Episode 52. Top 5 Easy To Use Tax Strategies

Top 5 easy to use tax strategies that will reduce your taxes and save you money in 2026. These are my top 5 tax strategies every business owner needs to know.

If you own a business, these five tax strategies are ones you need to start using today, and three of them can still be applied retroactively if you haven't filed yet.

I break down each strategy step by step. First, I cover Trump accounts and how your business can take a $2,500 per employee tax deduction that's completely tax-free to your employees. Then I get into retirement on steroids - how a defined benefit plan combined with a 401k lets you put away $200,000 or more into retirement and take it as a business deduction, even retroactively.

I also explain the difference between bonus depreciation and section 179 depreciation, including why section 179 might be the better option for most business owners, especially in states like New York and California that don't allow bonus depreciation. If you carry inventory, I walk you through the section 471 books and records method that lets you deduct 100% of your unsold ending inventory by filing form 3115 for an automatic accounting method change.

Finally, I cover the PTE pass-through entity tax strategy and the new $40,000 SALT deduction limit, why this strategy still makes sense for every S corporation and LLC owner, and how it works as a legal double deduction. Whether you're a sole proprietor, S corporation owner, or LLC member, these five tax strategies can help you pay less in taxes in 2026.

🆓  Download FREE PDF: 7 Write-Offs Every S-Corporation Business Owner MUST Know:   https://7taxwriteoffs.com/?el=podcast&htrafficsource=buzzsprout

*Disclaimer This material & presentation content is for informational and educational purposes only. This material and presentation content is designed to provide general information regarding the subject matter covered. It is not intended to serve as legal, tax, or other financial advice related to individual situations. Because each individual’s legal, tax, and financial situation is different, specific advice should be tailored to the particular circumstances. For this reason, you are advised to consult with your attorney, accountant, tax preparer, and/or other advisor regarding your specific situation or your client’s specific situation. The information and all accompanying material are for your use and convenience only.

Transcript

Five Strategies And What’s Retroactive

SPEAKER_00 0:01

If you own a business, then these five tax strategies will absolutely destroy your business income. It'll reduce your business income, which will reduce your taxes and save you a lot of money. Now, what are these five tax strategies? First of all, out of these five, there are three tax strategies that you can still use for prior year if you haven't filed your tax. So the first tax strategy are the Trump accounts. Yes, the new Trump accounts, even though they're individual accounts, they can actually be a business tax deduction, and that's what we're gonna cover. Number two, retirement and steroids. This is a retroactive tax strategy. Even though the year is over, you can actually use this strategy to put away$200,000 or more into your retirement account and take it as a business deduction. We're also gonna talk about bonus versus section 179 depreciation. Bonus depreciation is back. A lot of people are going crazy. Yeah, bonus depreciation, but but but you can actually do proper planning and claim section 179 instead and have a star next to it because this strategy can also be used retroactively for previous year if you haven't filed your taxes. Inventory tax strategy. This is a phenomenal tax strategy. Depending on your situation, it could help you write off hundreds of thousands of dollars from your inventory in the same year. And I'll show you how. Last but not least is the PTET tax strategy, and we have new limits. So stay with me till the end because I will show how this strategy, even though it is updated with the one big beautiful bill, applies to you as a business owner and how you can start utilizing it today. Ready? Let's dive in.

Trump Accounts As A Business Benefit

SPEAKER_01 1:42

Welcome to the tax reduction podcast for money-making entrepreneurs with Boris Mucheev. Boris has helped entrepreneurs across the United States collectively save millions of dollars in taxes with the power of tax planning and advisory. The only way you, the business owner, can save money on taxes is by using proactive tax strategies. And this podcast is all about saving you money on taxes. Boris will share with you in-depth and easy to understand tax reduction strategies that you can implement in your business within 30 days or less. Let's jump into today's episode.

Retirement Deductions Up To $200K+

Bonus Depreciation Versus Section 179

Free PDF And Why Advisors Matter

SPEAKER_00 2:15

Alright, Trump Accounts is the first out of the five strategies that I want you and I need you to use in your business, okay? Now, what is a Trump account? A Trump account is an individual account that you can set up for your children that are under the age of 18 years old. You can contribute$5,000 to the Trump account for each child. Here's the thing: it doesn't only have to be uh contribution by a parent, it could be anybody else, okay? It could be uh contributed by a parent, a grandparent, or another relative. But$5,000 per year for each child, and it is also not tax deductible. And when the child turns 18, it follows traditional IRA rules. So, really cool strategy. What about as a business, right? What happens when you have a business? Can you somehow write it off? The answer is yes. All right. So, first of all, let's talk about your employees, and then we will talk about your own children and how you can take it all as a business deduction. First of all, every business can set up a benefit for the employees and say, hey, employee, if you have children under the age of 18, we can put away$2,500 into their account. And um it is per employee, okay?$2,500 for a business per employee. Now, it is a hundred percent tax deductible to you as a business owner, and it is not taxable to your employees. That means there is no payroll tax. So let's say you wanted to give a bonus, but you're like, you know what? Instead of a bonus, I can give you something tax-free, and that could be a good idea, right? So your business can take$2,500 deduction up to each employee. It's very easy to set up. You would find out from your employee, hey, do you have a Trump account? Yes, I do. If not, help them set it up. And then you just fund it and you take as a business deduction. The question becomes: what if you're using a strategy of hiring your children? What if you have your children working for you in your business? So I've looked it up uh and I've done some tax resort research on it, excuse me, right? As it stands right now, while it is still a new law and new tax strategy, from the way I've researched and what I've seen, you should not have any problems when you're employing your children in your business, which is a tax strategy on its own. If you're not working, uh working or talking to your tax advisor about it, right? If you're not using a strategy of hiring your children, you should start. Because when you have children working in your business and you're paying them a salary, this benefit could apply to them as well. Okay, speak to your tax advisor, be like, hey, Boris said I can do this, okay? So really cool strategy and new strategy. Remember, even if you don't have children working for the business, whatever that may be, you can still do$2,500 per employee and take as a business tax deduction. All right, the two out of five tax strategies, and this is a retirement tax strategy. Now, I have a little R over here. That means it can be retroactive as long as you haven't filed your business taxes or your business taxes on extension. Now, before I talk about this strategy, I really want to explain to you how the 401k works so we can understand this, right? When you form a 401k in your business, whether you are the only employee of your business or you have other employees, you know, that could be either a solo 401k or a regular 401k. You can put away$24,500 from your salary and take that as a deduction. So if you have a W2 salary, for example, of$100,000, I'm writing with my finger here, right? You can deduct from your W 2 salary$24,450. That's for 2026. These numbers are adjusted for inflation every year. Your employees can do the same thing, which you will not be liable for, they can take it out of their payroll. Now, if you are the only employee of your business, you can use what's called a solo 401k. With a solo 401k, you can put another 25% of your salary. So if you're paying yourself$100,000, that's another$25,000, brings you a total deduction of$49,500, which is cool. Solo 401k, I usually pretty cool, uh pretty cool retirement strategy to have as a tax deduction. Now, if you're not the only employee in your business, then you can set up a regular 401k. Again, you will be able to do$24,500 from your paycheck, but then you're only limited to doing 3% for yourself of your salary, which is$3,000, which doesn't make this deduction very attractive. It's about$27,000. Now, there is another retirement plan that is called Defined Benefit Plan. It can also be called a cash balance plan, which can work together with your 401k or it can work on its own. You would really have to speak to those retirement people that set it up and they will set it up for you. But the gist of it, how it works, and how we use it for our tax advisory clients in my firm, we do tax advisory for clients in about 40 states, have them save tons of money on taxes with basic strategies, advanced strategies, and retirement strategies. Now, what do we do for them? We say, hey, we typically recommend this to any businesses that have a taxable income of$750,000 or more and less than 15 employees. It works best because when you do it for yourself, you also have to do it for your employees. And generally, what we have seen with our business owners, they're able to put away$200,000 or more additional for themselves into such a retirement account. As a matter of fact, we just finished finished projections for one of our clients. They putting away, husband and wife, business owner,$400,000 into this defined benefit plan, which is really, really cool. Now, when you do it for yourself, you also have to do it for your employees, but not under such a high number. Generally, you want to speak with your tax advisor, be like, hey, I'm putting away, let's say,$400,000 for myself, and my total contribution for employees is about$52,000. Do I still save money on taxes doing so? In most cases, the answer is yes, but speak to your tax advisor. This is retroactive tax strategy. If you have no retirement account set up for your business, or even if you have either a SEPIRA, 401k, some businesses even have what's called a profit sharing plan, you can still set this up for prior year, contribute to it this year, and take a deduction for prior year. So definitely speak to your tax advisor. Right, let's move on to the next tax strategy. All right, third out of the five tax strategies that you can use to help you pay less in taxes, not only this year, but you can also use it for prior year. Now that is bonus versus section 179. This is, like I said, a retroactive tax strategy. If you haven't filed your taxes yet or you're on extension, you still have some time to do planning. Now, I love bonus depreciation because it lets you deduct 100% of your assets that you buy for the business, right? Equipment, uh, machinery, furniture fixtures, whatever business that you may have, it lets you deduct 100%, which is cool. Now there's some limitations. Like, let's say, for example, you purchased furniture and fixtures, you opened up a new restaurant, right? And you purchased$250,000 worth of furniture fixtures and you know$100,000 of equipment. These are two different classes. That means if you're gonna apply bonus depreciation to one class, you have to apply to the entire class, right? So you cannot be like out of 250, I'm gonna do 100,000 on 100,000 bonus. The rest I don't need that much, so I'm just gonna do it over the course of the five or seven years. Doesn't work that way, but that's okay. We're still getting 100%. Another thing that I don't really like about bonus depreciation are the state limitations. States such as New York and California do not allow bonus depreciation. They say, nope, that's not gonna work for us. If it's a five-year property and you bought it for$250,000, then you're gonna, you know, divide it by five years and get a deduction every year,$50,000 a year. Okay, cool, but we still have bonus depreciation. A lot of people love it because they use it for their cars. There's something else that's called section 179 that is overlooked a lot by business owners. Section 179, there's a limit of, I think for 2026, there's a limit of$2,560,000. You can write off up to$2,560,000 all in one year, which a lot of small business owners that I have, you know, they're purchasing of equipment that they need for the business, right? We're not talking about an equipment that they don't need because a lot of times I speak to business owners, they say, I'm like, Do you use any tax strategies in your business? Like, no, my accountant just keeps telling me to buy more equipment, to buy more uh trucks, to buy more things that I don't need. And he says, That's how you're gonna get a write-off. That's not a strategy, right? We only want to purchase items that we actually need for the business, okay? So a lot of business owners that I work uh with for tax advisory and planning, the purchases that they have is usually under$2.5 million. Now, what I like about section 179, states do recognize it, unlike uh bonus depreciation. For example, New York State would recognize it, and you can pick and choose. Let's say we have a$250,000 and$100,000, right? And uh for whatever reason, you're like, I don't want to deduct entire$250,000 for my tax planning. That's why I said you can do this retroactively. Speak to your tax advisor, be like, hey, do I really need$250? Because I'm anticipating that this year is gonna be a bigger year. Maybe I can use some of the deduction this year. You absolutely can, right? You can take, first of all, whatever you need in the current uh in the previous year, let's say you only need$100,000 of it, but the$150,000 can be depreciated over the course of regular whatever it is, if it is five-year or a seven-year property. So you can actually get to pick and choose. So this is by the way, a huge tax planning opportunity. We do this for our clients all the time, especially if they're in a state such as, like I said, New York, California, or any other states that do not allow bonus depreciation. We review this as a tax planning at the time of preparing their taxes. Sometimes it's hard to say if the client needs it when you're doing projections because there could be some other strategies. But hey, this is like a must in our firm for business owners. So you want to make sure you speak to your tax advisor. Now let's move on to our strategy number four.

SPEAKER_01 12:27

If you have a tax preparer and you do not have a tax advisor, the only way you can save money on taxes is by using proactive tax planning strategies that only a tax advisor can give you. Boris put together a free PDF for you, the business owner. Seven tax write-offs every S Corporation business owner must know. In this PDF, you can find seven tax strategies that you can start using in your business to instantly start saving money on taxes. Click on the link in the description below for a free download.

Inventory Write-Off Using Section 471(c)

PTET And The New SALT Limit

SPEAKER_00 12:58

All right, the inventory strategy. By the way, like I said, if this does not apply to you because you do not have an inventory in your business, that's okay. Skip to the next chapter. But I want to talk to a business owner that has inventory and that carries on inventory in their business because this strategy is an absolute killer. So if this relates to you and nod your head with me, right? Every year at the end of the year, your accountant is asking you, what is the ending inventory in your business? And then you might have asked him at some point, what do you need to know? What's my ending inventory? And he might have answered at some point and said, Because whatever's ending inventory, whatever you paid for it, it is not deductible until you actually sell it. So nod your head with me if that, right? If that is you. Well, I am here to tell you that while your accountant is correct, there is another alternative method that allows you to take 100% of that ending inventory, the inventory that you have not sold yet. Okay? So it's 100%. By the way, I put an R next to it because it's a retroactive tax strategy. That means if you haven't filed your tax return for last year and you have an ending inventory, whatever that may be, 100,000, 200,000, 300,000, a million dollars, right? Speak to your tax advisor, but hey, Boris said that I can use what's called section 471C and take this deduction. Now, why does this apply to you? First of all, let's talk a little bit about qualifications. This is for business owners that in 2025 their gross revenue was at 31 million, and in 2026, their gross uh revenue is 32 million. IRS considers you a small business owner, right? A small business when you have these gross revenue limits and under. Okay, so because you're a small business under the IRS definition, you can apply for section 471, which is books and records. IRS says, look, if you're writing off your inventory every year without keeping track of it, just follow the books and records. It's called N-I-M S. I actually had it on the board, I erased it. Non-incidental materials and supplies. But most of you have not done that, have not just written it off, you have reported it as an ending inventory. So, what do you do then? So then this does not apply to you. That is correct. But you can let the IRS know hey, I want to change my accounting method and I want to apply for the books and records method. That will require you to file form 3115, which generally requires an approval from the IRS. But luckily for you, for the change of method for the inventory, it will be an automatic approval and you will be able to deduct your inventory. As a matter of fact, we just did it for a client who is a pharmacist, okay? And he has ending inventory. That could be drugs, that could be all the other stuff that pharmacists buy with that is not medicine and drugs. His ending inventory was$150,000. Well, guess who wrote her off? Right? Why? Because we did change an accounting method. We did we did books and records for under 471c, filled out the paperwork, and his tax return now has additional$150,000. So if you do not have a tax advisor that does these things for you, I strongly recommend you get yourself a tax advisor. All right, let's move on to strategy number five. All right, five out of five, and this tax strategy applies to all the business owners, okay? Now, your state may not have the PTET, but most states do. Let me explain to you what is a pass-through entity taxation. It's been about uh what, eight years now that we have this, and I am surprised to find out some business owners still do not use PTET. And when we enroll new clients for tax advisory, we still recommend this as a tax strategy and we save them a lot of money on taxes. Now, what is a PTET? Just want to take you through a background a little bit. When Tax Cuts and Jobs Act was uh passed into law in 2017, they put a limitation on sold, which is state and local tax of$10,000. That means that if you had a business income or a personal income or a portfolio income and you paid state income taxes on that income, the state income taxes were fully deductible before. But now there was a limit of$10,000. So a quick example: let's say you have a business profit of a million dollars, you have a W-2 salary between you and your spouse of$240,000, total income was$1.2 million, right? We're just gonna round it up. So on a$1.2 million you paid if your state has a 6% state income tax, I'm assuming in my example, 6%,$74,000 in state income taxes on the money that you earned, plus let's assume that you paid$10,000 in property taxes. Total tax is$84,000. Only$10,000 was deductible. Okay, that was a new limit. That was a big no-no for a lot of states because a lot of states said, wait a second, I don't understand. Uh how could you not allow our constituents not to deduct this when you allowed it before? So they came up with this genius, clever idea, and they said, We're gonna create what's called PTET, pass-through entity tax. If you have an S corporation or an LLC, which are considered pass-through entities, you can pay a voluntary business tax and get a credit for personal taxes. So the way it would work is that the state tax on a million dollars, right? Because that's a business profit, let's say it's 6%,$60,000 would now be a business deduction. And you will not pay state personal taxes on it because you will get a credit. So basically, you're still paying the state taxes, but you're paying it as a business tax. A lot of accountants, for for the life of me, I have no idea what why they still don't do it for their clients. Because some states require you to raise your hand and say, I elect to do this. For example, New York State and Michigan, you have to file, they have a hard-led deadline to file an election every year before March 15th. I think California, you make an election with your estimated tax payment till June 15th. Every state is different. So you've got to speak to your tax advisor, be like, hey, does this apply to my state? By the way, if you live in a tax-free state such as Florida, for example, this obviously doesn't apply to you because there is no state tax, okay? But most states have adapted this and now it becomes a huge tax deduction in 2026. With an effect of one big beautiful bill, okay, we now have a um sole deduction of$40,000. Actually, I'm not sure at this point, I have to look it up. Should have been better at this, right? If$40,000 is applicable to 2025 or 2026, I can look it up and get back to you. Well, I'll probably put a pin a comment uh on the bottom, but the limit is now forty thousand dollars. That means, okay, that on your personal taxes, if you paid a total of$84,000 off your state income taxes, okay, you can still only deduct$40,000. So does the PTET strategy still make sense for you? Yes, now more than ever. You might be asking, why boys? The limit went up. I st I will still make all my clients pay PTET because they're gonna get a credit for it. If they do not qualify for itemized deductions, who cares? Because they have a standard deduction if they're married of$32,200. If anything, it's like a legal double dipping, okay? So again, obviously it's a strategy, calculations involved in the back. We do this for our clients all the time. I mean, I do this strategy for myself. So this is an absolutely killer tax strategy for you in your business. Speak to your tax advisor. If you do not have a tax advisor, you are overpaying in taxes. Let me say it again. If you do not have a tax advisor, you are overpaying in taxes. So speak to your tax advisor. I just spoke actually to a business owner yesterday, a big manufacturing company. They do gross sales of about$50 million. And I said, Why are you on the call today? And he said, We want to be a lot more proactive than we were in the past. And this is the beginning of the year. I'm like, wow, right? This is one of the few business owners that actually consciously makes a decision to be proactive, not in the month of November or December, but earlier in the year. That should be you. Get yourself a tax strategy, get yourself a tax planner, and use tax strategies like this to pay less in taxes. I'll see you next time.

SPEAKER_01 21:12

That's it for today's episode. Be sure to check out the description below for some free tax reduction resources that Boris put together for you. If you're ready to work with a tax advisor on your tax planning, be sure to schedule your call by heading over to www.taxplanningcall.com. That's www.taxplanningcall.com. And be sure to subscribe to our podcast to be notified when the next strategy is released.