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just got robbed today they got me got me good this year taxes i worked my ass off last year made more than i did the previous year i had been paying taxes quarterly and it wasn't enough wasn't enough for them so i had to make up the difference and just uh just drop those checks off in the mailbox earlier today today's video is all about taxes as you can guess by the title of the video and my little intro there i've got some notes set up over here on this dry erase board i try to do these things in one take and always when i'm editing i'm like oh you left out a whole section of stuff you should have talked about but usually in the comments below someone brings it up and a little mini discussion starts so i do encourage you to check below for things that i've missed out on i want to talk about taxes write-offs learning from the rich and the ultra-rich uh s-corporations i've had a request i think was through patreon to do a video on s-corporation and why i am an s-corporation as opposed to an llc or anything else so i think we're going to start with an s-corporation s-corporations differ from state to state and in my state it is highly beneficial if you are self-employed to be an s corporation in fact everybody at the accounting firm that does my taxes every single accountant is technically self-employed and has an s corporation it is the only way to go why is that an accountant would be the best person to answer this question for you but i'm going to give you the layman's terms and how it was explained to me you get uh all your corporate tax deductions all the same corporate write-offs now where the difference is is the self-employment tax what an s-corporation allows you to do is only pay those taxes on a certain portion of your income and it and it really only becomes beneficial if you have like 60 plus thousand dollars a year in in profits and income because it's you know we're self-employed so it's it's income you take a dividend that's how you pay yourself is in dividends and those dividends are not taxed by the fica tax or the self-employment tax you have to take a reasonable salary out of your total and there's a percentage a minimum percentage of your your income that is fully taxed you know state federal and the self-employment tax but then there's a sizable amount above and beyond that reasonable salary that is a dividend that isn't taxed that way so that's why i do the s corporation and the more money you make the larger the benefit an s corporation is that's my understanding of the s corporation as you save because you are paid in a dividend and it only works when you have a large sum of income or sum of profits for the business you take a small reasonable salary the lowest they let you get away with uh back in the old days they didn't require you to take a reasonable salary that's something new that's a new addition because so many people were saying everything's a dividend this gear i bumped up my quarterly payments and because of this whole corona thing uh i've got to write the first half of 2020's uh taxes i gotta write a check for that next week so i've been hitting double whammy double whammy uh with the taxes so i'm a little bitter on paying taxes but i know that by upping my quarterly taxes i won't have this situation again where i'm bummed out because i gotta write more more checks a lot of people don't pay quarterly they want the use of their money and they'll pay the penalty i used to do it that way but i just changed so last year was the first year that i started paying quarterly uh well and like i said it wasn't enough it wasn't even close to enough it was about half of what i should have been paying gotta look for more deductions in the future as the business grows i start looking at these rich people i'm like man i always hear about these extremely wealthy people not paying much in taxes how they doing it there's a couple things that i've found is they maximize deductions they come up with deductions they have great accountants great lawyers and they uh they know the gray area and how to walk that line a couple examples i mean i'm talking like not talking like a couple millionaires i'm talking like hundreds of millionaires maybe like a half a billionaire this is personal experience by the way this is not uh reading it in a magazine article they have all these vacation areas and vacation properties and everything's a business even to get there they have a transportation company they have offices in these places around the world and these offices could just be an address in an office building to create the paper trail that they went to london to do some work but they were really just on vacation new york city miami la they uh they have offices there and their transportation company transports them there you can tell i change clothes have my best ideas when i'm in the shower and most of them go down the drain and they never make it to video so i was just reminded of another real world situation where i'm in front of a 100 millionaire and learning the ways they avoid paying taxes some of you may remember from my late night live streams a guy a middle eastern high pressure pipe welder that is a serial entrepreneur that i met when i lived on a sailboat in florida i had the smallest boat in the marina and he had the largest boat in the marina and every day he would come down and go young man young man come on down come on down for our cappuccino we'll have a cappuccino um he's going through a divorce and he just wanted to talk we became good friends um i was doing handyman work remodel work down there in fort lauderdale he says hey help me on the boat with a few different things uh we replaced a couple bilge pumps some outlets things like that pumps on air conditioning units and he had accounts at different marine supply houses and you know i'm watching paying attention this is you know very successful blue collar guy and he paid for it on a company account that was the name of the boat so this yacht and we're not talking like a a little yacht it's a 95 foot yacht and i'm like so how is the yacht of business he says oh you know they start getting real shy about you know talking about it the logistics is his business that he you know get passed down to his sons bought the the yacht created the yacht as a business and they entertain associates business associates and politicians on that boat but he lives on it and they do this entertaining of business associates and politicians a few times a year and that's it it's another real world example from my life of learning how other people manipulate the tax loss a lot of people get real mad at rich people say damn those rich people for screwing us and avoiding taxes now i like the term don't hate the player hate the game these guys just learned the game they learn the rules and they're just living by him he passed a business down to his children he was a high-pressure pipe welder and ended up owning a very successful business was able to put all three of his kids through college they all have business degrees and marketing degrees and he gave it to him now they're running
Thanks for your comment Victorina Roeber, have a nice day.
- Randall Steinkuehler, Staff Member
hey guys Alan Lee here with honestly handyman services and today I wanted to talk with you guys about business taxes specifically how a handyman handles business taxes as you all know we are quickly approaching tax season here and we are working pretty hard getting our taxes ready to submit them to our tax professionals that are going to be working on them this will be our first year doing taxes before the hanging in business as this was our first year in business full time for this business it's a little bit different this year because we were we were a sole proprietor for a little bit more than half of the year and then we incorporated to an LLC so while we were so while we were a sole proprietor we paid quarterly taxes and now that we are an LLC we have a different filing program for that and what I would say for taxes is I am NOT a tax professional so do not take what I'm saying to heart do your own research find your own tax professional and they will give you the best information that will fit what you need and so what we are doing we have a great tax organizing company called Anderson business and tax they are based out of Las Vegas Nevada super awesome company we are on their membership program so we can contact them you know anytime we need and they will give us a call they also have a tax tax plan that we're on and all that so and they are also submitting all of our 1099 s that need to go to independent contractors that we use throughout the year so basically what we're doing is we have a tax organizer planner and we are that they sent us and we're going through that and we're giving them all the information that they need you know including you know income expenses miles gas everything that we've used everything that we've written off tools equipment you know insurance things like that so yeah we're basically just going through all of our stuff and getting all that ready and then we are submitting it to them and then they're gonna be calling us and we're gonna be on a phone chat for quite a while I don't really know the whole process is our first year doing it so it's kind of new to us but basically the the most important thing I would say about taxes is be prepared guys always be documenting every single thing that you use every amount of money that comes in every amount of money that goes out always be documenting that and keeping good records for that in any which way that you decide to do that you know whether it's through you know Google Docs we've used that quite a bit or you know using your own Excel sheets or whatnot or there's also many other apps out there that help you with taxes like QuickBooks self-employed for one of them you can pay that you know it's a monthly expense but it helps automatically track your miles you know you can easily track your expenses your income you can put in receipts pretty easy and then that way it's just all kind of organized in one easy way we were doing that at the beginning of the year we're still doing that for parts of our stuff but most of it is we are we just found it easier to write it down on paper so for like miles and everything everywhere I go I stop write down my miles where I'm at and when I get gas right down my miles how much miles per gallon I use and all that so yeah that's kind of the way we're doing it right now so now we're just going through and gathering all the information we're going to be submitting that so that's kind of how I look at my business from a tax standpoint is at least for the first year and my plans for the immediate future are to be using a tax professional to do all my taxes on my 1099 s that I need to submit and everything like that and then as an LLC I still obviously need to submit you know basic income tax for me you know because my LLC is paying me so that's the difference between an LLC and a sole proprietors and now LLC is you pay yourself out of that and you pay any other employee or general con or independent contractor out of that LLC as opposed to a sole proprietor where everything you make is what you owe and it was what you own so like say you made 80 thousand dollars in a year if your sole proprietor that's your income you know so you're paying personal income tax on 80 thousand dollars a year so that's that's where it can kind of get you they say if you make more than twenty thousand dollars year you should probably incorporate your business because it will be a lot cheaper in taxes in the long run but anyways I'm not tech specialist just my take on it that's my opinion so that's kind of what we're doing this year for taxes so anyways thank you all so much for tuning in to this video I really appreciate you guys watching my videos and if you haven't take a look at my other videos that I've made in the past I had so much info so much good content about how to start a handyman business how to run it the tools you need for it you know what to do what not to do I've learned a lot made a lot of mistakes and I just appreciate your guys's input on all that and please leave me a comment in the comment section below with what you're doing this year for taxes and also what you do for a living I would absolutely love to chat with you in the comments so anyways thank you so much and have a great day
Thanks ViscoM your participation is very much appreciated
- Randall Steinkuehler
About the author
I've studied geometric number theory at Hampden-Sydney College in Hampden-Sydney and I am an expert in telecommunications engineering. I usually feel disappointed. My previous job was medical technologist I held this position for 25 years, I love talking about go and birdwatching. Huge fan of Doug Hutchison I practice windsurfing and collect police memorabilia.
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