Shahar brings decades of expertise in tax planning for the self-employed, particularly real estate agents and team leaders. From his roots in Israel to building one of Seattle’s top accounting firms, Shahar has always been driven by one goal—helping entrepreneurs keep more of their hard-earned money.
In this insightful conversation, Shahar reveals how real estate agents can save tens of thousands of dollars annually by structuring their businesses correctly. “Ninety percent of the agents who come to us aren’t set up as S Corps—and they’re losing significant money because of it,” he explains. Shahar walks through the process of shifting from a sole proprietor or LLC to an S Corporation, which allows agents to reduce their tax liability while still growing their business.
The episode also touches on how real estate agents often procrastinate tax planning until it's too late, leading to missed opportunities. Shahar emphasizes the need for intentional tax management throughout the year rather than scrambling at tax time. “The sooner you start thinking about your taxes, the better the outcome. It’s not just about saving on taxes; it’s about creating a long-term strategy that supports your business growth.”
Brian and Shahar also discuss the exciting new partnership between Sisu and Formations, offering real estate professionals a seamless integration between business performance tracking and tax optimization. This collaboration allows agents to have a holistic view of their business and finances in real-time, enabling smarter decisions year-round.
Top Takeaways:
(4:27) Why real-time financial planning beats last-minute tax fixes.
(9:47) Making sense of real estate taxes—Depreciation, aggregation, and more.
(11:19) How does having a dream team simplify real estate investing?
(12:27) The untapped tax benefits for 1099 real estate agents.
(18:10) Automating 90% of real estate tasks
(23:01) Why live financial data is the key to business confidence.
(24:21) Sisu and Formations—The integration every real estate agent needs.
(28:08) How to eliminate data friction with Sisu’s seamless integration.
(33:27) What are the benefits of S Corps for real estate agents?
If you’re looking to gain a better understanding of how smart tax planning can support your real estate business, this episode is a must-listen. Shahar’s expertise will change the way you think about taxes and how they can be used to fuel your success.
About Shahar Plinner:
Shahar Plinner is a tax and accounting expert with over 20 years of experience. After moving from Israel to Seattle, he built and sold one of the top tax firms in the area. Now, as the founder and CEO of Formations, he focuses on helping self-employed professionals manage their taxes and maximize financial efficiency.
Connect with Shahar Plinner
Episode Transcript:
Brian Charlesworth 00:34
Hello everyone, and welcome back to the latest episode of the grit Podcast. I'm Brian Charlesworth. I'm the founder of sisu, and as you know, the host of the show. And today is a little bit different than most of our shows. You guys are used to hearing from team owners and entrepreneurs. Today we are hearing from an entrepreneur, but I think this is actually going to be one of the most valuable podcasts for many of you real estate team owners and any entrepreneurs that we do so pay attention today. It's an important one. So I have a special guest, Shahar plinner is here with me, and he is the founder and CEO of formations. And formations is an accounting and tax solution for the self employed. And prior to doing this business, Shahar came from Israel, moved to and you can correct me, Shar if I'm incorrect, but moved to Seattle, started an accounting firm that he actually built and sold one of the top accounting firms in Seattle, and then he went on a passion journey to solve problems For entrepreneurs like myself or self employed people who maybe procrastinate taxes and tax planning and accounting just a little more than we should, right? So they've actually formations built a software that replaces QuickBooks, if you will. But they actually manage that for you guys. So if you guys were to dive in with formations, they would handle everything from your accounting to your tax planning. And on that note, Shahar, I'm going to let you take it from there and correct me where I'm wrong and maybe give us a little bit more of your background story.
Shahar Plinner 02:12
It’s great. Brian first, thank you so much for hosting me on your show. It's a great pleasure to be with you. You know I admire you and sisu and what you guys are doing in the world of real estate and enjoy the subject and being in front of your audience and share with them my kind of nuggets and insight around taxes. I think the taxes, it's a scary word, and what we're trying, kind of today to do is to unpack taxes and share with the world that when you engage with tax, actually there is, there is a lot that you can save, and actually it's an interesting topic. I don't you know. Expect everybody to be tax expert like myself and enjoy it. It's definitely, it's my guilty pleasure taxation. It's a passion for me to help self employed, to navigate through the complexity. Yeah, everything you mentioned is right. I moved to the US back in 2005 from Tel Aviv to Seattle to start my journey in the tax world. I'm more tax expert guru than an accounting you know expert. So the discussion today will be less about how to expense you know things and what you know your balance sheet and PNL and those boring concept should be, but we'll focus more on on the tax world and how you know when we when you are more intentional with your taxes, the savings are significant. We're talking about 1000s of dollars that were held being self employed in real estate in particular to save. And that passion translate into our basically, you know, love for real estate agents and real estate teams leaders and help them to navigate that complexity and keep more money in their pocket.
Brian Charlesworth 03:43
Wow, what a concept. So you guys actually do provide accounting services for these teams, but your focus is, hey, where we can really make a difference for you is in tax planning and tax savings. Is that correct at
Shahar Plinner 03:55
the end of the day? Again, people basically pay tax. They don't pay accounting. And I think the accounting is a tool. You know, accounting, bookkeeping, banking, credit card, payroll, retirement, everything, navigate towards the end result. How we can impact at the end of the day, your tax return and make sure that your tax return, or on your tax return, your only pay your fair share, and nothing more than that. But in order to get into the end result the tax return, you need what you call a tax management. You need an annual planning. You need an annual treatment of your financial on a daily, weekly, monthly basis. In order to get into the end result, when people wake up at the end of the day, and you mentioned the procrastination, when you wake up at the end of the day say, Hey, I'm ready to take care of my taxes. Sometimes it's just too late. And then you put your professional team in a place that they need to do some surgeries, you know, they need to do a last minute adjustment. But, you know, imagine a world when we can, you know, think about your taxes from January 1 and make smart financial decision based on real data. And that real data move. The needle. And I think this is why we're so engaged with the SISU platform, because this is what you help people on the front of the house, you know, identify, you know, their transaction as early as possible, and then help them to increase their close rate by being intentional about it. And this is what we do at the back end, how we keep more money in the pocket. If I can paint every dollar amount coming into your bank account live when we make live financial decision, it's impactful, big time.
Brian Charlesworth 05:29
Okay, let's back up a little bit. So how, how did you get so passionate about taxes? You moved to the United States. What year was this? You moved to the United States.
Shahar Plinner 05:41
So we moved to the US, my wife and I were telling we moved 2005 you know, we just got married, young couple. I I'm coming from a family owned business, you know, my dad is in the insurance space back in Tel Aviv. So I grew up when I wake up in the morning. When I was five years old, I was wake up in an office, you know, and presented myself as the Secretary and writing kind of, you know, fictitious invoices and playing office. You know, when I was a kid, when I grew up, you know, I saw the struggle of the struggle and the dream, you know, as the self employed, as my family basically around their own business. I see the struggle as the family has no, you know, Saturday dinners, because it's all about talking about the business, and the fact that, you know, my mom and my two brothers, everybody is involved, and everything is about and around the business. And while I had the choice to be part of that family owned business, I decided not to be. And you know, only when you grew up around family owned business, it's very clear and dry. If you want to be part of it, you're all in. And it's basically capture everything family and business, but you have the choice, and I am the youngest out of the three boys, and made my decision to be not part of the family business. I'm a finance guy. I always been around numbers. I hate statistics, but I love taxes. And I'm one of those fortunate people. When you present to me like a tax problem, I just see it, you know, like the metrics so easy for me to connect into the domain expertise, into the domain, into the subject matter. And on the other end, I born as a servant. You know, I'm a servant of my audience. I'm a service provider in my soul, and I enjoy, you know, being the connector, the translator between those complex tax strategy or complex tax world and how I can translate and bring it into a very simple discussion. So my audience, my customers, my people, can make those decision in a very easy way. So
Brian Charlesworth 07:33
you move here from Tel Aviv, moved to Seattle, you build an accounting firm, a successful accounting firm, you sell it. And then what's going through your mind at this point? How did formations come to be?
Shahar Plinner 07:44
So when I run? So I actually, when I moved to the US, I stopped working for someone, you know, I was a w2 employee for about three and a half years, and discovered that it's true, I'm just not employable. Like many of us, self employed. I had too many dreams and too much that I wanted to do, and I was limited because it was someone else business. So I decided to take kind of my dreams and start my own consulting firm. And when we started GPL, tax and accounting back in 2005 the idea was, how can we bring data in front of our customers than the customer profile back then was high net individual. I moved to Seattle, 2005 2006 is the golden era of the Northwest. You know, Microsoft was booming. Amazon was just introducing so Amazon was, you know, primary growth for our customer base. We design a product for what we call the 1040 the executive 1040 the corporate people that makes 345, $600,000, more. And we design a playbook for them how to treat, you know, their capital gains, their equity their stock options, their real estate activity, their foreign with foreign nationalities. And then through that journey, I got introduced into the real estate subject, I saw that many people basically using real estate as the wealth mechanism, as the retirement mechanism. 2005 2006 was just about before the subprime, you know, crisis. So it was a lot buy and hold. So we saw a lot of, you know, customer buying real estate to hold and then host. 2008 2009 we got into the distressed part. You know, people buying on wholesale, and people buying to flip, and people buying short term to gain, kind of, you know, the opportunity of distressed properties. So everywhere we go, in the northwest, in 2005 to about 2015 16, we saw real estate all over and again. As tax expert, you can choose which area you want to practice and participate. And we made a decision that real estate is huge part of of what we want to do, and basically because we saw a need to address tax and accounting for segment that people feel really confident again, that the front of the house, I really feel confident to negotiate the pricing. I really feel confident to manage. Project like, you know, flips and distressed property, buy and hold. I enjoy being a lender, but I really hate the back office. How do I reconcile flips? How do I reconcile buy and hold? How can I use depreciation, what it costs, aggregation? How can I 1031, exchange? So people start asking all of those questions, mainly because the Northwest was a huge hub for real estate activity, and when we saw, you know, that opportunity, we just went all in helping everybody in real estate to understand the tax consequences of how to deal efficient with real estate transaction.
Brian Charlesworth 10:37
So when did you start working with realtors? And like in 2008 it sounds like
Shahar Plinner 10:41
so we started from day one, from 2005 2006 when we start dealing with our audience, real estate was our diversification. You know, it was people have concentrated position with Microsoft stock. People had a concentrated position with Amazon stock. There's about 300 headquarters of Silicon Valley start, you know, operating in the in the Seattle, great area. So we had Facebook people and Google people, and everybody was, hey, I want to sell my stock portfolio. I don't want to be in the market. I want to diversify. Where should I put the money? And there we start advising people how to get, in a very smart way, into real estate. So we actually penetrate into real estate markets from the investment perspective. And then when we start offering people to invest in real estate, we start developing collection real estate agents, because they needed the entire ecosystem. So my philosophy was, I'm not sending you, Hey, Brian, you need to invest and buy real estate in Bellevue, Washington. It's hey, let's meet Joe, who is the real estate agent, and let's meet Dietrich, who is the mortgage broker. And let's make this dream team concept around you, so use the investor can make, you know, smart financial decision for yourself without the need to be a real estate expert or mortgage or lender expert. So we always believe in the dream team. And then once we start, you know, participating more in the ecosystem of real estate, we start getting, basically, more business real estate agents, you know, start approaching us, say, hey, we know that you tax expert on real estate. And then, you know, the communication between real estate professional and the ecosystem and our customers, the dialog started, and we've been in the middle, you know, the experts that facilitate those transactions.
Brian Charlesworth 12:24
When was formations actually formed?
Shahar Plinner 12:27
So when we basically, you know, start dealing with those high net individuals and the 1040 what we realized is that the world of taxation is geared towards corporations. What it means? It means that if you are a corporation, or if you have a w2 that works for the corporate, you're golden. You have a playbook, you have this umbrella that provide you, you know, the tax expertise, or at least the knowledge base that you need and the benefit. But once every while we got into the practice, those 1099, like the real estate agent that we referred in business, came and say, Hey, Shahar, I like your philosophy. Can you take care of me? And said, Sure. And now we're getting all of those 1099 what got the unconventional w2 the self employed. And every time at 1099 came to the practice, it was okay. What do we do now? It's kind of we need to invent the playbook. But once we did 1050, 100 of those, we saw that the playbook is kind of the same. We saw that, hey, a 1099, come in, we need to connect them into a separate banking so we can start reviewing the data. Once we review the data, we see that we potentially can recommend them to move into a better entity structure, usually from a sole prop to a single member LLC, into an S Corp. We start seeing the benefit of an escort. And then in 2016 actually, when Intuit introduced QuickBooks Online, it allows, for the first time to productize it, it was allow us, for the first time to connect an online accounting system into banking, to pull the data live, to connect some payroll, you know solution, and then start managing S corps in a very light way with one accountant that was taking care of them. But it was enough for me as an entrepreneur in the tax and accounting world to understand that this is my next kind of this is my next gig. I want to solve the tax and accounting problem for self employed. I want to give them the peace of mind. I want to provide them with tools so they can make smart financial decision, so they will stop overpaying on taxes, so they will feel rewarded and not penalized by the system, so they will stop acting with fear and uncertainty and doubt. So they will make sure they get the best solution out there. And this is kind of where the formations idea was born. Originally, we called the project, project balance monkey. So balance monkey was the first name of, you know, what become formations today. And the idea was that, you know, monkeys can balance financials of self employed. It's pretty. Simple. It's not as complicated. And then every step of the way, you know, we optimize it. We start bringing some retirement solution and expense management and some other tools. Until I found out around 2019 that's it. I have enough evidence for that balance marking project to be 100 times bigger than my consulting practice, and that's it. You know, as a self employed entrepreneur like yourself, when we spark the idea and we know that that's it, you know, this is the next thing for us. Yeah.
Brian Charlesworth 15:34
So most, most founders are certainly visionaries. Many of them have sales backgrounds. And if you look at real estate businesses, they pretty much all have sales backgrounds. So it seems to me that sales people really are not interested in taxes. And I know, like every year, you know, when it comes tax time, it's not something that I'm excited about. Like, like, you are, right? But it's interesting. You guys got into the real estate business, and I think it's a I think it's a great choice, because as I look at these realtors, these real estate team owners, even agents within these teams, taxes are something they despise. Taxes are something they don't want to plan for. Taxes, or, you know, there's just a lot there, and I think they have to get a certain size. I've watched many of these where they have to get to a pretty big size, usually, before they really start getting sound tax advice. So at what point would you recommend, like, if I'm a real estate agent, if I'm a real estate team owner, like, at what point should I be talking to formations?
Shahar Plinner 16:43
I think what we found out is that while real estate agents and real estate has a strong sales kind of background, or they love kind of you know, they enjoy the closing, what we found out there are even more relationship people, they are developing relationship with their community. They're very local. They're working with local providers. They know everybody. They travel around, you know, their zip codes, so they meet people personally and very relational. You know, sales transaction on real estate takes time. It's usually it's not, you know, five minutes. It takes, sometimes weeks and months they need to hold the customer or their client accountable, because probably it's the largest transaction ever their client are making. You know, it's bigger than when they buy cars, it's bigger than they they bet on school for their kids. It's bigger than anything that they expense. And because it's such a large transaction, we found real estate agents very relational. And I think this is what helped us to get into real estate. We kind of got into their heart, not just into their brain, to understand that in order for you to be successful, you need to have relationships, also for yourself, you know, you need to have relationships with, you know, with the lender. You need to have relationships, you know, with property management, you also need to have relationship with insurance, and you need to have like, a great tax person next to you, because every decision that you are making internally, for yourself and for your customers has that financial aspect. And I think we are presenting ourselves as the partner for the real estate community. And I think that what got us, you know, one passion about real estate, because we are relational, and the real estate market is very based on relationship. And this is where we find ourselves providing the most amount of value. When we have that relationship with someone, they start listening, and when they start listen, they start moving kind of the direction that we helping them to move. And I think part of what formations idea was is that there's so much that can happen at the back end without the real estate agent or without the team leader. Need to do anything. They just need to be aware. And I think this is the idea that there's so much 80 to 90% that we can automate at the back end, which is, this is the innovation that formations brings to the market, which what you call the Old World. The old CPL, doesn't have the tools to do that. Therefore the relationship over there is very daunting. Is I need you to do things for me while information is here is what I see, and this is what I want you to do for yourself in order to get into that financial well being. So again, the relationship is what makes us super passionate about the real estate industry.
Brian Charlesworth 19:34
How many real estate agents or team owners do you guys work with now?
Shahar Plinner 19:39
So right now, we have close to 1200 real estate agents on the platform, about 5% of them, about 60 team leaders at the moment, were taken care of while we're a national spread all over the country, there's about 10 or 12 states that probably make 80% of our customer base is usually where the state that you. See that has the most amount of activity. So it varies, this change based on kind of the time. But again, nationally, we can support any, anyone everywhere. But we see again that concentrated in again, the West Coast. We see some, some activity on the East Coast sometimes, you know, in the middle of the country, there's about 10 or 12 states that we operate kind of really strongly. And again, about 1200 customers so far.
Brian Charlesworth 20:27
So you said 1200 customers on the platform. Tell us about the platform, and congratulations, by the way. I mean, that's a that's a large number of realtors to be doing tax planning and accounting services for so tell us about the platform, though, because most people, I think, don't think of okay, I'm gonna go, I'm gonna go over here and do tax planning and accounting, and I'm gonna have a platform. So let's, let's talk about the platform.
Shahar Plinner 21:05
So the idea was, how can we bring all of your back office information in front of you, everything from your, you know, legal entity, you know, when do you need to renew? Do you need to move from a different entity structure, from a sole prop into a single member of C into an S corporation. How should they do it? What is the information that I need to get in front of me to make the decision to move an entity all the way from again bookkeeping, payroll and tax at the moment, when you go to your accountant, usually the discussion is over email, over phone. There's no information that you can see most accountants will provide you, maybe a portal to upload your document so you can see, you know, your tax return. You can see your formal documents, like 1099 pay stubs. At the update, they will send you maybe a link to sign, you know, something online. What formations wanted to do is to empower your back office by bringing you all of your financial data in front of you. So when you log in into our dashboard or into the online portal. You can see basically all of your business in numbers. You can see year to date financials. You can see how much money you made. You can see how much money you expense. You can see what is the net of that means. You can see the different categories. You can see benchmarks. How much do I expense compared to last month to last year. How do I expense compared to other agents? And I think again, that FOMO that we're living in, am I running at the maximum speed? Do I actually maximize my ability to perform? And, you know, to grow top line? Am I expensing too much? Do I take home enough money to support that journey. And I think this is a key, you know, sometimes we self employed. We feel, is this journey even worth it? You know, am I making enough to deal with this hassle, to be kind of responsible, both of bringing customers and managing everything and and the back end? So we wanted to create a platform. We wanted to create some visualization that actually give you a live snapshot of your business so you can actually one feel comfortable and confident in yourself that what you're doing actually can support your family, can believe in the system. You know that I'm paying just the fair share, but we wanted to bring as much data in front of those business owners, so they can be informed about their financial situation, so they can make real financial decision that will impact and keep more money in their pocket.
Brian Charlesworth 23:37
Okay, so this is what got me excited? You're talking about visualization. You're talking about giving them more data at their fingertips, real time, information, so they can make better decisions. These are all the same exact language that sisu uses. Difference is we're the platform that allows them to manage their business, and not just their financial side of their business, right, but to manage all of the systems and processes in their business, which allows us to give them visualization into their business, which allows us to help make them better leaders of their sales team, which allows us to make them better leaders of their ops team. And then this is almost an extension from that. And one of the things I love about this is we already have an integration into sisu with the formations platform, so that we can pull the expenses from formations into sisu, so we have these dashboards in sisu that are now more accurate as well. But what you guys are doing is really an extension of what we're doing, where you're actually giving them visualization, into their accounting side of their business, into their tax planning side of their business, which is something we don't do at all. And so for us to be able to leverage that and bring this extension to our customer base was really exciting for us. So let's talk about a relationship then. So. So sisu got to know the formations team, and got to see that they're working with 1200 teams across the country, where we're working with about 3500 teams across the country. It just made sense for us to bring this to some of our teams and to share this value, because we think it's incredibly valuable for a real estate team owner. So I guess I wanted to have Shahar on the show to talk about this, this relationship, this partnership, this extension of what sisu offers, because I think it's so valuable.
Shahar Plinner 25:36
So let's continue that. You know, we are saying that wherever you guys stop, we start. And I think this is why I love the synergy. Again, I cannot help your customers to be more productive with their audience, like I can save them time. I can give them some visibility into some decision making, but again, the fact that you have them to be way more productive. We saw it as a synergy, as we have to be more productive at the back end when we are, you know, optimizing someone financials to $20,000 of tax saving. This is an additional sale of property without moving from the chair. So when we first met sisu at one of the conferences, I think it was almost like 18 months ago when I heard about you, it was mind blowing for me, because for me, it was like, wow, you know, I want to be sisu partner, so it's why we chase, you know, sisu for almost like a year and a half, because it was, for us, it was no brainer for your audience to be exposed to something so innovative, like formations through the SISU eyes, because we see, you know, the industry so much alike,
Brian Charlesworth 26:46
yes. So just wanted you guys to know you guys are getting this firsthand. We have press release going out next week, but sisu has actually partnered with formations to bring you these really accounting and tax planning services. And just to make you guys again, this is you guys. Know, if you've been with sisu, you know we are all about helping you make more money, net, more money, and now on the back end, put more money in your pocket, instead of in the government's pocket as well. So anyway, I know I can tell you, Shahara, we are really excited that you chased us down for a year and a half. And I believe there's just tremendous synergy here. So as you think about this partnership, obviously you guys can reach out to your sisu account manager. We can introduce you to Shahar, but I would love for you to maybe just give a couple of things. I've heard you talk about S corps several times today. I know many, many realtors have an S corp today, but maybe that's a small piece of advice. Or what's something else that people should be looking at today, that you know, if they haven't done any tax planning, what are some things that they just some basic things? I mean, obviously you guys are going to get deeper with them. What are some basic tips for these people, things that that everyone, probably who's in real estate should be doing.
Shahar Plinner 28:05
So I think that one, I love the integration with sisu, because I think it's it's eliminate friction of the process. Again, you guys provide so much data, and sometimes you know your audience, your customers, need to take this data and move it into their bookkeeper, and the bookkeeper need to move it into their tax accountant. The tax accountant into someone that filed your business return or individual return. And every time that you move the information you know manually, you know, you lose some of the power of the data. And what we wanted to do is basically make sure that you know your audience can consume tax and accounting at the highest level, you know, within sisu, so there is no friction, so nothing of the information is Get lost. And I think when someone has first, I want to tell you that we still see that 90% of the prospects that are coming to us are not an S corpse. So surprisingly, again, you will still see a huge and tremendous amount of the real estate industry still operating in the wrong entity structure. So we definitely want to share the news that while LLC is a thing, you know was a thing, or still a thing, S Corp is the one entity structure you need to think about. And usually when someone is making more than 8090, $100,000 consistently, you can see the amazing tax savings, the 1015, 20,000 of tax savings. So definitely S Corp is the thing. But when you run an S corp, those couple of things that you must take care of. You know, while S corporation is really tax advantageous and the IRS is really kind of open for the S corporation to be the entity for self employed. There are some requirements. So one of the things that we want to make sure is that the S corporation is clean and compliant. We want to make sure that the LLC is getting renewed every year. We want to make sure that you have a separate bank account, that you are not commingling expenses. We want to make sure that there is definitely separation of entities. We don't want the IRS income and have a reason to revoke your s you know, if they will revoke your S election, the consequences is a huge tax bill on your self employment tax part. So we just want to make sure that the S corporation is clean and healthy reasonable compensation. When you move into an S corporation status, you start paying yourself as a w2 employee. We mentioned couple of minutes ago that the world of taxes is geared towards cooperation by democratizing S Corp. We basically take the big corporation playbook and bring it into the subject matters, or into the self employment segment, into the very small businesses. But there is some set of requirements that we just want to make sure that before we get into into the tax planning and the tax strategy, we just want to make sure that your S corporation or your entity structure is clean compliance set, that nobody can basically challenge the structure that you're in.
Brian Charlesworth 30:54
Yes. So one of the benefits, and you mentioned this, Shahar, but I've witnessed this, geez, I witnessed this first thing when, when my wife and I got married, she obviously, she had an S corp at the time, and she would pay herself a salary. And you just mentioned this, pay yourself w2 if you pay yourself w2 it certainly helps. And there's a balance, right? You don't want that to be too much, but you definitely want it to be enough that you can qualify to buy homes and different things that you want to buy, and what are some of the other benefits of doing that? So
Shahar Plinner 31:27
the w2 for us, again, it's an enabler, and real estate agents need to understand that w2 this is the mechanism that actually save you self employment tax. So this is the mechanism that save you so much money because you're only paying self employment tax on that reasonable w2 the rest the distribution, the dividend, the profit sharing, our net of self employment taxes, you know, so you can save the 15.3% on the bigger chunk of your revenue. But the w2 is not just enabler for tax savings. It's enabler for what we call corporate level benefit. This is where we introduce the solo 401, k this is where we introduce the HSA, the health savings account. This is where we introduce the FSA, the flexible spending account, both for child care and for medical expenses. So again, we are trying to mimic, we're trying to duplicate the corporate world by letting the self employed know that. You know, expense is not a strategy when you basically over expenses, because your fear of taxes, that money will never come back to you when I overpay on my marketing expense, so I prepay my continuous education, and yes, I can save my tax, but that money will never come back but when I fund my 41k or when I pay my kids and let them contribute with that amount into their Roth account. Or when I open an HSA a health savings account, and I can fund $8,000 a year for my out of pocket medical expenses. Or if I set aside $5,000 for my kids for pre after school or for summer camps. Again, those things that your w2 friend are getting from Microsoft, Google, Facebook, this is the same plans that you can design for yourself. Even better, because you're the only employee. You don't need to discriminate anyone. You can design the benefits for your own benefit and your own family. Those benefits are only available through the w2 through the earned income, through basically the reasonable compensation. So what we try to educate is one, there is an entity structure that you should and need to know S Corp. You need to know that S corp has some requirements, that you need to maintain, some things to make the S corporation. Healthy part of that is the w2 and the reasonable compensation. And once that, once that framework is set and hard and make sure that it cannot be challenged and it's super defendable. Now within the S corporation, the Fundy gun, this is where we can design different plans. This is where we can educate you on expenses. This is where we can optimize your rental activity. And we know that many real estate agents hold the retirement plan within you know real estate so again, while we know taxes probably better than anybody else, our solution designed specifically for real estate agent and real estate team to thrive within the tax and accounting domain. Okay,
Brian Charlesworth 34:25
so you just shared, like, a dozen things that people need to look at. So if you guys, like, if you are not doing these things, if you don't have an HSA, if you aren't paying your kids, if you're not doing all these different things to to allow you to actually benefit and not pay taxes in those areas. This is something you definitely should look at now. So
Shahar Plinner 34:47
and by the way, just to mention, while we Brian when we try to automate, you know, 80% or 85% of the experience, we also understand that each and one of our customer, you know, is a snowflake, and we want to make sure that we address what you call the last. Aisle, the 15% that actually make an impact, and formations develop, you know, a 27 different tax strategies, and I'm sure that part of it, our audience is already implementing. So we just want to reinforce that this is great, and continue to do that. And if you're missing out on some of those strategies, we definitely want to bring the awareness, and we want to make the recommendation if it's for you or not. Because, again, part of the tax strategy is not for everybody, and if it's for you, when you should, you know, implement it this year, next year, or maybe we need couple of more years until you're ready for some of those strategies.
Brian Charlesworth 35:37
So again, guys, obviously the more money you make, the more you can take advantage of this, but 27 tax strategies, you're probably using maybe one to four, one to five of those today. So reach out to your CISO account manager. Your CISO account manager will get you connected with Shahar and his team over at formations, and we'll make sure that you can have a one on one session to figure out if this is for you. So anything else you want to add? Shahar and thank you for being on the show today, and we are excited about the relationship and bringing even more value to our customer base.
Shahar Plinner 36:11
So I think that again, yesterday was the tax deadline, September 16, for pass through entities for LLCs and S Corp. So if you filed your S corporation before then or just yesterday. Congratulations. Good luck again. We are ready to take care of 2024 if you haven't filed your taxes yet, no worries again. Filing late, it's not something that we support, but it's not the end of the world. We are non judgmental. We'll help you to file your taxes even late, and the IRS has set off abatements That they will abate delay to file penalties or interest. So again, don't ignore your taxes. Sometimes it's challenging, but we all entrepreneurs. We face challenges all the time. And second, keep in mind that the next deadline is coming ahead of us really fast. So the October 15 is the deadline for your 1040 if you're a single member LLC, or if you're a just a sole prop. Again, the deadline is coming if you're a single member LLC or sole prop. I hope it's the last year that you're filing as a single member LLC or sole prop, and you'll become an S corporation soon in 2024 but as you mentioned, Brian, we love to be in front of your customers. We love to be in front of the SISU team members. Upload your tax return, upload your questions. Challenge us with whatever everybody else told you, no, you cannot do. We will probably say yes and no, and we always have a solution for taxes. And we're excited again. I think it's the beginning of a great, great partnership.
Brian Charlesworth 37:39
Yeah, it's a great time to put this in place. Whether you're finishing this year off late or preparing for next year. Right now is the time between now and the end of the year to make that preparation. So again, reach out through the chat. Reach out to your account manager. The sisu team will get you connected, and we'll get in a tax strategy session set up with the team. So anyway, Shahar, grateful to have you on the show, and it's going to be really fun to see our customers continue to benefit beyond some of the stuff we've provided to them at this point. So thanks.
Shahar Plinner 38:13
Yeah, looking forward to the relationship, looking forward for being in front of your customers more again, we have so much content and so much information that we want to share with them, so I'm excited, and I hope everybody else is excited.
Brian Charlesworth 38:25
Great. All right. Listeners, thanks for joining us on the show today. I'm really excited about this. I think this is something everybody should take advantage of, so that's why we're sharing it with you. That's why we've partnered with the formations team, and we will catch you all next week on the next episode of the grit podcast. Thanks for listening, everyone.
