How To Lower Your Tax Bill Episode 25

Episode 25: What To Do With Business Profits — And How They Affect Your TaxesIf you’re a small business owner or aspiring entrepreneur wondering what happens after you make a profit, this episode is for you. Host Terrance Hutchins and guest Tamia break down how to think about your business income strategically, plan for taxes, and avoid common mistakes that lead to IRS trouble. Learn how to shift your mindset from just “owning a job” to building a profitable, sustainable company that pays you and funds future growth.Key Discussion Points:Why paying yourself a fair market salary is crucial to measuring true profitThe “two hats” every owner wears: employee and shareholder — and how each is taxedFive smart ways to use profits: paying taxes, paying off debt, retaining as reserves, reinvesting in the business, and taking owner distributionsHow to plan ahead for quarterly tax payments to avoid penalties and stressPractical examples of overlooked deductions like the Augusta Rule, home office, mileage, and kids on payrollFeatured Tax Tip: Always treat taxes as a business expense — factor them in like rent or payroll. Look at your prior tax returns (line 24 divided by line 11) to estimate your tax percentage, then set aside that portion of every dollar you make to stay ahead of the IRS.Planning for taxes is just as important as planning your next client pitch or hiring decision. Build tax savings into your cash flow now so you don’t get stuck paying penalties later. Subscribe to How to Lower Your Tax Bill on Spotify or Apple Podcasts — and Keep More of What You Earn.