528: The Small Business Owner’s Guide to Taxes, LLCs, Deductions, & Audit Risks
56m
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BiggerPockets Money Podcast
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Starting your first or next business?This episode is for you. Today, we’re bringing you everything you need to know aboutsmall business taxes for beginners. Whether you’re a soloentrepreneur, partner,landlord, house flipper,Airbnb host, or something in between, you MUST know about these tax laws before you start making money with your own business becauseif you get them wrong, you could be paying a MASSIVE penaltycome tax time. You could save yourself thousands, or TENS of thousands, just by tuning in! Brandon Hall, CPA, runs a real-estate-focused tax and accounting firm for big and small real estate investors. But, even if you’re not investing in real estate, these tax tips also apply to YOU. In today’s episode, we threwdozens of hard-hitting tax questions at Brandonso you know what to do withyour next side hustle or full-blown business. We’ll discusswhether you need an LLC, the real benefits of getting one, and which business entity (LLC, S-corp, C-corp, etc.) makes the most sense for your specific business and tax needs. Making money on your own but NOTpaying quarterly taxes? This could cost you BIG, but thankfully, Brandon goes through exactlyhow much you could owe. And if you want to owe less to the IRS, we’ll give examples oftax deductionsplus, which are NOT worth it and could put you at aBIG audit risk. Need a tax professional for your small business? Find one for free withBiggerPockets Tax and Financial Services Finder! In This Episode We Cover Self-employment and small business taxes for beginners Whether or not you need an LLCand why most real estate investors have this all wrong Estimated taxesand theMASSIVE penaltyyou’ll pay if you forget about this Tax deductionsand theaudit red flagsthat the IRS is looking for The differentbusiness entitiesyou can start and which has thebest tax benefits The three things you NEED toset up an LLCand the most critical one beginners forget “SALT” taxesand why thoseselling goods in different statescould owe even more AndSoMuch More! Links from the Show BiggerPockets Money Facebook Group Network with Other Investors on The Path to FIRE Through the BiggerPockets Forums Finance Review Guest Onboarding Join BiggerPockets for FREE Mindy on BiggerPockets Scott on BiggePockets Listen to All Your Favorite BiggerPockets Podcasts in One Place Apply to Be a Guest on The Money Show Podcast Talent Search! Find an Investor-Friendly Agent in Your Area Find Investor-Friendly Lenders How to Obtain Real Estate Professional Tax Status Hear Past Episodes with Brandon: BiggerPockets Real Estate 196 - LLCs, House Hacking, and Saving on Taxes with Brandon Hall BiggerPockets Real Estate 269 - How the New Tax Code Affects Your Real Estate Investments BiggerPockets Real Estate 934 - How to Pay Less Taxes by Buying Real Estate (1 Write-Off You’re Overlooking) On the Market 96 - The Biggest Real Estate Tax Loophole You’ve (Probably) Never Heard Of On the Market 165 - Year-End Tax Updates, New IRS Interest Rates, and URGENT News for LLCs On the Market 187 - 100% Bonus Depreciation Coming Back? (Do NOT File…Yet) 00:00 Intro 01:42 Do You Need an LLC? 02:01 Different Business Entities 09:29 3 Steps to Set Up an LLC 16:49 KEY Dates to Know 19:14 Estimated Taxes 25:48 The “SALT” Taxes 31:56 Tax Deductions and Audit Red Flags 44:22 Claiming Passive Losses Check out more resources from this show onBiggerPockets.comandhttps://www.biggerpockets.com/blog/money-528 Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? [email protected] Learn more about your ad choices. Visit megaphone.fm/adchoices
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