Taxes don't have to be the financial death sentence most people accept them to be. In this episode, we welcome back Neil McSpadden from Tax Sherpa for his second appearance on the show. Neil shares his journey from owing the IRS $1.3 million to becoming a tax strategist who's helped save hundreds of millions in taxes across 50,000+ returns.

The conversation covers everything from the latest Trump tax legislation to practical strategies for business owners, plus why being a W-2 employee puts you at the biggest tax disadvantage possible. We dive deep into the "Big Beautiful Bill," estate tax changes that could impact infinite banking practitioners, and the fundamental difference between how employees and business owners are taxed.

Whether you're a pure W-2 earner looking for ways to optimize your situation or a business owner wanting to maximize deductions, this episode reveals why having a tax strategy isn't optional—it's essential for keeping more of your hard-earned money out of government hands.

The Tax Order of Operations: The fundamental difference between W-2 employees and business owners isn't just about deductions—it's about when you pay taxes. Employees earn money, get taxed on nearly everything, then spend what's left. Business owners earn money, spend on allowable business expenses, then only pay taxes on what remains.

Trump's "Big Beautiful Bill": Neil breaks down the key provisions of the new tax package, including making the Tax Cuts and Jobs Act permanent, the "no tax on tips" policy, vehicle interest deductions for American-made cars, and changes to the SALT cap. Understanding these changes is crucial for planning your 2025 tax strategy.

Estate Tax Alert for IBC Practitioners: The estate tax exemption could drop from $13.5 million per person to roughly half that amount. For infinite banking practitioners with whole life policies and convertible term coverage, this could mean your policy values might subject your estate to a 40% tax.

Why Everyone Needs Business Income: Even if you're primarily a W-2 employee, having some form of business income opens up tax strategies unavailable to pure employees. This doesn't mean quitting your job—just finding ways to generate legitimate business income that shifts expenses from after-tax to before-tax.

➡️ Chapters

00:00 - Opening thoughts on taxation philosophy

01:00 - Neil's backstory: From $1.3M IRS debt to tax expert

04:00 - How Tax Sherpa was born during the pandemic

08:00 - Why the IRS doesn't actually know what you owe

09:00 - Trump's "Big Beautiful Bill" breakdown

12:00 - No tax on tips: The details matter

17:00 - Child tax credits and vehicle deductions

22:00 - SALT cap negotiations and high-tax states

28:00 - Estate tax sunset: A ticking time bomb

33:00 - Generation skipping transfer tax explained

37:00 - W-2 vs. business owner tax treatment

42:00 - The guiding principle of business deductions

47:00 - Case study: Converting 1099 income properly

52:00 - Tax Sherpa's client process overview

57:00 - Why Neil understands infinite banking

Want to learn smarter ways to reduce your tax burden and keep more of what you earn?

Follow Neal on LinkedIn: linkedin.com/in/neal-mcspadden or book a call at https://taxsherpa.com/book-an-appointment to see how you can optimize your tax strategy

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