Mindset and Taxes: Becoming PROACTIVE instead of reactive

At Make Taxes Fair, we humbly believe that most CPAs and accountants are (without meaning to) what we call "Happy Historians." We mean no disrespect to the hardworking people in the tax and accounting profession. The professionals in the accounting field work tirelessly to keep businesses compliant, ensuring all the necessary numbers are put into the correct places, and making sure the returns are correct. And that can be a struggle because the truth is that Congress keeps making new tax rules, and the IRS enforces them.

So the CPAs and accountants of the world are hard at work to put all the right numbers in the right places, making sure tax returns are "compliant," or correct with the ever changing rules and regulations. But there's a difference between simply being compliant and actually saving money. Compliance is vitally important, but it’s just the first step.

And that is what we mean by “Happy Historian.” Reporting history without a systematic approach to evaluating what needs to change and how to do so leaves you, the business owner, overpaying on taxes by thousands of dollars and stuck in a rut of reactivity. 

Again, the work of compliance is super important, and we respect the people doing it. Without them, the tax system would be even more confusing and difficult for business owners.

But compliance alone isn’t enough. Filing your taxes correctly doesn’t mean you’re paying the least amount you could. Without a complete tax strategy, you could be overpaying by thousands each year. That’s where Make Taxes Fair and our CLEAR EDGE Framework come in. We help business owners like you take control of your taxes in a proactive way, rather than just reacting to deadlines and requirements.

Why Do You Need a Systematic Approach?

The problem is that most CPAs and accountants don’t have a solid system for helping people pay less in taxes. They are often under pressure during tax season and simply don’t have time to take a deeper look at strategies that might save their clients money.

These professionals do the best they can to give advice, but they usually have a reactive mindset. Their advice often stops at simple things like "contribute to a retirement plan" or "buy more equipment for your business." While these steps are helpful and can reduce taxes, they are just the basics.

This advice is good, but it only scratches the surface. There are many more things that can be done to save on taxes. Strategies that look at the big picture of your business, consider your long-term goals and work to ensure you’re not paying a penny more than you need to are available.

To help busy business owners overcome this kind of surface-level advice, we created the CLEAR EDGE Framework to examine all parts of a business from a tax perspective. This way, we can ensure that nothing is overlooked and that every opportunity to save money is taken.

Integrating the 4 E's of Learning: Education, Evaluation, Execution, and Efficiency

Before we introduce the CLEAR EDGE Framework and how it can transform your tax strategy, lets introduce our integrated approach of learning that we call the the 4 E’s of Efficiency: Education, Evaluation, Execution, and Efficiency. These four elements of learning make sure that the knowledge you gain is turned into real, effective action leading you to a state of efficiency.

So, quickly, let’s evaluate these together:

• Education: You don’t know what you’re missing until you’re given clear, concise, and relevant education to bridge the knowledge gap. Each pillar of the CLEAR EDGE Framework starts with education. For example, understanding how tax credits work, or knowing why your business structure matters. This education gives you the foundation you need. Education means learning what’s possible so that you can make the best decisions.
• Evaluation: Knowledge alone isn’t enough—knowledge applied is power. But before taking action, you need to evaluate how that education applies to your unique situation. Each tax strategy within the CLEAR EDGE Framework requires careful evaluation to understand how (or if) it fits your business. For instance, maybe you qualify for a tax credit but need to figure out if the requirements are realistic for you. The step of Evaluation bridges the gap between knowing and doing by evaluating how the new information can be used to improve your tax strategy.
• Execution: Once you have the right education and have evaluated how it applies to your business and your life, you’re ready for action. Execution is where we take those plans and put them into motion. We help you implement the best strategies, whether setting up the right retirement accounts or adjusting employee compensation to maximize tax savings. Without execution, education and evaluation are wasted efforts.
• Efficiency: The final step is Efficiency. Once the strategies are in place, it’s about maintaining that efficiency over time. Tax laws change, and your business grows, so it’s important to keep evaluating and refining your approach. Efficiency is the state you reach when your tax strategies work smoothly together and you’re constantly adapting to stay ahead. By combining education, evaluation, and execution, we can get a point where your tax planning runs like a well-oiled machine.

What is the CLEAR EDGE Framework?

The CLEAR EDGE Framework is how we cut tax bills by up to 75% using nine key areas or “Pillars”. Here’s how we integrate the 4 E’s with each pillar:

Credits- Tax Credits are incredibly powerful tax savings tools and many business owners miss credits that they should be claiming but just don’t know about. 

Education: Are you using all the credits you qualify for? Learn about the different tax credits available, such as the Work Opportunity Tax Credit (WOTC).

Evaluation: Are these credits right for your business? Do you have the necessary documentation and employee qualifications?

Execution: Apply for the credits and set the procedures to qualify every year.

Efficiency: Review these credits each year to see if there are new credits or changes that might apply to you.

Legal Structure: The legal structure of your business impacts taxes hugely

Education: Learn how different business structures—like LLCs, C-Corps, and S-Corps—affect your taxes.

Evaluation: Which structure is best for your income level and long-term goals?

Execution: Make changes to your business structure to maximize tax savings.

Efficiency: Regularly review your structure to ensure it continues to meet your needs as your business grows.

Employees: Hiring, rewarding, and retaining employees in tax-efficient ways

Education: Learn how you can save on taxes by using the tax code in the hiring process through Tax Credits or Tax-Free fringe benefits packages.

Evaluation: Understand which benefits will help both your employees and your tax situation.

Execution: Set up these benefits properly.

Efficiency: Review benefit programs yearly to keep them aligned with your business needs and tax-saving opportunities.

Accumulation of Wealth: Building wealth in tax optimized ways

Education: Learn about tax-optimized vehicles and tools to grow your wealth as you grow your business.

Evaluation: Determine which strategies are best suited to your business and personal financial goals.

Execution: Open and contribute to these vehicles or tools.

Efficiency: Continue to invest and evaluate the accounts for maximum growth while minimizing tax burdens.

Retirement Planning: Planning for your future confidently with tax savings

Education: Learn about different retirement plans, such as SEP IRAs or Solo 401(k)s, and how they impact your taxes.

Evaluation: Determine which plan best fits your current and future needs.

Execution: Set up and fund your retirement plan.

Efficiency: Keep track of contributions and make adjustments as your income changes.

Exit Planning: Cashing out without Uncle Sam taking (or taxing) a majority share 

Education: Learn what exit planning is and why it matters.

Evaluation: Evaluate how you can minimize taxes when selling your business.

Execution: Put an exit plan in place well before you intend to sell.

Efficiency: Review the plan regularly to adapt to changing market conditions or tax laws.

Deduction Optimization: Capture missed write offs and optimize your deductions

Education: Learn about common and advanced deductions you might qualify for.

Evaluation: Assess which deductions apply to you, like the home office deduction or the Augusta Rule.

Execution: Make sure you’re keeping good records and applying these deductions.

Efficiency: Review deductions quarterly to ensure you’re capturing everything possible.

Getting Organized: Get peace of mind by getting organized in your business and finances

Education: Understand the importance of organized bookkeeping for maximizing tax savings.

Evaluation: Evaluate your current record-keeping systems.

Execution: Implement new tools or processes to better organize your financial information.

Efficiency: Maintain these systems so that everything is ready for tax time.

Efficiency: Optimize your business and obtain efficiencies in your taxes and operations

Education: Learn how to create a tax strategy that works smoothly across all areas.

Evaluation: Determine if all aspects of your tax strategy are aligned.

Execution: Make necessary adjustments to achieve a fully integrated tax plan.

Efficiency: Keep evaluating and refining to make sure you’re always in the best possible position.

Bringing It All Together

Taxes are something we all have to deal with, but paying too much doesn’t have to be part of the deal. By taking a proactive approach with the CLEAR EDGE Framework and integrating the 4 E's of Learning—Education, Evaluation, Execution, and Efficiency—you can confidently reduce how much you pay and keep more of the money you’ve worked so hard to earn.

This isn’t just about saving money today—it’s about setting yourself up for future success. Each part of the CLEAR EDGE Framework works together to create a complete tax plan that serves you now and in the years to come.

Your Turn: Reflect and Act

Now that you’ve learned about the CLEAR EDGE Framework and the 4 E's of Learning, it's time to put it into practice:

• Education: What did you learn in this article about saving money on taxes? Think about the new information you’ve gained about tax credits, deductions, and the importance of a proactive tax strategy.
• Evaluation: How does this knowledge apply to you and your business? Are you currently using these strategies, or are there areas where you’re missing opportunities? Which parts of the CLEAR EDGE Framework do you think you need the most help with?
• Execution: What actions can you take right now? Maybe you need to re-evaluate your business structure, or perhaps you should start looking into the tax credits you qualify for. Identify one or two actions that you can execute today to improve your tax strategy.
• Efficiency: Finally, think about how you can keep your tax strategy efficient over time. What processes can you put in place to make sure you’re always on top of the latest tax-saving opportunities?

Reflect on these steps and take action. If you need help figuring out where to start, we’re here to assist you every step of the way. WHAT AREA OF THE CLEAR EDGE Framework do you think needs the most attention? Let us know, and let’s work together to help you save more!