Free PDF : 5 Tax Reduction Strategies Every Business Owner Must Know 1

Disclaimer
This material & presentation content is for informational and educational
purposes only.

This material and presentation content is designed to provide general

information regarding the subject matter covered. It is not intended to serve
as legal, tax, or other financial advice related to individual situations.
Because each individual’s legal, tax, and financial situation is different,
specific advice should be tailored to the particular circumstances.

For this reason, you are advised to consult with your own attorney,
accountant, tax preparer, and/or other advisor regarding your specific
situation or your client’s specific situation. The information and all
accompanying material are for your use and convenience only.

We, at BORISMTAX Inc., and its third party affiliates and presenters, have
taken reasonable precautions in the preparation of this material and believe
that the information presented in this material is accurate as of the date it
was written. However, we will assume no responsibility for any errors or
omissions. We specifically disclaim any liability resulting from the use or
application of the information contained in this publication.

To ensure compliance with requirements imposed by the IRS, we inform you

that any US federal tax advice contained in this communication (including
any attachments) is not intended or written to be used, and it cannot be used
for the purpose of (i) avoiding penalties under the Internal Revenue Code or
(ii) promoting, marketing, or recommending to another party any transaction
or matter addressed herein. Always seek advice based on your particular
circumstances from an independent advisor.

Free PDF : 5 Tax Reduction Strategies Every Business Owner Must Know 2
 Table of Contents
Introduction
About Boris Musheyev 4

Why Tax Planning

Tax Planning vs. Tax Preparation 6

Maximizing Retirement 7

Entity Structure 8

Income Shifting 9

Health Insurance Strategies 10

Home Office 11

Disclaimer 12

Free PDF : 5 Tax Reduction Strategies Every Business Owner Must Know 3
 Boris Musheyev, CPA, CTC
Ever since my first year in college, I had an unexplainable burning desire
in me to learn as much as I can about taxation. I wanted to do taxes and
nothing else. After graduating college, I was sucked into the world of
Traditional Accounting.

The same world that most tax accountants are in...

Grinding through tax season, preparing and filling almost 500 tax returns
per season.

That is an insane number.

There was no value that I was providing my clients by simply preparing

and filing their taxes.

Let me rephrase, almost 500 tax returns in 3.5 months, I was burned out
and my clients got no value out of it, because I was just making it through
the deadline of filing taxes.

Free PDF : 5 Tax Reduction Strategies Every Business Owner Must Know 4
 About Boris Musheyev
(continued…)

I came across so many businesses that were insanely overpaying in

taxes and there was nothing that I could do for them. Why? Because I was
just a tax preparer and not a Tax Planner. It was all REACTIVE rather
than PROACTIVE. That is why most tax accountants and CPA’s are not
specializing in Tax Planning, rather they are stuck in the work of tax
preparation.

After venturing out on my own, I decided to make it my duty and obligation to

focus on delivering only value to my clients and helping them save money on
taxes.

Most importantly educating business owners and entrepreneurs on the

ways they can minimize their tax liability.

And no, not JUST by tax preparation.

I’ve spent tens of thousands of dollars and years in trenches learning the
most effective methods to LEGALLY reduce taxes.

I have spoken with, studied, worked and learned from one of the best tax
experts in the country. I was also awarded the “Certified Tax Coach”
designation by American Institute of Certified Tax Planners and I am just one
of 700 Tax Professionals in the country that completed intensive program on
court tested, IRS approved Tax Strategies.

It is my hope that you will find the strategies in this book helpful, useful and
most important tax effective!

Free PDF : 5 Tax Reduction Strategies Every Business Owner Must Know 5
 Why Tax Planning
Tax Planning vs. Tax Preparation

Before we jump into the benefits and deduction of an law firm, I’d like to
introduce you to the world of tax planning.

Tax Planning is not a new concept but it is practically not utilized by small
businesses. You see, everyone thinks that Tax Planning is for big players,
multi-millionaires, big fish as they call them. That is a huge misconception. I
always say, “If you are profitable in your business, there is money to be
saved on taxes. Simple”.

Tax Planning is not Tax Preparation and it will NOT work if it is done at
the end of the year or at the time of filing your taxes. Tax Planning means
being PROACTIVE. The reason why a lot of people are not able to take
advantage of so many and again so many tax strategies is because they
fail to be proactive about it. They, most often than not, wait until the end
of the year only to be slapped with a tax bill. They are at the mercy of their
tax preparer who very often answers the following:

"There is nothing else that can be done, you made too much money and that
is a good problem to have."

That is simply not true. I know this because I work with business owners in
this situation and I help them significantly reduce their taxes via proper tax
planning and using little known LEGAL tax strategies. My clients are able to
save tens of thousands of dollars on taxes, and create millions of dollars
in TAX FREE income. Yes it is true and it is possible.

So, let's get right into law firm Benefits & Deductions.

Free PDF : 5 Tax Reduction Strategies Every Business Owner Must Know 6
 Maximizing Retirement
As a business owner with employees you can open a retirement account for
your business that will benefit you and your employees. By establishing a
retirement account for your business, you may generally make the following
contributions:

a. Deferral: $19,500 or $26,000 if you are over the age of 50.

i. Note: This is a deferral contribution, meaning you can make this
contribution from your own “salary” as an employee of the
business
b. You may match contributions at at least 3% for yourself and your
employees

Example: You are 55 years old. You have 3 employees in your business
each making 80k annually. Your company matches 3%. You, as a business
owner, make 100k from your business.

How It Works
1. Defer $26,000 from your own paycheck
2. $3,000 (100k x 3%)

Total Contributions and a tax deduction: $29,000

Free PDF : 5 Tax Reduction Strategies Every Business Owner Must Know 7
 Entity Structure
Before considering any entity type for your business, you should know that,
generally, Limited Liability Company (LLC) is the most efficient entity
structure for a number of reasons such as

● As an LLC, you may choose to file your taxes as a sole proprietorship,

partnership, C-Corporation or an S-Corporation. Depending on the tax
entity that benefits you the most, LLC can be converted for tax
purposes.
● LLC can be used as a holding company to hold ownership interest in
other companies as well as Real Estate holdings.

S-Corporation Entity Structure

Once you have your LLC set up, you may choose to file your taxes as an
S-Corporation for your main business to reduce the amount you pay in self
employment taxes. Self employed taxes combined with your federal and
state income taxes, could run up to more than 50%.

C-Corporation Entity Structure

On the other hand if you choose to be taxed as a C-Corporation, you could
be subject to double taxation and pay taxes at both, corporate and personal
level. One of the advantages of a C-Coration is that if you have plans on
selling this business in the future and if structured property, you can exclude
up to 10 mil in gain from the sale of the C-Corp stock.

Free PDF : 5 Tax Reduction Strategies Every Business Owner Must Know 8
 Income Shifting
You can shift some of your income to your children by:

● Hiring your children to work for you in your business. This allows you to
shift your income from your high bracket to your child’s low or zero tax
bracket.
● Paying college tuition expenses for you children. You may provide an
education assistance program as a fringe benefit in your business so
that you can reimburse your children up to $5,250 for college tuition,
free from income and payroll taxes.

Free PDF : 5 Tax Reduction Strategies Every Business Owner Must Know 9
 Health Insurance Strategies
S-Corporation Owners
A guidance from the IRS allows a more than 2% shareholder employee of
an S-Corp to deduct above the line health insurance deduction creating a
double benefit
1. Creating a deduction
2. Saving additional dollars on self employment taxes

How it Works

1. Your annual premiums must include the owner’s comp. salary

2. This should be implemented in your paycheck so that it can be
reflected on your W-2 at year end
3. Annual premiums will not be subject to Federal, State and FICA Taxes
of 15.3%

C-Corporation & Sole Proprietors

If you do not have any employees besides yourself and your spouse, you
should consider setting up a 105 HRA plan. This plan allows your business
to pay for ALL of your medical expenses.

Sole Proprietors, Single Member LLCs and Partnerships

Sole proprietors may deduct health insurance costs on their personal
income tax returns regardless if the health insurance policy is under a
business name or owner’s personal name.

Free PDF : 5 Tax Reduction Strategies Every Business Owner Must Know 10
 Home Office

By establishing an Administrative Home Office, your business may reimburse

you for the use of your home office, even if you have an actual office location
outside of your home. You can deduct your bills for utilities, insurance, security,
and general repairs and maintenance, rent/mortgage, property taxes including
depreciation on the property.

The IRS says that the home office is going to qualify for deduction when you
make it an ADMINISTRATIVE office for your business and conduct majority of
your admin work from home. Admin work includes but not limited to:
bookkeeping, billing, paperwork, invoicing, etc.…

Additionally, by establishing an administrative home office and performing a

significant portion of your administrative tasks from home, your commute to your
actual business location would create allowable commuting expensed by the
business.

How It Works
1. You must establish an Accountable Plan. Sign it and keep it with your
records.
2. As an employee, you must submit reimbursement request to your business
on a monthly basis for home office related expenses (see next slide)
3. Your business must reimburse you tax free, within 30 days for your Admin
Home Office Expenses including any travel associated with it

Free PDF : 5 Tax Reduction Strategies Every Business Owner Must Know 11
 Disclaimer
This material & presentation content is for informational and educational
purposes only.

This material and presentation content is designed to provide general

information regarding the subject matter covered. It is not intended to serve
as legal, tax, or other financial advice related to individual situations.
Because each individual’s legal, tax, and financial situation is different,
specific advice should be tailored to the particular circumstances.

For this reason, you are advised to consult with your own attorney,
accountant, tax preparer, and/or other advisor regarding your specific
situation or your client’s specific situation. The information and all
accompanying material are for your use and convenience only.

We, at BORISMTAX Inc., and its third party affiliates and presenters, have
taken reasonable precautions in the preparation of this material and believe
that the information presented in this material is accurate as of the date it
was written. However, we will assume no responsibility for any errors or
omissions. We specifically disclaim any liability resulting from the use or
application of the information contained in this publication.

To ensure compliance with requirements imposed by the IRS, we inform you

that any US federal tax advice contained in this communication (including
any attachments) is not intended or written to be used, and it cannot be used
for the purpose of (i) avoiding penalties under the Internal Revenue Code or
(ii) promoting, marketing, or recommending to another party any transaction
or matter addressed herein. Always seek advice based on your particular
circumstances from an independent advisor.

Free PDF : 5 Tax Reduction Strategies Every Business Owner Must Know 12