Hey, athletes! As you shine on the Paralympic stage, don’t let taxes steal the spotlight. With Name, Image, and Likeness (NIL) earnings rolling in, and your Olympic Medal monies piling up, understanding tax savings is your new game plan. Here’s the deal—all your money is taxable. Yep, you owe the IRS. But don’t sweat it; we’re here to help you keep more of your hard-earned cash in your pockets!
🎾For College Athletes
Set Up an LLC for Tax Savings
Setting up an LLC isn’t just for businesses. It’s a smart move, we have our athlete clients setup too. This helps to separate your personal finances from your athletic business income streams. And allows our team the option to elect your LLC with the IRS to file as an S-Corp, potentially saving you thousands of dollars in unnecessary self-employment taxes. Think of your own LLC as your secret weapon for keeping more in your pocket.
Track Your Expenses Like a Pro
Training, travel, equipment—these are just a few expenses that can lower your taxable income.
There are many apps to help separate expenses if you run everything through one account. However, if you want months to categorize things, will you remember that one meal where you talked business?
Keeping detailed records is like nailing that perfect routine—essential for reducing your taxable income.
So, we always suggest keeping a separate business checking and credit card to help you identify what is personal and business when you have time in your business schedule to finally categorize things. Or, if you just want a CPA team to help with this our amazing accountants are always ready to help. With a CPA on your team, you’ll know exactly what counts as a deductible expense.
Plan for Self-Employment Taxes
Having business taxable income likely mean you’re paying Social Security and Medicare taxes payroll taxes. Not fun! With some proactive tax planning – before December 31st – you can potentially avoid parting ways with your cash to the IRS. Our team stays on top of this for our monthly clients so you’re not overpaying these pesky FICA self-employment taxes every year.
🏅For Professional Athletes – Mastering Your Tax Strategy
You’ve made it to the pro level—congrats! Now it’s time to play smart with your finances. A solid tax strategy isn’t just a nice-to-have; it’s crucial for your long-term success. Our team likes to do a formal Q4 tax planning engagement with our monthly clients so we have a game plan together before December 31st avoiding taxes where we can.
Optimize Your Earnings with Strategic Investments
If you cash flow allows for, and you are a qualify for registered investor status, you can take advantage of things like oil & gas leases and wildlife funds that provide large tax deductions to help you offset your taxable income.
Understand State Tax Implications
Earning business income in multiple states with events? Each state wants there piece of your state income. A CPA can help you navigate the maze of state tax laws to ensure you’re not paying more than you owe.
Retirement Planning—Start Now
It’s never too early to think about retirement. Investing in a 401K or an IRA today can reduce your taxable income and set you up for a financially secure future. Plus, it’s a great way to ensure your earnings work for you long after you’ve left the field. And these monies are asset protected!
💡 Seeking Professional Advice?
Don’t leave your financial future to chance. A licensed CPA can provide the expert advice you need to manage your money wisely. From tax strategies to retirement planning, having a trusted advisor in your corner is a game-changer.
Whether you’re a rising college star or a seasoned pro, understanding your taxes is crucial to keeping your finances on track. At Insogna CPA, we’re here to help you navigate the complex world of athlete taxes. Don’t let taxes sideline your success—reach out to us today and let’s build a game plan for your financial future.
Contact our team today! We really do call you back and respond to your inquiries.