April 16, 2025
Tax season is a wrap.
(or at least your extensions are filed.)
So, how’d it feel?
If you’re like most entrepreneurs…
You ended up paying more than you wanted. Or expected.
And it’s not your CPA’s fault.
Not the IRS’s fault.
And no, you don’t have to accept it as “just how it is.”
The government didn’t earn that money. You did.
It’s your money.
And it’s your responsibility to protect it.
The problem is, after tax season is over, most people do nothing.
They check the box, file the return, and forget about it until next spring.
If next year you want to keep more than what you earn…
Here Are 6 Legal Ways To Reduce Taxes:
(Hint: if you want to maximize all six, start today and work with professionals!)
#1. ENTITY STRUCTURE:
If you’re still operating as a sole proprietor, stop. Set up an S-Corp or LLC and pay yourself a reasonable salary. Split the rest as distributions and save thousands on self-employment tax.
#2. DEDUCTIONS:
Track everything. Set up a separate business credit card and bank account. Deduct strategic travel, business meals, home office space, and yes — even your kids (see #3).
#3. TAX BRACKETS:
Hire your kids through your business. Pay them under the standard deduction limit. Tax-free for them, deductible for you (they cost money to raise, don’t they?).
#4. INCOME CONVERSION:
Stop earning income in the highest tax bracket. Move earned income into rental income (own real estate inside your entity). Shift ordinary income into long-term capital gains through asset sales and smart hold periods.
#5. TAX CREDITS:
R&D tax credit, energy-efficiency credits, EV credits, childcare tax credits. These are dollar-for-dollar reductions. Talk to a proactive tax strategist to see how to qualify.
#6. DEFERRAL:
Think: “Buy, Borrow, Die.” You borrow against appreciating assets… and the tax liability dies with you. 1031 exchanges in real estate are a powerful vehicle for this.
Most people only use 1–2 of these strategies.
High-level wealth builders?
They use 5 or 6, every year.
The key isn’t complexity.
It’s consistency.
The more you understand the rules of money, the more freedom you create.
You worked hard for your money.
Now it’s time for your money and your tax plan to work hard for you.
Chad
If you’re serious about reducing taxes and building wealth through real estate, check out my chat on the podcast Real Estate Investments with Josh Coniglio. We get into LLCs, trusts, liquidity, and how to avoid the trap of investing just for tax breaks.
Disclaimer: This content is for information purposes only and does not constitute personal financial advice or personal tax advice. Always consult a licensed financial advisor and tax professional before making any financial decisions. We are not liable for any actions taken based on this content.
P.S. If you’re an entrepreneur with $25M or more in liquidity and want to make your money work even harder for you–set up a call with my team, and let’s explore new ways to make that happen.
