I find it funny how there are so many times that we do things but really don’t understand why we are doing them.
Let me share an experience I had to help guide what I’m talking about.
I did a dinner workshop for small business owners talking about finances and how to look at ways to lower some of the taxes they may be paying. I spent about 15 minutes with intros of myself and the group.
After a while the group was getting frustrated with the tax code and the IRS, basically mad at the IRS. I was sharing examples of some wealthy business owners that we hear about on the news all the time and how they don’t pay high tax rates.
The group was making comments on how they pay too high taxes and know there are ways to lower them. The one lady blurted out, “I want Donald Trump’s tax rate!”
The group laughed in agreement. She had a point. So my question to the group was this, “Isn’t that why you are here? Isn’t that the point of this conversation?”
These small business owners were attending a dinner workshop to teach them how to understand their taxes but they didn’t know why they were there.
So I ask you what do these wealthy business owners have that you and I don’t?
Aren’t we all playing from the same IRS rule book?
If they had a separate rule book or if they were doing something illegal don’t you think the IRS would punish them?
What is the difference?
The answer is a simple one…
They know the rules. They have taken the time or have hired professional who have taken the time to understand the rules. That’s it.
You see most of these small business owners in my workshop example either did their own taxes or have a tax preparer that they bragged about how inexpensive they are.
Let me end with this in mind.
If you are in the 35% federal tax bracket and you saved on income taxes couldn’t you say that is a rate of return. If you didn’t save the income then you would be paying that money to the IRS, right?
So if you could get a rate of return of that percentage would you do the research to find out how? Would you hire a professional to help? Don’t you think this is important enough to focus some of your time and energy?
If not then you can’t complain.