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Old 01-24-2017, 07:44 PM   #21
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I'm investing that into my business. So it becomes a business expense
Asset investment and expenses are sort of different. You know that, right?
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Old 01-24-2017, 07:48 PM   #22
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I'm not a business owner and I'm hoping someone who is will step in with better information, but it seems to me that the tax "write-offs" you expect are taken at the entity level. If you are paying yourself a salary (and hence have a w-4 for withholding) then you owe taxes on that salary.

I'm having difficulty understanding your set up. Are you employed by someone else who is paying you wages or a salary under a W-2? Are you a 1099 independent contractor? A sole proprietorship or an S-Corp?
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Old 01-24-2017, 07:51 PM   #23
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I am a w2 employee and I have a HBB. I am a sole proprietor for a financial success company.
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Old 01-24-2017, 07:53 PM   #24
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No employees no inventory no storefront but a an HBB owner I get the same tax incentives as someone who owns a business.
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Old 01-24-2017, 07:54 PM   #25
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I'm not a business owner and I'm hoping someone who is will step in with better information, but it seems to me that the tax "write-offs" you expect are taken at the entity level. If you are paying yourself a salary (and hence have a w-4 for withholding) then you owe taxes on that salary.

I'm having difficulty understanding your set up. Are you employed by someone else who is paying you wages or a salary under a W-2? Are you a 1099 independent contractor? A sole proprietorship or an S-Corp?
You are correct. Taxes are due at the corporate and individual level. Expenses may or may not apply at each point.
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Old 01-24-2017, 07:56 PM   #26
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I am a w2 employee and I have a HBB. I am a sole proprietor for a financial success company.
A W2 applies if you are incorporated. If you are a sole proprietor, then the business goes under your individual taxes.
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Old 01-24-2017, 07:59 PM   #27
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I am a w2 employee and I have a HBB. I am a sole proprietor for a financial success company.
That makes things a little clearer. So you are expecting that your home based business will generate tax losses to offset your W-2 income. Although if it is really a financial success, won't you have even additional income? The only time I ever made actual cash money while generating a tax loss was in rental real estate.


In any event, it seems that you have already discovered a way to generate income.
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Old 01-24-2017, 08:00 PM   #28
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A W2 applies if you are incorporated. If you are a sole proprietor, then the business goes under your individual taxes.
I get the feeling that he is employed by someone else, but that he also has his own home based business, but I'm sure ramon will correct me if that is wrong.
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Old 01-24-2017, 08:02 PM   #29
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I get the feeling that he is employed by someone else, but that he also has his own home based business, but I'm sure ramon will correct me if that is wrong.
You may be correct.
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Old 01-24-2017, 08:08 PM   #30
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Hi Ramonjp... Welcome to e-r.org

I looked for a post from you in a Hi, I'm.... thread but I don't see anything from you. So, other than this thread we can only guess at your age, how much you have to invest, what your liabilities are, etc.

+1 from me regarding living below your means, saving more than you can imagine, taking advantage of tax deferred accounts, taxable accounts are okay too and then watch the compounding magic happen.

Since we don't know your age - I'm guessing your relatively young - compounding will work for you. If you're older, compounding is less in your favor although even in retirement DW and I have seen some significant gains in our account even though we are on a steady withdrawal plan.

I'm not aware of any get-rich-quick strategies. Most of us here on this forum created our wealth the old fashioned way - saved and invested in stocks and bonds.

For reference, here's a chart I made related to how DW and I grew our "fortune." It may not make sense at first but study it a bit and you'll see how our expenses became a lower ratio compared to our income and savings/investments became a larger and ratio with time. We are not the gold standard by any means but the chart may give you insight into age and wealth accumulation. I'm sure there are many on this forum that have us beat by a large margin.
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Old 01-24-2017, 08:33 PM   #31
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I am a w2 employee and I have a HBB. I am a sole proprietor for a financial success company.



I agree with your plan to pay the highest rate debt down first. I am confused that you are asking this question if you manage a "Financial success company". Can you explain what that is?
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Old 01-24-2017, 08:38 PM   #32
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What estimated tax payments on the home based business have you planned to pay? I assume you know about income tax and SE tax. Have you opened a solo 401k?
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Old 01-24-2017, 08:46 PM   #33
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I agree with your plan to pay the highest rate debt down first. I am confused that you are asking this question if you manage a "Financial success company". Can you explain what that is?
I asked this question because at the moment I'm learning wealth creating strategies and I want to know what other strategies are out the that I might learn and incorporate with my business
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Old 01-24-2017, 08:56 PM   #34
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Marrying a rich girl (or guy) might qualify as a "wealth creating strategy" -- though some would say there are much easier ways to earn money.

More seriously, I really don't think there is a magic answer to wealth creation. If there were an answer beyond "work hard, save aggressively, spend wisely, incur debt reluctantly, and invest prudently," I suspect someone would write a book, be paid well for that, and then everyone would know "the secret."

One possible strategy for "wealth creation" is to take a high level of risk. If it works out well, you might "get rich quick" -- but of course there is a downside to high risk.
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Old 01-24-2017, 09:11 PM   #35
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You could take everything you have, go the the casino, find the roulette wheel and put it all on red. You have a 47.4% chance of doubling your money in a few seconds.
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Old 01-24-2017, 10:22 PM   #36
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I asked this question because at the moment I'm learning wealth creating strategies and I want to know what other strategies are out the that I might learn and incorporate with my business


We've offered a few suggestions (some serious, some not) so maybe you could tell us 1 or 2 of the strategies you are learning about.
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Old 01-24-2017, 11:46 PM   #37
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Legal of coarse.
Well......errr....ahh....rats, I'll have to think up some others.
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Old 01-24-2017, 11:52 PM   #38
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OP - I do a little self employment and I feel there is really no way to have zero taxes due to deductions of your business.
Perhaps in the first year if you buy a bunch of machinery and a truck, but anything that generates real sales or income will outstrip the home deduction and related expense proportion you are allowed.

Now a self 401K you set up would mean you could pile in the max 401K contributions, but if you have a real job with a 401K then that is used up.

Perhaps I have missed a great opportunity here, so fill us in on one of your good ideas for not paying tax, other than not withholding which seems dangerous due to the penalties.
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Old 01-25-2017, 04:53 AM   #39
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I am a w2 employee and I have a HBB. I am a sole proprietor for a financial success company.
Need a link for the financial success company. Sounds sketchy to me.
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Old 01-25-2017, 04:57 AM   #40
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I am a w2 employee and I have a HBB. I am a sole proprietor for a financial success company.
Eventually the chickens come home to roost. If you run a business and don't pay taxes on your W2 wages, it is the sort of thing that triggers audits. I think the IRS has a computer and programmer.
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