SPEAKER_01: 0:00

This is the Empowering Healthy Business Podcast, and I'm your host, Cal Wilder. Each episode we'll dive into topics important to folks who want to run businesses that are both nicely profitable, sustainable, and scalable, and who want to achieve balance in their lives and realize their potential inside and outside of work. The show is sponsored by SmartBooks, provider of bookkeeping and accounting for businesses. Let's get started. Gregory, welcome back to the show. Thanks for having me. So as we are about to enter tax season, I'm excited to be speaking with you and help our audience understand what they can do to make this as uh successful as possible for them in tax season.

SPEAKER_00: 0:44

Feels like we just wrapped up tax season. And here we are again.

SPEAKER_01: 0:49

Well, I think we must be getting old, Greg, if uh the the year goes so fast.

SPEAKER_00: 0:54

I know, right? The older you get, the faster this I I don't want to talk about it. Um but so we've we've got a lot going on. It's gonna be a big year. We've got the one big beautiful bill act. Uh, I know we've touched on that in the past. Um, I know a lot of taxpayers are feeling a little uh anxious about this upcoming tax season. I've talked to uh existing clients, I've talked to a couple new clients, and um they're just feeling like I don't know what my tax bill is gonna be. Um and that causes a lot of anxiety and makes for a uh a pretty rough tax season. So, you know, a couple of things that I want to touch on today. We have a new service offering um that I'm pitching to clients, and then uh I just want to talk about best ways to you know prep for tax season to have a successful season with your CPA.

SPEAKER_01: 1:56

Great. Yeah, I know. I was kind of surprised uh with the one big beautiful bill. Um I didn't realize it brought back the research and development tax credit. And there are probably some other things that got brought back or introduced that we're not aware of. So I think it's probably you know a really good time for listeners to engage with their CPA to figure out uh you know what applies to them for 2025.

SPEAKER_00: 2:21

100%. And you know, unfortunately, you know, we're we're past December 31st, so a lot of the tax deductions for 2025 may have lapsed. There's always things that we can do, but um, for the most part, uh you know, everything's at this point set in stone, and there's there's not much that we can do from a tax planning standpoint, which brings me to our latest and greatest service offering. This is a a premium service offering that I'm really excited about. Um I've kind of tested it on a couple of clients so far last year, and it's it worked out really great. Um, these clients are going into this tax season feeling ready, uh, not anxious about anything. Uh, they are, you know, just waiting to get my organizer and then we're good to go. We'll get them filed on time because I have a good understanding of the client and um yeah, should be pretty painless for for both sides. Um so it's a it's a monthly tax coaching offering. And you know what that means is that we're gonna meet with you on a monthly basis, we're gonna have uh check-in calls, we're gonna, you know, take the the tax strategies that we've put or that I've presented to you and put them into place and make sure that we're staying on top of them. Um you know, obviously questions come up throughout the year. This is a good time for us to um you know talk about those questions uh when they're they're top of mind to you, maybe they're a little bit more relevant to you. Um and uh you know, as as new tax strategies come up, uh we're able to uh take advantage of them much sooner. Uh so this is a new exciting offering that we have, just monthly tax coaching. Uh it's gonna be different from projections or you know, say like quarterly tax planning, where you know, projections were just gonna tell you what you're gonna owe uh at the end of the year. And quarterly tax planning is you know optimizing your um really optimizing the the uh estimated tax payments.

SPEAKER_01: 4:55

Cool. And so let me just rephrase this, make sure I understand. So, you know, at a minimum, people need their tax returns filed. If you take the next step up from there, you'd like to know in advance what your tax bill is going to be. So that's your tax projection exercise, which you do for clients, right? Um, and that requires at least, you know, at least meeting with the client once a year to, you know, get the information.

SPEAKER_00: 5:24

Yeah, you know.

SPEAKER_01: 5:24

And then you can do some tax planning, which might be highlighting certain tax savings opportunities. Um, but then it kind of you rely on the client to implement those. And then you take the next step and the final step into tax coaching, where you're talking to clients once a month, once every two months, maybe, and and you're coaching them to actually implement the tax planning strategies that you've uh decided are a great fit for that client to help them actually get the job done, right?

SPEAKER_00: 5:55

Absolutely, and and this allows us to be super proactive. I know that's a uh a point that a lot of new clients that we get um bring to us, and they just say, you know, my my CPA wasn't proactive, I had to reach out, you know, more than one occasion, I you know, brought planning opportunities to them. Uh, and this is meant to mitigate that. Um, so we're acting more as like a business partner rather than just you know your your tax filing CPA.

SPEAKER_01: 6:32

And so you've been uh you've gotten a certification over the last year, right? Tell me tell us about, tell the listeners about what you've actually studied, because this is not like your run-of-the-mill tax CPA type stuff, right? This is the next level.

SPEAKER_00: 6:46

Correct. Yeah, so last year I uh I went out to San Diego. Thank God it was last year, because this year it's a little wet. Um but the uh the tax coaching certification is just a resource that we now have available to us that you know gives us a library of of tax savings strategies. Uh these are all vetted strategies. Um they've held up in court for the most part, um you know, for some of the newer um like one big big beautiful bill strategies. They've um you know they've they've gone through like several CPAs who have you know vetted the strategies, kind of put it into plain English, um, and gives us an opportunity to present this to the clients.

SPEAKER_01: 7:49

And so it's funny, we were speaking with uh um prospective client a few weeks back, and he basically said to us, he, you know, he he's not opposed to paying taxes, but he does not want to pay list price, right? He wants the discount that everybody else gets, right? So a lot of what you're doing is figuring out how clients can get that discount on their tax bill, right? Yes, everything's legal, but they're getting the maximum discount.

SPEAKER_00: 8:19

Yeah, uh, you know, just like buying a car, no one wants to pay the the sticker price. And same, same for your taxes, right? You know, if we could save a client, actually, um, you know, I was looking at a prospective client a couple weeks ago, figured out I could save them, you know, about fifty thousand dollars in taxes the first year, and then um, you know, ten to twenty thousand going forward thereafter. Um, I mean, that's a lot of money. And they can, you know, take that and reinvest it in the business, reinvest it in their community. Um, so you know, these are all legal strategies. You just want to be able to make sure that you're taking advantage of them so that you know you can use that money for you know something that's maybe a little bit more important to you than the government.

SPEAKER_01: 9:10

Right, right. And so as we get into January here, what should clients be thinking about? What should listeners be thinking about how to make this as seamless and successful at tax season as possible for them?

SPEAKER_00: 9:25

Yeah, so you know, now you know we're in January, we're we're getting ready for tax season. The IRS will probably open for they may have already posted it, um, but they will open their their e-filing site um probably the last week of January. Most states are quick to follow that. Um, you know, the form should be finalized by the last week of January. Uh the tax software companies have had plenty of time to get everything um squared away. So it should be a pretty smooth entry into tax season. Um so right now is a good time to start pulling together your your documents, um, you know, especially your itemized deductions. Um this year, we even if you've filed for the standard deduction in the past, um, because of the increased uh state tax deduction from 10,000 to 40,000, maybe itemized deductions is is back on the table for you. So um things like medical expenses, if they're on the on the bigger side.

SPEAKER_01: 10:40

So if you live in a high-tax state with high property taxes, you you're able to deduct mortgage interest. Okay. Um so that's huge for people to live in these high-tax states.

SPEAKER_00: 10:51

Yeah, exactly. Um and I think a lot of people, I mean, I've even advised some people to, you know, don't worry about it. You know, put that off your list. Don't, you know, the people who write down every single prescription that they've paid for, every doctor's visit, stuff like that. I'm like, you know what, you're wasting your time because we can't use it. But now that could change. So um might be a good time to start going back through your records and uh figuring that out. Um and then, you know, as far as business owners go, um, you know, working with your accountants, so I mean SmartBooks does a great job of those anyways, but you know, making sure that you know the year end gets closed, um, you know, final year end entries are getting recorded correctly, um, you know, stuff like that. The sooner that we can get the book a clean set of books, the sooner we can start prepping your taxes. Uh, so you know, it's it's important. Obviously, it's also 1099 season, so that's that's another important thing to start pulling together your records for.

SPEAKER_01: 12:07

You know, one thing, Greg, I'll mention um, you know, listeners, this may be applicable to them, or it may be applicable to their parents if they've got some retired parents with um IRA income. Um, one thing I had to learn kind of the hard way a couple years back um was the required minimum distributions from IRAs. And if you're gonna make charitable donations, there's a big benefit to having the investment company, what, Vanguard, Fidelity, whoever, um, send the checks out to the charities rather than you take the distribution first and then you make the donations personally after that. Because if you have the fund company send the checks out, then they can net that out of the reported income to you, and it's you know less income less taxable income to you. Whereas if you get the um the full gross amount from the investment company yourself and then you make the contributions personally, you may or may not be able to deduct the uh charitable donations depending on your personal tax situation. So just one quick pointer is if you can have the investment company send those checks out to reduce the amount of the reported distribution to you, that's that's a lot of money at stake potentially.

SPEAKER_00: 13:29

Yeah, no, absolutely. Yeah, I I had a couple of clients run into that where they, you know, got the money and then made the the uh travel donation and uh you know maybe they didn't itemize, and now um, you know, they don't they don't get the advantage of that um of that benefit. So it's a good point. It yeah, talk to your investment advisors about that, um and see, you know, what what you can do. Obviously, you know, you gotta do it, you know, anything you do now is for 2026, but um it's still a a good point. Um I would also recommend for clients to uh start pulling together your estimated tax payments that you might have made um and organizing that. A lot of clients do forget that sometimes, especially the earlier ones. And you know, now we end up getting letters from the IRS saying, you know, you know, you overpaid or here's a big refund. Um and it's usually a good situation because you're getting money back, but um, you know, it you don't want to be loaning money to the IRS.

SPEAKER_01: 14:47

Yeah, and this is also this time of the year if you have not uh done kind of a monthly home office reimbursement. This is a good time of the year to add up all of your home office expenses and utilities and everything and prorate that. If you've you know used you know 10 or 20 percent of your home for business, well, you know, add up all your all your expenses associated with that real estate and submit an expense report to the business and get reimbursed now, right? Yep, start looking at travel.

SPEAKER_00: 15:18

Um, you know, especially if you're a uh you know, single-member LLC, like a small business, single-member LLC, like that's all stuff that we would be taking on Schedule C. Um and then kind of more uh I guess we'll call it um you know what's the word I'm looking for. Um housekeeping items. The you know, making sure that you have access to the client portal if your CPA excuse me. Yeah, client portal if your CPA uses one. Um you know, maybe reach out to your CPA, make sure that they're still around doing your taxes. Um I have had clients come to me and say that you know their CPA closed up shop and and never told anyone. Um and then, you know, we typically will send our tax organizers out in, you know, second or third week of January. You should, you know, every CP is a little different on how they want to collect information, but make sure that you know you should be looking for some form of communication from them in the next coup next couple of weeks. Um you know, stay i if you have questions, ask your CPA. Um if you typically have to book a meeting with them, make sure that you you know get on their on their calendar. And then um otherwise you know, hopefully you have a a good CPA that's staying proactive and and communicative during this time. But um, you know, it it is a it is a busy time for us, so yeah. So cut them a little slack, I guess.

SPEAKER_01: 17:22

You're saying. Yeah, cut them a little slack if they're a little slow to respond. But still, this is one of those years where there's a lot, you know, changing. Some years that you kind of go through the motions, but 2025 with the big beautiful bill, there's some some major changes that impact small businesses and and business owners, right? So this is one of those years where you really do want to be in communication with your CPA.

SPEAKER_00: 17:47

And I'll I'll say my last kind of tidbit point is if you are coming into this tax season, uh maybe feeling a little anxious about what your tax bill might be, uh, that's usually a sure sign that you should be meeting with your CPA throughout the year to do some tax planning, um, or at least some tax projections uh at the very least. And you know, if there are planning opportunities, hopefully they uh can can identify those for you.

SPEAKER_01: 18:19

Yeah, that's definitely one of the things, right, Greg, we we pride ourselves on is trying to help clients avoid those unpleasant surprise tax bills at the end of the year and help clients get their tax returns filed on time. So avoid the negative surprises at the end of the year and hopefully get the returns filed on time, right?

SPEAKER_00: 18:38

I don't like giving those phone calls, and people don't like getting them from me. So yes, the idea is no surprises.

SPEAKER_01: 18:46

All right, Greg. Well, rest up. Get your rest if we go into town. All right. We'll talk to you later.

SPEAKER_00: 18:54

Thanks for having me.

SPEAKER_01: 18:55

Bye. Bye. Another episode in the books. Thank you so much for tuning in. For show notes and more, visit empoweringhealthy business.com. If you would like to have a one-on-one discussion with me, or possibly engage smartbooks to help with your business, you can reach me at cal C A L at Empowering Healthy Business.com, or message me on LinkedIn where I am easy to find. Until next time, this is Empowering Healthy Business, the podcast for business owners, signing off.