great write up.
> $920k over four years
so this gives an average yearly salary of 230k. Very close to FAANG senior salary with much more risk, effort and (probably) worse life-work balance. OP quit from google in 2018 and ran some other business, and this is his biggest sale so far. I think it shows how hard it is to make better money outside FAANG even when extremely talented and lucky like OP. But it's probably more about lifestyle choices.
interesting to reconcile this with calls to tax the rich. maybe we should be rewarding such effort after all? think about the tens of thousands of jobs created from people working at Google who'd make L3 or less at Google working twice as much...
Speaking as a small business owner/entrepreneur myself, there are lots of tax deductions available to people like me that aren’t to some collecting a salary. And that’s without doing any of the borderline or outright illegal stuff that I see many other business owners do, such as taking fancy vacations, leasing luxury cars, or buying real estate for personal use but writing them off as business expenses. The IRS basically now lacks the resources to go after most such cases, and even if they’re caught, the penalty often just amounts to paying back the avoided taxes. There’s really very little incentive to play by the rules. I’ve had CPAs tell me outright that I’m leaving money on the table by not using some of these so-called tax minimization strategies. Anyway, it’s all kind of beside the point because “tax the rich” as policy covers so much ground that it’s impossible to discuss the pros and cons without specifying what specific proposal we’re talking about. My point is simply that business ownership and entrepreneurial activity are already quite well incentivized/rewarded by the current tax code.
What are these miraculous tax deductions you are talking about?
Writing personal expenses as business expenses is tax fraud, not tax optimization. CPA suggesting this should be fired.
1. The Trump era automatic 20% deduction for LLC or corporate income. Totally unjustifiable, it's 20% off your revenue for everyone with a company for no public policy reason that I know of
2. You can mostly avoid paying into SS/Medicare by taking the large majority of your compensation via distributions, not salaried income
Just off the top of my head
You mean QBI? To apply, it needs to be matched with W-2 wages so you won't escape SS/Medicare, and it's not against revenue but profit.