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Mixing active and passive income in one entity could be costing you thousands. In this episode, we break down why separating your income streams is essential. Youโll learn how to structure your business the right way using S Corps, LLCs, holding companies, and even C Corps to unlock advanced tax strategies. From hiring your kids to slashing self-employment tax, this is the blueprint smart business owners use to keep more of what they earn.
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Chapters:
(01:04) Active vs. Passive Income (Why separation matters)
Why it's important to keep your active business and passive investments in separate entities.
(04:06) Choosing the Right Entity Type
Mike explains when to use sole proprietorships, LLCs, S corps, and C corps, depending on your needs.
(10:55) The S Corp Holding Company Setup
How to simplify taxes and planning by running your active businesses through one S-Corp holding company.
(14:36) Special Structures for Tax Strategies
When to use a sole proprietorship or C corp for things like hiring kids or unlocking health reimbursements.
(15:16) Real-Life Use Cases and Examples
Mike walks through examples for coaches, rental properties, and software businesses using strategic entities.
(21:16) When to Create a New Entity
Key questions to ask when deciding whether to form a new LLC, DBA, or use an existing structure.
Podcast Host:
Mike Jesowshek, CPA โ Founder and Host of Small Business Tax Savings Podcast
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๐ ABOUT THE PODCAST
The Small Business Tax Savings Podcast is your go-to resource for cutting-edge tax strategies to help entrepreneurs legally slash their tax bills. Hosted by Mike Jesowshek, CPA, this show breaks down complex tax topics into clear, no-fluff insights so you can keep more of your hard-earned money.
