Could Bitcoin mining turn a major business expense into a tax-saving opportunity?

In this episode, Mike Jesowshek and Colin from Leverage Mining explore how owning mining equipment could help business owners earn Bitcoin and claim potential tax deductions. They break down the upfront costs, participation requirements, and why a tax write-off alone isn’t enough to make this investment worthwhile.

You’ll learn who this strategy might suit, what a four-year commitment involves, and the risks to consider before getting started.

🚀 Could Bitcoin mining fit into your tax strategy? Book a call with Leverage Mining to explore the costs, potential tax benefits, and what getting started would involve: 

https://preview.khgmedia.com/widget/booking/WM032a6yfqW9p8Ls3WpR?utm_source=mike_jesowshek&utm_medium=referral&utm_campaign=partner_program

👉Find out how much your business could save in taxes.

TaxSavingsPodcast.com/scorecard 

🚀 Book your free demo call today. Click here or visit:

https://taxelm.com/demo/

Chapters:

(01:00) Bitcoin Mining vs. Buying Bitcoin
Bitcoin mining involves owning equipment that earns Bitcoin, rather than purchasing the asset directly. The discussion explains how mining machines work, why miners join pools, and how rewards are shared.

(06:00) Bitcoin Mining as a Tax Strategy
Mining equipment may qualify for bonus depreciation, creating an upfront deduction while the business produces Bitcoin over time. The conversation explores how this fits into a broader strategy of purchasing income-producing assets.

(08:00) Material Participation and Documentation
Using mining losses to offset wages or other business income involves more than purchasing equipment. The discussion covers material participation, tracking business activities, and planning ahead to meet the relevant requirements.

(13:00) Equipment Costs and the Four-Year Commitment
Colin outlines packages that combine mining machines, hosting, and electricity over four years. They discuss upfront costs, operating arrangements, and why the value of the Bitcoin earned can fluctuate.

(17:00) How Much of the Investment Is Deductible?
The full package price isn’t presented as a first-year deduction. Using a $100,000 example, they discuss an estimated $70,000 first-year deduction, with remaining electricity expenses spread over later years.

(19:00) Bitcoin Halving and Long-Term Returns
Mining rewards change over time, and Colin explains why his approach depends heavily on Bitcoin appreciating. The discussion highlights the importance of evaluating potential returns beyond the initial tax benefit.

(21:00) What Happens After the Mining Contract Ends?
As the four-year agreement ends, owners face decisions about older equipment and whether to purchase new machines. Colin discusses replacement, disposal, and the potential tax implications of selling depreciated equipment.

(24:00) Accumulating Bitcoin Over Time
Mining produces Bitcoin gradually rather than through a single purchase. Colin explains his preference for holding the Bitcoin earned and taking a long-term approach to price fluctuations.

(26:00) Understanding the Risks of Bitcoin Mining
Bitcoin prices, network difficulty, changing rewards, and equipment failures can affect results. The conversation also covers hosting fees, electricity contracts, downtime, and questions to ask when evaluating a provider.

(31:00) Who Might Be a Good Fit for This Strategy?
The discussion focuses on high-income business owners who can commit funds for several years and tolerate volatility. It closes with the importance of participation requirements, documentation, and building a legitimate business strategy.

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
Join TaxElm: https://taxelm.com

🚀 Visit:  https://www.TaxSavingsPodcast.com 

🚀 Check Out TaxElm: https://taxelm.com/

🚀 Join our Free Facebook Group: https://www.facebook.com/groups/taxsavings/

🚀 YouTube: www.TaxSavingsTV.com

👋🏼 GET IN TOUCH
You can Tweet @MJesowshek with any feedback, ideas, or thoughts about the lessons you've learned from the episodes. We want to thank you personally for tuning in 🙏

🙌LEAVE A REVIEW
If you enjoy the podcast, please leave a 5-star review on Apple Podcasts or Spotify—it helps more business owners find the show ⭐

Discover how you can save over 5 figures in taxes with my 3-step tax shift system in my upcoming masterclass on September 1st at 7PM EST

Join here: https://taxsavingspodcast.com/masterclass/

If your business earns between $50,000 and $750,000 in annual profit, you're probably paying thousands more in federal taxes than necessary.

But filing a tax return isn’t the same as tax planning. 

Proactive tax planning helps you make smarter decisions while there’s still time to reduce your bill.

On Tuesday, September 1 at 7:00 PM Eastern Time, Mike Jesowshek, CPA, is hosting a free 90-minute live masterclass on how business owners can cut their tax bills by $15,000 or more.

During the training, you’ll learn:

💵 Mike’s three-step Tax Shift System
📊 How proactive planning can uncover missed tax savings
🧾 The difference between tax preparation and tax planning
🏢 How an S Corp election could save an $80,000-profit business around $5,300 per year
✅ Which strategies may apply to your business and income

Mike will also stay after the training for a live Q&A, where you can ask about your entity, income, children, rental properties, or other tax questions specific to your situation.

The training is completely free, but you’ll need to reserve your seat.

Register now at taxsavingspodcast.com/masterclass

See you there! 

🚀  Discover how you can save over 5 figures in taxes with my 3-step tax shift system in my upcoming masterclass on September 1st 7PM EST

Join here:  https://taxsavingspodcast.com/masterclass/

Selling a business, rental property, or investment can create a significant capital gains tax bill. Could investing in an Opportunity Zone help you delay that tax and potentially eliminate taxes on future growth?

We cover how Qualified Opportunity Zones work, why the timing of your investment matters and all the rules for investments made in 2026 are very different from those beginning in 2027.

You’ll learn about the 180-day investment deadline, the limited deferral available in 2026, and the new five-year deferral beginning in 2027. Most importantly, you’ll learn why an Opportunity Zone investment should make financial sense before considering the tax benefits.

👉Find out how much your business could save in taxes.

TaxSavingsPodcast.com/scorecard 

🚀 Book your free demo call today. Click here or visit:
https://taxelm.com/demo/

Chapters:

(00:00) What Is an Opportunity Zone?
Opportunity Zones encourage investment in designated communities by offering tax benefits to investors who reinvest eligible gains through a Qualified Opportunity Fund.

(02:00) The Two Main Opportunity Zone Tax Benefits
Investors may be able to defer tax on the original gain and exclude future appreciation from federal capital gains tax after holding a qualifying investment for at least 10 years.

(04:00) What Happens to Opportunity Zone Investments in 2026?
Gains invested under the current rules generally become taxable by the end of 2026, but the investment may still qualify for the 10-year appreciation benefit.

(06:00) Can You Move an Existing Gain Into the New Program?
A deferred Opportunity Zone gain recognized at the end of 2026 generally cannot be reinvested under the new rules beginning in 2027.

(07:48) How the 180-Day Deadline Affects Late-2026 Gains
A new gain realized late in 2026 may qualify for the 2027 rules if the investment is made in 2027 within the required 180-day period.

(09:37) What Changes for Opportunity Zones in 2027?
The new rules introduce a five-year deferral, a 10% basis increase after five years, and a potential 30% basis increase for qualifying rural investments.

(12:04) Should You Invest in 2026 or Wait Until 2027?
The right timing depends on when the gain occurred, when the 180-day deadline expires, and whether the investment makes financial sense on its own.

(14:04) Five Questions to Ask Before Investing
Confirm that the gain qualifies, calculate the exact deadline, identify which rules apply, consider the 10-year holding period, and evaluate the investment without the tax benefit.

(16:43) Common Opportunity Zone Myths
Mike addresses misconceptions about eliminating the original gain, qualifying properties, reinvesting old gains, rural funds, and missing the 180-day deadline.

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
Join TaxElm: https://taxelm.com

🚀 Visit:  https://www.TaxSavingsPodcast.com 

🚀 Check Out TaxElm: https://taxelm.com/

🚀 Join our Free Facebook Group: https://www.facebook.com/groups/taxsavings/

🚀 YouTube: www.TaxSavingsTV.com

👋🏼 GET IN TOUCH
You can Tweet @MJesowshek with any feedback, ideas, or thoughts about the lessons you've learned from the episodes. We want to thank you personally for tuning in 🙏

🙌LEAVE A REVIEW
If you enjoy the podcast, please leave a 5-star review on Apple Podcasts or Spotify—it helps more business owners find the show ⭐

🎙 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.

Can you deduct your dog, pay your child tax-free, or claim the kitchen table as a home office? Tax rules for small business owners aren’t always straightforward. Wrong assumption could lead to missed deductions or problems with the IRS.

In this Q&A episode, Mike answersyour questions. He explains which expenses may qualify when a dog is used for marketing, how hiring children differs between an S corporation and a sole proprietorship, and what happens when a child turns 18.

He also covers mileage tracking, missing receipts, home office requirements, unreported Venmo income, retirement plan deadlines, college funding strategies, and whether health-sharing payments qualify for the self-employed health insurance deduction. 

👉 Get the Free Tax Savings Starter Kit Built for Small Business Owners:
https://www.taxsavingspodcast.com/starterkit

🚀 Book your free demo call today. Click here or visit:
https://taxelm.com/demo/

Chapters

00:45 Hiring Your Children Through an S Corporation
Mike explains how a child’s age and the business entity affect income tax, FICA withholding, W-2 employment, and 1099 contractor treatment.

05:03 Deducting Your Dog and Tracking Business Mileage
Learn which dog-related marketing expenses may qualify as deductions, which personal pet expenses typically don’t, and how to document business mileage.

09:10 Missing Receipts and Paying for College Through Your Business
Mike covers the documentation needed for expenses under $75, reimbursing personally paid business costs, and hiring a child to help fund college.

13:55 Retirement Deadlines and the Home Office Deduction
Review important retirement contribution deadlines and find out why working from the family kitchen table generally doesn’t qualify for a home office deduction.

16:28 Hiring a Teenager and Reporting Venmo Income
Mike explains W-4 and payroll requirements when hiring a 15-year-old, along with why business income must be reported even when no 1099 is received.

19:26 Health-Sharing Plans and Insurance Deductions
Find out whether health-sharing payments qualify for the self-employed health insurance deduction and how to compare their cost with potential tax savings.

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
Join TaxElm: https://taxelm.com

🚀 Visit:  https://www.TaxSavingsPodcast.com 

🚀 Check Out TaxElm: https://taxelm.com/

🚀 Join our Free Facebook Group: https://www.facebook.com/groups/taxsavings/

🚀 YouTube: www.TaxSavingsTV.com

👋🏼 GET IN TOUCH
You can Tweet @MJesowshek with any feedback, ideas, or thoughts about the lessons you've learned from the episodes. We want to thank you personally for tuning in 🙏

🙌LEAVE A REVIEW
If you enjoy the podcast, please leave a 5-star review on Apple Podcasts or Spotify—it helps more business owners find the show ⭐

🎙 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.

Life insurance isn’t just a way to protect your family. For the right business owner, it can also provide tax-efficient growth, access to capital, and long-term financial flexibility.

In this episode, Mike and Matt explain how cash value life insurance works, including tax-deferred growth, policy loans, death benefits, and long-term care benefits. They also break down term, whole, and universal life insurance, who this strategy may benefit, and how to avoid choosing an expensive or poorly designed policy.

👉 Need a life insurance policy that fits your financial strategy? Connect with Matt for a policy review and personalized guidance based on your goals: https://lifeincrs.com/tax-savings-podcast

👉Find out how much your business could save in taxes.

TaxSavingsPodcast.com/scorecard 

🚀 Book your free demo call today. Click here or visit:

https://taxelm.com/demo/

Chapters:

(01:25) Life Insurance as a Wealth-Building Strategy
For some high-income earners and business owners, life insurance can provide more than financial protection. A properly structured policy may support tax-efficient growth, access to capital, and long-term financial stability.

(03:25) The Tax Advantages of Cash Value Life Insurance
Policy contributions are generally made with after-tax money, but the cash value can grow tax-deferred. Beneficiaries may also receive the death benefit free from federal income tax.

(05:20) Understanding Policy Costs and Commissions
Permanent life insurance can carry significant upfront commissions and insurance costs. Evaluating those expenses over the policy’s full lifetime provides a more useful comparison than looking only at the first year.

(10:10) Accessing Cash Value Through Policy Loans
Policyholders may borrow against their cash value without creating an immediately taxable withdrawal. The remaining cash value can continue earning interest, while unpaid loans generally reduce the eventual death benefit.

(15:35) Contribution Limits and Modified Endowment Contracts
Life insurance doesn’t have the same annual contribution limits as qualified retirement accounts. However, overfunding a policy can turn it into a modified endowment contract and change how withdrawals are taxed.

(19:00) Term, Whole, and Universal Life Insurance Explained
Term insurance provides temporary protection without accumulating cash value. Whole and universal life policies offer permanent coverage, with different levels of cash value growth, investment exposure, cost, and flexibility.

(22:15) Designing a Policy Around Your Financial Goals
A policy can be designed to prioritize accessible cash value or a larger death benefit. Additional features may include chronic care riders, participating loans, and fixed or net-zero loan options.

(25:30) Who Should Consider Cash Value Life Insurance?
This strategy may fit profitable business owners who have already established emergency savings and funded their traditional retirement accounts. It generally shouldn’t be someone’s first savings or investment tool.

(30:00) Why Life Insurance Is Often Misunderstood
Life insurance is complex and sometimes presented as a solution to every financial problem. Its value depends on whether the policy is properly explained, structured, and integrated into a broader financial plan.

(32:10) Reviewing an Existing Life Insurance Policy
A policy audit can reveal whether existing coverage is healthy, appropriately designed, and aligned with the owner’s current goals. Before purchasing or changing a policy, review the numbers and consult a professional who understands multiple financial strategies.

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
Join TaxElm: https://taxelm.com

🚀 Visit:  https://www.TaxSavingsPodcast.com 

🚀 Check Out TaxElm: https://taxelm.com/

🚀 Join our Free Facebook Group: https://www.facebook.com/groups/taxsavings/

🚀 YouTube: www.TaxSavingsTV.com

👋🏼 GET IN TOUCH
You can Tweet @MJesowshek with any feedback, ideas, or thoughts about the lessons you've learned from the episodes. We want to thank you personally for tuning in 🙏

🙌LEAVE A REVIEW
If you enjoy the podcast, please leave a 5-star review on Apple Podcasts or Spotify—it helps more business owners find the show ⭐

Paying yourself the lowest possible S Corp salary might save taxes today, but it could create a much bigger tax bill later.

In this episode, Mike explains how to determine a reasonable S Corp salary based on your role, hours, local market wages, business profit, and cash flow. He also breaks down payroll timing, salary adjustments, documentation, and how to protect your S Corp tax savings while staying compliant with IRS rules.

👉Find out how much your business could save in taxes.

TaxSavingsPodcast.com/scorecard 

🚀 Book your free demo call today. Click here or visit:
https://taxelm.com/demo/

Chapters:

(01:00) What Is Reasonable Compensation?
An S Corp owner who actively works in the business must receive a reasonable W-2 salary based on what the business would pay someone else to perform the same work.

(03:05) The Goal Is a Defensible, Documented Salary
A reasonable salary shouldn’t be unnecessarily high or aggressively low. It should be supported by a clear process and adjusted as the business changes.

(04:05) Factors That Determine an S Corp Salary
The owner’s responsibilities, hours, industry, location, role in generating revenue, company profit, cash flow, and stage of growth all affect reasonable compensation.

(05:40) The Percentage Method and 40/60 Split
Using 40% to 50% of business profit as salary can provide a starting point, but a percentage alone doesn’t replace a complete reasonable compensation analysis.

(07:00) Using Market Wages and Replacement Cost
Breaking the owner’s work into technical, sales, marketing, and administrative duties can help calculate a salary using local market rates for each role.

(10:05) Comparing Salary to Business Profit
Reasonable compensation must also make sense in relation to the company’s profit, the owner’s involvement, available cash flow, and whether money is being distributed or reinvested.

(11:05) How Often Should an S Corp Owner Run Payroll?
Monthly or biweekly payroll is generally recommended, with a review later in the year to make any necessary adjustments or catch-up payments.

(13:15) How to Document Reasonable Compensation
Keep a written salary analysis, description of duties, estimated hours, market-wage data, payroll records, profit information, and year-end review notes.

(15:05) Two Businesses With Very Different Salaries
A real-world example shows why two owners with identical business profits can reasonably receive drastically different salaries based on their actual involvement.

(16:35) Protecting Your S Corp Tax Savings
The strongest S Corp strategy uses a salary that is reasonable, defensible, and documented instead of simply chasing the lowest possible number.

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
Join TaxElm: https://taxelm.com

🚀 Visit:  https://www.TaxSavingsPodcast.com 

🚀 Check Out TaxElm: https://taxelm.com/

🚀 Join our Free Facebook Group: https://www.facebook.com/groups/taxsavings/

🚀 YouTube: www.TaxSavingsTV.com

👋🏼 GET IN TOUCH
You can Tweet @MJesowshek with any feedback, ideas, or thoughts about the lessons you've learned from the episodes. We want to thank you personally for tuning in 🙏

🙌LEAVE A REVIEW
If you enjoy the podcast, please leave a 5-star review on Apple Podcasts or Spotify—it helps more business owners find the show ⭐

🎙 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.

Will electing S Corporation status ALWAYS save your business thousands in taxes? While that can be true, an S Corp also brings additional payroll requirements, tax filings, costs, and responsibilities.

In this episode, we break down how an S Corp reduces self-employment taxes, when the election usually makes financial sense, and which factors you need to consider before making the switch.

👉Find out how much your business could save in taxes.

TaxSavingsPodcast.com/scorecard 

🚀 Book your free demo call today. Click here or visit:
https://taxelm.com/demo/

Chapters:

(00:00) What Is an S Corporation?
An S Corp is a tax election for an existing LLC or corporation, not a separate type of business entity.

(03:00) How an S Corp Can Reduce Your Taxes
Splitting business income between a reasonable salary and distributions can reduce the amount subject to self-employment taxes.

(05:00) When Does an S Corp Start Making Sense?
An S Corp generally becomes worth exploring when a business consistently earns around $60,000 or more in annual profit.

(08:00) Who Is a Good Candidate for an S Corp?
Consistent profit, active owner involvement, clean bookkeeping, and reliable cash flow are important signs that an S Corp could be a good fit.

(10:00) When an S Corp May Not Save You Money
 Low or inconsistent profit, high reasonable compensation, state-level taxes, and an existing high-paying W-2 job can change the calculation.

(12:00) The Reasonable Salary Requirement
 S Corp owners who actively work in the business must pay themselves reasonable W-2 compensation before taking distributions.

(13:00) How Often Should an S Corp Owner Run Payroll?
Monthly or biweekly payroll is generally the safest approach, while waiting until the end of the year can create compliance and cash-flow problems.

(14:00) Hidden S Corp Costs and Responsibilities 

Payroll filings, W-2s, bookkeeping, accountable plans, health insurance reporting, and salary documentation must all be handled correctly.

(15:00) The S Corp Decision Framework
Use these questions to evaluate profitability, salary, payroll, state taxes, bookkeeping, and whether the potential savings exceed the added costs.

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
Join TaxElm: https://taxelm.com

🚀 Visit:  https://www.TaxSavingsPodcast.com 

🚀 Check Out TaxElm: https://taxelm.com/

🚀 Join our Free Facebook Group: https://www.facebook.com/groups/taxsavings/

🚀 YouTube: www.TaxSavingsTV.com

👋🏼 GET IN TOUCH
You can Tweet @MJesowshek with any feedback, ideas, or thoughts about the lessons you've learned from the episodes. We want to thank you personally for tuning in 🙏

🙌LEAVE A REVIEW
If you enjoy the podcast, please leave a 5-star review on Apple Podcasts or Spotify—it helps more business owners find the show ⭐

🎙 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.

👉 Ready to simplify your recordkeeping? Check out Shoeboxed to organize receipts, track mileage, and keep your business expenses audit-ready. Visit https://referrals.shoeboxed.com/mb4p7wl1ithi

You could qualify for thousands of dollars in tax deductions, but without the right documentation, the IRS could take them away.

Mike sits down with Doug Breaker, owner of Shoeboxed, to explain how proper recordkeeping helps business owners protect their tax deductions. They break down what to document for receipts, meals, mileage, home offices, and business travel, how long to keep your records, and how simple tracking systems can help you stay organized and audit-ready.

👉Find out how much your business could save in taxes.

TaxSavingsPodcast.com/scorecard 

🚀 Book your free demo call today. Click here or visit:
https://taxelm.com/demo/

Chapters: 

01:00 Doug Breaker’s Journey to Owning Shoeboxed
Doug explains how he went from working as a corporate CEO to purchasing Shoeboxed and becoming a business owner.

05:00 How Shoeboxed Simplifies Recordkeeping
Doug shares how Shoeboxed helps business owners digitize receipts, automatically collect expense information, and classify business mileage.

06:00 What Counts as Proper Documentation?
Receipts should capture details such as the date, vendor, amount, and business purpose, while mileage logs require the date, destination, mileage, and purpose of the trip.

11:00 How to Organize a Backlog of Receipts
Business owners with years of disorganized receipts should begin by digitizing recent records and creating a consistent process for tracking new expenses.

15:00 What an Audit-Ready Mileage Log Should Include
A proper mileage log should record the date, destination, miles driven, and business purpose of each trip rather than relying on an annual estimate.

19:00 How Long Should You Keep Business Tax Records?
Doug recommends keeping receipts, mileage logs, and supporting documentation for at least three years in a secure and accessible location.

22:00 When Driving From Home Becomes Deductible Mileage
Driving from home to a regular workplace is generally commuting, but traveling from a qualifying home office to another business location can create deductible mileage.

27:00 Deducting Expenses Before a Business Makes Money
Expenses incurred before a business begins operating may be treated as startup costs. Establishing a paying customer can help show that the business has moved into its operational stage.

32:00 Why Better Recordkeeping Protects Your Tax Savings
Consistently tracking every receipt and business mile helps protect deductions, reduce audit anxiety, and keep more money in the business.

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
Join TaxElm: https://taxelm.com

🚀 Visit:  https://www.TaxSavingsPodcast.com 

🚀 Check Out TaxElm: https://taxelm.com/

🚀 Join our Free Facebook Group: https://www.facebook.com/groups/taxsavings/

🚀 YouTube: www.TaxSavingsTV.com

👋🏼 GET IN TOUCH
You can Tweet @MJesowshek with any feedback, ideas, or thoughts about the lessons you've learned from the episodes. We want to thank you personally for tuning in 🙏

🙌LEAVE A REVIEW
If you enjoy the podcast, please leave a 5-star review on Apple Podcasts or Spotify—it helps more business owners find the show ⭐

🎙 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.

Can a rental property put $30,000 in your pocket without adding $30,000 to your taxable income? Let’s talk about rental property tax strategies

Mike explains how rental real estate can create tax savings even when you can’t use rental losses to offset your business or W-2 income. 

He breaks down the difference between cash flow and taxable income, how depreciation can shelter rental income, and what happens to suspended passive losses. He also covers short-term rental rules, real estate professional status, common entity mistakes, and the key questions to ask before buying a rental property.

👉Find out how much your business could save in taxes.

TaxSavingsPodcast.com/scorecard 

🚀 Book your free demo call today. Click here or visit:
https://taxelm.com/demo/

Chapters: 

00:00 How Rental Properties Create Tax Savings
Rental properties don’t need to generate a usable tax loss to provide tax benefits. Depreciation and other deductions can allow investors to earn positive cash flow without reporting the same amount as taxable income.

02:15 What Happens When You Can’t Use a Rental Loss?
Rental losses are generally passive and can’t usually offset W-2 or active business income. Unused losses are  suspended until they can offset passive income or be used when the property is sold.

05:15 Rental Cash Flow vs. Taxable Income
Cash flow is the money that reaches your pocket, while taxable income is the amount the IRS taxes. 

06:15 How $30,000 of Rental Cash Flow Could Create No Taxable Income
A business owner earning $200,000 could receive another $30,000 in rental cash flow while still reporting around $200,000 of taxable income. Depreciation and rental deductions could shelter the additional income.

08:45 When Rental Losses Can Offset Active Income
Short-term rental treatment, real estate professional status, and certain active participation rules can allow rental losses to offset W-2 or business income.

12:30 How Rental Property Depreciation Works
Residential rental buildings are generally depreciated over 27.5 years, while commercial properties are depreciated over 39 years. 

14:45 Why You Shouldn’t Hold Rental Property in an S Corporation
Rental properties are commonly held in LLCs for liability protection, but generally shouldn’t be placed inside an S corporation. Active business operations and passive rental activities should also be kept legally separate.

17:15 Building a Complete Rental Property Tax Strategy
A strong rental strategy combines positive cash flow, depreciation, expense tracking, appreciation, debt paydown, suspended losses, and potential strategies such as hiring your children or completing a 1031 exchange.

19:15 Four Questions to Ask Before Buying a Rental Property
Before investing, determine whether the property makes sense without the tax benefits, what its cash flow will be after debt payments, how much income will be taxable, and whether any rental losses can be used immediately or will be suspended.

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
Join TaxElm: https://taxelm.com

🚀 Visit:  https://www.TaxSavingsPodcast.com 

🚀 Check Out TaxElm: https://taxelm.com/

🚀 Join our Free Facebook Group: https://www.facebook.com/groups/taxsavings/

🚀 YouTube: www.TaxSavingsTV.com

👋🏼 GET IN TOUCH
You can Tweet @MJesowshek with any feedback, ideas, or thoughts about the lessons you've learned from the episodes. We want to thank you personally for tuning in 🙏

🙌LEAVE A REVIEW
If you enjoy the podcast, please leave a 5-star review on Apple Podcasts or Spotify—it helps more business owners find the show ⭐

🎙 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.

👉 Interested in learning more about oil and gas investing?  Email us at [email protected] and we’ll connect you with Nick White and the team at US Energy.

Big tax deduction or risky investment? Oil and gas investing can be a powerful tax strategy for high-income business owners, but it’s not something to jump into just because you want a write-off.

In this episode, Mike sits down with Nick White from US Energy to break down how oil and gas investing works, where the tax benefits come from, and why intangible drilling costs can create a large first-year deduction. They cover who is a good fit, how these investments can potentially offset W-2 income, business income, K-1 income, and capital gains, what the return and cash flow profile may look like, and the key risks investors need to understand before getting involved. 

👉 Get the Free Tax Savings Starter Kit Built for Small Business Owners:
https://www.taxsavingspodcast.com/starterkit

🚀 Book your free demo call today. Click here or visit:
https://taxelm.com/demo/

Chapters: 

01:00 How Oil and Gas Investing Creates Tax Benefits
Oil and gas investing is built around government incentives for domestic energy production. Investors who participate directly in drilling funds may be able to receive large first-year deductions through intangible drilling costs.

06:00 Intangible Drilling Costs Explained
Intangible drilling costs include expenses tied to the drilling process that do not have a depreciation schedule, such as labor, roads, and hydraulic fracturing. These costs can help create a large year-one deduction for qualified investors.

07:45 Offsetting W-2, Business, K-1, and Capital Gains Income
Unlike many real estate losses, oil and gas deductions may be able to offset active income, including W-2 income, business income, K-1 income, and capital gains. This is one reason the strategy is often discussed with high-income earners.

09:15 Who is Oil and Gas Investing a Good Fit For?
Oil and gas investing is generally geared toward accredited investors, including individuals with at least $1 million in net worth excluding their primary residence, or income of at least $200,000 for single filers and $300,000 for joint filers.

11:15 Key Risks Investors Need to Understand
Oil and gas investing comes with real risks, including drilling risk, pricing risk, concentration risk, and company structure risk. Look closely at debt levels, drilling strategy, diversification, and whether the company is focused on proven production areas.

17:00 Timing Your Investment Before Year-End
While an investment may qualify if completed by December 31, starting earlier gives investors more time to understand the deal, plan properly, and avoid rushed year-end decisions.

23:30 QBI, SALT, and Phaseout Planning
Oil and gas deductions may help business owners reduce taxable income enough to phase back into other tax benefits, such as the qualified business income deduction or state and local tax deductions.

26:00 Common Mistakes When Evaluating Oil and Gas Deals
Not every deal is structured the same way. Investors should avoid chasing deductions blindly and instead evaluate the partnership structure, use of debt, drilling approach, technology, risk profile, and long-term cash flow potential.

Disclaimer:

This episode was not sponsored. This conversation is for educational purposes only and is not investment, legal, or tax advice. It is not a recommendation or endorsement of any specific company, fund, security, or oil and gas offering. Oil and gas investments may involve substantial risk, illiquidity, commodity price volatility, operational risk, tax complexity, and possible loss of principal. Tax treatment depends on each taxpayer’s facts, investment structure, at-risk basis, passive activity rules, and professional advice. Past results do not guarantee future results.

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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.