Video instructions and help with filling out and completing Fill Form 944 Pr Entities

Instructions and Help about Fill Form 944 Pr Entities

Hey my name is Keith Hall I'm a CPA and I work exclusively with small businesses just like you now when it comes to tax returns we talk a lot about filling out the forms a lot about last year's information and how much we're going to end up sending to the IRS on April 15th but what I want to do is talk about creative and specific ways to save money so you can keep more of your money rather than just waiting on the tax return from last year so my tax planning tip number two is let's look at what you do with your kids a little bit differently than perhaps you've looked at it in the past so my first question for you is how much money do you give your kid okay now you see you guys a that's a big number right and I recognize that but I'm not just talking about the allowance that you give them but what about the money you're giving them to put away for college what about if they drive you have gas for their car if your daughters are like my daughter's there's always a new pair of jeans that you're giving them money for so how much money do you give your kid this is a very big number so I want you to kind of look at that money a little bit differently okay rather than just giving it to them as an allowance what if you put them to work what if you found a job in your small business that they could help you with and there are thousands of things in your small business you know that they can help with your inbound mail your outbound mail they can help with your scheduling they can probably do a better job with your social media contacts with Facebook then you can how cool would it be for your kids to tell their friends they get paid for playing on Facebook but that is a very important job lots of things that they can do I want you to think in terms of a job description of a time cards figure out an hourly wage $10 an hour whatever you think makes sense put them to work couple hours on Wednesday couple hours on Thursday night perhaps some hours on the weekends and before you know it you are paying let's just say about $100 a week still way less than what you're giving them now okay but instead of calling it an allowance now what you've done is create a job okay now here's what happens your child can earn up to fifty seven hundred dollars tax-free they don't have to pay federal income tax they don't have to pay payroll tax no FICA no Medicare no whew - no tsuita no payroll tax at all they don't even have to file a tax return but what about your tax returns that hundred dollars a week five thousand two hundred dollars a year is fully deductible right on your Schedule C okay now that is amazing the money that used to be called an allowance now is deductible wages right on your Schedule C because you created a job now this is unbelievable guys this is like picking money up off the ground okay you got to take advantage of this if you're giving your kid money anyway rather than just give it to them create a job okay now don't take a shortcut here don't just pretend let this be a real job make them work do the time cards do the payroll reports do a w-2 at the end of the year you're gonna have to do an annual payroll tax return form 944 but a little bit of paperwork for translating $5,200 from personal non deductible expenses into fully deductible business expenses is huge even if you're at the middle tax bracket this is the deduction for federal income tax and self-employment tax so you're gonna say forty percent or more on fifty two hundred bucks that's over two thousand dollars in cash because you've created a new job this is huge now what Congress has done is promoted job creation whether you're Republican whether you're Democratic whether you're independent doesn't matter one you listen to talks about creating jobs the Internal Revenue Code Congress promotes job creation that's why they will subsidize this new job you're creating okay put the kid to work okay you may be asking yourself well what about age limits is my child too young the answer is there is no age limit for your child as long as the wages you pay them or reasonable for example let's say you're an architect and you're doing some complicated math formula based on the vibration of earthquakes to see if the buildings gonna stand up and your child is 3 they probably shouldn't be doing that analysis that's probably not reasonable but what if your child is 3 and you're a photographer and maybe your best customer is a kids clothing supplier right so you're taking pictures of your child modeling the new clothing line that is exactly a job for a three-year-old totally reasonable for them to be compensated for that this is huge again taking personal money it is non deductible and by looking at it a little bit differently doing the paperwork don't just pretend do the paperwork now when it's time to fill out your tax return next April 15th everything is exactly the same but you will pay $2,000 less in taxes just for looking at things differently guys this is huge you've got to take advantage of this and what if you're giving money to someone that's not your kid how about a niece or a nephew another family member what about a youth that you're mentoring not even related to you if you're giving the money to the.