In this episode of the Fresh & Fit Podcast, we talk about how to start a business, LLC's, S-Corps, and how to run your own business. We also talk about the difference between human trafficking and human smuggling, and why they are two completely different crimes, and the differences between them. We also discuss the new movie, Kidnapping, and what the difference is between it and The Sound of Freedom, a new movie about human trafficking. Also, we have a special guest on the show today, Steve from Accounting, who has been with us for a long time! This episode is a must listen, and is definitely one of the most important episodes we've done for a while. Thanks to our sponsor, Fresh Fit Clips! FreshFit Clips is a high-end fitness and nutrition company based out of Denver, CO. They have some amazing products and services that are available for you to get you started on your journey to fitness, nutrition, and overall well-being. If you like what you hear, please HIT SUBSCRIBE so you can receive notifications when we upload new episodes of the show on your favorite podcasting platform! Subscribe, Like, Share, and Tell a Friend! We love feedback! Timestamps: 0:00 - The difference between Human Trafficking and Trafficking 6:30 - How to Start a Business? 7:15 - What is Trafficking? 8:20 - Why Trafficking is a Crime? 9:40 - How Trafficking vs Trafficking Is Better? 11:00- What are the Difference between Trafficking & Trafficking in the 21st Century? 16:00 17: What are you going to do? 18:30- What do you think of the difference? 19:40- How do you would like to know? 21:20- What would you like to see in a business? 22:00 + 22:40 23:30 24:00 | How does trafficking? 25:30 | How do I know someone else do it? 26:20 27:10 29:40 | What do I want to do it better? 35:00: What's a good idea? 36:00 & 35:40 + 36:30 + 37:00 Is it better than a business plan? 40:00+ 3500
00:00:58.000Welcome to the Fresh and Fit Podcast, man.
00:00:59.000It is Money Monday, and today we probably have one of the most important episodes we're going to do for a while.
00:01:04.000This is going to be one of those episodes that you're going to need your notebook, take notes, come back to it, reference it.
00:01:10.000Whenever you're ready to start a business, or if you are thinking about starting a business, this is going to be your blueprint and 101 and how to do this.
00:01:16.000And also, you guys asked for it so many times, so now we've got a few today for Stephen Mechanics.
00:01:20.000Yes, we brought our account in here, man, to give y'all the walkthrough step-by-step.
00:01:24.000So real quick, before we get into it, rumble.com slash fresherfitguys, go ahead and find us over there.
00:01:28.000So if we ever do get canceled, you know exactly where to find us.
00:01:31.000Also, check us out on fresherfit.locals.com for behind-the-scenes content.
00:01:34.000As you guys know, we do a live stream right before we do the show on Locals.
00:01:38.000And then also check us out on Fresher Fit Store to get the merch, hoodies, t-shirts, etc.
00:05:56.000And Steve was instrumental in that and me segueing over in a correct fashion where I wouldn't hurt myself from a tax standpoint and setting up my business appropriately.
00:06:05.000So for a lot of you guys, you're going to start as a full-time employee and then start your business.
00:06:10.000And then at some point, you know, you're going to want to quit that business.
00:06:12.000Sorry, quit that job and transition over to entrepreneurship.
00:06:15.000You need to do it in a very particular way so that you don't mess yourself up because I made some mistakes along the way doing that.
00:06:20.000And also, guys, debut Steve in the chat because Steve is giving you guys some massive gems here for free, by the way, and he charges for this all the time.
00:06:28.000So thank you, Steve, for coming to the platform as well.
00:06:45.000So before I came, I was looking at the shows that you guys have, the late night shows.
00:06:51.000So I think I went over the past 10 shows and then I did the ones where you guys had special guests on here.
00:06:55.000So I know in the beginning when you guys started that and you guys like kind of blew up and everybody was coming in for the red meat for the drama and the shows.
00:07:03.000And here I was kind of looking at like the viewership.
00:07:06.000I was just talking with Mo about this and I did...
00:07:09.000I did a little calculation on it and I think it's like 25% now, which is good.
00:07:14.000So that means you guys are really getting these guys across from there, bringing them in the door and getting them over to where they need to be.
00:07:34.000You guys teach people how to set up LLCs, credit, buy real estate, become financially free?
00:07:38.000Yeah, man, because at the end of the day, guys, if you want to be able to deal with a lot of these ridiculous women in a position where you have the leverage, you need to have your money on point.
00:07:47.000And I... And nowadays, they don't teach you any of this stuff in school.
00:09:33.000And kind of what we talked about when you were starting your fitness business and you were structured as an LLC. So most people...
00:09:39.000I think that, oh, I got an LLC, and it equates to tax savings.
00:09:44.000An LLC does not equate to tax savings.
00:09:46.000An LLC is just a form of entity that you can form.
00:09:51.000You can do it, and every state has their own limited liability company.
00:09:55.000You just get on the State Department, and this is what we're going to talk about on my channel in more detail.
00:10:01.000But that's the first step you do, is you select a name that no one else has in that state, You form your LLC. Make sure that name is available.
00:10:58.000Especially when you're a W-2 employee.
00:11:00.000Can you tell the people why that's so critical and why that's so important?
00:11:02.000Because I made that mistake myself in the beginning.
00:11:04.000So, if you're going to invest in real estate property, for every property that you have, you want to have a separate LLC. We're good to go.
00:11:32.000So they can only sue the LLC of that particular property.
00:11:35.000You may have multiple properties, such as yourself, where they can't reach over that.
00:11:43.000Lawyers started a limited liability in most states.
00:11:47.000And the reason why they did it is because they went into practice together, and they were partners, and they didn't want each other's Clients that may sue them coming after each other.
00:12:04.000Then they applied it to real estate as well.
00:12:07.000But you could get the best of both worlds because if you're going to operate a business where you're operating, you're getting income from an operational business, not a rental property, then that's where you want to take that LLC and convert it into an S Corp.
00:12:21.000I think the first person I heard talk about LLCs was Robert Kiyosaki.
00:12:24.000Obviously speaking, he wants to protect your assets.
00:12:26.000But we didn't know how to really do it, how it made sense for us as regular business owners.
00:12:31.000Okay, so it's okay for them to start off with, you know, create the LLC, right?
00:12:48.000It takes like 10-15 minutes not even to create an LLC. It's very easy, guys.
00:12:51.000You go on the website and you pay the filing fee, you get your articles of organization, which is basically, think of it as like the documents that prove you have a real business entity now.
00:13:20.000And a lot of times I get clients because, again, they go to an attorney, they form an LLC, and then at the end of the year when they come see me, I ask them, are you an S-Corp?
00:13:29.000They're like, I don't know what you're talking about.
00:13:33.000Did your attorney fill out these forms?
00:13:36.000Well, nine times out of ten they don't.
00:13:38.000Because lawyers don't know anything about taxes.
00:13:39.000Yeah, and we're coming in a year, maybe a year and three months or so later, and then I have to fill out the forms and then they have now a provision because it's so common that the IRS actually added on their form.
00:13:50.000A two sections where you could just check the box and say, you know, we're doing a late filing election.
00:13:56.000So you start off with LLC, so they got to get it, hopefully get it done within a year, right?
00:14:00.000And you're saying, yeah, you can count to two years, but certain, you got to make sure that certain forms were filed in a certain way.
00:14:09.000You know, I'm not going to get into that in detail, but that's typically the most cases, nine times out of 10, it's going to be a year later and we could, we could pretty much get the S Corp.
00:14:17.000And I remember with me, like, I was almost at the end of my time limit, and we switched it to an S-Corp right before, because I had an LLC, guys, that I had started for my fitness business, and then Steve saw, I got Steve as an accountant, and then he saw I was set up, and he was like,
00:14:32.000dude, you still have a W-2 job, and you have an LLC, what are you doing?
00:14:35.000And then we switched over to an S-Corp, and we'll talk about that here in a second.
00:14:38.000Guys, real quick, All the chats that come in, I'm going to read them here in a second.
00:14:43.000But go ahead and get your questions in, guys, because this is a fantastic opportunity for you guys to ask a real CPA who works for real clients from a small business angle and real estate.
00:15:43.000So now that's where if you don't make the S-Corp election, you have to put all of that business activity, the income and all the business expenses and the profit, Right inside of your 1040 on a Schedule C form.
00:15:56.000And I think we had a show and we talked about this.
00:15:58.000That's the number one audited form in the entire IRS. That's the one that probably 75% of people that get their 1040 audited.
00:16:42.000Everybody that does that, some people are well past The time limit to do an S-Corp election, and I make them form a new corporation with a brand new name, with a brand new EIN number, open up a brand new, and it's a pain in the ass,
00:16:57.000but I'm like, listen, you're going to thank me for this later because you need to file a separate form.
00:17:02.000So if they don't, let's say they stick with that LLC and they have their business and they have their W-2 job, that LLC income now has to be put in their 1040, which they're also earning income from their job, and that can mess them up.
00:17:14.000So you're basically putting both of your income streams on one form that shouldn't be put for two different income streams, and that form is the most audited by the IRS. Correct.
00:17:46.000You're filing this on your personal return.
00:17:47.000So now you have a guy auditing a pretty good-sized company that really doesn't have a lot of experience in the IRS, and they're going through everything, and they could turn your world upside down.
00:20:02.000So the other reason is obviously for the tax savings.
00:20:05.000So, you know, we use very simple numbers.
00:20:07.000Let's say you make a profit for $100,000, right?
00:20:10.000So if you file that on your Schedule C, On your income tax return, you're going to pay $15,300 in self-employment tax, even before you start paying regular income tax.
00:20:44.000So when you have an LLC and you're self-employed, now you're picking up not only the employer portion, But you're picking up the employee portion of that.
00:21:24.000You're the president of that company and whatever that company is, let's say you're a doctor and you've got a medical practice, what would you pay someone to do that job or so on and so forth?
00:21:37.000Obviously, if you're not profitable, and typically when you form a new corporation, typically the first year you're going to have more expenses than you do income, and you might have a slight loss.
00:21:46.000That's why I like to have that on a separate return, because then you get the slight loss that comes through on a K-1 form, and we attach it to your 1040, versus having a loss on your Schedule C. And then it's netting against your other W-2 wages like you had with DHS. That looks bad.
00:22:31.000That people do, they'll file with this little schedule on there and then all of a sudden they have a loss and then they'll, you know, maybe they have a $150,000 W2 wage and a $20,000 Schedule C loss.
00:22:41.000Now they're getting their income down.
00:22:44.000So you want to avoid all red flags that might come up to the IRS to say, you know what, this is all this person because of these things coming up on their account.
00:22:53.000I had a real estate agent where she was trying to sell real estate when the economy crashed and she didn't sell anything, but she incurred legitimate costs.
00:23:01.000And she was renting, paying desk fee, this, that.
00:23:28.000Versus if she would have, I would have told her, you should have been an S Corp.
00:23:31.000I don't know who you talked to, who did your stuff, but we could have filed that on a separate return, take the $35,000 loss, put it on the schedule K-1, and they would have left you alone.
00:23:42.000Isn't it amazing how the vast difference just by setting yourself up correctly, when you set yourself up correctly from the beginning, it avoids long-term problems versus if you set yourself up incorrectly in the beginning, it might be easier.
00:23:54.000Oh, I just made an LLC. Now I'm like, I'm a business owner.
00:24:09.000It's great because you get the best of both words.
00:24:11.000So if you're going to run a business and have an operation, then I would say, yeah, be the LLC, get the extra limited liability protection for your assets and also just convert it into an S-Corp.
00:24:21.000So in that case, we were talking about the second system, the $100,000 case, $15,000, 300 extra tax bill you're paying versus if you did it on an S-Corp, we could take $50,000 of that and deem that wages.
00:25:03.000One as an LLC, one as an S-Corp, right?
00:25:07.000Assuming you made the LLC, then you switched over to S-Corp.
00:25:09.000In the first scenario, where you're just a regular LLC working a job, let's say you make $100,000 extra from your business, you are going to be subject to paying $15,000 in, you said self-employment tax, right?
00:25:52.000And a lot of guys don't do that and they've been getting away with it, but I think now with Social Security and the situation that we're getting a lot of little notices and stuff like that saying that you need to...
00:26:01.000I think at some point the IRS is going to come back and probably claw back a lot of these returns that were S-Corps where the owner didn't pay himself a reasonable salary.
00:26:35.000Now you owe us that plus penalties and interest, and it's a 25% for a misstatement there on top of the 15.3% plus the interest.
00:26:45.000So we're talking about just off of a $100,000 profit, You're saving $7,500 that you would have had to pay, you know, double that if you had stayed as an LLC. Right.
00:26:57.000And then not to mention, and you can't, I guess, also with the S-Corp, you were saying that you set yourself up for better tax mitigation as well?
00:27:06.000As far as, like, is it easier to write things off?
00:27:09.000They're about the same, because if you look at a Schedule C on a 1040 and you look at the, you know, it's just basically a profit-loss statement.
00:27:40.000So what I would say is, yes, they can.
00:27:42.000But I would say when given the opportunity, if you have an opportunity with whatever your employment relationship is with someone, and I'd say this to everybody, always side to be treated as an independent contractor.
00:27:53.000If you can negotiate where they can pay you, As a 1099 independent contractor, then do it.
00:28:01.000Because by not doing it, you're getting a W-2 wage and you have very limited access to get your income down.
00:28:08.000But when you become an LLC and you're treated as an independent contractor, you basically open up your whole business to the whole tax code to take advantage to get your income as low down to near zero as possible.
00:28:26.000So if you have the opportunity, if you have a gig and you're like, oh, the other guy said he'll pay me a W-2, put me on the books and pay me as an employee.
00:28:33.000And I always ask him, I'll say, is there an opportunity for them to pay you as an independent contractor?
00:28:38.000And they're like, yeah, I could talk to them.
00:29:11.000I mean, the only thing you do is if you have a 401k with matching and stuff like that, You know, that's a different story.
00:29:17.000But if you have an opportunity, if they don't have any of those benefits, you know, like that, then just try to become an independent contractor.
00:29:22.000And most employers, excuse me, would opt for that, because that's less liability on them.
00:29:47.000Okay, so even if you're a W-2 employee, well, you definitely want to do it if you're a W-2 employee, but if you're just an entrepreneur, serial entrepreneur, and don't have a W-2 job, you should always, you could start as an LLC, but always at some point, if it's a business that's generating money,
00:30:03.000unless it's real estate, that's the only exception to this rule.
00:31:11.000Over the past years, we look at the H&R blocks and checks and hewits to see what they're charging and their rates to see how competitive we are.
00:31:33.000And the thing with the H&R Block is, like, you have a person, potentially, that's only gone through a 13-week tax course, and they're preparing your return.
00:32:05.000And a lot of these people, what they do is they take that course and then they'll spend a season there in the H&R Block and then they try to leave to go hang their own shingle or do their own side tax prep stuff.
00:32:16.000So then the next year you go back and you're getting somebody totally different.
00:33:21.000So I pretty much paid the same amount of taxes as I did when I was an agent with a W-2 job and just starting my business making about $30,000, right?
00:33:28.000$150,000 gross as I did making an M. And if that doesn't show you that fucking a guy like Steve knows what he's doing, right?
00:33:35.000Obviously all legal because I'm using real estate, I'm an entrepreneur, etc.
00:34:02.000Towards the end of the year, my bigger clients, I'll send out notices We'll sit down right before the year ends to see where they're at to do some tax planning and then to see if they need to buy more equipment, pull back, see where they're at, make estimates, things like that.
00:34:17.000They don't do any type of tax planning that's very important that comes in towards the end of the year.
00:34:22.000Me and you've been on the phone before planning like, hey, you should probably spend...
00:34:26.000You know, some money before the end of the year, etc.
00:34:29.000Any equipment that you want to buy, go pick it up now.
00:34:31.000I remember when we were buying the cars, pick it up now before the end of the year.
00:34:34.000Like, all this stuff is imperative because it will set you up, right, to pay a smaller tax bill in the future, guys.
00:34:42.000I told y'all before, when you're an entrepreneur or if you're a real estate investor, what ends up happening is you are the cornerstone of the United States economy.
00:34:48.000Small businesses, real estate, small business, Real estate, bam!
00:34:52.000You hit this corner right here, and you're able to create jobs, create housing for people, and you get huge tax breaks.
00:34:57.000And that's why I was able to pay less taxes now than I did when I was an agent as a W-2 employee.
00:35:01.000I think the allure is for H&R Block is that on some level, it's streamlined, and it seems to be an easy option because you just go there, get your documents, information, and they do it for you.
00:35:09.000But ease of access leaves you open to missing out a lot.
00:35:19.000You know, I think you're talking about real estate, you know, the most millionaires are in- Yeah, 90% plus.
00:35:26.000Should we talk about, because they've asked me this question a bit, you want to talk about our strategy that we're doing right now with the real estate?
00:35:33.000Okay, we're going to give you all some sauce, okay?
00:35:35.000We're going to go ahead and kill the Twitch, Twitter, Facebook, kill everything except for Rumble and YouTube.
00:35:40.000I've never revealed this, but I'm going to tell you exactly what I'm doing with Steve right now as my tax strategy for real estate for all you guys out there that want to invest in real estate, et cetera, and set yourself up for success.
00:37:46.000So that's probably the next step because now you have your operation business and you have all your real estate.
00:37:51.000You're going to have some other assets that you're going to be holding in there.
00:37:54.000So then that's the next level that we'll talk about is to get an attorney to do the trust.
00:37:59.000So let's say something should happen to you and then you can avoid probate and things of that nature.
00:38:06.000And Delaware, I think the reason, because my lawyer was suggesting Delaware, I think the reason why is because you guys are probably wondering why Delaware.
00:38:39.000And another reason, too, guys, why I made that LLC out of Delaware was, number one, for the privacy to hold all those LLCs.
00:38:44.000And then the other reason, too, guys, is I was able to open up a business credit card, right, where I charge all my real estate expenses on.
00:38:58.000Because I have an Amex Platinum that I use for Fresh and Fit and then I have an Amex Gold that I use for the real estate stuff.
00:39:03.000Everything for my real estate expenses gets charged on that gold and then at the end of the year, I just give Steve the credit card statement, the yearly statement that shows all the expenses for the entire year and I give him the Fresh and Fit one that shows all the expenses for the entire year and is able to go ahead and do what he needs to do from the tax standpoint.
00:39:22.000That's why I tell y'all, credit card is so important.
00:39:24.000You get free points, you're able to track everything, and you increase your credit score.
00:39:28.000There's no reason to use your own money, guys, when you have a business.
00:39:31.000So it allows me to go ahead and absorb those fees and get a benefit.
00:39:34.000And he avoids all the paperwork, receipts you have to keep for every transaction.
00:39:38.000Just give him his one list of charges from his credit card, he's good to go.
00:39:42.000You know, for you guys out there, too, also, to help out your CPA, so when you develop a relationship, you've got a business, whether it's a rental property, you're going to have, you know, for each one of those that we talked about when we were talking about with Roger, each one of those LLCs for each property has to have their own separate bank account.
00:39:59.000So when you do an LLC, okay, so the next step is, like, you get online, you go to your department of state, get your LLC, next thing you do when they get to approve is get an EIN number, and this is what I'm going to, this is, I'm going to have a book And then we'll talk about that at the end.
00:40:13.000I'm going to give it out for free for the viewers here only.
00:44:39.000And I hope, one, you can tell the whole extent of the story because this is, once again, I don't know how you do this, but you're very inspirational to me, at least, and Myron as well.
00:45:50.000Bro, you're not going to explain S Corp and LLC because people tell you all the time, oh yeah, I do an S Corp, but they don't tell you why.
00:45:57.000Literally, if you go ahead and just do an LLC versus switching it over to an S Corp, it goes into a pile that's more audited by the IRS and it raises the flags and it causes you problems.
00:46:06.000And like you said, from the very beginning, if you start right, you end right.
00:46:32.000Juvie goes, I'm 18, just graduated with two jobs and a 694 credit score and just financed a car to get credit history and have a credit card that I use instead of cash to make it 50k plus a year.
00:46:47.000I mean, I don't know about buying a car right now, but...
00:46:50.000Okay, so the finance car is not the best thing, but if you can pay it off and raise the amount of time, let's say a year or a year and a half, you could pay it off, then it's good.
00:47:19.000I would say for you, just focus on getting your credit score over 70.
00:47:21.000Also, to the guys right now, I would hold off, if you can, on getting a car right now because I think the car market right now, you should know.
00:47:34.000I've got a lot of car dealers that I work with, and I'm...
00:47:39.000I got them online, and I always ask them.
00:47:42.000I always talk to my real estate agents.
00:47:43.000I always talk to my car dealer guys, because those are the big ticket items.
00:47:47.000And once they tell me, as owners and operators of those businesses, if they're having issues, that tells me what's going on in the economy.
00:47:53.000And I've always used it as a barometer.
00:48:34.000You know, I just talked to Roger on the way here, and he told me, he gave me a stat, and I wish I would have wrote it down, but he's pretty optimistic on the rental market.
00:51:44.000So even as a trader, because people might do that where they trade commodity stocks, whatever, incorporate themselves as an S-Corp, I guess, huh?
00:51:53.000And that's another thing, because I've seen day traders do that schedule, and you do so much trading that your top line is like, it could be like a couple of million dollars, because it's in and out.
00:52:02.000You're trying to do these short trades during a short period of time.
00:52:07.000So these 1099s come out, when you look at the sales and the Purchases, they're huge numbers.
00:52:15.000You don't want to put that on your 1040.
00:52:52.000If it's a rental property, just stay an LLC. Is there a way for them to make it an S-Corp off the rip, or do they have to open it up as an LLC just for ease?
00:53:58.000There's also been things where I've had, like, if it's a limited liability where your account can't get, like, your bank account...
00:54:05.000I think there's something that has to do with your bank account.
00:54:07.000Can't get garnished if you're set up as a limited liability, where if it's set up as just a corporation, they can go in there and get it, though.
00:54:15.000I think that's one of the things, too, that I learned along the way.
00:54:18.000I came across that a couple of times in my experience.
00:54:58.000You take a percentage of, you know, the square footage and then you could write off a percentage of your utilities, your interest, your, you know, your insurance, so on and so forth.
00:55:08.000Whatever you're paying for that house.
00:55:55.000When you don't elect to be treated as a, As an LLC, or if you just do a business and you don't form a corporation, then you just default to a sole proprietor.
00:56:31.000So if you go in there and you DM me and you DM me Fresh and Fit in that book, I'm gonna show you, walk you through the steps, where to start, what to do next, how to fill out that form, and then I'm gonna be uploading some videos on there because you're gonna have questions on how do I fill out this 8832 form?
00:56:53.000They have some tricky questions on there, and you have to fill them out in a specific way to make sure you don't F them up.
00:56:58.000So I'm going to give the two videos on there that's going to be coming in the next couple weeks or whatever, and then that'll show you exactly what boxes to check, why to check those boxes.
00:57:06.000The stuff that we do, the stuff that I do every day, I'm just going to give it away for free.
00:57:09.000So do they have to, let's say he's in the state of Florida for simple purposes.
00:57:26.000So if you want to start your LLC, Go to your state, state department website, whatever it may be, which is for businesses, right?
00:57:33.000In Florida, I think it's SunBiz, right?
00:57:34.000In other states, it's called the Department of State for Businesses, whatever.
00:57:38.000Every state has its own thing, but either way, you go ahead and create the LLC in your state, wherever you live.
00:57:42.000Once it's incorporated, you get an EIN number from the IRS. Then once you have that EIN number, which is basically, think of it as a social security number for your business.
00:58:10.000Yeah, then you just go walk down to the bank...
00:58:11.000In his case, does he need to do anything else since he's not even an LLC? He's gotta create that LLC. He's gotta start right from the scratch, yeah.
00:58:54.000Would it be smart to start a car wrapping side hustle as an LLC, stack up a good amount of capital for rental property, then later into more real estate?
00:59:07.000But again, you got to make sure it makes sense because car wrapping is a, want to say, one of those niches where, like, guys have to be into cars.
00:59:15.000You need to know your marketplace at the very beginning.
00:59:17.000For example, who's going to be your customers?
01:00:02.000Let's talk about this real fast for the people.
01:00:04.000So they go ahead, they buy the real estate property under their personal name, and then they want to switch it over to an LLC. What do they need to do?
01:00:10.000So the first thing, what I used to do when I did it was I'd buy in Steve Colon and a signee.
01:00:52.000And then when you go to the attorney or the title company to do your closing, they say, hey, by the way, an assignee put it in whatever this LLC is, and then they'll make it happen with the paperwork.
01:01:06.000But you know, I have a lot of people too, and they were talking about like, you know, don't try to create this whole structure that Like, don't put the cart before the horse.
01:02:19.000There was one guy, and I'm not going to put a name out there, because I've been doing some research on this stuff.
01:02:23.000There was one guy, he's funny, and he had this reel out there talking about getting a trust and putting life insurance in it, and getting life insurance.
01:03:12.000Your workers' comp rates are going to be high.
01:03:14.000I don't know what state you're in, but I know in the state of Florida, you can do a workers' comp exemption if it's just you and two other people that have 10% ownership.
01:03:22.000And you can save on the workers' comp rate because those rates are high.
01:03:25.000They're like 30-something for every dollar that you...
01:03:28.000So if you're a small roofing company, it's just you, maybe a couple of guys.
01:03:31.000You can structure yourself where you don't have to pay that extra rate.
01:03:35.000Is it because of the liability of them hurting themselves?
01:04:08.000So, I mean, I say if you have a side gig and you're netting like $40,000 to $50,000 profit, you should already have started to think about getting a CPA firm to help you out.
01:04:29.000So depending on the industry you're in, I would ask around other people, like, you know, whatever it is that you're doing, there's got to be other people that you know in that circle and ask them who they use.
01:04:41.000So if someone is doing well in life, that's obviously well spoken for, has a good business.
01:04:45.000I'm just curious, brother, who's your CPA? And you ask them, and then they can help you out normally.
01:04:49.000Yeah, because if you have a specialized industry, I don't know what kind of work that you're doing, but typically, if it's a specialized industry, you want to talk to people in that industry and say, hey, who do you use?
01:04:57.000And typically, they'll refer you to somebody if they're happy with them.
01:05:02.000We got 3,000 of y'all watching over on YouTube and then another 3,000 or so on Rumble.
01:05:06.000Can you guys do me a favor and open up a tab on YouTube and come over and like the video on YouTube?
01:05:10.000Because as you guys know, we're in YouTube jail for about two weeks, so it's going to suppress us in the algo a bit since we're breaking out now.
01:05:17.000So it would really help with the algo if you guys went ahead and liked the video.
01:05:20.000Comment below for the algorithm or something like that.
01:07:04.000On the ATM thing, I'm going to give you guys an update probably in the next month or two with the ATM together and how my crypto ATM is doing and show you all the numbers.
01:07:13.000I love to be transparent with you guys.
01:07:17.000Brubri831 goes, I have an appliance repair business looking to expand.
01:07:20.000What would you recommend currently as sole proprietor?
01:08:34.000They have certain And that's why when you have a business, you have to put a code for what type of business that you're in.
01:08:43.000Because what the IRS does is they put those in a repository and they take all that data.
01:08:47.000And then any one of those expense line items falls outside of the ordinary percentage of what it is for gross income in that particular industry.
01:09:04.000And they're doing a good job comparing year over year to make sure there's no these crazy swings.
01:09:10.000He's saying when you day trade stocks and forex to save on taxes, can you even trade stocks or forex and save on taxes?
01:09:16.000Well, if you're having gains, I mean, I would imagine that you want to do it for profit and make money, not to take losses, unless you're harvesting them at the end of the year.
01:09:23.000But in which case, you have the wash sales, and that's a whole other...
01:09:26.000Is there a way to, like, mitigate tax liability through trading stocks, though?
01:09:31.000I didn't think that there was a way to do that.
01:09:32.000I mean, I think if you're trading, you're trying to make a profit and make money, so I don't understand the...
01:10:34.000It seems to me like to get tax benefits from trading stocks or forks is a very nuanced and case-by-case basis that requires specific tactics and strategies.
01:10:44.000The only thing I could think of is if he's got certain things that he doesn't think are going to come back and just wants to get rid of them.
01:10:50.000People are just trying to get around buying real estate.
01:14:35.000Or the ATM thing where it's, I think if it's passive income and you're not actively operating a business or an operational business where you're providing goods and services.
01:14:46.000Passive income, does it get taxed the same as earned income?
01:16:03.000Taylor Richard, getting a used car soon, about $9,000.
01:16:06.000If I start an S-Corp for my entertainment manager business, which I'll be my first client, but I'm in college to get the actual degree, can I write off the car somehow?
01:16:29.000And this is going to become a good one.
01:16:30.000Again, like we're talking about, the market's going to be really good for cars.
01:16:33.000So if you have a business and you want to get a nice deduction...
01:16:36.000You know, that's definitely a way to do it.
01:16:38.000So a lot of times that we have my clients trading out cars and getting new ones towards the end of the year to get a nice big tax break.
01:16:45.000And prompting for this question, is it better to lease that car under business or finance under your business for the best tax benefits, you would say?
01:16:53.000I mean, it all depends on the rate I would take right now, you know, because the lease is nice because you could take, you know, the lease, the whole lease payment on it.
01:16:59.000But the depreciation right now is really good, dude.
01:17:03.000Excuse me, with bonus depreciation plus section 179, if it's over 6,000 pounds, you can take the whole price of the car or whatever percentage of it that you're using.
01:17:32.000So if someone buys a car right now, a Range Rover, one of these cars that's over 6,000 pounds for their business, they're able to write off 80% of the car's purchase price.
01:17:44.000How much they put down, which is huge.
01:17:46.000So if it's worth 200,000, They're able to write off 160K. In the first year.
01:18:53.000You could even set it up as a Roth, too.
01:18:55.000You don't need the immediate tax deduction for it.
01:18:57.000That would be the best way to put your earnings in there.
01:18:59.000Roth IRA? Yeah, you can put up to $66,000 in one year.
01:19:03.000And if you do it as a Roth, I mean, you could get the tax deduction on it, but then you're going to have to pay the tax when you pull it out.
01:19:09.000But I like the 401k because you could take loans against it.
01:19:17.000And so then you could take loans against it and then you could pay yourself back the interest as long as you, you know, set up the paperwork right.
01:19:53.000So for your sole proprietorship, turn that into an LLC, then an S-Corp, and then your trading luxury watches LLC that you have, you need to make that an S-Corp as well.
01:20:01.000So you should be running two S-Corps if I'm not mistaken.
01:20:39.000So, you know, obviously in the United States, we're capitalistic, so we might get better tax benefits, et cetera, to some of y'all in these other countries, but it doesn't change the fact that, you know, you could definitely take advantage and make money in your respective country.
01:20:50.000We definitely have the most sophisticated and most complex tax structure.
01:21:48.000If a young kid came to me and I said, hey, you know, I want to know what it is that you do and how you do it and, like, how can I be successful doing it?
01:21:53.000I'll sit down and give him all my time.
01:21:55.000And tell him everything he needs to know for free.
01:21:58.000If he's humble and willing to learn and listen, why not?
01:22:25.000GhostRaven226, if I start an epoxy and pressure washing business in a small town, what should I know about moving my business to another state with a bigger market, M? So basically, yeah, so get with a CPA because they'll tell you everything you need to know, whether you have to register for sales tax,
01:22:41.000what type of business license you need.
01:22:43.000They know everything when it comes to starting the business and they don't charge a lot of money for it.
01:22:46.000It's not like they can do these corporations for you.
01:22:48.000Can they keep their business incorporated in their home state when they move?
01:22:51.000Yeah, they can, but that's a pain in the ass, though.
01:22:53.000If you're going to move the whole thing over, then you've got to go back and file over there.
01:23:27.000So basically, because a lot of people do this, they don't own the property.
01:23:31.000They just simply get it leased out through Airbnb and they get a percentage and the owner doesn't do anything.
01:23:36.000So the owner is able to keep that as LLC and passive income.
01:23:38.000You, on the other hand, since you're actively finding clients to rent the property, et cetera, and you're running it like a actual business, that's not considered passive income.
01:23:45.000So you need to escort, but the owner can LLC it.
01:23:48.000I think I got to change my dinner plans.
01:23:50.000I got my reservation because I don't know what she's cooking over, but it smells delicious.
01:23:59.000I understand the real estate strategy, but if I'm starting a business in, let's say, Virginia, should I do an S-Corp in Delaware or do I do it in Virginia?
01:24:42.000I understand real estate, but if I'm starting a business in, let's say, Virginia, should I do an S-Corp in Delaware or do I do it in Virginia?
01:24:47.000I think in your case, it's an active business.
01:26:00.000Can you give us like two or three of them?
01:26:04.000So, I mean, obviously, you're maxing out your 401k, but you also can do a traditional or a Roth IRA. But the Roth's not going to give you immediate tax benefit.
01:26:12.000But what's nice about it is you can let your money grow tax-free, and then when you pull it out, you get taxed at the end.
01:26:17.000But if you want to save now, you can put up $6,500 into there.
01:26:24.000Also, I don't know what type of work that you're doing.
01:26:27.000So you can look at different things where you might be able to take some advantage of Some of the employee expenses.
01:26:33.000I know in your case where you bought your own Glocks and so forth like that, it wasn't that, but in some industries where you have certain things that you can write off.
01:27:19.000What small business or side hustle would you recommend for guys in the military?
01:27:22.000Also, what do you guys think about AI OnlyFans business?
01:27:26.000Well, number one, with the military, you're a government employee, so you need to go ahead and get outside employment paperwork approved first and foremost before you do anything.
01:27:32.000That's number one, so you don't get in trouble, right?
01:27:34.000And I'll tell you that as a former government employee.
01:27:35.000And then as far as like a side hustle, what's your skill set, bro?
01:27:39.000I mean, I'm hoping that since you're in the military, you have an MOS. Hopefully the MOS can help you out in the civilian world and go ahead and have a business tied to your MOS so that you're skilled in.
01:28:07.000And then if you lie and you say, oh, no, there's going to be a side also with AI. And then they find out after the fact that it's AI only fans.
01:28:13.000You might have Army CID knocking on your door.
01:28:20.000Because, bro, remember, when you're a government employee, you have to have a certain level of integrity to whatever you do outside of the government.
01:28:29.000So if you're doing OnlyFans, that's essentially pornography.
01:28:32.000The government might look at it as pornography on the side.
01:28:35.000And I guarantee your chain of command won't approve that.
01:28:37.000That could jam you up in the future, have you a part of an internal investigation, administrative investigation by RBCID. All it takes is one person to hate and say, look at This guy is doing OnlyFans on the side with AI. He's doing pornography.
01:28:50.000And then, bam, next thing you know, you're getting a court-martial and you're over.
01:28:54.000And another thing, too, is with the USM, the, goddammit, the military courts, like, you have less rights than as a private citizen when you're being charged criminally.
01:29:03.000When they're hitting you administratively in the military and you go through the military courts, bro, that jag is going to fuck you up.
01:29:10.000So these are things you got to keep in mind when you're in the military, guys.
01:29:13.000You don't have as much freedom as a private citizen to do certain things.
01:29:21.000Especially if you got a clearance, they're going to come and they're going to, they can revoke your clearance.
01:29:25.000Like, bro, you got to be very, you got to move intelligently when you work for the government, especially when you got a secret, a top secret, etc.
01:31:15.000All he did was basically, like you could do it here in Florida, you just go in there, all he has is a fictitious name, or like, it's like a doing business as.
01:31:57.000Superguts goes, I have a couple of trustworthy friends, and we would like to know how we can all go in on the Umbrella S-Corp while owning separate properties that have equitable shares in the properties based on our ability to fund the accounts.
01:32:12.000Okay, so again, we're talking about properties.
01:32:14.000So I have this in my business as well, too, in my CPA practice.
01:32:18.000So you guys will probably be, you know, obviously an LLC, but then what happens is it's a multi-member LLC. It's not a sole member LLC. It's a multi-member.
01:32:27.000So you guys will default to a partnership.
01:32:29.000And again, it's real estate rental activity, I'm assuming.
01:33:39.000I know if I have a contact with someone and say, hey, what do I got to pay?
01:33:42.000It's typically anywhere from $300 to $500.
01:33:44.000So, this would be equivalent to me, you know, instead of doing a one-on-one with someone and give them, like, you know, advice and tell them exactly what they need to do, you're getting it for free.
01:35:00.000You're going to get this information for free.
01:35:03.000So, I mean, just definitely, those two books that I have would be like, if I had a client come to my office and sit down, these would be the things that I would be explaining to them.
01:35:30.000Lorraine goes, can you discuss or offer advice on how a U.S. citizen can create foreign LLCs or S-Corps subsidiaries, foreign irrevocable trusts, shell companies, and DBAs legally?
01:36:51.000On there, it's going to have the name, address of your business, and it's going to have the EIN number, and you're going to give that to the lady, and you're going to say you're going to pay whoever in the office is, the guy, and you're going to say you're going to pay the checks to me.
01:37:10.000Let's say I hire him to do some consulting with me, and I'm going to pay him as an independent contractor.
01:37:16.000He's going to form an LLC. He's going to give me a W-9 so I can pay checks to that LLC. And then I know at the end of the year when I give him a 1099, I have the proper tax ID number, the name of the company, and the address.
01:37:30.000So he gives that to me, and he signs and says, please, Steve, give me the...
01:37:34.000The checks in the name of this LLC. Bam.
01:37:37.000I didn't know that truckers can be 1099 employees.
01:37:40.000So for all you guys out there, because a lot of truck drivers actually listen to us.
01:38:17.000That does not matter whether you buy it with your personal check or not.
01:38:19.000As long as you have the paperwork to support that you're using it for your business, and you have the paperwork that you purchased it, you just give that to your accountant, they will accept that.
01:38:28.00090% of the 90% of the company vehicles that people write off and purchase, they purchase them in their personal name.
01:40:53.000Yeah, because having you out of Delaware, like I said before, it allows me to get a business credit card that allows me to charge everything easily to one.
01:41:23.000So first off, I would never suggest anybody to do what you're doing, obviously, but first thing I do when I get clients like you, because they do, they exist.
01:42:06.000So we don't do that in a timely manner.
01:42:08.000But if you have nothing on your transcripts and they're just empty, then you really don't have anything in the IRS computer system that requires you to file.
01:43:05.000And then you come down here, it's just crazy.
01:43:08.000People do weird odd jobs in Miami and Florida, bro.
01:43:10.000People take money in cash, and these are celebrities, and these people have actual presents, and I'm like, what are you taking money in cash?
01:43:55.000I can't have an LLC taxed as an S-Corp, so should I leave it as an LLC or a C-Corp?
01:43:59.000Now, see the thing with when you go to S-Corp, there's one nuance is you can't have any foreign members.
01:44:04.000So I don't know if they're U.S. citizens or not, a resident, but that's the thing.
01:44:08.000So you'd have to, whoever the person is that's going to be ultimately in the form of the S-Corp, you can't have a foreign resident or foreign individual on there.
01:44:16.000How about if he just does Escort by himself and pay them out, it's $10.99?
01:45:29.000Brian Grant goes 24 years old, 62K, W2 worker, and have an LLC for business services company, operational for less than one year, making less than 10K for this a year.
01:45:39.000Suggestions to lower personal taxes due?
01:47:05.000Should I keep it as an LLC? Escort, my friend.
01:47:08.000Switch that thing over ASAP. And for all you guys that have your LLC and it's been that way for a year or two, bro, y'all need to switch now.
01:47:26.000They've had their LLC open for a year.
01:47:28.000What should they do right now to switch over to an S-Corp?
01:47:31.000So basically fill out those two forms.
01:47:32.000Get my book because I walk you through that process and you go through there and I'll have those two videos that load it up soon on exactly how to check the boxes because it's very easy and then you fax the forms to the IRS. So yeah, get that and then...
01:47:57.000And then, so basically, but there's one, because if you're late on it, then you have to, you have to check a certain box to say, I'm asking for late relief.
01:51:13.000And then, when you're ready to go ahead and do the whole entrepreneur 1099 stuff, do it after your real estate stuff is done.
01:51:20.000Because if you plan to use loans from a bank, the worst thing you can do, this is literally life-saving advice, write this shit down to everybody in here.
01:51:28.000If you're thinking about buying real estate, guys, okay, and you have a W-2 job, and you're like, you know what?
01:51:33.000I'm going to quit this job and do my entrepreneurship stuff because it makes more money.
01:51:38.000Stay with your W-2 job because lenders like to see consistent income from a saved job over you being an entrepreneur.
01:51:46.000Because if you are an entrepreneur, what they're going to say is, we want two years of tax returns with your entrepreneur venture.
01:51:51.000You're not going to have it because you just started it.
01:51:54.000So stay at your W-2 job, do your side hustle, get the real estate, and then once you're done and you're prepared to go ahead and go two years without buying real estate, then you can go ahead and And transition and go the 1099 entrepreneur route.
01:52:04.000Because I'm telling you, it will mess you up with getting loans.
01:52:21.000And I do these letters all the time for this specific reason.
01:52:24.000You can have your CPA write a letter to the underwriter saying you were a W-2 employee and you're still doing the same type of work and sign off on it and vouch for it.
01:52:51.000You need a CPA. You need a CPA to write you a letter.
01:52:57.000Yeah, so form a relationship with that CPA, because you're going to need somebody to help you with the S Corp stuff and the tax filings on that, and then they're going to be able, once they need it, they're going to ask for it, and he could do the letter for you, or she could do that.
01:53:12.000If you're, let's say, a traveling healthcare worker, like traveling nurses do this a lot, et cetera, and you want to go ahead and go the 1099 route, and you're staying in that line of work, and you're just switching to 1099 so you can get better tax benefits, Make sure you get that letter from your CPA, because then it'll kind of be,
01:53:27.000hey, still same line of work, same earning, pretty much.
01:53:38.000Okay, so that'll suffice for the lender.
01:53:41.000Or if you are going to go and do, let's say, a completely different side hustle, let's say you want to be a fitness instructor, but you're also doing the nursing thing, then nah, man.
01:58:12.000I've seen it where people have set it up and come to me and I find out later there's partners in there that are foreign.
01:58:17.000And I don't know if the IRS has a mechanism to check on that, to be honest with you, because I've never seen anybody get checked on it before.
01:59:05.000DeAndre Reason goes, if you have a business you want to transition into an S-Corp but also plan to invest in rental properties, how should you set that up?
01:59:12.000Yeah, LLC for real estate property, guys, because it's considered passive income.
01:59:15.000And then if you want to take it a step further like I do, you can have one shell corporation out of Delaware, and then that controls all your LLCs that are each particular property.
01:59:26.000Yeah, and then each property is going to be a separate LLC. Yes.
01:59:31.000And I will talk to you guys about me and Steve are actually in the process right now of setting up how to collect money from tenants, how to pay utilities, etc.
01:59:41.000That's going to be on the next episode of actually managing all those different properties and collecting money from tenants and doing it in a way that won't pull your hair out.
01:59:49.000We'll do a full episode for y'all on that.
01:59:50.000Me and Steve are right now in the process of setting up the system, but I will tell you guys how the system works as soon as we have it done.
01:59:57.000That's going to be really valuable for you guys that have multiple doors.
02:00:00.000Yep, that are going to have multiple doors.
02:01:38.000It doesn't matter that you bought it after.
02:01:40.000So yeah, as long as it's business huge, which obviously Uber is, and then you're just going to have Uber pay you in the LLC, you're going to convert it to an S Corp, and you're going to get the deduction for the depreciation on the car that you bought, and it's all good.
02:02:46.000Your 10-9 employees are able to write off maybe if you put bottles of water in your car, if you keep your car washes, everything that you do for that vehicle to maintain it for Uber.
02:02:56.000And then you can write all that stuff off.
02:02:57.000Even the worst case scenario, if you get a used car, it's not 6,000, you're still going to get 20% because the car is depreciated over five years.
02:03:53.000Because they're basically, so they can get the full tax write-off because you're writing off the 6,000 pounds on the purchase price, not what you put down, right?
02:03:59.000Yeah, if you can get a lease pre-owned, that's awesome.
02:11:16.000And we're going to bring you back, probably with Roger, to talk about how we set up my real estate properties and how to set up a system to get paid without headaches, collecting late dues, all that stuff.
02:11:26.000I'm going to go over with y'all how to systematically collect rent from your tenants in a no-nonsense headache process.
02:12:16.000And then once it's up and running and everything is being collected correctly, etc., I'm going to show y'all A to Z. How to set up once you have real estate property.
02:13:16.000On how to set up your LLC properly and then switch over to an S-Corp, which we already discussed the benefits of doing so, multiple different benefits.
02:13:24.000And yeah, Steve, I'll give you the last word.
02:13:25.000Yeah, and that one's got the rental stuff with the cost segregation and depreciation and all that stuff for rental.
02:13:30.000That's specific for the newbie getting into the rentium.
02:13:33.000And I do cover a little bit about the program that you're talking about with just a tiny bit in there, but it's not very detailed on that section.
02:13:55.000So whether you're a W2 employee trying to transition into being an entrepreneur or you're thinking about it, whatever, we gave you all the tools, man.
02:14:01.000So always come back and reference this episode if you're thinking about starting a business, how to do this properly.