Whether you’re a business owner or an individual taxpayer, our tips are designed to help you make the most of your finances.
Learn about IRS tax strategies, Section 179 benefits, and equipment financing, and how they can significantly reduce your tax bill. It’s time to keep more of what you’ve earned and invest wisely in your future.
It’s essential to consult with tax professionals for personalized advice, but understanding these principles can empower you to make informed financial decisions. Watch the full video to learn more about these game-changing tax strategies and take control of your financial future. Your business deserves it.
So today we’re going to find out how the IRS can actually help us save money. So 2023, you had a pretty decent year and you ended up with a taxable income of, let’s say, $200,000. So and also considering a tax rate of 20%, it’s probably going to be 21, 22, or 35, even depending on your situation. Again, it’s always good to consult with accounting professionals to double-check, but let’s you end up with a tax rate of 20%.
That means you’ve got to pay Uncle Sam a nice $40,000. So these $40,000 are going to go straight to the IRS. Now, let’s figure out how. That’s something that a lot of people know, how we can actually save money by buying a piece of equipment. So you go ahead and you put up an order for it through the you x-ray system for, let’s say, $100,000 right now.
If you follow a five-year linear depreciation, depreciation you’re going to have for 23, 24, 20, 25, 2000, 26, and then 2027. If it’s linear, $100,000 will be five. You have $20,000 a year. Okay. 20 came 2026 and the final 20 K of depreciation. 2027. Which means that in 2023, when you’re going to pay your taxes next year, your taxable income is going to be reduced $280,000 here, which then is going to be with a tax rate of 20%.
Your tax bill is going to be $36,000. Pretty straightforward. So with a leaner depreciation, 20, 24, 2023 taxes, it saved you $4,000 from 40000 to 36. All right, So let’s see what Section 179 is able to do is. Section 179 is a pretty cool feature of the tax code that no other people know about. With Section 179 allows for fast depreciation of an asset, and there are limits this year.
The limits $2,890,000. So if you buy your $100,000 true value in 2023, you are going to be able to fully depreciate that asset in 2023. So you’re going to take a depreciation of $100,000, bring your taxable income to income to $100,000. 100 grand, -200,000 minus the degree of depreciation is $100,000, which means which means check this out for cool.
This is your now your tax. You go from $40000 to $20000. So you basically the tax bill is going to be divided by half because you’re you were able to fully depreciate that acid in that same year – But it gets a little better. So let’s see that not only you buy your true value in 2023, like we discussed, but you’re also financing it.
The monthly fee for that finance is about $2,000 per month as part of the finance deal, you got to pay the first and the last payment. When you start your financing, which means that in 2023, check this out. Let’s say October, November, December. So in November, you’re going to be first and last, which is 2000 plus 2000.
In November, you’re going to be in a 2000. And then in December, you’re going to be another 2000. So this year you’re going to be $8,000. So you bought a $100,000 in x-ray machine. You paid in 20, 23, $8,000, and you saved $20,000 in taxes. So, again, it’s a great deal worth doing it, especially now, as you’re looking at your taxes for 2033.
Figure out how much money you have left. Instead of giving the IRS this money, invest in a new piece of equipment with your warranty. Maybe we see something that’s going to improve your business and push your company far ahead of your competition. So give us a call today and don’t forget to subscribe and give us a call today, same as an email.
Learn more about how we can structure your business. Thanks for watching.
Dr. Bill Cardoso – Founder and CEO of Creative Electron.