Client of the Week

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Virtual Sales Star Saves Real Money

Young entrepreneurs are earning high income with YouTube self-promotion and sales online. One of our recent clients, age 41, creates online videos in which he promotes his own brand of products as well as offering product placement and reviews for sponsors. His S-corporation income is over $650,000 a year but in the past, he kept his W-2 low – about $40,000 – to minimize payroll taxes and took the rest in K-1 distributions. However, on the advice of his CPA and advisor, he will up his annual W-2 to at least $270,000 so that he can use that compensation as the basis for a retirement plan. He will now contribute over $100,000 each year to a defined benefit plan which is deductible from current year taxes. If he sticks with the plan, he will accumulate $2.6 million toward his retirement.

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