134. Why You're Paying Too Much in Taxes (and How to Stop)

In this episode of the 'Keep More Money' podcast, Kimberly Tara, a CPA and certified tax coach, shares essential tax strategies specifically for profitable women business owners. She aims to help women reduce financial stress, keep more of their hard-earned money, and create lasting wealth. Kimberly discusses why traditional tax preparation is often insufficient, stressing the importance of proactive, creative tax strategies. She highlights four main reasons why women overpay in taxes: working with reactive accountants, improper quarterly tax estimates, following bad advice, and lack of financial education. Throughout the episode, Kimberly shares client success stories and emphasizes the importance of finding the right support and education to navigate the tax code effectively. 

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Transcript

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Welcome to the Keep More Money podcast. The podcast for profitable women business owners who are tired of overpaying in taxes and tired of chasing down their CPA, deferring to someone else for every financial decision and getting hit with surprise tax bills every April. If you've ever felt like you'll never truly get on top of your business finances. This show is for you. I'm Kimberly Tara, CPA certified tax coach, multi-business owner and mom of four littles. With over a decade of experience and more than 15 million safe for my clients in the last few years, my mission is to educate and empower women just like you to keep more of their money, reduce financial stress, and create lasting wealth. Taxes suck, but they don't have to hold you back. I'll show you how to make tax strategy. Simple, fun and easy to understand. You've worked hard for your success and now it's time to keep more of it. Let's dive in. Welcome back to season four of the Keep More Money podcast. I hope you had an amazing summer and that your household is finding its rhythm again with the back to school season. You may have already noticed we have a new name. Over the last few months, I intentionally created space to step back and really work on the business. You know that feeling when you are not bogged down with a bazillion tasks calls into dos, and suddenly your brain has some white space. That was me for most of the summer, and it was such a gift that I had not really had in a long time. So as I thought about how I could serve you better, I realized. Something really important. The women coming to us weren't all moms. While we still work primarily with moms because we get that life, the common thread wasn't motherhood anymore. The real thing every single one of you needed most was this, how to keep more money as your business grows in profitability and success. So that's why I renamed the podcast Keep More Money. Because that's the phrase I hear most often from women just like you, and it's exactly what this show will help you do. You'll see how the name ties perfectly into what will cover this season and the benefits you'll take away from listening, because like I already said in the intro, you've worked hard this year and not necessarily harder as in more hours, but smarter. You're gaining traction both with your clients and as a CEO your business is doing really well. Most importantly, it's profitable, meaning there's money left over, and yet when tax season rolls around, or even sooner when those quarterly tax payments come due, it feels like the IRS has become your highest paid business partner. You may already know you're staring down a very large tax bill this year because your business revenue is high and your expenses are lean, or you feel like you're always catching up, always crunching, never sure if you're really on top of things, and that's second guessing. It's exhausting, right? I want to share a story with you to illustrate what I mean, because. I know you're probably gonna see yourself in this example. A client of ours, let's call her, Sarah, came to us after her second full year in business. What started as a side hustle quickly grew into a full fledged business, and she was able to quit her full-time job. Before she knew it, she was making over$100,000 in profit. Every tax season always felt like a nightmare, but the last one, after becoming so profitable was a hard slap in the face and a realization that something needed to change. She told me, I feel like all of my hard work is going to taxes and I'll never actually get on top of this. I don't have any support and I can't even get my accountant to respond to my emails. Her accountant. He handled her personal tax return fine, but when it came to her business, there was no strategy. He filed her taxes, gave her the number for next year, and that was it. He wasn't even available to answer her questions. Sarah thought that was normal, that this so-called tax stress was just a part of being a business owner and that the headache. Of finding a new tax accountant wasn't worth it because all of them would just be the same after just a qualification call to see if we were a good fit. Sarah told me I already feel more relieved and you know what? She is far from the only woman to tell me that on a qualification call together before we even start working together. It's sad really because no one has ever taken the time to. Simply Care. Ask more questions and just listen to you much less, create a digestible action plan to solve the issues at hand. After we started working together, things got even better. Sarah realized that everything she was experiencing before didn't actually have to be that way With proactive tax strategy and an on-call supportive tax team, she instantly, instantly went from panic and dread. To clarity and excitement from surprise tax bills, large bills in April, to knowing exactly what she owed based on her current business financials and paying it in throughout the year. She described it as finally having someone in her corner, knowing what needed to be done, and also having a team that helps her get it done. Okay. Sarah was now excited to grow her business because she was learning how she can use it strategically to actually pay less in taxes instead of more, and that's exactly why I created Make Money Moves Live, to give women like Sarah the strategies and the support that can change everything. Because that's what I want for you too. It's why we specifically, well, it's why we only focus on proactive creative tax strategy at the Terra CPA for. Because every dollar you spend, whether it's on a mentor, a contractor, an independent contractor, or taxes is one less dollar going home to you and your family, and that matters more than anything else. I hate seeing you overpay, stress and lose confidence when a solution is available. So. You might be wondering then, what are the real reasons you're paying too much in taxes, and I want you to hear me clearly before I dive into those four specific reasons. It's not your fault. The women I talk to, the women we work with, they are hardworking, organized, juggling a lot, and running a profitable business. The problem isn't you. The problem is the model you've been handed and the lack of strategy you've been offered. Let's break this down because once you understand the why, the solutions become much clearer. All right, so reason number one, accountants are reactive, not proactive. So the truth is most accountants are trained for compliance, not strategy. Compliance is essentially a fancy word for preparing and filing forms, doing the things you're required to do by the government as a business owner. Are if they have an accounting degree, and that's a big if these days, they just teach us the rules. In school. I have an accounting degree, so I went to school for this, not how to think proactively. So your accountant's job is to take the numbers you give them, put them in the right boxes and file the return on time. They're historians reporting what already happened, and it's essentially what we're taught in school, how to do that the right way so that you don't get in trouble with the IRS. That's great, but that's not strategy. That's not saving you money. That's just tax preparation, which is checking a box for the IRS that benefits the IRS, not you. And yet I hear all the time women just like you saying, I don't know what else to do or who to turn to. I'm not exactly sure what I need. I'm the first entrepreneur in my family and I don't have any guidance. So I thought this was normal, and if that's how you've been feeling too, you're not alone. Most women tell me they thought this was just how it worked. That tax season would always feel overwhelming and that their accountant doing the bare minimum was just normal. They were lucky to hear back from them and get their tax returns filed on time. Some firms will even offer a step above tax preparation, what I like to call tax planning. It's not really strategy. Maybe they run a projection in December and then they tell you to run out and buy a car because it's too late to do anything else. We'll talk about that more in another reason why I have a problem with that. Maybe they estimate how much you should set aside so you can be prepared for your tax bill in April. Again, that's better, but still reactive. It's still based on what has already happened, not what could happen if you made intentional moves all throughout the year. True tax strategy is proactive, it's creative. It looks at things like your entity structure, your income streams, your family goals, both short term and long term, and it asks how can you use the tax code to intentionally lower your bill? That's year round work. It's teaching you how to turn regular expenses into legitimate business deductions, often called write-offs. It's conversations with your tax team before you sign the contract, before you buy the car, before you put your kids on payroll. If you only meet your CPA once a year, would you believe me if I told you you're already overpaying in taxes? Period. Without me even looking at anything on your tax return. This is the kind of clarity we're going to dive deep into it, make money moves live, because once you understand all of these distinctions, everything changes. All right. Reason number two, no quarterly calculation. Another reason you're frustrated is because your business is growing, but your quarterly estimated tax payments aren't keeping up. These are often called quarterlys in the business world, and I talk all about them in episode 74. If you want a deeper dive to learn more than what I'm sharing in this episode here today, the IRS, and therefore, tax softwares automatically assumes that whatever you made last year, you'll make again this year. But what happens if you doubled your income? What happens if you finally hit your stride and your profit margin goes way up? Those estimates from last year, they aren't even gonna be close to what you actually need to pay in. So then April rolls around and you're blindsided by a huge tax balance due and your accountant. The one who's really just a tax preparer like we talked about in reason number one, they're just printing off the vouchers with last year's numbers, and they're not giving it a second thought. I cannot tell you how many women, new clients, or just women entrepreneurs I meet in general have said to me, I feel like I'm always catching up. I thought I was doing what I was supposed to, but it's never enough. And that's because no one is recalculating with you. As your business grows, as it becomes more profitable, a proactive tax strategist checks in multiple times each year with you, lovingly holds you accountable to show up to your calls with them and send in your updated profit and law statement. They run fresh calculations each quarter and make sure you know exactly what to pay so you don't get that April sticker shot getting. Can you feel the difference between flying blind and having clarity? One keeps you up at night, maybe wakes you up in the middle of the night. The other, it lets you sleep soundly knowing it's all completely handled because even better, you're not just paid up each quarter, but you've also implemented creative strategies to lower how much you need to pay even though your profit is increasing. Just like our client, Lisa, who doubled. Her income from$60,000 a year to$110,000 a year, but paid only$4,000 in taxes instead of the 6,000 she paid the year before. That's a freaking win-win. Wouldn't you agree? Don't you want that too profit to increase taxes to decrease? Okay. Reason number three, believing myths and listening to unqualified sources. This reason right here gets me a little fired up. There is just so much bad advice out there, and it's costing you thousands of dollars. And more importantly, the risk of an IRS audit. You know the myths I'm talking about? buy a car in December and you'll save on taxes. Spend more money so you owe less. Write off everything in your life. Pay your kids through the business. I wish I could tell you how many clients come to us after following advice from Instagram reels, Facebook groups, or even so-called tax strategists, who don't actually have any credentials. These people are repeating something. They heard, something that maybe their tax pro has implemented for them as a business owner, but without context, without understanding the law, without understanding how it applies to them or you, and then you're listening to that advice. And here's the result. Women are spending thousands of dollars on things they don't even need, thinking they're saving money in taxes, or worse, they're setting themselves up for an IRS audit and they won't come out the winner, one new client told me when we first met that she thought she was doing what successful business owners do spend money at the end of the year. She didn't realize she was just draining her profit and cash in future years. Here's the reality and most important thing that I want you to take away from this. Wealthy women don't spend money to save money. They invest money strategically. They buy things that create long-term returns, not short-term write-offs, and they do it with the advice and support of a qualified professional who deeply knows them, their business, their goals, and the tax code. Reason number four, lack of education and conversation. This is the biggest one, the biggest reason for why you feel the way you do about taxes. No one ever taught you this. No one taught you any of this. Not in school, not in your MBA program, not in any of the business coaching programs. You've invested tens of thousands of dollars in. I don't know about you. But when I think back to what I learned in school, we covered trigonometry, calculus, and physics, but never once did they teach us how to file a tax return, balance a checkbook, or understand how loans and interest rates really work. And let's be honest, those things apply to far more people in this country on a daily basis. Then calculus or physics ever will. Okay. I'm so beyond lucky and grateful that I had parents. Who had this knowledge and didn't gate keep it just because I was a girl. Believe it or not, I'm actually the business and finance person out of my brother and me as well as my husband and me, and rest assured, my daughter will have just as much knowledge about this as my son. It's a new day and age, but for centuries, women weren't even allowed to go to school at all, and when they finally were. They were often funneled into classes like, um, home economics or teaching, not math, business or finance, even into the early 19 hundreds, the assumption was that women weren't capable of understanding numbers or that they'd ever need them. Women weren't even given a seat at the table when it came to money. Until 1974, as in only 50 years ago, it was perfectly illegal for banks to deny a woman the ability to open a bank account, apply for a credit card, or take out a loan unless she had a male co-signer like a husband, father, or even a brother. It wasn't until the Equal Credit Opportunity Act of 1974 that finally made this type of sexist discrimination illegal. Think about that. 1974, my mom, most likely your mom was alive at a time when women could not access their own credit and money independently. I handle the finances and have the money acumen in our household. I helped my husband open his first credit card 15 years ago, and I'm two years younger than him, and I had already had my own credit card for three years at that point. To think that I couldn't make decisions or do things without my husband signing just baffles me. So is it really any surprise though that women feel behind when it comes to money? Conversations? For decades, daughters weren't invited into the discussions that sons were. Deals happened on the golf course in private boardrooms, behind closed doors, and in the good old boys club, and women were completely left out intentionally. Unfortunately, much of this still exists today in the year 2025. It's freaking mind blowing. So when I hear women say things like, we never talked about this kind of stuff in my house growing up, my accountant blows me off when I ask him questions to try to understand. I built a profitable business, but I feel like I'm failing when it comes to money. I just let my husband handle it because I'm not good with numbers. It makes complete sense. This isn't just a gap in what you were taught or what you weren't taught. It's the ripple effect of generations of women being excluded from financial education and financial decision making. And it breaks my heart because none of that is true. You are not failing. The system failed you. That's why make money moves live is so important. It's not just about your numbers. It's about finally claiming your seat at the table and learning what was literally never taught to you. Because the truth is women have always, always been capable. They've just been excluded, and the result is that too many women feel behind when it comes to money. Not because they can't understand it, but because no one ever gave them the chance. And even today, the tax code isn't shared in a way that empowers women entrepreneurs to use it to their advantage. So of course, it feels like you're always behind. Of course, it feels overwhelming, but here's the shift I want you to see. Just because the system wasn't built for you doesn't mean you can't win with it. Once you're educated, once you find the right person to support you, once you claim your seat at the table, you realize you can use the rules of the game to your advantage. So if you feel like you've been overpaying, stressing, or feeling like you'll never get ahead, it's not because you're bad with money or you can't do this, it's because you've been given incomplete advice, outdated models, or no education at all. And once you recognize these four reasons that I share with you today, one that you're working with a reactive accountant. Two, you're not paying your quarterly tax estimates properly. Three, you're implementing incorrect strategies, and four, the lack of education and conversation you have available to you, you can finally start to see a way out because the solution isn't harder work. It's not making more money, it's not more stress or simply giving up. It's strategy and support. Here's the good news for you, though. You don't have to stay stuck in this cycle. Wealthy women don't just pay taxes. They intentionally and creatively use the tax code in their business to lower them. They keep more money for themselves, for their families, for the life they actually want. They get themselves into the right rooms. They invest in qualified professional support. They don't take no for an answer, and they surround themselves with other women who are taking control of their financial future. And you can too. I want you to imagine this for a moment. Maybe close your eyes if you, if you can. It's March 25th, 2026. You're sitting on your back patio as the warm spring air blows your hair across your face. Your company's books were closed and completely finished back in January, and you had your financial statements, your profit and loss on your balance sheet in your hands or on your computer the first week of February. You're not really worried about your tax return or tax season at all. You're actually thinking ahead and focused on planning out 2026 and the big goals you have for the year. You have the 2025 data to go off of your tax returns. They're almost finished being prepared, but you're not even expecting a surprise tax bill. Instead, you're already preparing for your 2026 quarter one estimated tax payment because 2025 is good to go. Yeah. Can you imagine a tax season where you already know the number months in advance where there's no panic, no guessing or stressing? Just clarity and forward thinking momentum. Now let's take it a step further. Imagine you're sitting at the kitchen table with your family. One Friday night you ordered pizza, laptops are open, and you're planning your summer vacation. The kids tell you they wanna go on a cruise instead of your first thought being, we can't afford that. you find yourself saying what kind of cruise where too? Because the money you saved on taxes has created options and opportunities you didn't have before. Maybe instead of a cruise, it's a trip to Disney with the kids, or a two week adventure through Italy tasting wine in Tuscany, walking through Rome and actually enjoying it. The entire time because you know the trip is paid for with money that would have gone straight to the IRS. Otherwise, can you see how different that feels? Can you feel it in your bones? Not only do you have clarity in your business, you have peace in your home, in your life. You're not robbing Peter to pay Paul. You're not sacrificing family memories to cover tax bills. You're using your money strategically to create the kind of life you've always dreamed of. Can you imagine writing a check to the IRS? But it's a fraction of what you're used to paying. Instead of dread, you just feel relief. Just like our client, Katie messaged me recently saying. I wanted to tell you, we got our tax return on Friday to review, which was our 10 year anniversary. We are receiving a five figure refund, and last year we owed over five figures. I cannot stress enough what a relief that was for us to hear, and the best news Katie's business did better this year than it did the year before. Imagine taking the money you save five figures or more and putting it towards something that actually matters to you. Hiring that team member so you can step out of the weeds of everyday tasks, paying for your kids' activities or that vacation to Italy. You've been dreaming of funding your retirement or investing in real estate. Another one of our clients, Chelsea, told me. For the first time, I'm not afraid to make more money because I know how to keep more of it. I'm so thankful for you and your team and what you do for us. Can you imagine what it would feel like to stop holding yourself back simply because you're scared of paying higher taxes? To finally believe that every extra dollar you make doesn't mean more stress. It actually means more opportunity. That's what strategy does. It gives you a plan. It gives you confidence, it gives you control, and it gives you back your power, which ultimately gives you peace in your business and in your life. This podcast is your invitation to that shift to move from a reactive taxpayer to a strategic wealth builder, to step into the role of CEO and one who doesn't just make money, but one who keeps it. Grows it and uses it to build a life she actually wants and enjoys. You'll start to feel this shift just by listening to this podcast and it's exactly what we'll put into action at Make Money Moves Live. If what I've shared with you today hits hard. If you're tired of feeling like you're overpaying in taxes, tired of being left outta the money conversations, and you're ready to finally take control of your finances, I want to personally invite you to join me and a hundred other women just like you in the room at Make Money Moves live this October in Charlotte, North Carolina. This isn't another conference where you sit and take notes. It's an immersive hands-on experience designed specifically for women like you, profitable, ambitious, and ready to take control of your financial future with strategy and confidence and the right support. Over three days, you'll learn the exact strategies wealthy women use to keep more of their money, and you'll walk away with a clear plan for your own business. You'll be in the room with women who get it, who are building businesses and lives just like you. And you'll finally feel the camaraderie, the support, and the knowledge you've been missing. And secretly craving seats are limited, and I don't want you to wait on this because the longer you wait, the more you keep overpaying in taxes. you can go to Tara cpa firm.com, make money moves live. Or click the link in the description to grab your ticket and step into the room where you belong. You deserve to be there. You've worked hard for your success, and I know how frustrating it feels. It's a total catch 22 to run a lean business with low overhead and high profits only to pay through the roof at tax time. You feel like you're being punished for. Having a financially successful business from making smart decisions. The truth is, though you can keep more money, that's why this show exists. To give you the clarity and strategies you need to stop overpaying and start building wealth. That's it for this week's episode of the Keep More Money podcast. I'll see you next week where we'll dive into how wealthy women think differently about taxes.