Chad Willardson, President & Founder of Pacific Capital and Best-Selling Author of Wealth Wired Differently, emphasizes the importance of proactive tax planning for entrepreneurs. He acknowledges that many business owners struggle with tax planning due to lack of time or knowledge, resulting in high taxes eating into their profits. Willardson believes that strategic planning in this area is essential for maximizing financial well-being and minimizing tax liabilities.
He encourages entrepreneurs to take a proactive approach to tax planning, viewing the U.S. tax code as a coupon book full of incentives and strategies to help keep more earnings. By identifying legal strategies within the tax code, business owners can minimize tax liabilities and retain more of their hard-earned money. He suggests elevating the tax team to partner with throughout the year and not just during tax-filing deadlines, ensuring they are forward-looking, up-to-date, and strategically-minded.
Willardson advises entrepreneurs to audit their business structure with the help of tax professionals to ensure it is optimized for their specific needs and growth trajectory. It is common for founders to start a business and set up a business entity without considering the most advantageous structure for their situation. By collaborating with a tax advisor to review and potentially adjust the structure of their businesses and investments, entrepreneurs can reduce their taxable liabilities and maximize their financial well-being.
As Tax Day has passed, Willardson encourages business owners to start preparing for next year’s tax season by finding the right tax team that offers more than basic number-crunching. He stresses the importance of seeking a tax advisor who proactively seeks solutions, plans ahead strategically, and understands the individual needs of the business owner. By working with a dynamic tax advisor, entrepreneurs can make more informed financial decisions and optimize their income for personal and business needs.
It is crucial for business owners to realize that tax planning is not a one-size-fits-all strategy and that the right strategic tax partner can help them navigate the complexities of the tax code. By making more strategic financial decisions and leveraging the expertise of a proactive tax advisor, entrepreneurs can transform tax season from a dread event into an opportunity to reinvest more into their business growth. Willardson emphasizes that it is not about how much money is made but how much is kept, highlighting the importance of maximizing financial resources for long-term success.
