The Child Tax Strategy Guaranteed To Lower Your Taxes

Main Street America. My name is Mark Kohler and I'm here helping build your American dream. I'm a CPA attorney, best selling author and just an all around entrepreneur. Just trying to keep living the dream myself. I own rental real estate. I've owned a lemonade stand off and on my entire life. I think I was 6 years old out there with a lemonade stand hocking drinks on the street just like many of you entrepreneurs. And I'm excited to be here with you today because the lemonade stand is a theme today. Any of you with children, grandchildren, nieces or nephews, or you just want to haunt children with an entrepreneurship dream? This is your chance to teach them about making money and business. And I just love this topic. And so today I want to teach some basic principles and I'll get as technical as you want on how to hire kids in your small business, what you can do to invest the money you pay them, how to put it on the tax return, the best method to do it. And I want to talk about your family board meeting. We got some extra, oh, I need a drink in here, some ice water. And we're going to talk about having your family vacation as well, how to write that off in a strategic, ethical and legal way. And just I want to talk to you tax pros out there, any of you that might be accountants, bookkeepers, enrolled agents, CPAs, tax lawyers, financial advisors, and you're looking for some deeper knowledge on just one of 80 different topics. Paying kids is one of 80 topics. I teach in a certification program that is taking the country by storm. It's amazing. So lots to talk about. I'm going to give you out some specials on some upcoming workshops and prices and you know, let's dive into it. I want to make sure that I'm helping you here today. And there's no hide the ball. I'm going to throw down everything I know on this as quickly as I can. Of course, this is probably a two or three hour topic so it will be truncated here and there. So please type your questions down below on hiring your children. But before you type too much, let me tell you a few things. First, I'm going to do the easy part. If you have kids that are 18 or older, if you have children 18 or older, they're going to college, they're adulting, they're launching, they're starting their own business and you help them out financially from time to time. Time. One of the easiest and best ways to pay them and to justify it is to put them on your board of advisors of your LLC or board of directors of your small S corporation. Now some of you may go. I have an LLC I've never heard of Board of advisors. Well, that's because you may have just hacked out your LLC online with an online company or did it yourself. Please clean up your llc. Make sure you have a corporate book, membership certificates, operating agreement. Everything's up to date with the state. And now this year you haven't until December 31st to file your BOI, your business owner information report with FinCEN, which is required. You're gonna be hearing more about that. So getting your LLC cleaned up is a great opportunity to hold your family board meeting and that's called a board of advisors. When we set up an LLC for clients around the country, we always ask who's your critical friends or family members that you may travel with. Put them on your board now. Now we're going to talk about teenagers and younger here in a minute, but if you have kids 18 or older, you're helping them out financially at all. Don't give them money, give them a 1099, put them on the pay, put them on the board and give them a payment as a subcontractor and you're going to pay them out of your company. So when your kid calls and go, hey, I need tuition, oh, I got a flat tire, oh, I need to pay rent. You're like, okay, you need to earn it. I need you on my board and I need you helping me out with some marketing, some, some support in the company, any which way you can. Maybe you've got a rental property near them. Find a justifiable reason for them helping, give support and advice, which is the first piece, being on the board. And then you're going to give them money directly from the company. So we'll go to the whiteboard here if we need to in a bit, but you're going to just 1099 them out of your company. That's how you're structured and all that. It's a big conversation. You may want to get a tax advisory consultation with one of my lawyers or someone in my tax pro network. So I'll give you that link a little later here too. And you just get a consultation, pay for an hour, maybe pay for overall consultation with the trifecta and build a picture of what you want to do with your business. But get those 18 year olds on the board, treat them as a subcontractor, 1099 and take a tax write off. Quit paying taxes at your level and giving them money, put them on the board, pay them as a sub. Done. All right. Now if you have kids under age 18, it gets to be a little, I don't want to say trickier, but we've got to follow a better process. So point number one, and this is a big one, this is my MJK 2024 calendar. You can get it on my site. Inside I have all these little tax resource guides and tables, maps of the country and which states have the best entities and tax strategies. One of those in here is we're looking at the standard deduction for 2024. It's $14,600. Now this is an important point. No one in America pays taxes on the first $14,600 of earned income this year. You don't? Nope. That's your standard. If your kid is still a dependent of yours and you claim as a dependent exemption, whatever you want to put on your tax return, you're taking care of them. If they go work at McDonald's, they don't pay taxes on the first $14,600. They have a standard deduction, even if they're still a dependent of yours. So if they work for you and your business, you still deduct them as a child under 10 40, but you pay them out of your business up to $14,600. They don't pay any taxes at all. No federal taxes at all. Now we'll come to the states. Some states don't have a standard deduction of $14,600. For example, this last year in California was $4,800. So if you pay them more than $4,800, your kid has to pay California state income tax. But federally, no child of yours, not even you, pays taxes on $14,000 of $600 of $14,600 of income in 2024. That's great. Okay, now that does not mean you pay your kids $14,600. If they don't earn $14,600, you don't pay them that. You pay them what they earn. Now, a 10 year old helping out around the rental property, mowing lawns, washing your car that you drive for Uber, shredding paper in your office, stuffing envelopes, helping with your social media, whatever. If they as a 10 year old only deserve and earned $4,000, then that's what you pay them. Just because you can pay them up to $14,600 doesn't mean you do that. No, I have some clients, I had a client the other a year or two ago, pay their 17 year old $40,000 out of their company. I was like, what the hell's going on? I get on the phone, I'm like, this is not good. You can't pay a 17 year old $40,000. And I go, he's the licensed realtor in our business. He had six closings, he earned every red center. And I said, wow, that is awesome. But you paid him wrong. You paid him a 1099. And they thought, well, that's how we pay our realtors. He's under age 18 now, he's got to pay more taxes getting a 1099. If he's under age 18, there's a whole other way to do it. And they actually, I need to say they paid him as a W2 and then they had all this withholding that they didn't need to do. And so we wanted to change that approach. We still didn't give them a 1099 or a W2, but there's a process. So point number one, standard deductions, $14,600. Point number two, your kids have to earn the freaking money. And you may pay a 5 year old 1000 a year or 6 year old for shredding paper. I started putting my kids on payroll at age 5 or 6 helping around with the office, janitorial and shredding paper. Or you may pay a 15 year old 10 grand or 15 grand, pay them more than 14,600. It doesn't matter that how much you pay them is based on what they do. Okay, now here's the beauty of this. When you put your kids on the, on the pay of the company, you get a write off and they may not pay any taxes at all. And then they can use that money to save for college, to invest in real estate, to fund the Roth IRA to build wealth. But you're getting a write off for crap you would have been paying for anyway. That's the beauty. Now let me diagram how this looks. If you wanted like, okay, you got the concept. Now here's how we structure this. And I use what I call the trifecta. It's a picture of how I want you to structure your business and tax life. And then from there I show you where to pay the kids. So in the trifecta, it starts with foundational point of your revocable living trust. Or we'll put down here your 1040 tax return. All the money flows downhill into your tax return. We're going to split your life in half. And I'll explain this little Circle here in a minute. We want to put your operations on the left and we want to put your assets or investments on the right. Operations create ordinary income assets create passive income and all that income is going to flow downhill into your 1040. Now the trifecta says if you have an operational business and let's say it's an LLC or an S corporation, it's going to be owned by your trust and that money goes down to your 1040. If you have rental property, you have an LLC with some rental property, it is owned by your trust and all the money or the passive losses from depreciation or gains goes down to your 1040. That, my friends, is the trifecta, the trust, your operational entity and your LLC for your rentals. And then the party starts over here you might have IRAs, a Roth, a 401, you might have a day job, 401k, a Solo 401k, all sorts of goodies. So we decide, we divide your passive side into two pieces. Your tax free side or tax deferred and your after tax money. So we're going to kind of build these two different sections. That's your trifecta. Now where do you pay your kids? I want to switch this over to red and I will show you here, we're going to put this in red. We're going to pay our 18 year olds, 18 or older, we're going to give them a 1099. Over here we're going to give them a ten 99 if they're 18 or older, 1099. And you're going to have a board of directors or board of advisor. I'll put B for board, B for board. Now if you're an operational business making more than 50 grand a year, you're going to be an S corporation. There's no way around it. You're going to be. And so what I want to do is show you the S corporation is ultimately where you're going to be. Now I will say let's kind of put it here for some of you that might have an LLC side hustle and you haven't made an S election, you can still pay your 18 year olds out of that LLC with a 1099. That's good. But over here, let's clean this up too. Let's make our board. Put that in black. Okay, so we'll go over here, here's our board and we're going to make this an S corporation because that's where any client of mine that's making $50,000 or more net should be considering an S corp. And all of you accountants out there, CPAs, enrolled agents, tax advisors, financial advisors. I had a client in a workshop two weeks ago, said, I said, how much do you make in your business? She goes, we make 250 grand net. They're making 250 a profit. And I said, you're an S corp, right? They go, no. Our accountant said I needed to make more before I could take a reasonable comp. Are you kidding me? That's malpractice in my opinion. And you accountants out there, and I'm sorry, I'm a little being a little feisty. I have gone to every reasonable comp training, read every reasonable comp case. I've understood all the reasonable comp software out there. I've interviewed four or five IRS agent prior IRS agents out of the Chicago office auditing S corporations. I myself and our firm over the last 20 years have prepared over 5000s corporations and have never, ever, ever had a client audited for taking too little of reasonable comp. So get over it. There is way too much fear on this. We need to take reasonable comp and it's okay. So if you're making 50 to 100 grand a year, I can do a 60, 40 split. A 5050 split on payroll and justify it all day long. And people out there, if you're making 60 grand a year and I do half in salary and half in payroll, you just save 15% on 30 grand. That's 4,500 bucks. If your accountant's not even talking about an S corp, you're leaving thousands on the table. All right, now why I bring this up is because you don't pay a kid out of an S corp that's under age 18. Not good. We do not want to pay our children under age 18 because if you pay a child under age 18, you've got to do a W2. Not good. And are they really going to be a 1099? Uh, so when you do a W2, you've got to do withholdings and to do the FICA F word. We don't want to do that. So what you do is you pay a management fee. And this little management fee goes over here to a sole prop. And this could be an llc, it could just be a regular sole prop. And I'm going to pay the kids out of a schedule C. So this is going to be a management fee expense on the 1120s and then it's going to be revenue. In schedule C is management income. And Then I'm going to have outside labor to the kids, not payroll. It's going to be on page two is an other expense. I told you I'm not going to hold back. I'm not trying to hide the ball here. And I've got a certification training where I teach this in white paper and throw down all the facts and figures on this outside labor. So if I pay, I've got two kids, both, maybe they're 8 years old and 12 years old or 10 years old and 15 years old, whatever. And I'm going to pay them five grand each. I can take a management fee, expense, pay each kid five grand and I zero out my schedule C. I just got a write off of 10 grand. So I just saved taxes of 30%. Fed and state could be even more. My kids file it. They don't even have to file a 1040. They paid no tax. No tax and we're off to the races. They could then take that five grand and fund a Roth ira. And with that Roth ira, be a partner in my next LLC and go buy a rental and all those deposits come out for college tax free while the growth continues to build wealth for them. And you're teaching financial literacy to your kids and you're teaching them about business. So the point being here is there's a methodology, there's a procedure. And you business owners have to demand this from your tax preparer. And if they are like, oh, that's too risky, please remember this moment where I tell you again, I have the best selling author on this. I'm a cpa, I'm a lawyer, I serve on the board of AICPA here in Arizona. Got malpractice insurance. I've been practicing for 25 years now and I've never ever, ever had a client get audited for paying their kids, ever. And I've been in audits where clients get in trouble for 1099 and people that shouldn't be getting a 1099 and the agent goes, oh, that's the kids payment. Fine, done. This is the American way. This is small business. Business is family. Family is business. Start acting like it. Get those kids on the payroll parenthetically in the right way, whether it's 1099s or outside labor. And if your accountant says this is too aggressive, you have got the wrong account. Think of a New York deli hiring their kids after school in the summers to work at the deli. Oklahoma farm, hiring the kids in the cornfield. Idaho farm hiring the kids in the potato field. Realtor In California saying, help me put out signs on the weekend. An Arizona rental property owner saying, hey, go help mow the lawn. A kid up in New Jersey helping their family at the fruit stand in the summer. This is summertime. Put your kids to work, make some freaking money and pay your kids out of the business. You save taxes, make money and teach your kid the American dream people is doable. Now any of you advisors out that are like, where the hell do you get off saying all this? Mark. I have put together the most amazing certification program to train and business owners take the same program. They're like, I want to be certified as a tax advisor for myself. You don't have to be a cpa. You don't have to be an enrolled agent. If you're an accountant out there and you want to learn real strategies and get certified to start charging advisory services, I'll be done here. Check out the link below. Sign up for the Main Street Tax Pro demo. Check out my demo on our program. 880 strategies videos, online quizzes, weekly trainings. I put together a network where people can find you. I teach you how to bill. I help you make money. You are going to blow up your business. I want to triple the size of your business teaching you how to bill advisory convert. Those clients that are just tax comp compliance only, we're going to bring them over. Your payroll clients, going to bring them over. Your bookkeeping clients, we're going to bring them over. You're going to be a real tax advisor and a quarterback. Now you clients out there that are small business owners, you got to demand this. And if you want to find an advisor in my network, it'll be down below. Find an advisor. MarkJ Kohler.com TaxPro Network right there. It's down below TaxPro Network. Go over there and you can interview them for free. I don't make any money. I just tee it up. I teach them. They're part of my community. They're my tribe. We're trying to change America. We're trying to change Main Street America. Helping entrepreneurs employ their family members properly and take a frickin tax write off. You can do this. Business owners demand it upgrade. Yeah, you might spend a little bit more money getting a tax advisor planning call and I want to save you 10 times that. It's okay. There's no one out there in the country that has more books, more podcasts, more blog articles and more videos on this than me. And I'm standing behind it, people. You can do this. The American dream is alive. And, well, now I want to take your questions here. A couple other thoughts. I have a three day tax and legal 360 workshop. It sold out last week ago in Salt Lake. It's amazing. We're going to be in Phoenix in December. The links down below, it's 15% off tickets, early birds through the rest of this month. So for two weeks, that's it. Bring your kids. Bring them. We're going to be at the Scott Hotel in Scottsdale, Arizona in December. Who doesn't want to be in Scottsdale in December? And it's affordable. I think it's like 5, $600 for a general ticket. Don't be chasing these different workshops that are thousands and thousands of dollars where it's rah rah, rah and blah, blah, blah. I've got the goods. It's rah rah, rah and freaking bring it, Mark, because I'm bringing real strategies. So that's taxandlegal360.com and I'll bring up a couple other things, but let's do some questions. I'm all yours. I'm all yours. So, Zach, here in the studio, I don't know if we're going to the whiteboard. You tell me, what do we got? Anybody with a question here?

All right, so the first question coming up is from tiago over on TV, YouTube. They're asking, how do I hire kids as a sole prop, and where do I write it off?

Okay, hire. How do I hire kids as a sole proprietorship, and where do I write it off? Okay, let's go to the whiteboard. Now, remember, when you say I have a sole proprietorship, that means you're not. That's not rental property, okay? That's Schedule E. So when they say sole prop, they means they have a side hustle. And I'm gonna go like this. A lot of sole proprietors are just, boom, they're just a dba. You don't have an llc. I might recommend that you get an llc. But let's just deal with this. You're a sole prop, okay? You're gonna be filing a schedule C. So if any of you drive Uber, any of you sold anything on Etsy, any of you drive for doordash, you've got a car on Turo, you're selling consulting services on Upwork, you, you're mowing lawns, whatever, any small business, that money comes in here as a sole prop and you report it on schedule C, Then it goes to schedule one, and then it drops onto your 1040. That's how it works, okay? So if you're going to hire your kids, your kids have to have a bank account. So let's say you've got two kids here, and you're going to say here's their bank account and you're going to transfer money from the business into their bank account and then pay for soccer and school clothes and school lunch and college savings and a Roth IRA or a Coverdell or whatever. It doesn't even have to go into savings. But you may just say, I just need to pay for this stuff. Quit taking money and paying for it. No more. You're not going to do that. You're going to pay the kids and let them pay for their own expenses. That's what we're shooting for here. Okay? So when your money comes in, you're going to put it on page two. A schedule C has page one and two. Right here on the end of page two is called other expenses. And that's where you're going to put kids and call it outside labor. My accountants out there do not, and I repeat, do not put it on payroll on page one. Because you're not going to withhold taxes. You don't have to withhold taxes on your kids under age 18. That's why you don't need to do a W2. There's no FICA withholding. And if they're below the standard deduction, there's no federal withholding. That's it. Now, if you're in a state and you're going to pay more than the state withholding, you might do a W2 just to kick out some state withholding. That's it. Now, the person who asked that question, what was her name? I forgot here. Whoever asked that question, I hope you're just asking for fun. Like, I kind of want to know. Because if you're doing your own freaking tax return on TurboTax, trying to live the dream, trying to do a side hustle and trying to pay your kids. Please, I beg of you. I beg of you. Get a tax advisor, meet with them for a couple hours and get a plan. Every tax advisor in my network, when they do their consultation, they'll tell you, if I don't save you more taxes than our consultation, I'll give you money back. Pay for a professional, damn it. They will save you 10 times that. They will rock your world. Get over my network and interview someone and go, hey, I want to pay my kids. I want to write off my auto. I want to write off my family vacation. I want to write off my electronics and my Apple watch and my cell phone and the equipment in my garage at Home Depot, at Best Buy, Apple Store. If your accountant's not talking like this, you got the wrong freaking accountant. So I'm loving the questions, but don't do it yourself. I don't go to Home Depot to become a plumber. I go to Home Depot to do some basic repairs. Please be careful. All right, next question.

Before we get into the next question, I have this fun comment from Casey over on YouTube. It says, hey, Mark, sitting in Montana right now, having our question quarterly family business meeting right now.

I love it. Doing a board meeting in Montana. By the way, I'm just hitting here with my tax daddy mug. What's up with that? So any of you that want some real tax pro shop gear for the special account in your life, get over to taxproshop.com. we got some fun stuff. I got a towel that looks like a 1040. So fun. We got so much gear over there. Check it out. This is my I'm your tax day to people. All right, next question.

Next question is from BFP over on YouTube, and they're asking, does the payroll tax exemptions apply to grandchildren?

Okay, now what he's asking is the payroll tax exemption. I wouldn't call it that. But the question, what they're asking is. Okay. Oh, all right, I'll go with exemption. Fair enough. Are you exempt? Okay, everybody. Parents are exempt from withholding FICA when they pay their own kids that are under age 18. Now, if you had a divorce and one of the kids is claiming the kids is a dependent, but you're still hiring your own kids when they're with you to work in the business. And I'm not talking about child support, but if you're paying your own kids, biological children, you're still exempt from withholding FICA even if the ex is claiming them on the tax return. You're good. Parents do not have to withhold FICA. That's why a W2 doesn't matter, because there's no penalty if you don't do the W2 because the penalty is based on withholding and there is no withholding. So you're good. But grandparents, you can't. You don't. You. You have to withhold. So wouldn't it be nice if there was a loophole, some sort of backdoor method that we could do it? I've got one. You ready? Let's go to the whiteboard. Grandparents, here's the trick. So grandparent is up Here, grandparents over here and they want to pay grandchild for helping legitimate in the business and then they want to fund the grandchild's Roth ira. That's really what they want to do. Because grandparents know that a grandchild Roth IRA is gold. Oh my gosh. They want to teach their grandchild to have a Roth ira. But if they just put money in it, it's a gift. There's no write off. And if they pay the kids out of their business, they got to do a W2 and withhold FICA. And that sucks. So how in the world do we get this money over here? Well, what you do in your business is you su 1099 the manager of your grandchildren. So I'm going to 1099 the parent and the parent is going to pay the grandchild for working in the business and the grandchild is going to contribute to the Roth IRA. When you 1099 your kids, you get a write off. So you could say, all right, I'm going to pay this teenager six grand, but I'm going to 1099 the parent. They're going to put it on a schedule C and pay their child who are exempt from withholding fica and then pay the grandchild or child in your case and 0 out the tax return. So 6k in 6k out 0 tax, grandchild dropped 6 grand. You just end up with 6 grand in the Roth IRA and you're teaching your kid about building grandchild, about building wealth. That, my friends, is the loophole. All right, next question.

Next question is coming from Mike over on YouTube and they're asking for some clarification on their situation here. So the passive losses from our rentals cannot offset my wife's W2 ordinary income from our in parentheses her restaurant, which is an S corp unless I'm a real estate professional.

Correct, Correct. Now here's the let's put it in a trifecta, everybody. So look at the trifecta. They have an llc, they have rentals, and these rentals are being depreciated and they're creating losses. Very common. This is beautiful. Is creating tax free cash flow and then losses on paper. And they have an S corp restaurant owned by the wife and the revocable living trust. And wife is taking a W2 reasonable comp, which I talked about a bit ago. And husband, I don't know where husband's at in this mix. I presume husband has a day job W2 and he is funding the 401k that he gets at work and playing in the Match and then getting out. And the whole family has Roth IRAs. Husband, wife, and we'll assume two kids. A little Mayberry family here. Boom, boom. Okay, this is a perfect trifecta. Look at this. S Corp for restaurant, W2 for wife, W2, day job, husband, 401k gets the match, they drop out, fund all the Roths for all the family. Everything's owned by the trust, llc, owns the rentals, Tax free, cash flow, paper losses and a river runs through it. I love Brad Pitt. Now here's the thing. These losses are kind of locked down until they sell one of these rentals. And that's okay. You go sell a rental, you get to dump out all these losses. You keep them until the day you die. That's great. But what this guy really wants is he wants to unlock those losses. He wants those losses to come over here and wipe out his wife's W2 or wipe out his W2 on the day job. Well, the only way you can pull that out with long term rentals LTRS is if one of them, husband or wife, is a real estate professional. Well, it ain't going to happen with the wife with a restaurant. And if the husband has a day job, you're just going to keep track of those losses. It's okay, just don't be on your tax return. There's a form that captures them every year and tracks them. If you go with short term rentals, I can unlock them. Oh, you want to know a sweet strategy? Here. Here's a sweet strategy. I'm going to put it in red. This is why you come join my network. Because this is what I do is teach you strategies that are outside of the box. What we would do is instead of buying another long term rental, I'm going to ask you guys, who's your best renter? Who's the best renter you could have on your planet? It's not your kids, it's not even your mom and dad. It's you. So why don't they take this LLC and go buy a little commercial building and rent it to the restaurant. They buy their own restaurant building instead of renting from someone else. So that, my friends, is called a self rental. And this is a special election that you make under 469 AF6 and we're going to make this election to be a self rental. And when you own 100% of your own building that you lease back to the restaurant of which you own 100% of, you don't have to be a real estate Professional. So I can cost seg the hell out of this. Take all that depreciation and unlock those losses against the W2 and against your day job. Now these losses from these rentals, they stay over here. That there is. Those are stuck. That's okay until you sell one of those rentals. But this red section becomes a self rental. And we love that. So you want to look at that as a strategy. All right, next question.

All right, next question. Here is a good one from Nicholas over on YouTube. If I am a legal guardian of a non biological child under 18, can I pay them under my business?

You can, but you got to withhold fico. But think about it. You're the non. You're the guardian of a non biological child. Unless you adopt them. Who are you married to? Like now? Maybe you're. Maybe you're a grandparent. Maybe you're trying to get around that. Maybe your aunt or uncle taking care of this kid. I don't know the. No, I just don't see it. I mean, you may have them as a dependent on your tax return. Under age 18, you're their legal guardian and they're your dependent and they qualify as a dependent. I'd be worth researching that. Talk to one of the tax advisors in my network. For any of you that haven't already done that, you're like, my accountant's great. Really? Does your accountant talk like this? Because if your accountant doesn't talk like this, they're not great. So get over to the freaking Marc J. Kohler TaxPro Network and find a new one and hire one of them and pay him for an hour and say, hey, will you go research a non biological legal guardian of a child under age 18 that's a dependent on my tax return? Do I have to withhold fica? Some of you might go, well, Mark, you should know that answer. Yeah, I'll go dig up the answer. Pay me frickin. Hey. What do you think I'm working for free over here? We want to help clients save money, but sometimes these questions get really tricky. They're fact specific for certain clients. So that's why you call up your tax advisor and go, let's figure this out. So anyway. All right, next question.

Next question is from Basil over on YouTube as well. Hi, Mark. Can you explain how I can go on family vacation using my business?

Oh, yeah. Okay, so the family vacation. I don't know if I want to call that a family vacation. Oh, Hazel. It was Hazel. Basil. Basil. Basil. I'm sorry, did I misunderstand You. Did you say your family board meeting? I thought that's what you said. You're not going on a family vacation. What the hell? You're going on a family corporate board meeting retreat. Now, in our trifecta, if you have an LLC or a corporation or an LLC over here with your rentals, you're going to have a board of advisors boa, a board of directors bod, and a board of advisors boa, all right? You are legally allowed under law and in fact, required under law to have an annual board meeting. So you want to go have this board meeting and have a meeting maybe somewhere in a boring location, exotic location. I do not care. And I cannot write off 10 days in the Cayman Islands having a board meeting for two hours. But what we can do is write off the day the board meeting was held and the travel to get there. Now, let me show you a picture of this. This is pretty cool. All right, so let's say we got our days of the week. Sunday, Monday, Tuesday, Wednesday, Thursday, Friday, Saturday. All right, Sunday, Monday, Tuesday, Wednesday, Thursday, Friday, Saturday. Okay, now, let's say. I'll put it in red. Let's say that you're gonna have a board meeting on Friday, okay? So you're gonna have your board meeting. And that is a business day. That's a deductible business day. Now, what the IRS or the Internal Revenue Code says is that your day to get there is a business travel day. That's what it's called, business travel day. And the day to get home is another travel day. I'll put business travel day. So you get to write off Thursday, Friday and Saturday, the airfare, the hotel, the Airbnb, the Uber, the whatever, all. And food. 50% of all your food. You're going to write off all of that for this one board meeting that you might have in Miami or Vegas or Seattle, Maine, I don't know. That's your board meeting. Now, let's say you're going to have your board meeting on Friday, okay? And you travel on Thursday, okay? And damn. I get stuck in Vegas on Saturday and Sunday because I got another meeting on Monday. So I got this other meeting with a customer, a client, a vendor, a strategic partner. Maybe I go to a workshop. I already held my board meeting. You can't milk it. Another time. But I have another business meeting of some sort, and then I travel back on Thursday or Tuesday. Okay? So travel on Thursday. Board meeting, get stuck in Vegas Saturday and Sunday, Another business meeting on Monday. Travel back on Tuesday. IRS says Saturday and Sunday. Morph into business days because you were stuck there because you were doing business on Monday. I just wrote off six days, all the travel and 50% of the food. Hear this, it's called pen drop. Now, the trick here is you've got to justify this other day. And you may say I have multiple days. Maybe we're doing a conference in Cabo. The IRS says a business day is a required meeting with a third party, not family. After the board meeting, it's got to be required meeting with someone, third party or it's four hours of business. At least four hours. So I have many clients, they're going to go on a trip to Cabo and they're going to hold their corporate board meeting, maybe bring employees in a couple days later. And then they're going to have corporate training at least four hours a day. And then after that it's, whoo, we're down by the pool, we're rocking, we're having a good time, drinking margaritas because you did business four hours a day. Do not try and pull this off on a cruise ship. Cruise ships suck. For a write off, you're going to do this at an all inclusive, maybe a Sandals Resort. I hear they're really neat. That, my friends, is how you deduct travel. Board meeting, board meeting, pay the kids, travel with, do business. No vacations, corporate retreat. One last question.

Yep. So this question is from edgar over on YouTube. Do these strategies apply to all entity types or only LLC and S Corps can soleprops use this as well?

Everybody can do this. Everybody can do this. This is your tax daddy talking to you. H2O. Nothing heavy today. All right, let me throw this out, everybody. Any entity will work with these strategies, but it can be tricky. Kids are older, kids are younger, you're married, you're single. What type of business is it? Is a rental property, is it not? This is why you need a decent tax advisor. Get to my network and check out any of you that want to become a tax advisor. Freaking A. You could be a financial advisor. Sucking, hating life. Come become a tax advisor. We'll feed you clients. They're everywhere. They're all over this YouTube video, their Instagram and Facebook. Everybody's like, I need a tax advisor. Get certified, do the demo. It's the first link down below in the description. Check it out. I promise you it will make you money. It's going to save you money. And any of you business owners that want to do it, come check it out. Also, you can get the early bird special on my tax and legal360 event in December. And remember that little box at the bottom, that revocable living trust, that estate plan at the bottom of the trifecta? Everybody needs an estate plan, a will and a trust. Everybody, young or old, rich or poor, kids or no kids, single or married, doesn't matter. It can be super affordable. And once it's done, you just update it every five or 10 years. Every Memorial Day, every June for the last nine years, we do a special and we knock off 10 or 20%. It's the only time during the year that links down below as well. Kkoslawyers.com get your estate plan done. Give it to your mom or dad. It's Father's Day this weekend. Give your dad a gift of an estate plan for Father's Day. It's a great gift. That was to my kids. Did you hear that? Can someone record that and send it to him? Just tell him to pay for it, please. Okay, people. American dreams real. Don't give up. It's hard. You wake up every day trying to get make money and pay the bills. Let me just give you a tip. Get rich slow. It's a lot easier than getting rich quick. It really is. Get rich slow. Have a side hustle. Build your business. Get out of debt. Save the money. Learn tax strategies. The number one cost in your life. Protect it, share it, build it as a family. It's the American dream. I just defined it.