Mastering & Knowing Tax Secrets I Matt Bontrager DSH #428

Get a refund or go a little bit.

But when you're self-employed, it is literally this like world of difference where it's all not gray, but it's like this area where there's no right or wrong.

You can take certain deductions.

You can do certain things with your expenses.

And so I think the biggest misconception is, is that the IRS always knows what you owe them.

When in reality, you're telling them what you owe them.

And then if they don't believe that, then you start to like flirt with the audits and stuff.

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And here's the episode.

Welcome to the show, guys.

We are here on the Digital Social Hour, and today we are going to help you save some money on your taxes.

I have with me Matt Von Trager today.

How's it going?

Good, man.

Thanks for having me.

Absolutely.

So this is a topic no one likes to really, you know, dive into, but.

I think it's going to be beneficial to talk about.

Yeah, I think taxes are a little bit taboo and that you don't learn a lot about them unless you're going into this field.

Yeah.

Or you become, you know, like a savvy business owner.

So.

Yeah.

I mean, it's definitely a game to know.

When I found out I was paying more in taxes than Donald Trump, I was like, yeah, I'm doing something wrong here.

Yeah, for sure.

And we'll get into that too because there's also certain things that he does that it's the same thing we do with our clients.

It's the area that we focus into.

Yeah.

So what made you go down this path?

Were you into taxes growing up?

I always make the joke, so I'm a Jew and I just love money.

So right out of high school, I went to work at a bank.

I thought I was going to play pro baseball.

That didn't work.

But I went to go work at the bank and working at Wells Fargo and just a large bank and seeing people with money, without money, really opened my eyes and got me intrigued as to how to sort of chase more dollars and earn more.

And then I stayed in finance and then I went into accounting and school.

And then when you're in accounting and school and college, they just preached you to go to the big four.

And so I tried that.

I landed myself at one of the big four out here and then had a great time.

It was this big organization.

I got a really good resume.

When I I left, anybody would talk to me.

And then I just stayed in accounting and saw the money that was there and saw that it's such a big need.

Nice.

It's the language of business, you know.

What was the biggest bank account you saw at Wells Fargo?

Dude, there's a funny story.

So he actually lives here in town.

I obviously can't say the name, but they always told us at Wells Fargo that if there was a high-end customer that came in and when you, like, for example, when you populated their account, the screen would turn gold.

And I was like, oh, this is like a myth.

I've never seen it.

Oh, yeah.

And it happened one day.

And I was like, oh, my gosh.

And so, I mean, it was at least over 10 million.

Holy crap.

And liquid cash.

Yeah.

Liquid cash, too.

And, right?

And so I had saw that happen.

I was like, whoa.

And so, yeah, that guy still lives out here, runs a business.

Yeah.

Yeah.

That was a cool thing that I had heard about it and then finally saw it and I was like, whoa.

That's sick.

So when you made that jump from the big four company to start your own CBA firm, what was that like?

A little bit scary.

So that was right around the time I met Ryan.

Being an accountant, I feel like it's very risk adverse, right?

You want to go.

go to school, get a good job, good W-2,

sort of work your way up the ladder, staff, senior, manager, senior manager.

But I started, you could say, a little bit slow.

I slowly started to grow a book of business on the side and have clients on the side.

So when I made the jump, it wasn't as scary

than just going out and having no clients.

Yeah, that's good advice for people looking to go from their nine to five to their own startup.

Have some sort of side income as a safety net, right?

Oh, yeah.

That's, yeah.

So if anybody asked me when the right time, I don't necessarily think there's an exact time, but I'm much of a fan of I would grow some sort of business on the side, make some side income so that when you make the jump, you're not stuck with no paycheck for it.

Absolutely.

Yeah, that's what i did in college because i was like i can't just drop out off an idea i need to actually have some revenue yeah and that's where people i think mess up yeah and you have the time to do it right i mean like whatever you're doing full time if it's currently at a job or being in college you have time to do something on the side to start proof of concept yeah so what are some common tax myths you see online or from people that you want to address Dude, the first one is that the tax system is an honor system.

So like there's a meme that goes around where it's like, well, hey, the IRS knows exactly what you owe them.

And if you don't pay it, then you go to jail.

And if you ask them what you owe them, then they're like, I don't know, you tell me.

And there's some truth to that.

Like if you're a W-2 employee, there's a right answer on your tax return.

You made this much money, you owe this much tax, you either overpaid or underpaid, you get a refund or you owe a little bit.

But when you're self-employed, it is literally this like world of difference where it's all not gray, but it's like this area where there's no right or wrong.

You can take certain deductions.

You can do certain things with your expenses.

And so I think the biggest misconception is, is that the irs always knows what you owe them when in reality you're telling them what you owe them right and then if they don't believe that then when you start to like flirt with the audits and stuff yeah have you ever had to deal with an audit oh yeah what's that like are they up your ass like calling you it really depends one they're people so on the other end of it you can get somebody really nice or you can get somebody that really wants to be a stickler right um so being nice to them and like you know you catch more bees with honey kind of thing is for sure true when you're dealing with the irs but um

one of the other biggest misconceptions is all you really need is documentation when it comes to an audit.

And people always ask, well, what does that look like?

Well, I've seen documentation be a receipt for something, an invoice, an email, a calendar screenshot, a text screenshot.

Think of it as if you were sitting across the table from a friend and you're trying to argue a point.

You know, you're trying to bring everything to the table to prove your case.

And so that's how audits are.

And then obviously you have like a tax code or a list of rules to follow, proving that you followed them.

Now, what triggers these audits?

Is it revenue-based?

Like, do they go after the bigger companies in general?

I would say more so, yes, because that's where the potential most liability lies for them and the underpayment to them lies is larger companies.

But it can be a range of things.

One is misspelling.

Misspelling on a tax return can be off, and that can trigger something.

Wow.

If you misspell the name or something.

Totally.

A name or an expense line item that looks funky, that can trigger it.

Round numbers is a big one.

So when I'm about to do a tax return, if somebody sends me numbers and they're like, I spent $5,000 on meals, I spent $10,000 on meals, like something is off.

Rarely will you spend that exact dollar amount.

I would say those are the two biggest.

And then obviously, if they just see major losses, meaning like you're making income over here, you have losses over here.

And if they feel that there's an approach that maybe you didn't follow, then they can trick you, like grab you there.

But yeah.

In terms of write-offs, what are some good things that business owners, entrepreneurs should be considering writing off?

Now, in this day and age, with just obviously digital work,

there's two things that people have to keep in mind when it comes to writing things off.

And it's, is it ordinary and necessary?

So is it ordinary for someone in that same line of work to spend money on something that you are?

And is it necessary to produce income?

Obviously, us sitting here, if this was your business, the lights, the cameras, the desk, the mic,

right?

Everybody involved is somewhat of an expense.

So I feel like people need to keep that in mind because the question is not what can you write off.

It's first.

Well, what are you spending your money on to produce it?

And then I think when you start to look outside of that, you factor in those two variables.

Like, hey, I'm not a fan of spending money just to get a tax deduction because at the end of the day, you're out the cash.

I'd rather keep the cash.

But first, I would look at what you spend money on in your business and then two, start to see what you can buy to there further improve your business and then still get it as a write-off.

Yeah.

Is it true they just changed the write-offs on meals and restaurants?

It went back, yeah.

So for COVID, they gave you two years where it went from 50% deductible to 100, which was massive.

Like, I mean, we ran that up last year.

And then now it's back to 50% this year.

It was to spur economic growth in the restaurant industry.

So you could see that's how they kind of write these policies.

Oh, man.

Yeah.

I went off.

Went to Nobu.

Yeah.

I went off, man.

It was fun.

Yeah.

We had missing those days.

I know, dude.

Yeah.

Now we're back in the 50%, which still is not bad, but yeah, it's not 100%.

It's still decent.

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And they changed it with, I know, Jets, right?

Jets used to to be 100%.

Well, so the whole bonus depreciation thing, that's where if we want to get into that, that's the lane and the space that we really ride in.

So the Trumps, the Cardone's, Kiyosaki's, like how all these people are making a ton of money at their business and then buying a ton of real estate and knitting them out together

is really the depreciation component.

So Jets, you can still take depreciation on buildings, cars, but it went from 100% for certain assets down to 80.

Wow.

So people are freaking, but it used to be 50.

So people are freaking out that the 80 is bad.

And I'm like, 80's not bad.

So good, yeah.

I I like the way Kiyosagi does it, man.

I keep getting his clips.

It's super impressive.

He knows the tax game well.

He does.

I mean, you could see that he's a savvy business owner that takes the time to talk with his CPA.

Yeah, absolutely.

So in terms of CPA versus accountant, there's differences there, right?

Oh, yeah.

So an accountant, I feel like you can just like self-proclaim you're an accountant.

Once you go into the field, you're maybe landing clients.

You got an accounting degree.

A CPA, there's a series of tests.

You're licensed by the state board, stuff like that.

So that was probably the most grueling time of my like educational life.

Oh, it's tough.

Oh, dude.

It's so like I always argue it's way harder than the bar.

Wow.

Is it actually?

Oh, I think, yeah, the pass rate's a lot lower.

And there's four tests.

You know, the bar is one, I think.

Yeah.

What's the pass rate?

Oh, the pass rate is definitely sub 50 for sure.

Whoa, there's four tests, all written tests.

So they're one of them's like a 60-40, and now they're changing them as we go.

So back when I was doing it, one of them, for example, was a 60% multiple choice, 40% long answer.

Now I think they're going more 50-50.

Geez, I was never a fan of long answers or short answers.

Yeah, dude, it's a, it's a grueling process.

But now, I mean, I'm glad I got it.

Yeah.

Well, and the worst, you have to pass all four within 18 months.

Wow.

So if you start to like, like, lapse, you'll lose them.

You got to redo them.

Yeah, I have to get my, uh, I'm getting in the insurance game right now, so I have to get my insurance license, and it's giving me PTSD from like high school.

Yep.

I hate tests, dude.

Are those the series licenses for insurance or no?

I don't know if that's for insurance.

Maybe that's more for like finance.

Yeah, I got to study 40 hours and I think it's an online test, which shouldn't be too bad.

Yeah.

Because sometimes the in-person ones, you just get in your own head.

But I feel like online, it's more like chill.

Oh, yeah.

Self-study is fine.

And then again, if you get to take the test online from home, I don't think that'd be bad.

Yeah, I think I'll be good.

But in terms of like LLC structures in general, what do you see as good ways to structure if you're like a business owner, entrepreneur, LLC?

So my word of advice here is anytime you are ready to spend money in pursuit of a business to make money doing something, I would set up an LLC.

A lot of people think LLCs are there for tax purposes, but they're not.

This is purely a liability play.

So it's really a legal play.

So that's my answer.

It's like right away when you're starting a business or starting a new venture, I would set up an LLC to give you that protection.

Yeah.

Did any of your clients make that move to Puerto Rico?

No, they haven't.

And that's not something that we deal with.

If you're going to do that, I 100% would find an account that specializes in moving assets there because there's an interesting fact, right?

So when you're a citizen of the U.S., you're taxed on worldwide income.

That's sort of the price to pay of being a citizen.

And so you technically lose citizenship when you go do that.

Oh, really?

Yeah, there's a lot of complications there.

Oh, I didn't know that.

I thought you keep it if you're there for 181 days.

Yes, but then, so there's another way that they'll sort of claw at you is if you have, so what I've heard is people will start and grow a business in the U.S.

And then right before exit, they'll try and move there.

But if the income is already sourced from the U.S., the U.S.

is going to grab their share.

So it's like, even if you move and try to close the transaction while you're there, it could be sourced back to the U.S.

Wow.

So that's why, yeah, you really have to go to any CPA that you're working with.

You got to find one that deals with exactly what you're looking to do, that has clients doing what you're doing.

I didn't know that, man.

And yeah, I had one friend who did it, and he said when he was going through his IRS audit, they were geo-tracking his phone.

So they were seeing if he was actually there.

That's gnarly.

I've never heard of that.

That's crazy, though.

And I don't doubt it.

I don't doubt what these government agencies have access to.

Yeah.

So now basically they could tell where you are because everyone has their phone on them all the time.

So, oh, you were only there four months.

You're paying the full tax rate.

Yeah,

that's crazy.

Yeah.

what's it like dealing with nevada tax because it's zero right zero income tax yeah so like us texas florida um really easy and that's again sort of my reason i like to live here you know state income tax so you don't got to deal with cali because i heard cali's tougher than the irs oh it's a mess in california right now if you try to call somebody a contractor and they work in california it's so difficult because for them they want them to be employees because then you owe all of these other insurances and taxes on top of your employees and so it's very hard to be

i guess considered a contractor in California.

They really want you to be an employee.

Yeah, they want every dollar they can make out there, man.

Oh, yeah, dude.

And I don't think it's going to the best places either.

Oh, no, no, yeah.

That's a whole lot of shit.

So the money's not being spent well.

Yeah, that's a whole other conversation.

Yeah.

I've always been interested in this potential write-off, like your house.

I've heard from different people, like you can write off certain rooms.

Is that true?

Like your personal house?

Like

if you have an office in your personal house?

Yeah, for sure.

So that's right.

So home office deduction is if you, right, if you have a business or business activity within your house, you can write off certain aspects of the house.

So part of your mortgage interest, part of your cable, utilities, internet, all of that that are associated with that square footage of the house.

The best example I gave or have is we have a client that did Amazon FBA out of the house.

And so usually when you see somebody working in their house, it's maybe 10, 15% of their house that they use.

But this guy had like 65% of his house because he was just storing inventory there and had this like whole Amazon FBA operation.

That's impressive.

65% of the house just in inventory.

Yeah, I know.

Inventory and like packaging and all that stuff, though, too.

So, yeah, it's basically how much square footage are you using for your business?

What's the total square footage?

Do that math, you get a percentage, and then multiply that times your expenses.

Interesting.

That's good to know.

Yeah, I should probably do that because I, yeah, I would say 10% of my house.

If you include the bathroom, not the bathroom, but.

If the bathroom is exclusive to like the business portion of the house, then yeah,

yeah, I only use it when I'm in the office.

So that could make

there you go.

So, right now I'm looking into trust because I'm buying a house.

What's been your experience with timing and trust?

Like when should you go down that route?

I would get a trust if, let's say, you're at least 300,000 liquid maybe,

or you run a successful business that's generating cash flow every year, or you have one plus rental property.

So, I mean, I see a lot of people that think that that's a quick fix to things up front, when in reality, it's not.

It's really just upfront costs, and it's going to give you legal protection.

But until you have the assets to really substantiate needing one, I'm more of a hey use that five or ten grand that you would spend for a trust towards your business yeah i'm mainly doing it for privacy i'd say and uh definitely additional legal layer right yep exactly yeah you can't really now is this true because i've heard when you get sued or you're in a lawsuit they can't go after trust

Some trusts, yes, they cannot.

So whether it's an irrevocable, revocable, and that's where like you definitely want an estate attorney that's going to be like, hey, these are my goals.

If I get sued, I don't want them to be able to get this.

That's so crazy.

So I'm assuming all the richest people in the world have something set up like that.

Oh, yeah.

Crazy estate planning structures because then you start to get into the tax game too, where, you know, if you die, your estate is taxed at a certain rate.

And so you try to like structure your assets to be given out basically upon death kind of thing.

Yeah.

What are some ways to minimize the death tax?

How much do they take when you die?

I don't even know what that is.

I think the estate tax might be like 40.

40%?

40%.

Just for dying?

Right.

If you don't have proper planning in place for your estate.

Right, right.

So if you just die without a plan, half half of it's gone pretty much.

And that's where, too, when you're at that level, you don't want to leave something like that up to a will or something like that.

You would want to trust with some sort of an estate attorney set up.

Dude, that's insane.

And you have a lifetime gift exemption.

So a lot of people ask, well, if I walk down the street and I just gave somebody 30 grand, some of that technically could be taxable, but you have a lifetime gift exemption, meaning you can give away, right now it's roughly 12 million.

You can give away that for free, no tax to either party.

And so if you were again to walk down the street, because people usually ask, well, what amount can I give somebody without it being taxed?

You can technically walk down the street and give somebody a million bucks.

It would just come against your lifetime exemption.

Oh, interesting.

Sort of this bucket, which that goes down here soon, too.

Oh, yeah, it goes down.

I saw Mr.

Beast dealing with this.

I think

he gives away so much stuff.

Now it's to the point where he's paying taxes on the stuff he gave away.

Exactly, because the receiver can't pay the tax on the assets that they're receiving.

Got a question about salaries.

A lot of CEOs of Fortune 500 companies, they pay a majority of their salary in stock.

Yep.

Is that due to

tax savings mainly?

I would say that because then they start to get the growth on the stock.

So it's probably their preference as well than to get just a cash value up front.

And from a cash flow perspective, it's easier for the business to give them stock shares than to give them cold hard cash.

Right.

So, yeah.

So it's really a, it's a growth play for the receiver and it's a business play too for them to sort of harness cash.

Yeah, because I noticed, I think Nike, like 10 million stock a year or something and like very minimal salary, like just enough to live off of.

Yeah, I was just reading an article the other day.

Wells Fargo is actually in hot water and they said one of their like VP bankers was worth 150 million.

And I'm like, whoa, as a right, as a banker.

And so again, I would assume most of that is stock options.

Oh, yeah.

He was there from the start.

Yeah.

Interesting.

Wells Fargo hate to throw shit, but they're always in some

hot water.

Oh, dude, I was there during that whole debacle of seeing people set up fake accounts because it was such a numbers game.

Yeah.

You would come into the branch and you had to get eight or ten sales on the day.

That was it.

Yeah.

Oh, yeah.

You had to get sales on the, it was such a sales-heavy business.

So when you say sales, you're talking people opening up a bank account?

New accounts, credit cards, debit cards, all of that.

And they were just letting anyone make accounts, right?

I remember this, I think.

Oh, yeah.

And they were setting up accounts for people that didn't want them.

Oh, really?

You'd come in for a checking account and I would just throw a debit card on it for you.

But yeah, I saw that all the time.

Wow.

And would you get a bonus if you got like...

Oh, yeah.

Most of your bonus compensation was tied to sales.

Oh, so that's how people were.

Even, right?

Like your branch's performance was all tied around sales, too.

Yeah.

I mean, it makes sense because the more accounts they have, the more they're worth.

So I could see why they would want to do that.

It looks better, right, from the, let's say, a buyer's perspective if they were going into the bank to invest with them.

It just makes your numbers look stronger.

Yeah, absolutely.

Yeah.

So with your firm, what's the strategy?

Do you want to sell the company one day?

Do people even buy these types of companies?

They do.

Private equity is coming into CPA firms right now pretty hard.

I love it.

I think it's a great business model because for context, a lot right now, right, are like educational companies.

Those kind of scare me because because one, you're always relying on new sales.

If your sales team slows or dies, you die as a business.

CPA firms are great because they're almost like rental properties with clients.

If you treat a client well, you do a good job, they're likely to recur.

And as they grow, you grow with them as a client.

And so, yeah, usually the multiple on a CPA firm can honestly be anywhere from one to three.

So if you have a CPA firm.

Yeah.

So if you have a CPA firm that's, you know, grossing a million dollars, you can expect anywhere from one to three million for that firm.

Nice.

But I think to end up like,

I guess, positioning your firm to sell, you really have to focus on the process, not so much just the relationship with the clients.

Because right now, I've been approached to sell or buy.

And my always thought has been if I come in and buy an old legacy firm with all these older clients and they see some young guy with a hat come in and they're like, hey, you're not going to come to my office.

I'm going to zoom you.

They're going to leave.

So it's really big on client retention.

So you have to get the clients really relying on the firm, not so much the partner of the firm.

That's a good point because usually when you sell a business, you're kind of hands off at that point because you've outsourced everything.

But with CPA firms, it's all about relationships, I feel like.

so if I just say hey book of business is gone I sell it for two million bucks the buyer's not you know if if half the clients leave because I leave yeah then they I'd be interesting to see how many would stay and how many would leave there is going to be such a massive shift in this industry in the next five to 10 years because everybody's old and they want to retire soon dude that's a good point a lot of my accounts that i used to use were old

old and they're doing it their old ways and you know but again if i'm in my 60s and i'm going to retire in whatever five ten years why would i change yeah just write it out make some money and then sell it later yeah No, crazy story because my first accountant ever was in Jersey when I lived there.

And I ended up moving to Vegas.

So I'm texting him like non-stop, like every couple weeks.

Yo, did you follow the return?

And like, I'm emailing him.

I'm emailing his old employees.

No one's responding.

And I think the dude died.

Oh.

Yeah.

Cause I looked up his name and found like an obituary.

I'm like, oh my gosh.

Yeah.

That's crazy.

Yeah.

That whole industry is nuts now because there's so many, there's more than enough clients and not enough CPAs and like, you know, service providers.

So yeah, it's a a weird time in the industry good problem to have i guess it is it is yeah so can you even take on more clients right now are you fully oh we can it's just now bringing on the right style clients so like our our space is real estate so real estate investors flippers wholesalers whatever yeah but you know like that's why if you're going to go work with a cpa like i've said it's important to find somebody that's in your industry there's too many generalists out there that can help you file your taxes but they're not going to really give you advice right yeah so i know you're big into real estate do you believe real estate's the best way to save on taxes oh 100 so how would you go about setting that up in the proper way?

So if I was somebody right now that let's say I made 90 grand and I'm like a manager at a department store, the first thing I would do is I would save up enough cash to go get a short-term rental property.

And this is how it really shakes out on paper.

My W-2 is 90 and this rental property, let's say, will cash flow me three grand a year.

So nothing crazy, but on paper, I could lose, let's say, 40 to 60 grand on paper through depreciation, meaning I get to write off a portion of that, right, like of the property.

So if I make 90 over here and I lose 40 on paper, I technically only pay tax on 50 grand.

Wow.

So you could put it against your salary almost.

Exactly.

And so, yeah, so it's funny, like in a slide deck I have, the taxpayer that pays tax on the 90 will pay, let's say, around 19 grand.

Or no, I'm sorry, like 16 grand.

And then on the flip side, it'd be about four if you did that strategy.

So if you multiplied that and were able to get one or two homes a year, which again, most people want to buy rental properties because it's a great retirement strategy.

Forget about the tax benefits up front, front too that's really great to know because i purposely don't pay myself a lot but using that strategy it could provide more flexibility to me oh yeah for sure right and then it it's like two birds with one stone you're growing your portfolio for retirement you're getting cash flow from the property but then on the same same end you're saving on your tax bill so that's exactly what kiyosaki's doing kiyosaki's making five million in education he'll go out and at a larger scale now buy apartment buildings and you know wow so he could write it off using that it's a separate business though right right?

Exactly.

At the end of the day, you're trying to generate cash over here.

You're trying to buy real estate on this side, and then you get the losses to net against it.

That's the master plan.

Dude, brilliant.

Yeah, that's so brilliant.

And is that what Trump did?

Oh, yeah.

Yeah, that's what they're all doing.

When he bought those big hotels and casinos.

Grant Cardone did it with the jet.

And he realized he sold the jet.

So he's like, oh, I got to buy another jet too.

Oh, he sold it?

Yeah.

Well, he sold it and then bought another one.

Oh, I understand.

Had to upgrade that, baby.

Yeah.

Yeah.

Out of all the presidents in your lifetime, or I guess ever,

who would you say had the best tax policies?

Since I've been in an account, I have to say Trump, and it was really for small business.

So, I mean, the standard deduction increase was nice, but then also he gave this QBI deduction, which was basically qualified business income.

And the way to think about it is it's like a 20% shave off the top for small businesses.

Wow.

And so, yeah, so we saw small businesses save a lot in tax this year.

So instead of paying that federal, federal is 37, right?

Max is 37, yeah.

He lowered it to 17.

No, so what he did for the corporate, he brought the corporate tax rate down to 21, which was nice.

Got it.

But as far as just this QBI piece, you were still hit with the normal tax brackets, but he gave you basically a 20% chop off the top before you applied the tax bracket to it.

And so it was really helpful for small businesses.

Wow, that's cool.

And Biden just reversed it.

Didn't reverse it.

It's still there, though, but that's where these policies are starting to sunset.

So depreciation last year was 100.

Now it's 80.

Next year will be 60.

And so now the million-dollar question is, will it come back?

I think it will.

I don't think it will sunset eventually to zero.

It's set to, but again, we'll have to see.

Someone will change it before then.

Yeah.

Does the IRS ever publish how much revenue they take in?

That's a good question.

Oh, yeah.

I'm sure that that's in the budgets, right?

And like, like, in all of those talks, they do.

Yeah, I'd be so curious how much they're raking in.

It's got to be something astronomical.

What they call it, too, is the tax gap because they feel that, you know, what they're receiving and what they should be receiving.

And that's exactly why they have audits.

They're trying to go out there and find the lost tax dollars.

Didn't they just hire like 30,000 agents?

The plan was like 87,000 agents.

But yeah,

I feel like they cut that down to some dramatic number.

I don't know how many they've hired since then, but they pay pretty well.

And so what's always funny now is a CPA, we always joke that if we worked for them, we'd be raking it in because we know now what to look for.

Oh, they pay well, you said?

You could probably get a salary for $140,000, $150,000.

And then you have plus benefits, probably a little bit more.

Government benefits are insane.

Damn, IRS, man.

It's all a game, dude.

It's all a game.

Yeah.

I mean, what's the most you've helped a client save, you'd say?

The first one that comes to mind was like 270 grand last year, but that's one.

yeah so like when you extrapolate

if you extrapolate across the client book millions for sure but i mean one individual client at least a quarter million but i mean that's huge that's a house for sure right and we have a lot of clients too where like they'll end up paying zero because of if they buy enough real estate basically is the game at that point can they bring the tax bill to zero right yeah

So I'm just wondering, because you're parking a lot of money in real estate, but it does seem to be worth it if you're getting these tax deductions, right?

Well, yes, but think about it this way, too.

You're not necessarily parking that much because you're using leverage to buy it.

So let's say for like the easiest example I give is a car for 50 grand.

In this case, you could put 0% down on a car and get an entire $50,000 deduction.

For a home, a half a million dollar home, you can put down, let's say, 80 to 100 grand and get a deduction, let's say, at the end of the day for the exact same amount.

Got it.

So, you know, at some point that the ROI, right, like this is how I say, would you rather stroke a check for 100 grand to the IRS or stroke a check for 10 to 15, but then also buy a rental property?

Right.

And so when you start to lay it out that way, it's like, well, I think the funds would better be used, but right, growing the portfolio.

Plus, you have an asset.

Yeah, that makes sense.

I'd rather have that than cash these days with inflation, man.

Yeah, exactly.

You're losing money every day.

You have it.

Yeah, that's crushing people.

How did you become business partners with Ryan Pineda?

So we're both from Vegas.

Funny enough, too, we had must have crossed paths playing baseball too when we were younger.

He was a little bit older than me, but he was posting on Instagram looking for a bookkeeper.

And I was working at a firm and I'm thinking in my head like dude I could do this with my eyes closed and so after a few DMs we ended up meeting I went and met with him and his sister

and then first meeting I was just gonna do his bookkeeping and then it quickly led to tax work and then

he was throwing a quarter party for like his old brokerage and I had made a joke like hey man you know like we should start a business you'll drive the business I'll run the business and then I quit my job December of 19 we started January 2020 wow amazing yeah that's a great partnership man it worked great yeah so what are you working on next?

Next is bookkeeping blueprint, which is a big thing for me because all of the tax talk, at the end of the day, the biggest problem that we see with business owners or self-employed people, they don't keep good books.

So at that point, you can't even really tax plan.

Everybody wants to do the sexy tax planning.

And so now Bookkeeping Blueprint is helping basically start small bookkeeping businesses to help people do bookkeeping.

I love that.

Yeah, I used to never really care about bookkeeping, but now I do my P ⁇ L at least once a week.

That's great.

It actually helps because you realize what you're spending money on and what's what's working.

So, I'd recommend just doing that in general.

Oh, for sure.

Whether it's your personal finances or your business, like,