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Hire Your Kids and Save Taxes!

In the intricate game of business, every move counts. Hiring your kids can be a strategic play that not only saves taxes but also lays the foundation for a business dynasty. Let’s unravel the mystery behind this financial masterstroke.

Why the Heck Should I Hire My Kids? Tax Benefits, Baby

Picture this: Your kids, under 18, working diligently in the family business, and, voila! No Social Security or Medicare taxes. As the business guru, you deduct their salaries, expertly slashing your taxable profit. Their income? Taxed at their rate, likely lower than yours. It's not just a financial move; it's a game-changer.

Build Wealth While They Learn

The financial journey for your kids goes beyond a simple paycheck. Their hard-earned cash becomes a catalyst for wealth-building. A Roth IRA or a Coverdell ESA becomes their portal to the financial game. This not only secures their future but also allows for a seamless transfer of assets, passing on the family fortune.

Personal Growth Galore

It's not just about the money; it's about molding future leaders. By hiring your kids, you instill vital life skills—problem-solving, discipline, and goal-setting. Real-world experience becomes the cornerstone for their future career triumphs and entrepreneurial feats.

Plan for the Business Dynasty

If the vision is to keep the business within the family for generations, hiring your kids becomes a cornerstone for succession planning. By introducing them early to the operations, you ensure business continuity and prepare your children to confidently step into leadership roles.

What's the Catch? Keep it Legit & Age-Appropriate

In this financial journey, authenticity is key. Pay should match the job, just like any other employee. Document tasks and hours diligently; the IRS won’t buy your 5-year-old as a dental records analyst. Keeping it legitimate and age-appropriate ensures the strategy's success.

How Much Can I Pay the Little Boss? Tax-Free Cash Infusion

For the budding employees aged 7-22, the world of tax-free cash beckons. With a potential annual income of $13,850, your business deducts, and their taxable income remains zilch. Combine this with IRA and 401k strategies, and you set the stage for a financial KABOOM!

IRS Will Love You (Surprisingly)

There's a tax dodge waiting for sole proprietors and partnerships where parents own the joint. But what if your business is a corporation? Fear not, for there's a workaround—an IRS-approved family management company.

Family Management Company - Your Tax Ace

The concept is simple yet genius. Set up a separate gig owned by you or your spouse. This company manages tasks, schedules, and books for your main corporation. Charging a fee to your corporation and paying your kids from the family management pocket circumvents corporate payroll and payroll taxes.

In Conclusion

Hiring your kids transcends the realm of saving money; it’s a strategic financial masterstroke. However, always remember to keep it above board, age-appropriate, and well-documented. Now, are you ready to turn your kiddos into tax-saving sidekicks?

Ready to turn your kiddos into tax-saving sidekicks? Let's build not just businesses but dynasties.

Being Thankful…

Thanksgiving this year was and always is a thankful time. This year we ended up with just my in-laws, due to 2/3 of my brother in-laws and their families being sick. As much as that sucked not having the little cousins run around with each other, it was also nice to just be with my in-laws and talk about the future, next trips, what the boys are doing, etc.

The holiday season is designed for us all to reflect and remember that our loved ones are what matter, regardless of the situations you may find yourselves in and this year has been one of those for me. As you know, transitioning to a virtual office away from a physical office and my former business partner, was difficult but beyond needed!

I am thankful for all of the families that entrust me to help guide their families on their wealth journey, through all the bumps in the road know that I HAVE YOUR BACK.

The Power of Sports

Two things have happened in the last week that remind me how important Coaches are in life and how important sports are to use as athletes.

• As you know, I coach flag football for Lincoln’s team (Croix possibly next season) and I have had this kid on the team for two years. Usually quiet but is a hard worker, solid QB and just loves to play the game. Well this year, after a practice we took him from Football straight to Soccer (as of course both seasons happen at the same time) and low and behold he was a chatterbox! From that moment on he would talk to me about everything under the sun. Then this thanksgiving happened and I receive a text from his mother… “At Thanksgiving my mom asked Palmer to tell her about someone who had been kind to him or taught him something new this year. He said: My football coach” “I thought that might make you smile. Your leadership really reaches beyond the season.”   Seeing this text, warmed my soul and just made me thankful I am able to coach and make an impact on young kids lives… I am not crying there is dust in our house.

• You may have heard me say this a time or two but I am a Drake Bulldog, specifically a former Football Player. The season that Drake just had is truly remarkable and record setting. They won 3 games last season, the coach was on his last year of a 5 year deal, most likely not being renewed, only 3 players on preseason list and Drake picked to finish bottom 3 in the conference. Well these guys went out and lost the first 3 games of the season….then went on to win 8 straight! Win conference, go to the playoffs (first in Drake history), have the Special Teams Player of the Year, Defensive Player of the Year, Coach of the Year in conference and 12 others get PFL awards, plus potentially more recognition to come… if this isn’t a story of resilience idk what is! I am thankful to be apart of that family and truly blessed to see this team do what they did!

Next Issue Teaser: Unleashing Tax Strategies (Issue #61)

We focus on what you can do as a W2 employee, not as much flexibility as a business owner but still some strategies to help reduce your tax nugget!

#NoBSWealth Clip of The Week

Cannot wait until next week or just want more, check out our podcast @nobswealth and catch us on Youtube. You can always follow me on Instagram and Twitter as well! Or just email me, [email protected].

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