Dan & Cannon sit down with a 26-year veteran of the banking industry and learn some mind-blowing stuff that every business should know to succeed!!

Check out the show's Google Docs notes below!

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⤵️SHOW NOTES⤵️

Showing income at the end of the year

1. Why should I show income?  If your ultimate goal is to grow your business it is important to show your income. I’ve never met a business owner that told me they started a business just so they could pay their current personal expenses. 
2. Bottom line is a bank is only able to give a business credit for what you actually claim on your taxes.  The business has to show after the day to day ordinary expenses are paid, they still have enough to pay their additional debts.
3. If I show income then I have to pay taxes... I don't want to pay taxes. I want to pay the least amount as possible

Why is going out and spending all of my profits at the end of the year to avoid taxes a bad thing for my banking future?

1. This is one of the biggest decisions or let’s say traps that a business owner falls into.  While it is your CPA’s job to save you from paying taxes at the end of the year, as a business owner you need to show income if you ever want to qualify for credit in the business’ name.  The biggest issue for most startup companies is initially a business owner  has to use their personal assets and or credit cards to fund business expenses.  When you go that route it affects your personal credit scores and your debt to income.
2. This is where banks and tax preparers clash. Your tax preparer's job is to show the least amount of income so you pay less taxes.
3. If you're looking to grow and utilize a business line of credit, purchase equipment etc. from your bank, this hurts you more than helps you. 
4. If you show income and pay taxes, then that tells the bank you're profitable and makes you more appealing to them.  
5. Business owners need to look at their bank as a partner or financial adviser.  Just like a consumer needs to show income to be able to finance things like a home or a vehicle, a business will only be able to obtain credit if they show the business has income to pay the debts.  Otherwise, you will be financing the business’ needs on your personal credit which in the long run will affect you being able to purchase your personal needs.

How do Direct Liabilities and Contingent Liabilities affect my business AND personal life?

1. What are Direct Liabilities =  Direct Liabilities are debt associated with your SS# and appear on your credit bureau.
2. What are Contingent Liabilities = Contingent liabilities are debts that you personally guarantee if the business is for any reason unable to pay. Contingent liabilities do not show on your personal credit bureau.
3. Example - You're about to buy a house and a truck breaks down and you end up having to go buy a truck and then the underwriter for your home loan says, "Looks like we can't approve the loan for your new house because you just bought a truck." Imagine telling your wife this and it's because you're dealing with Direct Liabilities and Contingent.

That’s a great example…In this case a bank will do a soft credit pull within 72hrs of a mortgage closing.  If the business financed the trucks and can show a 12 month history that the note on the truck is paid out of the business, the new purchase will not affect the loan.

What should I expect from my bank during tough times like Recession or Depression?

1. Are they going to stick with me when things or times are challenging? Or are they going to run for the...