71–80 of 143 posts
Earlier quoted context omitted.
Administration fee is less important than overall impact, which I assume is what people who worry about overhead actually care about. There are plenty of evaluators that skip worrying about overhead and get to them meat of the issue, how much does this charity help per dollar.
What's the difference? What portion of your dollar is neither "help" nor "overhead"?
Re-invest it in your business. Hire someone to help with SEO and SEM. Hire someone to write content like a blog. Find someone to manage your social media, moderate a discord and build community around your product. Spend (more) money on ads You aren't going to find a better investment. A well performing mutual fund might get you 10% a year. Something riskier could get you up to 15%. I'm willing to bet you can make mu…
1. If it's something you think is inherently short term (say it's about NFTs and you don't think they'll last) take a portion of the excess income and invest it elsewhere, even if its from the same corporate entity you'll be able to shift to multiple revenue streams.
2. Sometimes with these smaller opportunities it's more fun to just hyper-focus on making the most delightful experience possible, instead of squeezing out another 40% by optimizing SEO and user funnels. I know a couple people that ultimately built much larger companies because they started in something that was a labor of love before the market really even existed (e.g., a podcast app) so when the sea of people finally came they had the most polished offering. You said you didn't really want to focus on growing the company, so this is a happy middle way you could think about.
The next logical step would be assuring it stays that way. You are basically done creating and earning, you are defending and securing it now.
Get help from an accoutant to legally get as much money out of the company as cheap as possible, so you can diversify it. If you want to keep your money, you do not want to have all your eggs in one basket. Read up on personal finance and once you understand how these things work and believe in them, invest in world wide portfolio of stocks through ETFs.
Even if you do not want to invest further into your company, I would consider also switching modes there: How can you defend it? What are scenarios how you could lose it all? What happens if several failures happen at once? Say you are sick for two weeks, your employee wants to quit, but your server just got hacked. I would work on automation of critical routine tasks, failovers, security, backups and so on to make this thing as solid as possible.
If I were you, I would see myself as the most critical part: What if there is suddenly trouble with your family and you are unattentive for a few weeks or months? Can your business sustain that?
Only after I would have created a good level of confidence in all of the points above I would think more about what to actually do with the money. That's a good problem to have, which also requires creativity again, once you are sure it will actually stay there with reasonable probability.
Contact a tax advisor/accountant, ask them if you should elect s corp treatment, also ask what a reasonable salary draw is to avoid IRS tax evasion scrutiny. Defer to their advice over HN’s; they’re the tax/finance professional on the hook for given guidance.
If you get fined by the IRS for taking their advice, can you actually sue them for damages for being wrong?
Or if a lawyer gives bad legal advice, can you sue them?
I always thought the responsibility stayed with the person, even if they paid for professional advice.
If you have it as an LLC, any profits will pass through to you through your schedule C, and you will be taxed at regular income tax rates. Your accountant will help. But tax optimization can REALLY matter, and as a small business you have massive opportunities to very legally and ethically optimize your business and tax. Top of mind, what you should really consider is: a) setting up a 401K under the business to shelt…
Thank you!
Earlier quoted context omitted.
A million times this. Some randoms on a website are the last people you want to take financial advice from, especially when that financial advice could potentially lead to a very hefty tax bill and/or criminal charges.
Dumb advice. Tons of people here have been in the exact same position and the advice given is super standard.
Are you a solo owner? You need to take an s-corp election and you do not need to pay yourself that type of salary. At most you should pay yourself $54,000 a year. The reason is money that goes through an s-corp you don’t pay self employment taxes on. Salary you do. That is 15%. You wouldn’t need to pay yourself more than $54,000 without the government getting upset. Right now, based on $54,000 a month you are losing…
Are you saying that if you have an S-Corp, and not an LLC, any money the company makes past $54,000 annually is tax free?
Are you a solo owner? You need to take an s-corp election and you do not need to pay yourself that type of salary. At most you should pay yourself $54,000 a year. The reason is money that goes through an s-corp you don’t pay self employment taxes on. Salary you do. That is 15%. You wouldn’t need to pay yourself more than $54,000 without the government getting upset. Right now, based on $54,000 a month you are losing…
Are you saying that if you have an S-Corp, and not an LLC, any money the company makes past $54,000 annually is tax free?
Are you a solo owner? You need to take an s-corp election and you do not need to pay yourself that type of salary. At most you should pay yourself $54,000 a year. The reason is money that goes through an s-corp you don’t pay self employment taxes on. Salary you do. That is 15%. You wouldn’t need to pay yourself more than $54,000 without the government getting upset. Right now, based on $54,000 a month you are losing…
Are you saying that if you have an S-Corp, and not an LLC, any money the company makes past $54,000 annually is tax free?