GottaSellEmAll

Sales Manager

How can I avoid taxes?

95%+ of my annual income comes from my W2 as a high performing individual contributor. I hate that I feel so powerless to the tax man and the 30-40% of my check he is taking.

Are there any good ways to drastically lower my taxable income in a W2 scenario?

If I created a business on the side would there be a way for that business to lower my taxable W2 income or would it just reduce the income generated by the business? Honestly just looking for anything I can do.

I have a 401k but kind of don't like contributing because I plan to retire well before 65 and don't want money to be locked up. Same with an IRA.

Help!

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45 comments

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FattySnacks

Politicker

Senior Account Executive

Wild idea. Talk to a CPA.

funcoupons

WR Officer

👑

thats a crazy suggestion bro

GottaSellEmAll

Big Shot

Sales Manager

lol obviously. I just figured some of the high earners on here have some tips or things they've done

FattySnacks

Politicker

Senior Account Executive

Right. Random Internet forum won’t steer you wrong. Do you ask for medical advice here too 😂

GottaSellEmAll

Big Shot

Sales Manager

how did you know!?

Corpslovechild

Politicker

Inbound Sales Manager

Stop making sense. This is Bravado, we don't do that here.

SaaSam

Politicker

Account Executive

First, make friends with a decent but unknown artist.
Second, make friends with an art appraiser.

Buy a painting from your artist friend for a thousand bucks or so. He'll be happy and you'll be likely to get his best work.

Take the painting to your art appraisal friend, he does you a favor by appraising it at like 10k.

Donate that sumbitch to a charity.

10k tax write-off.

I'll be billing you for the advice.

GottaSellEmAll

Big Shot

Sales Manager

Where does one find art appraiser friends? Artist friends I already habe

SaaSam

Politicker

Account Executive

You're an AE. Do some prospecting. You've already got a good starting point if you have artist friends, time to do some networking.

Corpslovechild

Politicker

Inbound Sales Manager

Wait is this legit?

SaaSam

Politicker

Account Executive

Happens more often than you think.

Corpslovechild

Politicker

Inbound Sales Manager

Fuck I need more friends then.

SaaSam

Politicker

Account Executive

No, just the right ones.

RealPatrickBateman

Politicker

🔪Amateur Butcher🔪

Hop in a time machine back to 3000 BC. Stay there. Become a Pharaoh. COLLECT taxes. BOOM. Taxes avoided.

GottaSellEmAll

Big Shot

Sales Manager

Best idea yet

RealPatrickBateman

Politicker

🔪Amateur Butcher🔪

“I’m here to help”

washedD1soccer

Politicker

Regional Sales Manager

Set up an S corp LLC and get your company to pay you your wages as a 1099. Then, create a SEP IRA and get a CPA to help with write-offs. Put profits into real estate and other “non income” producing assets.

Hoopnip

Politicker

Commercial AE

Have you done this working for a tech company? I’ve always thought about this scenario but never actually tried proposing this to my employer….

washedD1soccer

Politicker

Regional Sales Manager

I haven’t done this, no. I’ve seen some others do it. Biggest obstacle in my opinion is not having health benefits. Having to go to the open market with kids would be expensive and not viable for me. If you had a spouse who could put you on their benefits that would be ideal.

Revenue_Rambo

Politicker

Director, Revenue Enablement

☝️This is really the only way to even start getting away from taxes. If you are in the US, register that business in Delaware (no income taxes, no sales taxes).

Pay yourself as an employee.

From there its all about maximizing revenue while reducing taxable business income.

Need a car? Buy it with the business.
Want to pay for your kids college? Put them on the payroll and write a corporate policy for tuition reimbursement.

Most important thing.... HIRE A CPA. Spend $1000 plus a year on them so that you can potentially save 10x that amount.

CuriousFox

WR Officer

🦊

You need an accountant.

ADudeBeingAGuy

Politicker

Account Executive

Step 1. Commit tax fraud
Step 2. Become ungovernable
Step 3. ????
Step 4. Profit

DungeonsNDemos

Big Shot

Rolling 20's all day

Step 2 is my favorite part

LordOfWar

Tycoon

Blow it up

GottaSellEmAll

Big Shot

Sales Manager

Lolol

SADNESSLieutenant

Politicker

Officer of ♥️

Also, Sell drugs

LordOfWar

Tycoon

Blow it up

I would kill to only have 40% of my pay taxed. The max rate here is 53.53%

*Cries Canadian maple tears*

unclespacejam

Politicker

ur dad’s brother

It’s fucking brutal. Don’t forget that 13% sales tax on everything you buy with your after-tax dollars

GottaSellEmAll

Big Shot

Sales Manager

Maybe I should stop complaining…

Account Executive

I am in Canada as well and pay the same tax rate however we get tax funded medical "free medical" for that 13% difference. Although it is more like going to the VA and is reactive medicine vs the proactive medical system in the USA private sector. *I lived in Seattle for 10 years until Covid and I would prefer the proactive medical than what we get here.

Sunbunny31

Politicker

Sr Sales Executive 🐰

You may intend to retire before the age of 65, but there's a good chance that may not happen, too.

I have never talked to anyone who regretted maxing out their 401(k).

However, considering you're legitimately trying to figure out tax fraud, you seem to be operating in a whole other level, so yeah. Honestly, the only way I've seen to not pay taxes is to be so obscenely wealthy the government throws money at you instead of demanding that you be a contributing member of society.

Talk to a tax professional.

ADudeBeingAGuy

Politicker

Account Executive

No no no, you’ve got this all wrong.

Be the government.
Steal other peoples money.
Give it to your friends.
Make policy that impacts publicly traded companies, know about it in advance, profit.

This is the way.

Corpslovechild

Politicker

Inbound Sales Manager

Everyone plans to retire well before 65 but that is just a plan. I hate to be THAT GUY but throw money into your 401K JUST IN CASE if your plan doesn't go peachy.

BmajoR

Arsonist

Account Executive

Have you heard of cheese?

Boutdamtime

Politicker

Client Executive

The entire point of a LLC is to separate your business ventures from your personal assets and to protect both from each.

If you are W2 there’s little chance you’ll be able to blur those lines.

Would you be willing to go to jail for your employer? Maybe, but I bet the price is high. Don’t expect a CPA to put their nuts on the line for $300 a year from you, just sayin.

That being said I’m told you don’t have to pay taxes if you break even with an LLC…

But I’m also 7 margaritas deep on cinco de mayo and dropped out of accounting class so…yeah maybe hire someone.

Hoopnip

Politicker

Commercial AE

If you’re married , have your spouse be a real estate broker / investor. Buy residential/ commercial properties and you can offset any expenses / depreciation off your ordinary income.

Troika

Opinionated

Enterprise Account Executive

I’m not married- can I buy the properties myself or does it have to be a spouse?

Hoopnip

Politicker

Commercial AE

Also the best way to avoid taxes is to just simply not file a tax return …ever. 😆 Much easier when you have your own business. W2 is almost impossible.

Justatitle

Big Shot

Account Executive

Do you know who Al Capone is? The US government jailed him for tax fraud… that should tell you everything you need to know about avoiding taxes

GottaSellEmAll

Big Shot

Sales Manager

Tax avoidance is 100% legal. Tax evasion is a different thing

Justatitle

Big Shot

Account Executive

To be clear I’m more so warning against shady practices that often tow the line of evasion and avoidance. My dad is a CPA and to this day he tells me the last people I ever want to deal with are from the IRS

Pachacuti

Politicker

They call me Daddy, Sales Daddy

Is there a Bravado for CPAs?

finboi

Notorious Answer

Fi-nance

W2 workers have little room to deduct.

I would push back on your 401k comment. That is one of the best ways to reduce your total taxes paid and it’s a great way to compound over time and plan for your retirement.

Max that out to the extent you can ($20,500 this year and $22,500 next year).

Seriously. Before starting to look at anything else I would focus here.

finboi

Notorious Answer

Fi-nance

And as others pointed out, talk to a CPA. A good one. Search around and find a trusted accountant. Little hack is to get a great CPA referrals talk to trust and estate attorneys or financial advisors/ wealth advisors at reputable firms. They all know good ones.

CRAG112

Valued Contributor

Account Executive

You could defer to pay taxes only at the end of the year.

The big issue with this is ensuring you can pay it when it is due.

However, this can mitigate the higher tax rates you get when you earn your commission. IRS sees this total number and assumes you make X per year.

So lets say you make 1k a week.
Now you have 5k this week --- higher taxes.

If you defer taxes you could pay a consistent rate and potentially save money. Of course, ensure the calculations come out and make sense before changing your W4 and such.

An accountant, CPA, whomever may be a good bet to consult with. Pay them their 150 or 300 bucks, go over your W2 and weekly statements, see what they come up with as a comparison to ensure you aren't missing anything.

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