CLEAR EDGE Framework and FIRE Method for Business Owners [EP1]

Intro: If you paid more than $50,000 in taxes last year, you are in the right place. This is the tax reduction podcast powered by Make Taxes Fair. Hosted by tax strategist Chris Middleton, the show is designed for business owners who want to stop overpaying the IRS and keep more of their hard earned money. Every episode delivers targeted tax advice you can use to cut your tax bill and put more cash back into your business. No fluff, no gimmicks, just proven strategies most accountants never share.

Now here's your host, Chris Middleton.

Chris Middleton: Let me ask you something. Are you using a system, a real strategy system to reduce your taxes? Or you're just using the system of hope, right, hoping that your CPA is doing everything right. The truth is most business owners are overpaying the IRS by tens or even hundreds of thousands of dollars either every year or over the life of their business just because they don't have a proactive tax approach or tax plan. Today, I'm gonna show you the exact framework that we use at Make Taxes Fair to help our clients legally reduce their taxes by 30 to 50%, sometimes a lot more year after year after year, and it's something that we call the clear edge framework.

And when you combine it with our simple, what we call the FIRE method, you'll know exactly what to do, what it saves you in tax dollars, and how to take action fast. So let's get into it. The problem is this. The tax system is not built for you and I. Right?

It's built for the government, confusion, and that confusion is what leads to overpayment. And most CPAs and accountants, god bless them and bless their hearts, are not intentionally, but what I they are what I call happy historians. Right? They happily put the right numbers in the right boxes, but when it comes to actually, you know, doing anything beyond filing clean tax returns, they're not doing much proactively to look ahead and say, hey. Here's how we can reduce your tax bill next year or the year after or the year after.

And big companies and, you know, corporations and billionaires, they have teams of people that are using systems to pay less to the government legally and legitimately, and they do it with confidence. Well, they have those resources to dump into all those people. And here's the thing. You don't need a huge team of people. You don't need, you know, hundreds of thousands of dollars to pay lawyers and CPAs.

You can capture those results with a system, not a spreadsheet, not a shoebox of receipts. We wanna get away from all that. A real system designed to help you win the tax game legally. That's what we call the clear edge framework, and that's what that gives you, a clear edge. So what is the clear edge framework?

It's a nine pillar system that we use with our clients to identify missed opportunities, layer tax strategies legally, and build long term tax efficiency. So here, let me give you a quick flyover of each pillar of the clear edge. The c stands for credit optimization. You may qualify for tax credits that no one's ever even mentioned to you. The workers' opportunity tax credit, r and d tax, research and development tax credit, energy tax credit, state tax credits, and more.

Credits are incredibly valuable because they're a dollar for dollar equivalent of tax. That means a thousand dollar credit tax credit equals $1,000 of actual tax. So it really acts like a payment towards your tax bill. And the wild part is, again, most busy business owners just flat out miss tax credits that they should be taking advantage of because they just don't know about those credits. The next pillar of the clear edge framework is what's called the legal structure, and that c is for credits, l is for legal structure.

So is your business set up as the right entity? When was the last time you looked at your legal structure? The difference between a sole prop and an s corp election could be, you know, tens of thousands of dollars to you every year. Well, structuring your business entities for tax optimization is not only vital, but it also is impacts by where you live, like what state do you live in and do business in. So the structure for one person may look very different than another's.

Right? Each business legal structure can have a huge impact on how you're taxed, and we find that business owners just don't examine or revisit this topic as often as they should. The next pillar is employees. Right? So we have credits, legal structure, now employees.

The tax code actually rewards you for how you find, hire, train, and retain your team. So if you know the rules, you can leverage the tax code to find, reward, retain your team to not only help you save money on taxes, but can also boost your employee morale and really provide fuel for growth when you have a happy and productive team. The next pillar is the accumulation of wealth. So so far, we've had credits, legal structure, employees. Now we get into accumulation of wealth.

And with this pillar, we help people build assets in tax advantage ways and including depreciation, real estate, tax advantage investments, tax free investments. Entity structuring can also have an impact when we talked about layering the different strategies and pillars. Entity structuring can also have an impact and understanding how certain benefits can be leveraged depending on your entity type to create real wealth while paying less in taxes. That's the key. The next pillar is retirement planning.

Right? So we have, credits, legal structure, employees, accumulation of wealth, now retirement planning. So retirement accounts, your SEP, solo four zero one k, four zero one k, cash balance plans, all those can provide short term savings and long term wealth building. So it's important to examine your retirement plans through the eyes of a tax perspective to say how can we build this both for tax efficiency now and in the future. The next pillar is exit planning.

This is the first e in the edge. So exit planning. That's when it's time to cash out or say, hey. We're gonna transition out of a business or hand things off, whether it's your business, your highly appreciated asset. Well, you don't want uncle Sam walking away with 30% or more of your exit, right, being an equity shareholder in your business or your asset.

So exit planning is a key pillar of the ClearEdge framework because the right move it takes to say, hey. We're gonna reduce your tax burden on the exit should be made well in advance of the actual exit and not really made at the last minute as a last minute scramble. You can get results with that last minute scramble, but being proactive and saying, hey. Let's be intentional about this and plan is really key to keeping more of your hard earned wealth in your pocket and in your bank account. Deduction optimizations from fringe benefits to accountable plans to the Augusta rule.

Right? We talked about exit planning as part of the edge. Now we're to deduction optimization. Most busy business owners just leave thousands of dollars on the table every year simply because they don't know the basics of what is tax deductible and how to leverage legitimately leverage the rules to their advantage. Getting organized.

So we've got exit planning, deduction optimization, now getting organized. Proactivity. There's so much value in just getting basic organization around your finances, bookkeeping, payroll, cash flow management, documentation of the different strategies as we put them into place. Right? Getting organized protects you in the event of an audit and simplifies your tax season forever.

A little bit of effort right now can yield countless of saved hours and eliminate sleepless nights as a business owner stressing about the unknown. The last e in the edge, so we exit planning, deduction optimization, getting organized. Now we get to efficiency. And when we've applied each of the pillars of the clear edge framework and when they're all in place, we now have a systematic approach to revisit your taxes each quarter and each year to constantly evaluate your business as you grow. The ClearEdge framework really is a secret sauce to keeping current with tax law changes and avoiding having to reinvent the wheel each year.

So the ClearEdge framework is designed to give you exactly that, a clear edge over the government. But I need to share a secret with you. No one strategy will magically eliminate your tax bill. But when you layer all nine pillars together for a synchronized and organized approach to identify and deploy tax strategies in each of these pillars, that's where real savings are found. The American author Robert Collier, I love this saying, he famously said success is the sum of small efforts repeated day in and day out.

Let me say that again. Success is the sum of small efforts repeated day in and day out. You did not magically have a business that was built, right, and profitable. Like, that came as a result of repeated effort, small efforts day in and day out. The clear edge is exactly the same.

It gives us that lens through which to view your business and best understand where those small efforts should be focused on right now to achieve success in terms of tax mitigation and paying less to the government. Hearing all that, you might be thinking, hey. This sounds great. But let's face it. I'm already overwhelmed.

I'm running a business, to raise a family, trying to stay mentally healthy and mentally together. In fact, I despise the term small business. There's absolutely nothing small about being in business, folks. Getting up every day for that daily effort that it takes to tackle the world and create your own economy, nothing small about that. So you're like, hey.

I'm already running a business. I don't have time for a new system, and I totally get it. I'm a busy business owner just like yourself. That's why to add to the clear edge framework, we developed what we call the FIRE method to help busy business owners like you cut through the noise, take focused action quickly. So here's what FIRE stands for.

The f is for focus. We help you zero in on the one thing that matters most right now in your tax road map. We do this by providing targeted education around a topic to help weed through all the fluff and understand and get to the meat of the information that you need to know. The I stands for impact. So every strategy that we teach has real dollar value attached to it.

You'll know what you're gonna save before you act. Right? This component is absolutely critical to help you evaluate how impactful this strategy or new knowledge will actually be to you and your bottom line. The r is for react. So once you've focused in and understand the impact, you're like, well, shucky darn.

That's gonna impact me positively in thousands of dollars every year. So that information that you've just absorbed and said, cool. That's really, really neat stuff, but that's useless without execution. So we show you how to react, how to implement what you've learned quickly and confidently. Execution is absolutely vital, and you must take action to achieve results just as you must take action to generate income in your business.

That was not a passive result. Your tax bill is not the result of passive activity. Your tax bill came as a result of you actively working. Efficiency is the e in the FIRE acronym and so or the FIRE method, I should say. And with this approach, we help you create repeatable systems so you can stack those tax savings every year without massive amounts of added effort.

So think of it this way. The clear edge framework is the road map. Right? The fire method is the fuel that you put into your tank to propel you along that road map. And this is just the beginning.

Today, we've introduced the clear edge framework, which really kinda helps you understand the bigger picture in this tax reduction process that we at Make Taxes Fair have. So welcome to the tax reduction podcast. We're introducing you to the ClearEdge framework and the FIRE method so that as you dive into future episodes, you'll be able to take a peek at and say, hey. What is this? I'm gonna focus in on this.

I'm gonna understand the impact. I'm gonna be able to react and take action and gain efficiency as I understand which pillar in the clear edge that this specific tax strategy falls into or fits into. Goal is to break down things that can be very confusing and overwhelming to help you take action. In the next episode, we're gonna be breaking down something that confuses a lot of people, which is differences between tax preparation versus tax planning versus tax strategy. Right?

Preparation is recording history. Tax planning is saying, well, here's what our bill is gonna be, and let's make sure that we can have the money set aside to pay for that bill. Tax strategy is the active engagement to implement systems to reduce your taxes. So we'll dive into that more in the next episode. So if you don't know the difference, there's a good chance that you're leaving money on the table.

So stick around. Make sure you hit follow or subscribe wherever you're hearing this so you don't miss it. And if you want to know if you're overpaying the IRS right now, you can actually head to www.thetaxreductionpodcast.com. That's the taxreductionpodcast.com. You download our free clear edge framework assessment that we put together where you could self evaluate your own tax efficiency in each pillar and get instant clarity on where you need to improve right now to save money on taxes.

Thank you for being here. Your time is incredibly valuable. We hope this has been useful. Thank you till next time. Make it an amazing day.

Bye for now.

Intro: That was today's play on the tax reduction podcast with Chris Middleton. For step by step checklists, examples, and access to the tax savings communities, visit www.thetaxreductionpodcast.com. And remember, if you found this helpful, share this with a friend. Because friends don't let friends overpay the government. Don't give a massive tip to the IRS every year.

Keep more of what you earn, and join us next time on the Tax Reduction Podcast.