The 2025 Tax Changes You Need to Know Pt.2
- Davian Rhodes, CPA
- Nov 12, 2024
- 2 min read
Updated: Feb 26
D. Rhodes, CPA, Writer and Editor
We're not here to discuss the presidential election. Instead we're here to discuss the potential tax implications in result of the election. With Trump's recent election win, major tax changes are coming that could put more money in your pocket – and help you achieve your dreams of shop ownership, real estate investment, or finally not wearing every hat in your business.
Here's What the 2025 Changes Mean For You
Tips Are Going Legit: Trump's proposing to make tips officially tax-exempt. Let's be real – some industries have been selective about reporting tips. But now? You can legally keep 100% of your tips AND use that documented income to qualify for mortgages, business loans, and credit cards. Think about it – all those $5, $10, and $20 bills you receive for your craft? They could soon be 100% yours to keep. This isn't just about keeping more money; it's about building legitimate wealth and accessing the financial system that builds empires.
Your Family's Future: Got kids? The proposed increase in the Child Tax Credit from $2,000 to $5,000 per child is like getting an interest-free loan from Uncle Sam to invest in your future. That's money you could use to:
Put a down payment on your dream shop location
Invest in high-end equipment that sets you apart
Start your real estate portfolio
Fund your children's education
Establishing or Expanding Your Business: The Tax Cuts and Jobs Act (TCJA) extension means you'll keep enjoying lower tax rates indefinitely. For businesses operating or taxed as sole proprietors, LLCs, S-Corps or partnerships, this is like getting a permanent raise. Get this, when the TCJA was first introduced to the American economy, Five Guys grew from one burger spot to over 1,500 locations and they consider the TCJA as one of the main drivers to their success.
Warning: Equipment Costs Might Rise
New tariffs could make imported tools and equipment more expensive.
Target survived and thrived during the last time this happened by stocking up early and smart. Take a page from their playbook and plan your equipment purchases strategically.
Your Next Move
Start tracking your tips meticulously (you'll thank me when these changes kick in).
Consider incorporating your business before 2025.
Build relationships with equipment suppliers now to lock in current prices.
Work with a tax pro (shameless plug - like us) who understands where you want to go.
*Just like how Floyd Mayweather turned his boxing career into a $1.2 billion empire through smart financial moves, you can use these tax changes to transform your career into something bigger.
Remember: Our ultimate goal is to help you save time and money, while building wealth and legacy.
The choice is yours, but the clock is ticking. Reach out today so we can help get you from where you're at, to where you want to be. Your move boss.
*This article provides general information, not individual tax advice. Tax situations vary; consult with a qualified tax professional, like myself, for advice specific to your circumstances.