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May 7, 2019

Cheers To Business | Ep34 | Tax as a tool

In the episode, Cadie relinquishes the Cheers To Biz mic to Karen, and she explains why she wants to be in the highest tax bracket, doesn't want to be able to itemize, and why (and when) you might want to pay more taxes too. The tax that you pay is the proof that you and your company are profitable entities and shows the equity in your company. That proof allows you the means to be able to finance any expansion, plan, or venture to grow your business. Nobody goes into business to lose money, and Karen suggests finding that CFO or CPA that can analyze your balance sheet, make a tax plan, and then help you find the smoothest path to where you and your company wants to be in 5 years.

 

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Shareables and Tweetables

You cannot pay debt, and you cannot look good to the banks unless you have income. If you have income, then you're going to pay tax. - Karen Simmons

You have five years to get your balance sheet where the banks need it because we (CPAs) know how much they're going to let you borrow based on your balance sheet. - Karen Simmons

Nobody's going to loan money to you if you don't have anything. If you can't show that you can afford to pay the loan back, you can't expand, you can't get that new piece of equipment, you can't build that building unless you can prove to other people because the banks are going to look back two years. - Karen Simmons

To get to your company where you want to be, make it over time, do it consistently, start showing a profit. - Karen Simmons

Don't pay for everything out of your house out of your business checking account. Make your books real. - Karen Simmons

You're trying to tell somebody and convince them that you have a profitable business, but you're writing every damn thing you can off because you don't want to pay tax. It's going to bite you in the ass. - Karen Simmons

If you want your payday to be significant, then you've got to be able to be willing to sacrifice now to take a little payday to get to a bigger payday. - Karen Simmons

How is tax a tool? It's a tool if you make money and you're profitable, you're going to have income which means you're going to have tax, which means you can finance something to expand, to grow your business. - Karen Simmons

To grow your business, I will say that I would rather use somebody else's money at a lower price, so a small interest rate.- Karen Simmons

If you ever have a CFO tell you that the balance sheet isn't the most important thing, you need to fire them. - Karen Simmons

Nobody goes into business to lose money. All you entrepreneurs out there, you went into business to be successful. You wanted to be successful because you were good at something. - Karen Simmons

Find that person so they can help you get to where you want to be, but think about it hard first because to get where you want to go, if you do want to be successful, you are going to pay some tax. - Karen Simmons

If I'm in the highest tax bracket, I'm making a whole lot of money, and I'm at a happy place because I'll give you $35 for a hundred dollar bill every single day. - Karen Simmons