Maximize & Optimize Tax Savings with Vik Randhawa CPA

   Business Entities and Their Pros & Cons By Vik Randhawa, CPA Starting a business involves making several key decisions, and one of the most crucial is choosing the right business entity. The type of business entity you select affects your legal liability, tax obligations, and operational flexibility. In this blog, we’ll explore the most common types of business structures and their advantages and disadvantages. 1. Sole Proprietorship Overview: A sole proprietorship is the simplest and most common form of business entity, owned and operated by a single individual. Pros: Easy to Establish: Minimal paperwork and legal formalities. Full Control: The owner has complete control over business decisions. Tax Benefits: Business income is taxed as personal income, avoiding double taxation. Cons: Unlimited Liability: The owner is personally responsible for all business debts and obligations. Limited Growth Potential: Difficult to raise capital as investors may be hesitant to ...

  Retirement Plan Options for the Self-Employed: A Guide by Vik Randhawa, CPA As a self-employed individual, you wear multiple hats—entrepreneur, manager, and financial planner. One of the most critical financial decisions you’ll make is how to save for retirement. Unlike traditional employees who have access to employer-sponsored 401(k) plans, self-employed professionals must take charge of their own retirement savings. Fortunately, there are several excellent tax-advantaged retirement plans designed specifically for self-employed individuals. In this post, I’ll walk you through the most popular retirement plan options, their benefits, and how to choose the right one for your needs. 1. SEP IRA (Simplified Employee Pension Plan) Best for: Self-employed individuals and small business owners with few or no employees. Key Benefits: Allows contributions of up to 25% of net self-employment income or $69,000 (for 2024), whichever is lower. Tax-deductible contributions reduce your taxa...

  Maximizing Tax Benefits for Short-Term Rentals with Cost Segregation By Vik Randhawa, CPA Short-term rentals (STRs) have gained immense popularity as an investment strategy, offering property owners a lucrative income stream. However, beyond rental revenue, savvy investors can significantly reduce their tax burden using cost segregation studies to accelerate depreciation. Understanding how this strategy works and its impact on additional depreciation deductions can unlock substantial tax savings for STR owners. Understanding Cost Segregation for Short-Term Rentals Cost segregation is a tax-deferral strategy that involves identifying and reclassifying property components to shorter depreciation lives, allowing for accelerated depreciation. Typically, real estate assets are depreciated over 27.5 years (for residential properties) or 39 years (for commercial properties). However, certain components such as flooring, cabinetry, appliances, and landscaping can qualify for 5, 7, or 15...