This episode is a live mini-workshop recorded with members of the Escapee Collective (and released here because it was too useful to keep inside the community).

My guest Diane Kennedy (CPA) breaks down what most new escapees get wrong about taxes and business structure — and why the real first question isn’t “LLC or S-Corp?”

It’s: Are you building a business… or replacing a paycheck?

From there, we get into the most common setup for solopreneurs (LLC + S-Corp election), how to think about deductions without getting cute, and why “keeping it small and keeping it all” is the solopreneur cheat code.

We also bring in Lisa Dini from Lettuce, who explains how they help solos run the S-Corp model without turning you into an accountant.

Heads up: This is educational, not legal/tax advice. Talk to your pro for your situation.

What you’ll learn

1. The real first question for escapees: build a business vs replace a paycheck
2. Why “LLC vs S-Corp” is usually the wrong framing (and what Diane recommends instead)
3. Why Diane believes you should set up an LLC early (asset protection + flexibility)
4. The 3 “buckets” of income for solopreneurs: Earned, Leveraged, & Passive (the holy grail)
5. A simple way to think about deductions: ordinary + necessary (and how to find write-offs you already have)
6. How S-Corps can help you keep more of what you earn (salary vs distributions, plus other benefits discussed)
7. Real-world Q&A on: partners, joint ventures, and multi-state setups, California “special rules” , Schedule C vs S-Corp timing, Solo 401(k) and related retirement ideas

Resources Mentioned:

Lettuce.co: https://hubs.ly/Q03Yz8KX0

Tax Calc: https://hubs.ly/Q03Yz8Rf0

Tax Prep: https://hubs.ly/Q03Yz8JY0

Guests

Diane Kennedy

CPA and long-time solopreneur. Diane helps business owners structure their business and income in smarter ways so they can keep more of what they earn and operate like a real business.

Lisa Dini (Lettuce)

Lettuce helps solopreneurs run an S-Corp model efficiently, without drowning in admin and accounting work.