On this Podcast we answer listener questions! If you have a question you would like discussed on a future episode, submit it now!

1. Go to www.TaxSavingsPodcsat.com
2. Click Podcast 
3. Scroll to the Bottom and Submit Your Question

You never know, your question may be on the next Q&A session. Below are today’s questions, tune into our Podcast to hear the answers!

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Liu: A friend of mine owns a business in another state. The business (S-Corp) was run smoothly by the general manager. In years, he never paid himself the owner’s salary but only took dividends. He has another full-time job as a software developer. His accountant warned him that the IRS won’t like it, and he should go with the 60/40 rule. My friend thinks it is nuts since he spent no time on the business. I listened to many podcasts, but this topic was never addressed. Can you shed some light on this? 

Listener from San Diego, CA: I have two small businesses. One with employees in which we offer a simple IRA. Another side hustle in which my spouse and I are on payroll. We take a small salary and it’s an S corp. My question: can I start a solo401 k in my side hustle without breaking control group rules. Thanks so much

Eric: Just listened to this podcast- thank you! I am wondering about a membership at LifeFitness that offers the business offices/ meeting suites to their gym membership.

Facebook Group Member Heather: I have been paying my teen salary from sole proprietor llc and not having to pay taxes on but this summer he is getting w2 part time internship for 2 months. Do I need to adjust his taxes from business pay to amend taxes now and pay fica ect. He may still be under federal filing limit at year end as he won’t work both jobs at same time. 

Listener from Edgartown, MA: Enjoying your podcast. Q. I have a solo 401k and just created a solo 401k for my wife sole prop. What are my contribution options to fund both accounts?

Sharon: Hi! I have a question. As part of the service we offer, our accounting firm first handles basic line by line bookkeeping. We receive a bank statement and just go through each transaction line categorizing the expense to fill out a P&L. Is there a program that exists yet where this can be done automatically by a computer? I can’t imagine huge corporations like Walmart and Amazon where they have thousands of transactions a day and they just have people sitting putting everything in manually item by item. I’m wondering if a program like that exists that could help my firm free up some time in the workload. Thank you!

Listener from Lincoln, NE: You said that single member LLC’s are disregarded and don’t need an accountable plan. What about husband and wife owned LLC. I am recently married and my wife and I are starting a business together. We both have other businesses but won’t be combining them. We have an LLC together. I’m assuming we’ll do an s-corp election once we start making money next year. Thanks!

Facebook Group Member Christina: I’m a bookkeeper and have a client that sometimes buys furniture for her business off of FB Marketplace. Obviously these transactions don’t come with receipts. Does anyone know if this becomes a problem during an audit from the IRS, or if there’s a good way to prove the sale that I’m not thinking of?

Nakia: Can a Pastor reduce Self Employed taxes with expenses such as mileage, uniform, etc? Thank youl

John: Can you do a podcast on passive income ideas. Real Estate is easy, oil and gas is kinda know, maybe other ideas? Like LP funds maybe.

Anonymous Facebook Group Member: Dumb question but when setting aside taxes do I set aside taxes of the gross amount made or profit margin? Ex. I’ve made 535 in gross sales..but after paying for material I’ve only made 262. There is obviously quite a large difference between setting aside 30% of 535 versus 30% of 262.

Daron:  I run an S corp and pay my kids therefore through a family management company. Question: what is a reasonable fee to charge my s-corp for managing and scheduling my kids’ hours? What are some things I can deduct to offset some of this sole proprietor income? (I have been charging about 10% of their wages)