Your Money, Your Rules | Financial Planning, Budgeting, Scarcity Mindset, Financial Freedom, Online Business

91 | CPA vs. Enrolled Agent: What's the Difference? (with Tanya Akimenko)

• Erin Gray | Financial Coach, Former Certified Financial Planner and CFO

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Do you feel overwhelmed when it comes to your taxes? 

In this episode, I sit down with Tanya Akimenko, founder of Golden Apple Agency, to discuss the essentials of taxes, bookkeeping, and how entrepreneurs can develop a healthier relationship with their finances. Tanya, along with her team of finance experts, helps business owners understand taxes, gain financial clarity, and stay audit-ready through smart tax strategies and best practice bookkeeping-empowering them to make better financial decisions for their businesses 

Key topics mentioned in this episode:

  • CPA vs. Enrolled Agent: What's the Difference? 
  • Top Questions to Ask Before You Hire an Accountant
  • How to Find the Right Accountant When You "Don’t Know What You Don’t Know" 
  • Business Entity Structures and Tax Implications


Resources Mentioned:

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Erin

Erin Gray:

Do you feel overwhelmed when it comes to taxes? Are you tired of avoiding your books like the plague? I want to say that you aren't the only one. This week on the podcast, I invited Tanya Akimenko, founder of Golden Apple Agency, to share what she experiences with her clients and their businesses. Tanya leads a team of business finance experts dedicated to helping entrepreneurs understand taxes, achieve financial clarity and stay audit ready through smart tax strategies and best practice bookkeeping, empowering them to make better financial decisions for their businesses. Can I get a yes, please? We need more of her in the world.

Erin Gray:

We discuss what's the difference between a CPA and an enrolled agent the top three things. You need to be asking an accountant before you hire them how to make taxes and bookkeeping more fun, because you know me, I believe that money and taxes and business could be more fun. Do you want to create a system to stop avoiding your money? Maybe you're feeling guilt and shame when it comes to finances. Welcome to your Money, your Rules.

Erin Gray:

I'm Erin, a former certified financial planner and CFO, and yet I used to avoid my money and had fear, no matter how much we had. I can't wait to teach you how I overcame my money avoidance and started consistently managing my finances in a really simple way. It's time to get comfortable with money Before we get started. If you're ready to go deeper into transforming your relationship with money, to stop avoiding it, to start managing it and really create a financial plan that actually feels aligned for you and your family, with your values, let's work together one-on-one. You can schedule a call with me at generatealifewelllivedcom. Click on the link work with me and then support and mentoring. Schedule a call and we can make money work for you versus feeling like it's working against you. Thank you everyone for being here and, tanya, thank you for coming on and sharing your knowledge with us.

Tanya Akimenko:

Thanks for having me Okay.

Erin Gray:

So let's talk a little bit about what is the difference between a CPA and an enrolled agent.

Tanya Akimenko:

Well, a CPA was what everyone knows. It's the more traditional. The CPAs are licensed at the state level, so the state that they're in is the one who monitors their education, monitors their licensing and things like that. But an enrolled agent is licensed on the federal level, so the IRS actually monitors their education, makes sure all of their education is about taxes and basically a CPA most likely works within just that state. They could be working in like next door states, but they work within their state, versus an enrolled agent works with any state because every state recognizes the enrolled agent but not each other as a CPA.

Erin Gray:

So with a CPA they typically go to school like four years and then they sit for their CPA exam and maybe they have to have time in motion. What is it like for an enrolled agent?

Tanya Akimenko:

So pretty much the same thing. You just sit in for a different test.

Erin Gray:

Okay.

Tanya Akimenko:

And then you don't have to have working under another CPA, so that's out. But you pretty much sit in for the same test, the CPAs test. They'll have like two or three questions about taxes. Most of their tests focuses on the general accounting accepted principles versus the EA. All of their questions is tax basis and about taxes.

Erin Gray:

Okay. So if you're looking for an accountant because this has been so many women have said this to me is that they either have not been pleased with their accountant that's probably been the or they can't find one that they really like and enjoy working with. And so what would you suggest? If you're going to look for an accountant, what are some questions to ask them? And, like what you have seen working with clients that have come to you, what would be some of your suggestions to ask them? Ask the accountant that you're working with and you know to support you in your business.

Tanya Akimenko:

Yeah. So I think even with me, like when new accountant, when new clients come in, I do ask them what they liked and what they didn't like about working with their previous account and honestly, the number one complaint I get is the communication part is and I understand from the accountant's perspective, because we have so many taxes, especially during tax season, it is hard for us to call back everybody. You know in one day like we would literally not do get any work done. But I think the most important part is set up the know, the expectations of how you communicate. Is it through their client portal, is it by emails Like what's the best way to reach your accountant and what's the expectancy Like? For example, during the non-tax season time we usually get back to you within one or two business days. However, during the taxes it's more like three to five, and that's just. You know just because of taxes. So know what the expectancy is and based on what services you're getting a lot of times.

Tanya Akimenko:

So this is the second one. So the first time is communication expectation. The second one is what services am I actually receiving? Because you go in there you don't even know what you need or you assume your accountant is doing it. But unless you have like an engagement letter which is really just a contract between the two of you, you need to know what services you're receiving, because a lot of times people are like, oh, I thought my accountant did it, but they didn't do this. Well, that wasn't part of the agreement. And a lot of times people just sign up with an accountant most of the time because it's tax season and they need to get their taxes done, so they're not really looking into what all the services are actually being provided. And I think as long as the accountant has some general knowledge of your industry because each industry works a little different and if someone does not know your industry, it's kind of it's going to be harder for you to work with them- yeah.

Erin Gray:

Okay, I want to go back to the second point of, because a lot of women have also told me like I don't know what I don't know, so how do you even know the questions? I mean, I think business is a lot of learning by doing and messing up, or you know, learning from from our experience. But like how can we, if we don't know what are the questions that we would even ask your potential accountant that they do or don't do, because you don't even know what is required or what your previous, if you're not aware of what your previous accountant is doing, how do you, how do you start there and ask like I don't even know what I don't know?

Tanya Akimenko:

Yeah. So that's actually really simple, because you don't know what to even ask for. You just say what are the 10 most important things that a business owner needs to be doing? What?

Tanya Akimenko:

do I need to be doing and that's actually I'm going gonna say 99% of my initial consultations is the is the business owner. They're like what do I need to do? Give me, give it to me in layman's terms so I know step one, step two, step three and you know all the way to step 10 or 20, whatever. So that's really the question that you need to ask what is it that I need to do as a business owner and a good tax account or a good accountant in general who works with business owners, because a lot of people focus on personal. You also want, if you own a business, find someone who focuses on business clients, because those are two different aspects of each one. So a good accountant will be easily able to tell you all the steps in one second. You have to research them.

Erin Gray:

Um, and then with the um, you and I talked about this before, about how we make money emotional, and so you made the comment like, okay, well, a lot of people look for accountant during tax season, which, ladies, if you're doing this, no shame. And also like, let's back it up a bit, like you want to be looking for an accountant, like in July or something like that, to give yourself time to interview several people, to really I call it like ride your way to like, feel into like who do you actually jive with and then that way you can get started. Versus taxes are due depending on what class you're in, you know, either March 15th or you know, but you know having that, having that relationship with your, your business, your books, your money and a lot of times women avoid that and also understanding, is your person a tax prep person or do they actually help you plan? So can you dive into that a little bit as well?

Tanya Akimenko:

Yes. So a lot of people and like a lot of our education is so focused on compliance that when we start our own businesses and this goes for everyone EAs, cpas, just a regular account without any letters behind their name. They were so trained and focused on being compliant and that's like recording the history that not very many people are like hey, what can we do different to save taxes, to save money on taxes, to make sure the business is actually profitable and things like that. So when you're hiring an accountant and you're right, you do need to make sure you have enough time at least have a conversation, maybe not specifically the accountant, but at least an admin that does their communication, so you get a sense of what it's like to work with that office. Because a lot of times to talk to an accountant you do need to pay a consultation fee, so just which might be worth it.

Erin Gray:

I say I vote for paying the consultation fee for everyone listening. It's worth it, you know, because it's you are right, I do think, if you're okay with me chiming in here, I do think it's super important is like pay that, because number one working with like you're building your business or growing your business and you want to grow it with someone that you enjoy and I truly believe in paying for people. When I say smarter than us, I don't I just mean that they've got more um years of wisdom in their expertise, and taxes is one of those things. So surround yourself with people that are wise in their industries. I think it will like reward you 10, a hundred fold.

Tanya Akimenko:

Yeah. But also you get to discover a lot of things in the consultation like this you know, get your, first of all, get your questions answered, but also really see if the accountant is able to answer them on the spot for you. And this comes into play if they know your industry and they don't have to say, well, I'm not sure I need to check, and tax laws change. Sometimes we do need to say I'm not sure I need to double check because literally tax laws change every year, so we do have to keep up to date. But, like what I do for consultations is I give them credit on their next invoice, so the consultation comes out to be free. But you're right, I would agree with you A consultation is important.

Erin Gray:

Yeah, it really is there. There was when I used to, you know, work in my family's construction business, our CPA. She ended up leaving and going working for like a major electrical contractor, so we had to get another one, no-transcript. One of the things that I had to ask was are you going to be the person that's actually working with our taxes or are you going to have someone that's, when I say, younger, newer in the business doing the taxes, which is fine, and also, like I think those are questions to know and understand, because if I'm paying the rate and you're having someone else do it and I'm having to teach them, I don't know if I necessarily agree with that.

Erin Gray:

So, really, you know, asking some of those questions like who's going to be looking at my tax return? Who's going to be doing it? Who's my point of contact person, just deep diving some of those asking some of those questions because I mean, ideally you would want to work with someone for an extended period of time in your business and grow with them and knowing how they run their practice, how they are, and, like Tanya saying, you know, like, can they answer the questions? Because an accountant, just because they've passed the exam doesn't mean they have had experience in your industry and that also can cost you I guess is a way to say it right If they aren't aware. That's true, yeah.

Tanya Akimenko:

And actually it's a good thing that you brought that up is to ask am I actually going to be working with you? Because a lot of times like, for example, I'm just going to talk about me, like I obviously own my own tax agency but I have 10 accountants who work under me and then I review their work constantly, so I don't communicate with clients. They're not my point of contact because I'm overseeing my 10 accountants who are doing, but each accountant I focus on specializing in a particular industry. So when we get a new client, the initial consultation is always with me, so I know who to best fit them with. As far as, like, the daily communication, because in reality it can't be just one person you know, so their direct accountant is the one that's reviewing. That's constant communication and things like that. But then if I need to step in, I'm always available and I'm reviewing overall their work.

Erin Gray:

Yeah.

Tanya Akimenko:

So ask the question am I going to be working with you? Or the other question is like where are you outsourcing this to India?

Erin Gray:

That is very, that's a very good one too, because my previous CPA I got a letter. This was in 2024. I got a letter and he said it wasn't even a phone call, which, okay, I don't expect you to call and also like here we go back to like where's the relationship, you know? And yeah, it was basically sign this form, we're outsourcing and I was like I am not signing this form and I am not working with you anymore. Thank you very much.

Tanya Akimenko:

You know, um and I'm against outsourcing because that's like your personal information, that's like social security. Birthdays, I mean bank accounts, everything. So for me everything's in house. Yeah.

Erin Gray:

Yes, I think. Also too, do you think that there are accountants that are and I know we're speculating, but just to allow the listener to understand the reason why they're so busy is because they're just doing taxes, which is almost kind of like a I don't want to say a churn and burn, but it is. I mean, you have to do so many taxes to create a certain amount of income versus having more. Like, what you do is that holistic planning that yes, you're doing taxes, but you're also providing financial advice throughout the year. So you're maybe not having and you have obviously 10 other people to help, but you're not having them to have that pressure of doing so many tax returns because you actually have more of a different business model.

Tanya Akimenko:

That's actually true because we do focus more on a relationship with the customer versus people who just do tax prep and they'll hire like part time assistants and things like that through you know per tax year, where your file might be done by just an assistant, you know, but the tax account reviews it with you or whatever. So yes, I think most tax preparation businesses just focus on taxes. A lot of times they say they don't do the bookkeeping, you have to find someone else. But we do both bookkeeping and taxes because they kind of go hand in hand. And back to the planning like our bookkeeping clients, we actually sit down and review what their plan is for taxes coming in the upcoming year.

Erin Gray:

So like that's our summer. We do tax planning during our summer. I love that and I love that you said bookkeeping because I I am consider myself self-taught in QuickBooks, like I learned by fire hose, um, and diving into franchise tax and just so many things, and there were times where I had questions around book, specific QuickBooks questions, and I would ask our accountant and she wouldn't. She's like I don't, I don't know, and so that I think that's another fallacy that people think that your accountant knows bookkeeping and that's not necessarily the case, right?

Tanya Akimenko:

That is correct. That's not necessarily the case right, that is correct.

Erin Gray:

That's not necessarily the case. And so you know, finding either having, like what Tanya does, finding someone that does the bookkeeping for you and also your taxes and planning, tax planning, or finding a really good bookkeeper and then finding, you know, someone that does the tax planning, because I think QuickBooks is an entirely different language and I think when you're starting out, sometimes, I mean sometimes I'm just like, keep it simple. As you grow, yes, do the QuickBooks and depending on what grow equals right, but, like, for some people, it's just like, just get your Excel spreadsheet set up and just do that on a consistent basis. And Tanya's laughing at me for those of you listening. But Tanya's laughing because I think we, what we're trying to really do is build the habit. Right, we're building, we're building the habit of and and I've heard this from so many CPAs and I'm like what are you joking with me?

Erin Gray:

But they're not. They're like my clients will come in with a shoe box of like receipts or like, and I'm like, no, you're kidding. And they're like, no, we're not. And so I would rather someone just have an Excel sheet. Even though it's not fancy, at least you've got income expenses, where stuff went, so that you can actually sit down and do this, versus try to do QuickBooks and then you don't stay with it and you, you're still where you are when you got started you don't stay with it and you, you're still where you are when you got started.

Tanya Akimenko:

yeah, and I'm gonna just add to that quickbooks, um, you know people start with good intentions, yes, but it can get hard and then you pull a report and nothing matches because your transactions are not categorized correctly and then they give up. But quickbooks is also, especially when you're starting out. It could be an expensive expense that you don't really need. I was laughing at spreadsheets because I love spreadsheets and I honestly think that everyone should start out with a spreadsheet.

Erin Gray:

It's, you know, the easiest to use and it helps you build habits of, you know, doing your books, designating some time to get it done, and yeah, I love that you said I love spreadsheets, because one of the things that I told Tanya before we hit record I was like how can we make this more fun for people? Because obviously the work I do is with women and like how they feel about money and one of the things that they will say is like I just need a system. And I'm like, yes, and there's plenty of systems already out there. The reason why you're not using the system is because how you feel when you either look at your numbers or just around money or what taxes mean, and so how, how do you suggest we make taxes more fun? I mean, it's obviously how we think and feel, but like what are some suggestions that you might have?

Tanya Akimenko:

I said, I'm going to have to agree with you on the whole emotional part. I've seen like I've been doing this for 20 years and I've got to say that every financial decision is an emotional decision. So, no matter what the logic is behind it, everything is back to that emotional state. And how do you make it fun? I think it really depends on like more of your personality. But what I've noticed, that is, if you set a ridiculous goal for yourself, like way out there, so unattainable, so ridiculous, you know, and then you're like, well, how much can I actually achieve of it? You know, not necessarily knowing that you'll achieve it, but more of like, well, what if? Well, it's not going to work if I don't try it, but what?

Erin Gray:

if yeah, it's like the releasing the pressure I think there's already so much pressure that we put on ourselves when we start a business. And versus like, let's just like, I always just say like fuck it, let's just see what happens Right. Versus it has to like I have to make this, this amount. I mean I like the way Tanya's thinking of like what if it? If it shuts you down and it really like rattles your nervous system? Okay, well then check back in with your body. But like what if it could be like that? Like what, what would I try? I think that's where the lid gets to come off and the creativity can be like well, what would I try if that's what I was going to do?

Erin Gray:

In terms of like taxes, do you see people avoiding doing taxes because of their relationship with money and I guess the word tat like we've. I think as a society we've made taxes not a fun thing. Versus like look at how far I've come. Like it's just numbers, it's literally math and we get to be like look at how far I've come, look at how I've grown, look what I've learned.

Tanya Akimenko:

Yeah. So the whole thing about taxes is, I always say taxes, no matter where you live. It's a subscription you paid for the country you live in. It's a privilege? Yeah, it is a privilege, and you know, of course every country has its issues, but I still think the US is still the best, you know. Still, with all of our issues, it's still the best.

Tanya Akimenko:

Yeah, so if I think the most, the reason why most people are scared of taxes is because, simply, they don't know. They don't know how much money they made, they don't know how much taxes they owe. They're not prepared and a lot of times they'll file an extension just because they don't want to deal with it. And I have so many customers who are calling after the extension is up. Can I get a second extension? No, there's no extension. So a lot of people just don't want to deal with it, and I think it's because we make it complicated for ourselves.

Tanya Akimenko:

Hence the spreadsheet. What's my income and expenses? You know, use two different spreadsheets, so you're only using two columns instead of. You know, multiple columns, multiple calculations, use multiple spreadsheets, if that's what makes it easier for you To actually want to do it, whether that be setting up a time once a week, once a month. You know the you do it once a week, it's going to take shorter amount of time. If you're doing once a month longer, you're doing it once a year, it's going to take days. And that's where the anxiety comes in. The emotional draining comes in is because you're like, oh my gosh, I have to sit down and do math for the next three days to see where I'm at.

Erin Gray:

Yeah, I always say like money dates, and I and I mean this goes back to like you may not get, you may not go from avoiding your money, to be like let me grab my favorite latte and sit down and do my numbers, okay, so that it doesn't happen overnight like that. But I do recommend more often in the beginning because of a couple reasons. One, you're building up the habit of like you're the CEO that sits down and looks at her numbers and numbers are important to her and running her business. And two, like what Tanya is saying, the more you do it, it takes 30 minutes to look at your numbers every week, as opposed to I'm three months behind and I have to.

Erin Gray:

It's like the dread, right. It's like and I would always get curious of like the procrastination is resistance and it's like showing you like what am I, what am I afraid of looking at. So if we could look at it from a compassionate and curiosity lens versus a judgment of like, here I am again. I'm not doing it, which a lot of women do, I think, right, like so much shame and guilt of like, here we are again. Why didn't you? You know, you said you weren't going to do this and here you are. It's like you know what. That's what happens until we become the person that just sits down and looks at our books. I wanted to ask do you have a lot of clients that wait till the very end? Because I think this is really important, because there's a lot of women that don't share this and I think there's a lot of women that experience this.

Tanya Akimenko:

You know what Actually I do and they do feel guilty. You know they would come over and they're like sometimes I have. So I deal with IRS issues too. So we do a lot of IRS resolution cases, meaning like they own money or they haven't filed their taxes and I've had like grown adults cry because they haven't. They couldn't force themselves to sit down and do their taxes and it's been like 10 years. You know. Now they can't buy a house, they can't really put their kids through college, nothing because of all those unfiled taxes.

Tanya Akimenko:

And what I think the emotional part comes in is like we really should just be nice to ourselves. Yeah, imagine the stuff we say to ourselves. We say to somebody else, like that'd be ridiculous. So we really should just be nice to ourselves and give ourselves that grace and like, hey, it's okay. Well, we're here now and let's focus on the now and let's get it done. And that's what I tell my customers who haven't filed their taxes or like super late, or calling you know 10 days or a day before the extension is due, asking for a second extension. Guys, it's okay, what do you have now? Let's focus on the now. Let's get it done as much as we can now you know. But yeah, definitely be nice to yourself. No shame.

Erin Gray:

There's a lot of women that do that and I mean, I used to my story with money was different, in the sense of like I I mean I think also to our relationship with money is just a mirror of our relationship with ourselves. Um, you know, I used to always think like whatever we were saving and having, it wasn't enough. It was always needed to be more. It was, it was all around this like not good enough, um, and so I would avoid our money and looking at stuff because I was like it's not, it's never. You know, it would be stressful to me because I would think it's not enough, you know. And so we have a lot of, there's a lot of women that have shame and guilt. Like that is probably the number one. Two, and then fear is probably the third emotion that they feel when it comes to money.

Tanya Akimenko:

And fear comes from not knowing. Yes, because you're not, you're not wanting to look, you know. And then then you have the fear like, oh well, I don't know.

Erin Gray:

Yeah. So I mean without giving information about your clients. I mean, is this, is this something that happens with women in their business who are just starting out, and they've been in business for 10 plus years? Do you see, like it it? It doesn't have a an age of business that does not?

Tanya Akimenko:

right, yeah, yeah, it happens like at any time and sometimes you might have a good year and you're okay, but then you know we can't keep our business separate from our personal life and something could happen on the personal side that will affect you on your business and how you deal with money and things like that. And again you just have to, you really have to just be nice to yourself and allow yourself space, so like, if something personally does happen, we'll allow yourself, you know, the space to not do it because you can't. And then you know, come back to when you can schedule it. I always schedule things and I'm like, okay, I'll think about this later. And then when all these thoughts creep in, I'm like, no, no, no, I have it on my schedule to think about it later.

Erin Gray:

I love that because that's for me. That's like my mind constantly goes, and so I've just started to put things on my calendar and when my mind like goes crazy, I'm like, no, no, like exactly what you're saying. It's on the calendar, we're going to look at it when it's you know when the bell rings for it to come up there. I love that trick.

Erin Gray:

Yeah so, and I also say putting putting your book, sitting down with yourself as the CEO, on your calendar, because then you get to get curious what did your brain tell you was more important than sitting down with your numbers, or what were you feeling that you were avoiding sitting down and looking at your numbers? And then that's, that's like what Tanya saying, like being nice to yourself, like we can make change. I used to be like beat myself up to make change, but now I'm like, okay, be compassionate to make change, and it just there's no right way, right, it's just it feels better in the body when I'm like, hey Aaron, what's going on here? Versus why didn't you do this? You said you were going to, and just you know, berate myself.

Tanya Akimenko:

Yeah, but this way you can also learn your own patterns. You know, yeah, so like one of my things I do more work, better work, faster work in the morning, so in the evening I'm just done. Like you can't convince me to do anything. You know so, and then, if you put it on your calendar, you will recognize the pattern.

Erin Gray:

Yes, absolutely yeah, and when you like to work, that's really good Cause I like to do it either Mondays or Fridays. It typically is it's always on Mondays, but sometimes I do it on Fridays and that's just when I like to do it and it feels good. And I grabbed my favorite tea and I sit down and I take a look, see and um. And I wanted to ask you too, because a lot of women say I don't know what I don't know which we already talked about and also, what can I write off? And by write off, what I think they mean is what can I expense, or what expense can I use to lessen my income?

Tanya Akimenko:

Yeah. So that's actually a very, very question that gets brought up all the time, especially people who just start a business. Like I can't tell you how many people sat across from me and they're like, oh yeah, I started my business and I got this much income. I'm like, okay, what are your expenses? And they're like, oh, I didn't have any business expenses. And I'm like, no, no, no, you had a business, you have business expenses. And a lot of times people just focus so much or they're scared of the IRS. Oh, IRS is going to come after me. That's the other fear. But in reality that's not the case. You know, you do have legitimate business expenses, even though you might think that's not really a business expense, and actually put a list together and kind of like included in out of the box, thinking there's just 10 of them, although that's not all the business expenses, but it kind of gives you an idea of what can be tax deductible and kind of opens your mind to it.

Erin Gray:

Okay, we'll put that in the show notes. And that is a fear for a lot of women as well, and I think that that is done on purpose with our government. I think a lot of I'm so outside the box, like the way I think you know with like, why are they actually doing this? And I think you know people, people will make change because, like fear is a bigger motivator than you know desire and expansion, and there's been a lot of women that have said that to me, like I'm like what, what are you afraid of?

Erin Gray:

And it's like I'm afraid of being audited by the IRS and and it's almost like this big, scary monster. That's like you know, like when you were little and we thought that something lived underneath our bed or in our closet and we just didn't ever look at it and so it just kept getting bigger and bigger and bigger, and then finally we were like, okay, you know, mom or dad come in here with me and like, okay, there's nothing underneath there. I think that that's the way that we think about money. I think that's the way we think about taxes, the IRS, until it's like, oh, okay, going back to what Tanya said is like the knowledge part understanding and also I always think like we can always find someone to help us with whatever we're working through Right. Like so, let's say, you do get audited, okay, we can find someone that can help us.

Tanya Akimenko:

Like there's always a solution for something because audits are so emotional and because you're such an emotional state, you become an oversharer. So that's really important. People think they're like oh no, I don't want to hire because it's so expensive. But because you're so emotional during an audit, you know like I literally coach my clients before an audit and that's just because they don't know. You know not to like, avoid or whatever, but just because they don't know and they're going to overshare, they're going to tell them about their mother and their grandmother and everybody else and you're like no, stick to the facts.

Erin Gray:

It's like the law system. It's like you know, when you go in and you're like my husband's a big like I would never say anything, I would just lawyer up immediately and I'm like, really, he's like, yes, I'm not saying anything without someone telling me what I need to say.

Tanya Akimenko:

Yeah, I mean it is. Yeah, we become emotional, we overshare.

Erin Gray:

Yeah, totally. Is there anything else that you want to share or talk about that maybe we haven't discussed?

Tanya Akimenko:

I think before we talked, we were talking about the single most effective tax strategy. Okay, yeah, I did want to touch base on that, and what I've noticed is, no matter where your business is at, no matter what tax strategies you're using, but the most important, the most effective, is to make sure that you are being taxed in the correct entity. So a lot of people will just get an LLC, and what people don't understand the LLC is on the state level, so just think of it as a business name. It has nothing to do with your taxes. The LLC picks how it's going to get taxed. And that's the most common mistake is the LLC. You set up an LLC initially and you become a Schedule C so sole proprietor tax and you just continue and you're making more money and you need to switch entities, but you just continue because that's how it was set up. Oh my gosh.

Erin Gray:

I'm so glad you said this, because I was just thinking about can you please clarify for everyone, because I've even seen on YouTube that they say they're CPAs and they're like LLC or S corp. I'm like that's not an option, it's LLC. And then how do you want to be taxed? And I'm like how are the CPAs getting away with this? So Tanya is saying and what I have said before is I look at the LLC like an umbrella, like it. It can help you if you set it up and structure it correctly, like keeping your personal from your business expenses and income and things of that sort and a couple of other things. It's like that is your protection against should you get sued. Is that a fair way to say?

Erin Gray:

Yeah, that's more of attorney's question but yeah, but yeah, and then you have underneath, like what Tanya said is then you have do you want to be taxed as, like a sole proprietor or an S corp or a C corp or a partnership, and that is your taxable entity and it even says it on your uh, is it W nine? I'm like not 10, 99. What is it? W nine? Yeah, so on your W nine it'll, it says that. So I just want to clarify, because there's a lot of people that's like oh, I'm just an LLC. I'm like you're not at well, you are an LLC, but like, how are you taxed?

Erin Gray:

Yeah, and I've heard different. I actually sat down with an accountant and we actually like did actual numbers, cause a lot of times CPAs will be like oh, if you're at 50,000, is there? And I think a lot of CPAs say that. But I think it just depends on, like, a lot of other factors. But there is a, there is a break point where it makes sense to go from a sole proprietor to an S-corp. Would you agree with that statement?

Tanya Akimenko:

Oh yeah, there's definitely, because with an S-corp you have to be on payroll. Also, your kids will get social security taxed if you put them on payroll with an S-corp. Also, your kids will get social security taxed if you put them on payroll with an S-Corp. So there is no one particular number. But if you're just by yourself, I would say do not switch to an S-Corp unless you're making over $150,000 in gross income.

Erin Gray:

That's good You're probably the first accountant that's ever said that or enrolled agent or however we say it. But yeah, because I I have questioned other accountants and then I'm like 50 000 and then when you break it down, I'm like it doesn't really make much sense to go through all of that work every single week or two weeks. However, you want to do payroll and the extra compliance and the whatever um here you go back to like it's why it makes sense to sit down with either Tanya or someone else to like do the math to see what makes sense.

Tanya Akimenko:

Yeah, there's a lot of accountants out there who actually and I've had to switch them back because there's like a customer who made $50,000 gross income and then their net is like $10,000. And they're on an S corp and I'm like what, why? No, we're going to switch you back. And that's why the LLC is good is because you can't switch back and forth without changing your business and stuff.

Erin Gray:

Yeah, and can you do that and these? And when I ask Tonya these questions, this isn't like advice, for for you guys listening, it's more so just general advice. Obviously, speak with somebody, but with the LLC you can I know you can switch back. Can you switch? Also, you can also switch during the year as like a look back, so like if you went your entire year and you're like, whoa, I'm way over 150. I can, you could.

Tanya Akimenko:

So you can't go backward, you can't go backward, you can't go backward. That's why you have to tax plan. You can only move forward and you can switch the LLC structure every five years if you want to. Okay, so you can't be switching it every year either.

Erin Gray:

When I say switching it, I'm referring to if you're an S Corp and, sorry, if you're a sole proprietor and you wanted to go to an S Corp, could you do that during the year?

Tanya Akimenko:

so you initially have 75 days in the beginning of every year to actually request that request. Got it. If you do it in July, it's going to get effective the following year.

Erin Gray:

Got it Okay. Anything else that you want to say?

Tanya Akimenko:

I think we pretty much covered a lot of things. Yeah, If people want to know the tax deduction. Much covered a lot of things. Yeah, If people want to know the tax deduction. I also did create a do yourself business success, which just focuses on training Like even how to do a spreadsheet. Simplifies accounting. We use everyday language instead of the accounting I will.

Erin Gray:

Where can people find you? I'll put this in the show notes, but where can people reach out to you and learn more about you?

Tanya Akimenko:

Yeah, it's just on our website golden apple agency Inccom.

Erin Gray:

Okay perfect and I'll put that. I'm going to go and download that. Um, what would you call it Guide? Um, yeah, the cheat sheet. Yeah, and I love that you said layman's terms, because that's sometimes I'm like whoa, stop talking, break it down. Even you know more simpler um for us to understand it. So thank you, tanya, for being here.

Tanya Akimenko:

Thank, you for having me.

Erin Gray:

Did you learn something today? Do you know another female entrepreneur who might be avoiding her money? Will you send this episode over to her for me and, if you have it in you, please leave me a review for this podcast. It helps the show grow and I love hearing from you. See you next week.