Dec 2019 Income At-A-Glance
Gross Income for Dec: $184,157
Total Expenses for Dec: $52,942
Total Net Profit for Dec: $131,215
Difference b/t Dec & Nov: +$23,747
% of net profit to overall gross revenue: 71%
Why We Publish An Income Report
This monthly income report is created for you, Fire Nation!
By documenting the struggles we encounter and the successes we celebrate as entrepreneurs every single month, we’re able to provide you with support – and a single resource – where we share what’s working, what’s not, and what’s possible.
There’s a lot of hard work that goes into learning and growing as an entrepreneur, especially when you’re just starting out. The most important part of the equation is that you’re able to pass on what you learn to others through teaching, which is what we aim to do here.
**We’ll receive a commission on the affiliate links below. If you click on my affiliate link and sign up for the products and services I trust and recommend, then I will earn a commission.
Josh Bauerle’s Monthly Tax Tip
What’s up Fire Nation, my name is Josh Bauerle. I’m a CPA and the Founder of CPA On Fire, where we specialize in working with entrepreneurs to minimize their tax liability while keeping them in line with the ever-changing tax laws.
I’ve been working with JLD & Kate at Entrepreneurs On Fire for years now, and they’ve included me in these monthly income reports with unlimited access to all their accounts so I can verify that what they report here is complete and accurate.
And because they believe in delivering an insane amount of value to you, my job doesn’t stop at the verification level; I also provide a new tax and accounting tip every month!
Josh’s Dec Tax Tip: Paying Your Kids
Last month we talked about paying your spouse as an employee in your business, and this month we’re following that up with paying your kids as employees in your business.
If you listened to last months tip, you know there are only a few cases where paying your spouse makes sense from a tax perspective – and mostly just if you wanted to contribute to their retirement account.
But paying your kids could present a significantly larger opportunity to save money on your taxes.
First, if your child is under the age of 18 and your business is owned solely by you and / or your spouse, you have no requirement to pay social security and medicare taxes on their wages.
Further, if you pay them less than their standard deduction ($12,200 for 2019), they will owe no taxes whatsoever on that money.
So you are potentially talking up to $12,200 per kid, per year of income that would have been taxable to you; giving it to your kids as wages for work done; and eliminating it from any form of taxes.
A pretty sweet deal, especially for those in high tax brackets!
But it gets even better…
Since your kids now have earned income, you can take some or all of the money you paid them and put it in a retirement account like a Roth or Traditional IRA.
Imagine maxing out your kid’s retirement account every year from the age of 10 until they get to college!
Or you could put the money in a college savings account like a 529.
Either way you are paying them tax free wages and putting the money into accounts that allow it to grow tax deferred or tax free.
I’m sure you are wondering at this point: what’s the “catch”?
Surely it can’t be as simple as paying your kids money and getting a big, fat tax deduction?!
While there is no catch, there are several factors to consider when it comes to paying your kids from your business.
- How much to pay them depends on their age, what type of work they are doing, how often the work, etc. This isn’t just a fake “my kid worked for me and I paid him $12,000”. It has to be a legit. You can’t pay your two year old. You can’t pay your 14 year old $12,000 to work once a year. Make sure you document everything, including what role they filled in the business, and make sure the wage you pay is reasonable for that role.
- What type of entity is your business? If you are taxed as an S Corporation you will likely need to create a management company that is not taxed as an S Corp in order to get the payroll tax requirement waved. You will definitely want to work with a tax professional here.
- Make sure everything is done properly, including filling out the payroll tax returns. You will want to use an actual payroll company, even if your kids are the only employees and you aren’t paying payroll taxes on them. In fact that will make it even more important to use a payroll company. We recommend Gusto, but any full service payroll will do the trick.
This isn’t a strategy you want to pursue lightly, but it’s one that can both save you a ton on taxes while also putting your kids in a great financial position. Talk to your tax professional and get this started for 2020!
As always, please feel free to contact me if you’d like to discuss what would be best for YOUR business. I LOVE chatting with Fire Nation!
What Went Down In Dec
You Up For the Challenge?
During the month of December we started working on something brand new – something we’ve never done before – and we’re so excited to share it with you!
We’re teaming up with Jill & Josh Stanton from Screw The Nine to Five to run our first ever challenge for Fire Nation called The Think Like An Expert Challenge.
You might be wondering, “What’s the challenge all about?”
We’re glad you asked! :)
The challenge is specifically designed to help you turn your existing knowledge (yes, what you already know) into a profitable business.
The challenge will roll out over 5 days and be run inside of a Private Facebook Group starting February 21. That means you’ll get direct access to all 4 of us inside the group for 5 days straight!
PLUS… in addition to the 5-day challenge itself, we’ll be going live in the Facebook Group EVERY DAY, running contests, giving away prizes, AND if you join the challenge and stick with us for the 5 days, you’ll be the FIRST to hear about this thing we’re doing that absolutely zero people (other than the 4 of us) know about right now.
Our first ever Think Like an Expert Challenge is over, but if you’re ready to create next level success in your life by sharing your existing knowledge through in-person trainings, virtual workshops, or masterminds, then check out Knowledge Broker Blueprint by Tony Robbins and Dean Graziosi. It’s ON FIRE!
How to Plan Your Goals for the New Year
Like many of you, we also took time out in December to reflect on 2019 and also look ahead to 2020.
Our reflection uncovered a lot of great lessons learned from projects that were both successful and unsuccessful, all of which we’ve shared with you along the way in our monthly income reports.
And looking ahead to 2020 has been – and continues to be – so exciting!
We’re continuing to focus in on our BIG 5 things (introduced in 2018), which has helped us manage our time and what we say yes to so effectively.
As we head into 2020 we’ve made a commitment to be much more intentional about how we set up our promotional schedule for affiliate launches, in addition to maintaining the lifestyle freedom we’ve created over the past 7+ years.
Have you reflected on 2019, and spent time planning your goals for 2020?
If you’re looking for a little nudge and the exact steps you can take to start today, check out our post on How to Plan Your Goals for the New Year!
Looking Back at 5 Years of Kate’s Take
A big takeaway from the time I spent reflecting on 2019 is how important it is to acknowledge how far you’ve come.
It’s so easy to get wrapped up in projects and constantly checking items off your to-do list, but if you never stop to celebrate what you’ve accomplished, or appreciate the growth you’ve experienced as a result, then what’s the point?
As I was reflecting on 2019 I realized I’ve been publishing the Kate’s Take podcast for over 5 years now, and that’s a pretty incredible milestone!
I’m so appreciative and grateful for everything the podcast has taught me – the massive personal growth I’ve experienced, the many lessons learned I’ve been lucky to have, and the incredible relationships I’ve built with my audience.
I’m also appreciative and grateful for this particular reflection reminding me of how critical it is to evaluate what you can commit to when you’re setting goals or considering new opportunities.
Evaluating what you can commit to not only helps ensure whatever you’re saying yes to is going to help you get closer to your BIG goals, but it also ensures it’s something you actually have the time and bandwidth to manage effectively.
Otherwise, all those little “yes’s” can quickly add up to a lot of overwhelm, and suddenly you’re in over your head and aren’t able to really give anything your 100%.
I know this sounds familiar to many of you tuning in – I know exactly what it feels like!
So if, like me, you’re tired off feeling overwhelmed all the time and ready to take your time management skills to the next level, then I share a deeper dive on all of this – plus what you can do today to make overwhelm a thing of the past – in this post and episode: What’s Next and Looking Back at 5 Years of Kate’s Take.
Product/Service Income: $156,349
TOTAL Journal sales: 1,270 Journals for a total of $37,830
The Freedom Journal: Accomplish your #1 goal in 100 days!
- TheFreedomJournal.com: $2,399 (87 Hardcovers & 1 Digital Pack)
- Amazon: $14,257 (507 Freedom Journals sold!)
- Total: $16,656
The Mastery Journal: Master Productivity, Discipline and Focus in 100 days!
- TheMasteryJournal.com: $86 (2 Hardcovers & 0 Digital Packs)
- Amazon: $7,171 (266 Mastery Journals sold!)
- Total: $7,257
The Podcast Journal: Idea to Launch in 50 Days!
- ThePodcastJournal.com: $168 (3 Hardcovers & 0 Digital Pack)
- Amazon: $13,749 (404 Podcast Journals sold!)
- Total: $13,917
Podcasters’ Paradise: The #1 Podcasting community in the world!
- Recurring: $15,445 (208 monthly)
- New members: $10,331 (23 new members)
- Total: $25,776
Real Revenue: Turn your BIG IDEA into Real Revenue
- New members: $315 (7 new members)
The Revenue Crew: An Elite Mastermind ON FIRE!
- Currently closed to new members
Podcast Sponsorship Income: $92,200
Free Courses that result in the above revenue:
Your Big Idea: Discover your big idea in under an hour!
Free Podcast Course: Create and launch your own podcast!
Funnel On Fire: Create a funnel that converts!
Affiliate Income: $27,808
*Affiliate links below – if you click on my affiliate link and sign up for the products and services I trust and recommend, then I will earn a commission.
Resources for Entrepreneurs: $21,555
- Audible: $185
- BlueHost: $165 Step-by-step guide and 23 WordPress tutorials included! Disclaimer: This is my affiliate link and I will receive a commission if you sign up through my link
- Click Funnels: $20,929
- Coaching referrals: $0 (email me for an introduction to a mentor for overall online business or a Podcast focused mentor!)
- ConvertKit: $58
- Disclaimer Template: $60 (legal disclaimers for your website)
- Fizzle Mastermind: $343
- Virtual Staff Finder: $0
Courses for Entrepreneurs: $4,746
- Knowledge Business Blueprint by Tony Robbins: $0
- Create Awesome Online Courses by DSG: $1,226
- Digital Course Academy by Amy Porterfield: $1,918
- Boost Blog Traffic by Jon Morrow: $0
- Opesta by Ethan Sigmon: $802
- ASK by Ryan Levesque: $300
- Closers on Fire by Dan Lok: $500
Resources for Podcasters: $1,031
- Pat Flynn’s Fusebox Podcast Player: $12
- Podcasting Press: $250
- Designrr: $0
- Tim Paige’s Make My Intro: $0
- Libsyn: $707 (Use promo code FIRE for the rest of this month & next free!)
- UDemy Podcasting Course: $62
Other Resources: $476
- Amazon Associates: $172
- Other: $304
Total Gross Income in Dec: $184,157
Business Expenses: $50,135
- Advertising: $0
- Affiliate Commissions (Paradise): $4,865
- Accounting: $961
- Cost of goods sold: $11,316
- Charitable Contributions: $750
- Fulfillment (Shipwire): $1,296
- Design & Branding: $975
- Dues & Subscriptions: $70
- Education: $40
- Legal & Professional: $430
- Meals & Entertainment: $1,029
- Merchant / bank fees: $1,363
- Amazon fees: $16,847
- PayPal fees: $356
- Shopify fees: $82
- Office expenses: $1,796
- Community Refunds: $2,382
- Promotional: $595
- Travel: $1,530
- Virtual Assistant Fees: $3,533
- Website Fees: $99
Recurring, Subscription-based Expenses: $2,807
- Adobe Creative Cloud: $100
- Boomerang: $50 (team package)
- Bonjoro: $45
- Authorize.net: $70
- Cell Phone: $264
- Google Suite: $50
- Internet: $260
- eVoice: $10
- Infusionsoft CRM: $309
- Insurance: $648
- Libsyn: $216
- Chatroll: $49
- Shopify: $68
- Linktree: $6
- Sumo: $29
- TaxJar: $19
- Taxes & Licenses: $523
- Thrive Cart: $37
- Zapier: $15
- Xero: $30
- Zoom: $15
Total Expenses in Dec: $52,942
Payroll to John & Kate: $15,900
Wondering what we do with all of our net revenue? We share all in our April 2017 Income Report :)
Total Net Profit for Dec 2019: $131,215
Biggest Lesson Learned
Consistent and Focused Action Equals Results
Throughout December I took on a challenge that I see hold so many people back from accomplishing their goals: taking consistent and focused action.
It all started in late November when I realized there were just about 50 days until Jan 1, 2020 – the New Year. I had been toying with the idea of starting a new podcast, and with The Podcast Journal helping you go from Idea to Launch in 50 Days, I thought what better time than right now to dive in?
So I did it – I picked up my Podcast Journal and I opened to Day 1.
For the next 45-ish days (some days I did more than just 1 day in the Journal) I not only followed every single exercise in The Podcast Journal, I also went LIVE in our Private Facebook Group for Podcasters’ Paradise to share what I had accomplished that day.
I wanted to share everything I was learning with the community because I knew it would accomplish a few things:
- It would hold me accountable to finishing
- It would give proof that consistent and focused action can net BIG results
- It would encourage others in the community to ditch their excuses and join me
- It would show others that we don’t have all the answers – but that doesn’t hold us back from moving forward
I’m excited to announce that on Jan 2, 2020 I submitted my RSS to Apple Podcasts, and my new podcast, Ditch Busy: Make Overwhelm a Thing of the Past, is LIVE!
There were some days I picked my Podcast Journal up bright and early – first thing – and was so excited to dive in!
There were other days when I had so much on my to-do list, I had no idea how I was going to find time to do that day’s exercise.
But I committed to it. I asked for accountability and support. And I did it!
If you ever feel busy, like you’ve run out of time, or overwhelmed by all the things you want to accomplish in a given day, then I encourage you to join me for 2 episodes per week that will deliver a valuable tip or idea around time management and how you can Ditch Busy!
Alright Fire Nation, that’s a wrap!
Until next month, keep your FIRE burning!
~ Kate & John
Note: we report our income figures as accurately as possible, but in using reports from a combo of Infusionsoft & Xero to track our product and total income / expenses, they suggest the possibility of a 3 – 5% margin of error.