Resources, tools, and reference for the proactive taxpayer.

Which strategies might apply to me?

Five questions, no email required. The output is a starting reading list, not a tax plan.

Tax terms, in plain English.

Common terms across the tax strategies, written for owners and operators rather than for examiners.

• Section 1202IRC §1202

  Strategy

  A federal exclusion that lets a non-corporate shareholder exclude some or all of the gain on the sale of Qualified Small Business Stock held more than five years. The maximum excludable gain per issuer is the greater of $10 million or ten times the taxpayer adjusted basis. For stock acquired after July 4, 2025, the cap is the greater of $15 million or 10x basis, with partial exclusions at 3 and 4 years. Earlier stock keeps the $10 million / five-year rules.

• Qualified Small Business Stock (QSBS)QSBS

  Strategy

  Stock in a domestic C-corporation that meets the §1202 gross-asset and active-business tests at original issuance. QSBS status is the prerequisite for the §1202 gain exclusion and the §1045 rollover.

• Section 1244IRC §1244

  Strategy

  Allows an individual or partnership to treat a loss on the sale or worthlessness of qualifying small business corporate stock as an ordinary loss rather than a capital loss, up to $50,000 per year ($100,000 on a joint return).

• Section 83(b) election§83(b)

  Strategy

  An election under §83 to recognize the value of restricted property at grant rather than vest. Starts the long-term capital gain holding period at grant and locks in the ordinary income amount at the grant value. Must be filed with the IRS within 30 days of grant.

• Cost segregation study

  Strategy

  An engineering-based analysis that breaks a building into components and reclassifies short-life property out of the default 27.5 or 39-year real property schedule. The reclassified portions can then be depreciated more quickly, often eligible for bonus depreciation.

• Cash balance plan

  Strategy

  A defined-benefit retirement plan that looks like a defined-contribution plan, with hypothetical participant accounts credited annually with a pay credit and an interest credit. Funded actuarially. Often allows owner-operators to deduct contributions far above 401(k) and profit-sharing limits.

• Defined-benefit planDB plan

  Strategy

  A qualified retirement plan that promises a specific benefit at retirement, funded actuarially by the employer. Cash balance plans are a type of defined-benefit plan structured to read like a defined-contribution plan to participants.

• Donor-advised fundDAF

  Strategy

  A charitable account at a sponsoring organization that lets a donor take an immediate income tax deduction for the contribution, while distributions to charities flow out over time. Useful for bunching deductions in a high-income year.

• Charitable remainder trustCRT

  Strategy

  A split-interest trust that pays an income stream to a non-charitable beneficiary for a term of years or for life, with the remainder passing to charity. Lets an appreciated asset be sold inside the trust without immediate capital gain.

• Entity optimization

  Strategy

  The deliberate selection and combination of legal structures (S-corp, C-corp, partnership, single-member or multi-member LLC, trust) so income, distributions, payroll and basis flow through the lowest viable tax cost.

• Income shifting

  Strategy

  The legal redistribution of taxable income across taxpayers in a family group or across entities under common ownership so the aggregate tax bill is lower. Mechanisms include reasonable compensation to family members, family limited partnerships, and trust distributions.

• Reasonable compensation

  The level of wages an S-corporation must pay an owner-employee for services performed, before non-wage distributions are taken. The IRS examines reasonableness based on industry, role, hours and comparables.

• Bonus depreciation

  Strategy

  A federal provision that allows taxpayers to deduct a percentage of the cost of qualifying property in the year placed in service, rather than spreading it over the asset useful life. Permanently 100% for qualifying property acquired after January 19, 2025; earlier acquisitions follow the prior phase-down.

• Qualified Business Income (QBI) deduction§199A

  Strategy

  A deduction of up to 20 percent of qualified business income from pass-through businesses, subject to income thresholds, wage limits and specified service trade or business rules.

• Passive activity loss rules§469

  Strategy

  Rules that limit deduction of losses from passive activities against non-passive income. Real estate operators who qualify as a real estate professional or who meet short-term rental tests may avoid passive treatment.

• Tax planning

  A process of analyzing a client’s financial situation and applying tax strategies to pay the lowest amount of taxes legally based on their facts and circumstances. Distinct from tax preparation, which is the year-end report on what already happened.

• Tax preparation

  The work of arranging a year of facts on the right forms and submitting the return. Preparation answers what already happened. Planning shapes what is about to happen.