Nuts and Bolts of Running Your Small Business Wealth Management Jason Arsenault

You started your business to create a livable income but it seems that any extra money you create goes to taxes. This is whether you are a pass-through entity where the top tax rate is a whopping 37%, or a C-Corp where you get taxed 21% at the business level and then again at personal and dividend rates. We are talking about your federal obligation and haven’t even included what money you are going to owe for state and local taxes. It is safe to say that your taxes are quickly becoming your biggest expense. It is time to start rethinking what Wealth Management means.

Most of us do our planning for Wealth Management with extra money we have accumulated after all these federal, state, and local taxes. What we need to start doing is handling our Wealth Management with business money. The idea is to take our pretax dollars (the ones you haven’t given to the IRS yet) instead of your after-tax dollars (the smaller amount because you have given them away to the IRS). That means you are giving away your money to the IRS every time you spend after-tax dollars when you could have used pre-tax dollars. So, lets talk about some ways we can start spending those valuable pre-tax dollars.

First, make sure you are working with the right Certified Public Accountant. The General Accounting Office was created by our government, and they estimate we over-pay our taxes each year by a billion dollars. These are due to the mistakes being made on your tax returns. You want to find a CPA who is staying up-to-date with training and has a vast knowledge of the tax code. The time to sit down with your accountant isn’t when you take in your information at the end of the year, but instead someone you have several interactions with throughout the year.

Your plan should include how much you are going to pay in taxes, not some number you feel you have no control over. Therefore, you want to create a full tax strategy that stays within the law and best utilizes those pre-tax dollars. Another benefit of doing tax planning and being proactive is you are going to be lowering your risk of being audited. When you are using a tax plan, you are paying attention to your tax issues and constantly reviewing, which translates into detailed documentation.

Tax plans can become very creative. It is always a good idea to explore income shifting to later tax years or to lower income brackets. If you haven’t thought about employing your children, this is something you should consider. Have your business establish separate entities for your assets if they are purchasing things like capital equipment and real estate. Review your business entity formation to see if you could be saving more money if you changed to something else. Most importantly you want to make sure you are exploring all your options with your CPA.

Art123 Gallery 123 West Coal Avenue, Gallup, NM 87301 505-488-2136 Hours: Monday-Friday 1:00pm - 5:00pm Saturday 12:00pm - 4:00pm

The largest ever show of student work will include artworks ranging from preschool students, who will be sharing their embroidery and sewing work, to mid and high school students, who will be showing their self-portraits and other amazing works of art. This work comes from 14 schools, 15 teachers, and 200 students who will participate from across McKinley County. Some schools are returning and will have participated in all 5 years of shows, and other schools are entering their first show. New this year are two charter schools and home schooled students, but what you will see is the same high quality and originality of the artwork and many styles and media. The 5th Annual Youth Art Show is held in March to coincide with National Youth Art Month, and the opening is on the first ArtsCrawl of the season. gallupARTS is proud to help recognize the hard-working

teachers and their students who bring out the creativity in the students in McKinley County. Please come out and see their work on opening night on March 9th and any time throughout the show dates which is March 9th – April 10th.

Breakfast hours: 6am-10am Saturday & Sunday 7am - 11am Dinner hours: 5pm-10pm 505-722-9600