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KJCE 1370AM>Audio on Demand>>Small Business Financial Show, 2/2/14

Small Business Financial Show, 2/2/14

Feb 2, 2014|

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If you're a business owner pay attention. It's time for the small business financial show with a small business tax consultant. Professor and lecturer comfort -- -- split comfort give you the knowledge you need to increase profits and grow your business now. Here's your host comfort should Vance. You're listening to small business financial hurt every Sunday morning and -- and company. Blame your post comforts and it's helping you as a small business owner finds -- best investments. You can listen to previous broadcast of our current -- -- thirteen cent when he -- -- you can find resources. To help you with their business need. Small business taxes dot com this month we are taking a look at small business taxes and some things that you can do to minimize. Your taxes. We will also look at strategies that will help you to maximize your heart attack while. These two goals are to. If your goal is to only minimize your taxes. Then you would tend to look at deductions income limitations. -- balls as they release to the current year. You know the current tax here because your focus is on reducing how much tax you hey how are. With upper tax planning maximizing after -- well. Looks at big picture which and moved to growing your -- seeing how much of your earnings can be legally cap. -- -- -- now as well as in the future. Before we get to that. We're going to conclude our talk and our ability which we started last week. We're going to be concluding with cash flow and budgeting and we're looking at what happens -- you generate income into your business. How do you monitor it most of your business to make sure that heart of your business is eating right which is your cash blow. Where that money is going. And how much. You know that is. How it's being allocated in your business. Now just as. Doctor will run some task to make sure that your heart. -- is within the range that -- need to be an impact your health the so that you can continue to function. There are some simple thing that you as a business owner can do to see where your businesses that it's growing or that stagnant. May be in the past you used your attachments. And experience. To get an idea of how things are going. And judgment as well as experience certainly goes a long way. What you may also. Could have avoided problems are sent back and he made a well informed decision by utilizing some of the financial tools and proven techniques that are. Available TU. Okay. So let's just sort of recap our ability. While we talk about profitability and business we're looking at your operation. It's a nice to have very -- business owner including independent contractors as well as investors. So when you are questions about how comfortable you are. It has to do with your operating activity. Your operating activities are transactions related to the services you provide to your money in our products you sell to your customers. These transactions. Usually include the cost of acquiring the products that you were going to be selling. Expenses that you. Incurred in the course of running your operations. And the actual sells or services. You -- right it. So you receive payment services. You you know. You performed at or products in which he sold. You also spent some money. Which is used to either buy products. Or vice eyes and these supplies were used to. Provide the services that you rendered or invested in the products -- bought to sell. Many time businesses are talents. In this area because the owners or hired managers. In this situation. You may have enough working capital. And funds set aside to operate initially. Spending whatever is necessary to operate you know doing whatever -- never using a budget never -- entering the cost. That are involved in spending what ever amount. On you want to including for yourself. Because that's just simply what you want and you have not taken into consideration. That tax implications. Or counted the costs. To see if you can truly afford it. The other reason. That business owners may have issues around our ability. Is that sometimes small business owners just simply fallen hard times. Economy changes. Services were provided but they were not. Compensated timely. Born expecting emergency took place and and then your house to simply to lead it. So these business owners. Find themselves just trying to weather the storm trying to get through. The tough times. And hurt. Our business owners. Who saw an opportunity but the timing was not right it was in the best tying them to take on. I'm either expanding the business. So. Or example. An opportunity came along. You sought a location that. Was worth. Expanding your business too because the existing location is doing well and so there's an opportunity or a second or -- location. So. -- -- to get time to expand may -- open up a couple of more stores because you can generate more coming right. Well sometimes just because the opportunity is there does not mean it is the right time. Unfortunately it -- business owners go completely broke. Because the you know begin to cool from one operations to -- another. Operations. Based start tapping into their retirement -- -- go for loans. And even with owing to the loans are not really sure how they're going to pay the money back. And unfortunately some cases have led to shutting down the business entirely. If you half and in any of these. Situations -- have business loans that are overwhelming -- please contact us as we will be able to provide you resources. Are you to get out of debt or restructure the debt. -- obligation that you currently have don't wait because timing is important. The sooner. The better you will. Be able to turn things around or you. Okay. So monitoring the pulse of your business. You wanna start buying reviewing your box. On a monthly basis. Remember that you aren't -- business owner. So it's important for you to know what's going on in your business. So that you can make a well informed decision so that you can make the right choices. Wanna pay particular attention to your cash -- statement. This is the financial statement that shows you how much dollars came in from your tax balance. How much of that was used our cash expenses. And you notice. I did not use the term. And long statement. Because the profit and loss statements. Will tell you what you learn from both your right -- cells as well as your tax -- Ain't. As well it's how much was spent. Using cash and credit. Because sometimes. You have time to pay the bill. You've got it recorded on your -- But it doesn't mean that it was -- It's just a reminder an indication that there is a pending expense. That needs to be -- -- -- -- not at the actual payment. Was made. All right so. It is your cash flow statement that you want to pay close attention to. Now. I recommend that you take a look at past -- Especially. This is the first time that you're going to be. Taking action. You pay attention to the activities. You know the operating activities of your business so that you can. Grow towards being healthy business. Wanna start I take a look at past three months to even get an idea of how things. Have been trending. You wanna pay attention to what you spent the most money on what services generated. Most income in your business. And of those expenses. That you spent. It it was worth it -- on the necessity of that expense. To generate. Cash. Into your business. Now the profit don't want us includes items of credit. So. I am we we will take a look. A little bit later on. As well as in the future. Episode to see. How you can utilize the profit and loss. More effectively as well. Now. Most businesses anyway. Operate using the cash method of accounting at the 02 as opposed to a rule. I am Soo many businesses also use a combination and they're not even a win here. That they're using. The combination. And I mentioned last week that usually it's count. Takes a look at the transactions. At the end of the month and makes any needed adjusting entries to correct -- -- postings. And sometimes those -- postings. Maybe. It could be. On a payment that actually belonged in one category. -- mistakenly it was recorded in a different category that needs to be corrected as. You want your. Financial statements. To provide you the the album to be reliable and provide you with the best information or decision me so it needs to be. -- OK so did you realize that your expenses are nearly. The same as your income or. Your expenses are more than your income. There are some things you can do to control the buttons and turned things around. OK we already talked about taking a look at the three months' worth comparing them well shortly after that. What you want to do is take -- in termination. And began to read about it. And I wanna remind you that budget is -- got it it's not a procedure document. It's more like a man. Your goal with your budget is just trying to stay within the guideline. Not necessarily follow it to the T. Right you wanna use it as a guy. So you can meet your goals. It during the month to realize that you have to spend more than you -- or just simply want to document the -- Wanna take no. Why this happened if it was a one time occurrence. Or. If perhaps. It's something that's going to be happening. It's gonna be consistent moving ports such as the price change -- one of your vendors perhaps. Then what you need to do is that every month. You need to make they needed adjustments using the same method. When you aren't designing the -- budgeting initially. You will base it on pass is history. Specifically. Taking a look. At the past few months made the pass order for example. Then every month after that. Based on that this month's budget. You want to use that as a guy moving board. So it's gonna be constant monitoring. Just like visiting a doctor to see how you're doing and to make sure. That you're doing the right -- Get your help. So hopefully. What we would like to see is that these habits of these practices that you are beginning. To implement. That eventually it will become a way. That you do business and though -- that you do business sort of like a way of life. And so it will become natural or you so that each and every time as you are moving forward. And getting better. That. And seeing positive changes in your business as you're rolling -- you're becoming profitable it is second nature or you. Can't keep in mine that you have -- -- In you have variable cost. As you're doing your budget. Your fixed costs are those that never changed during the operating year. It could be your -- and services you subscribe to. You already know what they aren't and how much it is. It is not so something that's going to change that's your -- costs and then you're terrible cost 12 weeks. So when we come back time and we're going to take a look at -- and then we're gonna talk about planning tools that you can use alongside the budget. To help you to plan better. Are you looking for an opportunity to choose your own work schedule receive steady income and enjoy the freedom of work life balance. Well becoming a client support professional is a unique opportunity to be self employed without bearing all the cost of extra ambushing a business and getting started requires just a few simple steps are -- support professionals that's enough solutions. Our independent certified work at home custom. Agents we take -- calls for fortune 500 companies an opera world class customer service as an agent you determine your work schedule you -- the industry won -- service and you are in control of your earnings. Only investment is paying for your certification courses in background check in addition you'll join a network of over 20000 agents get lots of support so you're never alone and make new friends start living alike he wants and make money doing it call 1877. By 30 by five or zero that's 1877530. I -- or zero or visit small business Texas dot com click on services and get started now. The welcome back to the small business financial shows once again here's your host comfort should that it's welcome back. And your listening to small business financial -- every Sunday morning. On top thirteen 7:8 I am your host kind of a generic helping you as a small business owner -- -- investment. You can listen to previous broadcasts of our program at top thirteen 78 dot com. And you can find resources as well. On our website at small business Texas com. We are. Concluding. Issues surrounding profitability in looking at things that you can do to monitor. Your operating activities monitor. Your cash flow so that you can -- And be profitable at the same time and limit some of the common challenges that on several business owners they. And the later on we will be taking a look at. Some they know that you can do with the business owner help you pinch role to take control of your taxes. So before the break we were talking about the budget your business budget. -- you have ex cons and that you have bearable cops. So we're going to take a closer look at this now. One planning tool that you can use alongside your part to. Is what we call in the industry. Costs volume analysis. Also known as CBP analysis. Now it makes her own to big complicated. Like what is this you know too many -- small business owners spent out there. Your count will certainly know what this says but I'm gonna try my best to simple right or you so that on your own. You know -- a simpler. Viewpoint you do on your own you will be able to implement some of these strategies. -- without necessarily having to wait. To meet with your accountant in the next month or two whenever you can get. And a week. OK so. The cost volume. -- analysis. This is where you'd take a look at your next cons in your terrible cost. To determine the impact on your business prospect. And sometimes that impact. Of the difference and how much of your costs as it. And how much of your cost is bearable because huge difference in your business profitability. Usually. It is better to have more appear cost it then variable. To help you understand it's. This particular point. I'm going to have you reflect back. On the housing bubble. While we try to remain positive and move forward into the future with progress. At times it's. Good to reflect back and to learn from history. On what. I -- Is that using. A scenario of the recent economic downturn that we are. Only moving a week -- Will help you she makes cents of this costs volume -- analysis. As a school you can use alongside. One helping you to budget or your business. Now before the housing but all. Credit rules were a little more relax. And as a result many -- quality by abide beautiful homes. That perhaps may have put your household finances over. Worried that borderline. And for many others the variety of loan types gave you the opportunity. To be able to have -- home. One of those tweaks its. Was the adjustable. Rate market. Commonly known. As the arm. So you may have heard terms like a five year arm. Every year arm or the seven year arm. Well if -- how to -- your arm or use a career army as an example. And that meant that your market. Was going to be it. At the current interest rate at bank was giving you at three years. And afterwards it would adjust to whatever. Interest rate will be in the future. And perhaps adjustable every year after that what this means is that it would become. Variable. Port it would vary. Or we can use that term to wait. Based on the economic conditions. At that timing. I remembered this is the future so we don't know what's going to happen in the future we only know and see. Beings as they are right now. Most people have a household income. And most people manage their home finances. Using a budget. What makes it easier are so many households to say even plan -- -- expenditures. Whether it's investment. Or leisure. Is that they're essential living expenses. Are. They already know how much is needed to cover their basic household need. So for many -- all had the -- -- the adjustable rate market. Once those you hear is of having a X amount of market was over. And the variable interest rate -- and it -- so many people -- In addition. Since the future is unpredictable. And many people did not have a contingency plan. The impact. -- job loss and the decline in business income or just so many people. Into a position where. -- or. It would they were able to a board these things and now. It's no longer portable. Why because the more it was higher it had to just it. Right and so discretionary income which which is money left over after all the house -- Happen -- -- or was a very little. In some case it was zero. Or eight in many other cases it just wasn't enough. To meet those household expenses anymore. And this is the point. Right at this point is where financial crisis. Began. And it can only. Only way to control -- is by generating more income. Right or eliminating. Unnecessary expenses. So a solution at that point in time. That the more it. Adjusted. After those -- years. Is would it help if many people that lose their jobs because. They lost their job they lost income. And so as a result they couldn't keep up with mortgages. Right. Also. What. Would have helped many people are probably did help many people is that at that point in time and take a look at your household budget. And then you begin to identifying and Guerrero where do I need to eliminate. Expenses are not necessary. Even. Going as far as saying you know why. Maybe we'll have no house own it'll just cell phones we don't need all these phones in the house it may have been a decision to sell a car. It may have meant cutting down on. On is that we're set aside our leisure and entertainment. Maybe you didn't go to the movies as -- Turco dining -- month. So hopefully this helps you to understand what it crosses in business. Right and why it's more -- and variable costs. Because what -- You can plan profitability. In your business. A whole lot better then when you have more bearable cost. So when more of your business expenses and costs -- -- the better you can control that profitability in your business. -- there is a science to business accepts. We've got tools available that we can use. Help is gauge where things are and to help us clinch roll. Some of these event within our business. We cannot control every event or circumstance. Not. There are tools and strategies available or you to use to help you better your business. It's the bearable -- now that it's many business owners are trying. Because these. Are the costs or expenses. To -- They don't remain the same. Like your utility bill. Light water. Sometimes your own service. Depending on the use of minute so you know suppliers. Because price may change due to a hike. You know in the crisis. Or based on the one to -- -- your order. If you're not sure. What his ex cons senior business. What his variable. -- thinks the take a look at your lecture. Make a list. Of all your expenses. See how often they are coming out of your bank account or how often your making this -- Meaning are you making the payments on a monthly bases. Are you make these payments and orderly basis. Then you wanted to check to see of the payment are the same every month every time that you pay it whether it's monthly or quarterly. And it happens to beat. The same amount every time. Right then it's -- -- However if you notice that you paid at different amount every time that payment was made and it's a variable -- fluctuates. You want to add up all the -- cost. Or expenses. And then you want to all the very hopeful expenses as well. What you wanna do is you want to grow which one is more. And how much more. Right you wanna kind of take a look at the ratio. You know don't have a whole lot of six expenses are doing have a whole lot of variable expenses. The marsh picks expenses you have the better profit planning you can do because of those costs are not gonna change over time so you can. Guerrero what you want your profit -- entity. But if you have too many variable expenses -- the amounts or extremely high because sometimes you can have one or two. Major bearable expenses but there -- so. Much to of those together compare to all the little -- expenses that. You may have in your business. So. What you want to do is you wanna see. Or the bearable cost which ones you can may be renegotiating. Or if you can convert it to a X amount right. Even if you have to get another supplier. Another tool you can use to check the pulse of your business is by performing some financial statement analysis. Generation notes. You can use -- horizontal analysis. Whereby you compare. The -- Current year and the previous year -- To see Trent. For example. On our sales increasing at a factory. And the cost that's associated with ourselves. Or you can use a tool unlike vertical analysis. To help you to see percentages. Within the categories. For example. What was. Right percent of your. Cells. To your income overall. Or your overall income. Ratios. As well are very very helpful. They're used in analyzing -- Our ability as well as the quality of your earnings. It will help you to answer questions like how lick -- is your company. Or the ability. Of your company to -- its long term obligation. You know. Investors and financial institutions. Use the ratios as a guide to help them determine whether it is why it's. That to invest in your company. Or to give you alone. So it is used to out of it will be -- dance hit. To check these things are yourself. Before you spend precious times seeking funding. You can use the tools to help you took -- wisely. If you think you'll need funding. In the near you tour or in the future. You. Can go to our website at small -- and com. We've got financial calculators as well as their tools and resources that are free to use TU. And down we -- here to help you. As well -- you need guidance. You know just visit small business Texas dot com. And then you can contact this from there as well. When you're designing your cash budget. You also want to see. Where you can cut. -- or you can eliminate expenses altogether. Just as we talk about. Or as was mentioned. In the example. Using. The markets it just a bull market. Or on a personal home loan. 21 of the things that was mentioned was to take a look and see where you can cut costs. So I do recommend that you shopped around some ideas that will work within your. Your means. Let's look at some other examples to see how this will work or you. If you notice. That your own bill is too high in the business. Because the price price point is no longer affordable or you. It is your abolition. So consider look at another service provider or changing the current plan that you have these are just some simple things that you can do. Two out of control costs within your business as your work on your budget because. When you're going through your budgeting your going. Taken a look at each of your count. Line my line. I'm you'll be able to see. What it is. Anger paying for and how much and then you can tune you can note on you and your business partners and that's affordable that's. Not affordable. You know you wanna keep -- not wanna keep it. All right so let's take a break and when we come back we will complete. The profitability of right on and she sounds dumb ways that you can minimize your taxes. Are you looking for an opportunity to choose your own work schedule receive steady income and enjoy the freedom of work life balance won't becoming a client support professional is a unique opportunity to be self employed without bearing all the costs of -- ambushing a business and getting started requires just a few simple steps -- -- support professionals that's enough solutions. Our independent certified to work at home custom. Agents we take -- calls for fortune 500 companies an opera world class customer service as an agent you determine your work schedule you -- the industry won -- service and you are in control of your earnings. Only investment is paying for your certification courses in background check in addition you'll join a network of over 20000 agents get lots of support so you're never alone and make new friends start living alike he wants and make money doing it call 1877. By 30 by -- or zero that's 1877530. I'd -- or zero or visit small business Texas dot com click on services and get started now. Yeah. Welcome back to the small business financial shows once again here's your host comfort should that it's. Welcome back you're listening to small business financial -- every Sunday morning on top thirteen 78. My name your posts comforts you yeah helping you as a small business owner find success in the business. You can listen to previous -- -- of our program that -- thirteen Sony dot com. And you can find a resource is to help you with your business mean at small business at this. It is tax time and we're. Taking a look at a moment at things that you as a business can do. To take control of your taxes. Let's -- conclude. Some of these strategies and rules. On that you can use alongside as you are budgeting. And trying to. Control. Costs and increase profitability in your business. We had just mention to the we before the break we were talking about. The phone bill as well as a couple of the other costs. Another common costs actually I find it to be. One of the biggest cost many small business owners and is beyond the -- If you find that your lease. Is currently two crying. I know what are the solutions are available or you. Sometimes. It might be right -- to just. You know -- to consider moving moving on from that location. And it actually let's zero in a little bit on this. There are several options. Available. When it comes to commercial you know leases and some mark. You know straightforward and easy to understand. You know but I do recommend that you get an attorney. Get an attorney. To someone who specializes in this area to review your release or you. To review the agreement. To ensure that the term it's truly worked for you that it's not just one signed an. I have in the past had too short or what tests. You know about the financial standing of clients. Disparate lease agreement that went back -- Now I'm not an expert. On commercial leases at all but from my experience. As an accountant as a tax consultant. Can get. Pretty expensive and it can get ugly. You don't wanna wait for things to get worse just face the reality that business is not where you would like it should be. You know or where where it once once. It's okay -- bounce back. Things will get better. If you do not know. What to do you call your attorney call your CPA. Remember those business partners that we mentioned end. On the previous episode. And it and it you. Had not had a chance to listen -- on that. I do recommend that you visited on top thirteen seventy dot com are small business. Taxes dot com and there are passed arm. -- episodes that you can listen to we do have podcasts available or you say you can listen to those episodes. And learn from them. So. Those business partners. They can help you. And you wanna -- -- reach out to west as well if you don't have access any of those business partners. Maybe your landlord. Will allow you to sub lease. The space you're in which. Will preview of that bonded. That you find yourself in now it's not what you plan. But depending on which one of the circumstances that we mentioned earlier. -- decisions were made economy went bad Alan -- times. You know some of the leases. Some of the landlords will allow you to -- You know. And that is where. You'd mind someone else to finish out your leaks or you so. Don't ever think back you're just stuck in a situation users usually solutions out there. Some of you. Depending on the type of business you have you might wanna consider setting up an e-commerce business. Righty. And downsize. To a smaller store perhaps smaller location. I mean technology is great. We can become global. In very little time these. Times these days because of the advancement. -- in technology. If you provide services. You may want to set -- home office. In fact. Even if you're selling products. Depending on the type of -- right. You can work from home. The Internal Revenue Service does permit a -- this addiction. And we will look at some of these as we go into. Tax time -- Some other things that you can do to help you control. Coston. That you can maximize profitability in your business. Is you wanna take a look. In reconcile rate -- your bank statements reconcile them. Especially if you have not been staying organized with an accounting system. Are meeting with your CPA. And a regular basis. Well every business owner should review their bank statement. I am talking about those of you or not currently organize. In Europe just now trying to get things in place. You need to know where your money is going. Another huge expense -- businesses is payroll. You know who do you use a hero. Earlier in on some previous. Episodes as well we talked about knowing what taxes are common tier industry. Or what is specific to your business so we have employees he has. You have the related payroll taxes. Payroll expenses. Right Europe also. Probably paint or those surface. Which I do actually recommend I have. Never. Enjoyed the you know payroll accounting. So I say outsourced it. There is that too much involved. As ours payroll lots of concern. You know keep in mind back. In future and the future in future weeks to comes we will be taking a little bit. More in depth look at payroll. So you definitely want to its AT and downsize if you have him. Early you can continue to grow and stay profitable. Many businesses. Operate out of their homes as we mentioned earlier. And technology these days has made -- so much easier for us to be able to do this. So don't worry about what people make -- What they may say it's time for you to be real about these issues. So that your business can grow -- help. Interior designer to help you -- space that is warm and inviting and will motivate you to work. To do your work well. So. Even if that space is smaller than what you're used to. -- controlling costs. Use your acted as a -- I remember the financial plan that you're using as a map to help you speak boat is so that you can achieve your goal. Okay well. It is tax time and we're gonna move on team since. We are going to take a look at things that you can do. As a business owner to help you. Take control of your taxes strategies to. -- you maximize. Your. After tax well not just minimize your taxes. Okay. On site small business Texas that -- you can find answers to common questions. You may have about everything business including payroll taxes debt management debt elimination. Or if you just need consultation or Rick Perl you may be it seat being. Com. That can help. Okay many times. Business owners get frustrated. Because of their various tax responsibilities. It all else seems like it's a challenge to get ahead at times because of how much is allocated -- taxes. Depending on the side -- needs of the enterprise and the goals of organization. Most mrs. owners would rather see those dollars a reinvested. In their companies. It would probably. -- are to see it apply towards charitable activities are satisfied or. Is that to avoid paying some cuts taxes. One has to pretty much to reduce the amount of revenue they bring in its not true. If you bite into that we have eighteen. That minimizing your income is the only way to cut down on taxes. Then one could almost say that our system. Is structured in a way that is impossible for anyone to get a hat. This probably means that Europe also deliberately. Limiting your potential. Choosing an alternative way of life. -- Worth while business deals because of future attacks in patients. So it is probably fair to say then that your business and life is being controlled by taxes. Unfortunately. Many people. Do this at -- personal level also. Limiting your potential. Banking on those tax refunds and spending tying to figure out how much you can get back. Not realizing that tax laws can change. And every year. Congress gets to decide what laws we T. What laws will be -- find. And what -- -- laws are going to be expended and which ones will not. Right which ones are gonna come to an end. So an awareness. Of tax laws should actually empower you not -- -- I -- A lot business owners are a breed. Because. They don't understand -- frustrated because you you you don't understand. What these taxes are about why you having to pay them. So I'm not saying -- or against taxes. It's just the world we live than I do think everyone should pay their fair share but the question as always. What is it. And that's beyond the scope of today's talk. So we'll have to keep at another time. All right extend its. That taxes you pay is the end result. Of the transactions. That took place. -- the year it is a reflection of the decisions he made as a business owner how much tax planning you did. So. You can actually turn that thinking around. Take charge and being more in control of how much revenue you get to keep. And Europe point to accomplish this. By using the tax laws to legally. Keep more of your money. But -- I would like to take the opportunity to share with you briefly just -- -- an understanding of why we pay taxes. With highlights. You know on some of the business taxes. I find that many business owners are cutting tax. And not understanding. Why you were cutting the checks or why you're required to do so. And I have noticed. That it usually how when you know why you're doing the things that you are doing. Let's start with petrol taxes. In general federal taxes are levied. To raise money to fund operations of the government. Taxes are enough Marines they are not penalties. Taxes are not punishment on the people. Even though some of you many see -- way. Funds raised taxes usually go towards the cost associated with the essential functions of our government. Such as providing national security. Maintaining a strong military force would -- Everyone benefits. It's like saying we all live in this country on this land and we must protect it. And ourselves so let everyone check it and help to cover the costs. Now. There are also functions. That our tax dollars. On that do not benefit everyone. Such is certain governments subsidize programs that are. Only for those who meet the criteria -- program it's like saying it's our moral responsibility to Karen how others. So to raise money. To fund all these functions. All sources of income -- -- Whether it's personal. Or business. All income is -- to meet these goals and to get the joke. Our current tax system here in the United States is a progressive pac system. Which mean. As your revenues increase so does your territory. Simply -- the more you bring in. The more you're required to counter it that being sent. Our tax laws. Cup also in its structure attributes that encourage or -- -- certain behavior. Or push towards a particular purpose. -- example. There is a deduction. Or individuals or businesses and give to a qualifying charitable columns. Because our government encourages giving. You can look at it another. Incorporating all these. Causes into the government's budget and overseeing it might be a bit much soul delegating the responsibility Unix publishing laws. That will. Exempt organizations -- attacks and provide. He reduced tax amount will encourage certain behaviors while accomplishing the goals. This is just an example to help you understand things better. So. Taxes actually payment that is a part by the government whether it's federal state. Our local and only government agency can impose attack it is not on a voluntary basis it is required. Now we -- city and -- our program court today. Next week we're gonna pick up and we're gonna take a look at some things that you can do to minimize tax. Thank you for listening this -- is huge. Please join us again next week. When we continue. Our talks on tax trying to attack this.

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