Go Back   Airline Pilot Central Forums - Find your next job as a Pilot > >
Money Talk Your hard-earned money
 

Welcome to Airline Pilot Forums - Connect and get the inside scoop on Airline Companies

If this is your first visit, be sure to check out the FAQ. Join our community today and start interacting with existing members. Registration is fast, simple and absolutely free.


User Tag List

Reply
 
Thread Tools Search this Thread Display Modes
Old 02-22-2018, 02:12 PM   #11  
Doesn't Get Weekends Off
 
RockyBoy's Avatar
 
Joined APC: Jun 2007
Posts: 2,499
Default

Quote:
Originally Posted by Sparky View Post
My wife and I started an LLC flipping homes and she's also a new real estate agent. We went to tax guy and realized we'll get hammered with taxes. I know lots of my fellow pilots have side businesses (including real estate investments). Looking for some practical advice on how to limit our tax exposure. Thanks in advance!!
Your biggest tax advantage of an LLC is that 50% of the income within the LLC should be shielded from self employment tax (FICA and SSA). That is only if you and your wife are both 50% owners of the LLC. Ideally you should be classified as a non participating member of the LCC. (you can still work on houses etc.) How and who did you have setup your LLC and what do you know about the membership rules?

Here is my cliff note version of advice.

1. Have an attorney who knows about LLC's set up your articles of incorporation and by-laws. You can get an LLC from the state very easy by yourself, but the real value of the LLC is in those articles and your by-laws which are usually specific to what you are doing and trying to accomplish. The boiler plate version from the internet or Legal Zoom isn't a good choice.

2. Use a CPA who deals with small business's and understands LLC's. Use Turbo Tax to do your teenagers taxes.

3. Get a checking acount and credit cards in the LLC's name and NEVER use either of them for personal use. Make sure you classify any money that comes to you as a capital distribution. This is the first place any attorney will look if you ever run into a liability issue. Your personal assets WILL NOT be shielded by the LLC if you have ever used any of the funds in the LLC for personal use. Be very nerdy and accountant like with your money. Quicken or Quickbooks is a MUST.

4. Have an annual LLC meeting and record the minutes of that meeting.

5. Don't forget to annually renew your LLC certificate with the state.

6. If your business grows big enough or has significant assets, have an attorney that deals with estate planning work that into your will. It becomes complicated when deeds become involved. You want the LLC to "live" after any owners for tax purposes. You do not want it to be probated.

7. Pay people for advice. APC and Google can a bad thing for advice on an LLC.

Last edited by RockyBoy; 02-22-2018 at 02:25 PM.
RockyBoy is offline   Reply With Quote
Old 02-22-2018, 05:16 PM   #12  
Line Holder
Thread Starter
 
Joined APC: May 2007
Posts: 69
Default

thanks Rocky!! great advice! the main point of this post was to bring some ideas to our tax guys. the guys ive talked to seem not too dimensional, and each has given different advice.
Sparky is offline   Reply With Quote
Old 02-22-2018, 05:41 PM   #13  
Doesn't Get Weekends Off
 
RockyBoy's Avatar
 
Joined APC: Jun 2007
Posts: 2,499
Default

Quote:
Originally Posted by Sparky View Post
thanks Rocky!! great advice! the main point of this post was to bring some ideas to our tax guys. the guys ive talked to seem not too dimensional, and each has given different advice.
Good Luck! Business stuff is fun for me, but it isn't easy. Finding a good accountant that knows taxes can be tough. Some of them will seem not too dimensional when talking about a small LLC because there isn't much dimension to it when it comes to "lowering" your taxes. Anyone who sells themselves as a tax guy who can "lower" your taxes is probably doing stuff the IRS won't like.

Find a guy that will listen to you and not act like you know nothing about taxes. I call my guy all the time with stuff like, "Hey I want to put in a sprinkler system for my yard. How should I do it so I can write off half of it as a farm expense?" He'll tell me to tie it into the irrigation system for a field and to replace or do needed upgrades on the farm system while I'm at it. I'm sure with a house flipping business there are lots of business expenses that could benefit you personally.....just be able to justify them to the IRS.
RockyBoy is offline   Reply With Quote
Old 02-22-2018, 08:04 PM   #14  
Gets Weekends Off
 
Joined APC: Nov 2016
Posts: 216
Default

This is just trashy to be honest. Just make your money and pay your taxes. You're not winning bonus points by deducting your new sprinkler system as an irrigation upgrade.
LumberJack is offline   Reply With Quote
Old 02-23-2018, 07:05 AM   #15  
Doesn't Get Weekends Off
 
RockyBoy's Avatar
 
Joined APC: Jun 2007
Posts: 2,499
Default

Quote:
Originally Posted by LumberJack View Post
This is just trashy to be honest. Just make your money and pay your taxes. You're not winning bonus points by deducting your new sprinkler system as an irrigation upgrade.
Not trying to win bonus points, just trying to lower the tax bill. If you have ever spent time running a business and dealing with other business owners and CPA's you would be surprised to see what people write off as a business expense. Trashy isn't a legal term. If it fits within the IRS guidelines and tax law rulings, you write it off. Why wouldn't you?
RockyBoy is offline   Reply With Quote
Old 02-23-2018, 07:46 AM   #16  
Gets Weekends Off
 
Joined APC: Jun 2015
Posts: 1,249
Default

Quote:
Originally Posted by RockyBoy View Post
Why wouldn't you?
Probably just does a 1040EZ. C'mon....why use itemized deductions? They merely "cheat" the system out of what is owed to Caesar. 😁
FL370esq is online now   Reply With Quote
Old 02-24-2018, 04:21 AM   #17  
Gets Weekends Off
 
Joined APC: Dec 2008
Position: 777 Cap
Posts: 178
Default

Have you chosen to get taxed as a corporation, as opposed to just letting income flow through to your personal return and taxed at your rate?
flap is offline   Reply With Quote
Old 02-24-2018, 05:40 AM   #18  
Gets Weekends Off
 
poor pilot's Avatar
 
Joined APC: Jan 2006
Posts: 565
Default

Quote:
Originally Posted by Sparky View Post
My wife and I started an LLC flipping homes and she's also a new real estate agent. We went to tax guy and realized we'll get hammered with taxes. I know lots of my fellow pilots have side businesses (including real estate investments). Looking for some practical advice on how to limit our tax exposure. Thanks in advance!!
1031 exchange may help, it allows you not to pay capital gains tax if you roll money into another investment within 6months.
poor pilot is offline   Reply With Quote
Old 02-24-2018, 05:41 AM   #19  
Gets Weekends Off
 
poor pilot's Avatar
 
Joined APC: Jan 2006
Posts: 565
Default

You need to find a tax guy that’s a investor
poor pilot is offline   Reply With Quote
 
 
 

 
Reply
 



Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are On


Related Topics
Thread Thread Starter Forum Replies Last Post
AAG reports record Q4/Full year profit InformationEcho American 75 01-30-2015 10:50 AM
FDX--PRSP after tax contributions??? kwri10s Cargo 34 11-27-2014 03:05 PM
Tax Equalization iarapilot Cargo 49 08-15-2007 01:39 AM
A Tax Equalization comparison iarapilot Cargo 29 08-09-2007 12:08 AM
Excellent article on tax rates SWAjet Money Talk 0 03-30-2005 10:12 PM


All times are GMT -8. The time now is 07:57 AM.


vBulletin® v3.9.3.5, Copyright ©2000-2018, vBulletin Solutions, Inc.
Search Engine Optimization by vBSEO 3.6.1
User Alert System provided by Advanced User Tagging v3.3.0 (Lite) - vBulletin Mods & Addons Copyright © 2018 DragonByte Technologies Ltd.
Copyright ©2000 - 2017 MH Sub I, LLC dba Internet Brands