@baldridgecpa ISSUE 31 A Guide to Self-Employed Retirement As a business owner, you're building a company and your future. But most of the business owners I work with are leaving behind serious savings by using the wrong retirement plan (or worse, no plan at all). Here's how to choose the right retirement plan that maximizes your tax savings while building long-term wealth. The 3 Options SEP IRA Contribution limit: Up to 25% of net earnings or $70,000, whichever is less Perfect for:...
12 days ago • 3 min read
@baldridgecpa ISSUE 30 The Book I Wish I Had Read 5 Years Ago Today we depart from our originally scheduled content to celebrate the release of Nick’s book The Sweaty Startup. On July 1, 2019, I sent my friend (though he was a random guy writing on Reddit at the time) Nick Huber a poorly written cold email. I didn’t know it then, but that email would change the course of my life. Nick was writing on the subreddit r/entrepreneur and he was saying things that were counter-positioned to any...
14 days ago • 2 min read
@baldridgecpa ISSUE 29 How Your Lifetime Effective Tax Rate Shapes Your Wealth There’s a fundamental tax concept that many people never quite catch on to that could end up costing you millions in your life and (unfortunately) your death. Lifetime Effective Tax Rate: the total tax you pay in your entire life divided by the total income you ever earn. To best explain this, let’s look at a scenario. Someone works most of their life and ends up with a substantial net worth. But it doesn't all...
19 days ago • 4 min read
@baldridgecpa ISSUE 28 The Most Honest Tax Letter Ever Written Tax season has a way of making even the most confident business owners feel uncertain. You gathered your documents. You worked with a professional (or maybe braved the forms yourself). You filed. You paid. But you still might be asking: "Did I get everything right?" Welcome to the club. This is the known unknown of tax season. You know you filed a return. You know the rules are mind-numbingly complex. And you know there’s a decent...
26 days ago • 2 min read
@baldridgecpa ISSUE 27 Tax Extensions: There’s Still Time It’s busy season over here, so this newsletter is short and to the point—because that April 15th deadline isn’t slowing down for anyone. Feeling the pressure to get your return done? Here’s the good news: you still have time to file an extension. An extension gives you until October 15th to file your return—plenty of breathing room to get things right. Just remember, it’s an extension to file, not to pay. If you think you’ll owe, make...
about 1 month ago • 1 min read
@baldridgecpa ISSUE 26 What You Can (and Can't) Deduct The IRS pays extra attention to business meal and entertainment deductions, and for good reason. They’re some of the most misunderstood write-offs in the tax code. I’ve seen business owners miss out on serious savings simply because they didn’t know the rules. I’ve also seen audits get ugly when people try to stretch them too far. Here’s what actually works, so you don’t leave money behind or invite trouble. How the 50 Percent Rule Works...
about 1 month ago • 2 min read
@baldridgecpa ISSUE 25 Should You Start an LLC? Out of all the questions I get asked as a CPA, this one tops the list: "Should I start an LLC?" As with most tax questions, the answer is: it depends. Entity selection isn't a one-size-fits-all decision, and sometimes it's not even the first step you should take when starting a business. Let's break down when you actually need an LLC, what your options are, and when it really matters. Entity Types: What You Need to Know For federal tax purposes,...
about 2 months ago • 3 min read
@baldridgecpa ISSUE 24 The Cash Flow Paradox Your business is making money on paper, but your bank account tells a different story. Sound familiar? This disconnect is lethal. I've seen thriving, "profitable" companies collapse because they drained their bank accounts while waiting for their paper profits to turn into real cash. Profit vs. Cash Flow: They're Not the Same Thing Your P&L statement can show healthy profits while your business struggles financially. Why? Because profit and cash...
about 2 months ago • 3 min read
@baldridgecpa ISSUE 23 Quarterly Taxes FOR Business Owners Nothing ruins a good quarter like a surprise tax bill. Yet that's exactly what happens to thousands of entrepreneurs every year who misunderstand or mismanage their quarterly tax obligations. If you've ever been blindsided by an unexpected tax bill or penalty, you're not alone. The quarterly tax system trips up even experienced business owners—but it doesn't have to. Quarterly Taxes Matter (And They're Such a Pain) The U.S. tax system...
2 months ago • 3 min read