Unlock Tax Savings: Keep More of Your Hard-Earned Wealth!

The Augusta Rule (IRS Code Section 280A(g)) allows homeowners to rent out their primary residence for up to 14 days per year without having to report the rental income. This is particularly powerful when you rent your home to your own business for meetings or events.

Benefit:

• Tax-free income for the homeowner.
• Deductible expense for the business.
• Ideal for small business owners with home offices.

Considerations:

• Limited to 14 days per year.
• Rental rate must be fair market value.
• Proper documentation of business use is crucial.

Section 1202 allows for the exclusion of a significant portion, or even all, of the capital gains from the sale of Qualified Small Business Stock (QSBS), provided certain criteria are met. This can result in millions of dollars in tax savings upon the sale of a qualifying business.

Benefit:

• Up to $10 million or 10x basis in tax-free capital gains.
• Significant wealth accumulation for entrepreneurs.
• Encourages investment in small businesses.

Considerations:

• Stock must be held for over 5 years.
• Original issuance must be from a C-Corp.
• Specific gross asset and active business requirements apply.

A captive insurance company is a wholly-owned subsidiary created to insure the risks of its parent company. This allows businesses to self-insure against unique risks, potentially reducing insurance costs and creating a new profit center, while also offering significant tax benefits under certain IRS provisions (e.g., Section 831(b)).

Benefit:

• Tax-deductible premiums for the operating business.
• Accumulation of underwriting profits in the captive, taxed at a lower rate or deferred.
• Enhanced risk management and coverage for unique business risks.

Considerations:

• Complex to set up and administer; requires specialized expertise.
• Significant upfront costs and ongoing regulatory compliance.
• Best suited for businesses with substantial revenue and unique risks.

Hiring your minor children in your business allows you to shift income from your high tax bracket to their lower (often zero) tax bracket. Their wages are a deductible business expense for you, and if structured correctly, their income can be tax-free up to the standard deduction amount.

Benefit:

• Business deduction for wages paid.
• Tax-free income for children (up to standard deduction).
• Funds can be used for their education or investments, building their financial literacy.

Considerations:

• Children must perform legitimate, age-appropriate work.
• Wages must be reasonable for the work performed.
• Proper payroll and documentation are essential.

A Section 105 HRA (Health Reimbursement Arrangement) allows a business to reimburse employees for out-of-pocket medical expenses and health insurance premiums on a tax-free basis. For self-employed individuals or small business owners, this can be structured to cover family medical costs with pre-tax dollars.

Benefit:

• Business deducts medical expenses.
• Reimbursements are tax-free to the employee/owner.
• Covers a wide range of medical, dental, and vision expenses.

Considerations:

• Must be a formal, written plan.
• Specific rules apply to S-Corp owners and sole proprietors.
• Cannot be used if already covered by another group health plan.

A Charitable Remainder Trust (CRT) allows you to donate appreciated assets to a trust, receive an immediate income tax deduction, avoid capital gains taxes on the sale of the asset within the trust, and receive income payments from the trust for a set period or for life. The remaining assets go to charity.

Benefit:

• Immediate charitable income tax deduction.
• Avoid capital gains tax on appreciated assets.
• Generates a stream of income for the donor.
• Supports a chosen charity.

Considerations:

• Irrevocable trust, assets cannot be reclaimed.
• Complex to set up and administer.
• Best for highly appreciated assets and philanthropic goals.

Proactive tax planning goes beyond simply filing your taxes. It involves strategically analyzing your financial situation throughout the year to identify legal opportunities to reduce your tax liability, rather than just reacting to your tax bill at year-end. We help you implement strategies that minimize your taxable income and maximize your savings.

Traditional CPAs often focus on compliance – making sure your taxes are filed correctly. At Pristine Tax, while compliance is important, our primary focus is on high-impact tax planning. We actively seek out and implement advanced, legal strategies to significantly reduce your tax burden, often saving clients tens of thousands of dollars or more annually.

Absolutely! All the strategies we employ are 100% legal and backed by the U.S. tax code. We specialize in understanding the intricacies of tax law to help you take advantage of every deduction, credit, and loophole available to legally minimize what you owe. We operate with the highest ethical standards.

Our services are ideal for small business owners, entrepreneurs, and self-employed individuals who are making good income but feel they are overpaying in taxes. If you're looking for proactive strategies to keep more of your hard-earned money and grow your wealth, Pristine Tax is for you.

A discovery call is a free, no-obligation 15-minute conversation where we learn about your financial situation and tax goals. It's an opportunity for us to assess if our high-impact tax planning services are a good fit for your business and how we can potentially help you save significant money on taxes.