they're not going to allow you to do that until you have the title free and clear. But even I was in Wells Fargo the other day and they said, hey, do you want to transfer the ownership of your personal account to your trust while you're here? I'm like, I'm very impressed. Thank you. What do you have a form for that? She goes, yep, your two page form. And she goes, it won't change the name on your account and it won't change your checks. It's just gonna. Won't change your account number. But if you die, your trust is automatically the owner. I go hand it over. So I think whenever you can make your trustee owner, you're doing your family a favor. You're making life a lot easier for them and it wouldn't hurt. But on these LLCs and corporations for businesses and professional practices, the dol. The department. Sorry, not the deal. The Doppel Department of Professional Licensing. They're really looking through a lot of those trusts to just see who the real professional is. And whenever you can have your trust, the owner of everything and every, you know, anything and everything, the better. So cool. Okay, take us out.

Right? Okay, well, thanks everybody for listening to Main Street Business podcast. Thanks for all those that submitted your questions. Remember, you can go to mainstreetbusiness.com right out there on the homepage there. Submit a question. If one pops in your brain, just go throw it in there. Mark, we did go back a couple weeks here of questions that we pulled from and try to submit questions that you think other people will enjoy hearing. If you got a weird situation or we were asking about line this on this tax return in your odd situation, that's not a great question we're going to read. So try to give one you think would be helpful to other listeners and most of them are in the small business, real estate, retirement tax, all that stuff. You know, those are questions we love to field here on the show. And if you like the show, Please give us 5 star rating on whatever podcast channel you subscribe to and listen to this. And thanks for being with us. We'll be back back next week with another amazing episode. Keep living the Dream.