The 10 Minute Income Tax Tune-Up

April 13th, 2022 by admin No comments »

Are You Needlessly Over-paying Your Income Taxes?

The “Ten Minute Income Tax Tune-Up”

Income Taxes (hereafter IT) generally are the largest single bill in your life. They are a BIG annual and non-amortizing expense. Income taxes comprise 30%-40% of your daily labor, ’till the day you die. Income taxes are thus The Forever Bill.

But IT are also, by definition, a variable expense. IT can, and must, be proactively monitored and managed throughout the entire course of the year. A tax plan is always a part of your business plan. Makes sense, right?

The following IT Savings Worksheet illustrates a gross income of $1 million. But the entire $1 million is taxable ordinary income. Ouch. The Tax Man cometh. It’s not what you earn. It’s what you keep. The 8 simple steps below will save you big money:

Tax Tune-Up / Tax Savings Worksheet

1. Gross Income: $1,000,000.00

2. Gross Business Expenses: $400,000.00

3. Net Business Income Before Taxes: $600,000.00

4 Tax Bracket – 40%

5. Lifestyle Costs $200,000.00 – Your personal expenses.

This $200,000 is after-tax consumption, and is NOT tax-deductible.

6. Reportable Gross Income: $333,000

Lifestyle Costs divided by the inverse of your tax bracket. In Florida, your Income Tax Bracket is a maximum of 40%. The Inverse of your bracket is.60. Divide.60 into your Lifestyle Costs, which is #5 above. This is the Gross Income that you must report on your Personal 1040 Tax Return to live the $200,000 lifestyle that you have chosen in # 5. So, the correct Gross Income on your Personal 1040 is: $333,000.00

Please note that Step 6 is The Key: Only bring home the pre-tax $333,000 that is needed to pay for your after-tax lifestyle costs of $200,000.

7. Amount available for Pre-Tax Savings (#3 minus #6): $267,000

8. IT saved in this example: $106,800.00

Number 7 above x 40% (combined state and federal tax bracket).

In this hypothetical example, you paid $133,200 in IT (40% x Reportable Income of $333,000). Before this Tax Tune-Up, you were going to pay $240,000 in IT (40% x $600,000). But, instead of reportable Income of $600,000, you reported $333,000, and left $267,000 in the corporation as pre-tax income. By keeping $267,000 in your Corporation pre-tax, you have saved $106,800 of otherwise-lost IT dollars. (40% x $267,000).

You then add this 106,800 of “soft” tax dollars saved… to your “hard”, after-tax dollars of $160,200 (60% of $267,000). This equals a 66% rate of return, tax free ($106,800 / $160,200). Recapturing 40% In “dead” tax dollars on your net, after-tax 60% is a 66% rate of return, tax-free. All because you reported $333,000 of income, just enough to pay for your $200,000 lifestyle costs, while keeping the remaining $267,000 in your Corporation.

The instant that you utilize IT Reduction as part of your Business Plan… You earn a 66% tax free rate of return. This 66% rate of return is “instant” the moment that you deploy the $267,000 into a legal tax deduction inside your Corporation.

The happy ending for you is that you continue to lead the lifestyle that you want ($200,000). We simply did NOT bring $267,000 out of your corporation as taxable income. You reported income of $333,000, not $600,000. That saved you forty percent on $267,000 of Income = $106,800. The non-reportable $267,000 was put to work inside your Corporation in a legitimate tax-deduction that became an Asset. Converting otherwise-lost “dead” tax dollars into Assets. Simple, Legal, Smart.

Think about it: You just made 66%, instantly, and tax-free. There is no reporting of income. You simply “recaptured” otherwise-lost IT dollars. That’s not a taxable event. That’s just smart business. By recapturing “dead” IT dollars, you add forty cents of new-found “soft” money to your “hard,” after-tax sixty cents; and that earns you sixty-six percent, tax-free. In the end, your Corporation has an Asset, instead of a cancelled check from the IRS.

Business Success Using Marketing Research

March 29th, 2022 by admin No comments »

Launching your product? Want to know what the market is all about now? What does the data say about the current market status? Is it a good time for your product to be launched? Will the audiences perceive your product? How different it is from other products? These questions might arise in your mind always. For that there is a solution which is called Market Research.

What is Market Research?

It is the process of assessing the market for the launch of new products with conducting a thorough research directly with the consumer. This lets the company to identify its target market and gather statistics and data from the opinions gathered from consumers regarding the product. Market Research are mostly done by the companies itself or through third parties who are experienced in the market research field. A lot of marketing strategies can be used for market research such as surveys, product testing and directly approaching the consumer groups for their opinions regarding the product.

Now the question is What is the need for Market Research?

The purpose of doing market research is to assess the market related to the product or service to gather results how the consumers will react to the product. The companies may try to find out what the consumer likes and what not and where does their product stand between these and how to make it better so that the consumer perceives it. They can remodel the product according to that and bring about changes to the actual product so that it fares successfully in the market after its launch.

How is market research done?

Market Research requires a lot of strategies and plans to be implemented to bring out fair amount of results for the company. The companies develops variety of steps with proper planning. It gathers information regarding the market and the company must analyze the data that has been collected to look after the relevant data that can be used later on to bring modifications to the product.

What is the use of Market Research results?

The company which is planning to launch its new product must conduct the market research to find out consumers views and also data regarding the product. These data helps the companies bring changes to the new products. If the company thinks that any alterations is required to bring to the product which may result in bringing success to the product right before or after the launch. To catch the consumers eyes the companies use this data and statistics to make sure the product is worth showing interest for and the consumers will be in benefit.