Did you know that overlooking just a few tax deductions could leave hundreds, if not thousands of dollars on the table? I recently sat down to chat with Danielle Hayden, a seasoned CPA and founder of Kickstart Accounting, Inc. She dropped some gems that could reshape how you approach your finances as a Traveling Therapist.
First up, separating your business and personal expenses. It can be tempting to swipe your personal card for a quick work lunch or buy office supplies while shopping for home essentials. But, being meticulous here ensures you're capitalizing on every legitimate deduction.
Now, if you're netting between $50K and $75K annually, it might be time to consider structuring as an S Corp. Yep, paying yourself a reasonable salary can seriously cut down on that self-employment tax burden. And trust me, having a business structure that aligns with your income level is a game-changer.
Here’s a golden nugget: pay attention to how you show up financially. Are you grabbing that coffee to brainstorm some work ideas? Use your business card. But if it's just a morning treat, stick with personal finances.
It hurts to see money wasted, especially thinking it's saving taxes. Spending $1 to save $0.40 isn't smart. Have you ever been told to go on a spending spree to reduce your taxable income? That advice can backfire, big time. Nicole, one of Danielle's clients, faced debt after following such misguided advice.
Key points
About Danielle Hayden:
Danielle Hayden is the Co-Founder and CEO of Kickstart Accounting, Inc. a bookkeeping and accounting firm that is on a mission to coach six figure (+ beyond) female entrepreneurs so they can better understand their numbers through bookkeeping, financial analysis, and support so they can grow profitable, sustainable and enjoyable businesses.
With over 15 years experience in the world of finance, Danielle has worked her way from accounting firm intern to the Co-Founder of Kickstart Accounting. She understands how complex business finances can be, and she knows that entrepreneurs need more than just a bookkeeper; they need real financial analysis and support in order to get the confidence required to create the sustainable wealth they deserve. Danielle brings a unique perspective when it comes to providing business owners with “the total package” as it relates to their finances.
She has been a guest on multiple top-rated shows including, The EntreMD Podcast, Private Practice Workshop and Practice of the Practice. She is also the host of the Business By the books podcast.
When Danielle isn't in her money mindset work you can find her hiking or spending time with her family.
Connect with Danielle:
Website: kickstartaccountinginc.com
Instagram: https://www.instagram.com/kickstartaccounting
Linked In: https://www.linkedin.com/in/danielle-hayden-kickstartaccounting/
Free gift for podcast audiences: https://kickstartaccountinginc.com/gift/
Connect with me:
Instagram: @thetravelingtherapist_kym
The Traveling Therapist Membership:
https://kymtolson.kartra.com/page/travelingtherapistmembership
Revolutionize Your Private Practice with AI Course:
https://kymtolson.kartra.com/page/ai
Signup to learn more about life as Traveling Therapist:
https://www.portablepracticemethod.com/free-training
The Traveling Therapist Facebook Group:
https://www.facebook.com/groups/onlineandtraveling/
Bill Like A Boss Insurance Billing Community:
https://kymtolson.kartra.com/page/blab
Subscribe to the Podcast:
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TRANSCRIPT:
0:00
Hey everybody, welcome back to another episode of the traveling therapist podcast. Really excited today to have Danielle Hayden here with us. She's not a traveling therapist, but she has a lot of good information for us. I can't wait to dive into it. So today we're going to talk about the top six overlooked tax write off categories, which equals more cash in the bank for us. So I'm excited to talk about that. And also I was hoping she'd maybe give me a tip about being a traveling therapist at tax write offs, but we'll see if we get to that. Danielle, wait. Welcome to the show. So glad to have you here. I'd love if you could just introduce yourself, and then we could just jump into your topic and help all these traveling therapists with their tax write offs. Yeah. Danielle Hayden,
0:41
I am a CPA and CEO and founder of my firm, kickstart accounting Inc. Started my firm about 10 years ago, which I cannot believe my background is working as a CFO for mid sized companies, helping the CEOs Board of Directors management teams make business decisions with their numbers, and I have found over the years that I I love helping people use numbers to make better decisions, period. You know what I mean, no matter.
1:15
Tell you how much I need that in my life, it's I do everything emotionally, and then I have a boyfriend who's super logical, like he's, there's no emotion in him really whatsoever. I'll say, I think I'm gonna do this, and he's did the number support that. And I'm like, I don't know. I didn't even think to look at the numbers. Just, just sounds like fun. So thank you for saying that. It's a good reminder for everybody listening. Look at the numbers. Look
1:39
at the numbers. You're you probably fall into my category of free spenders. So we find that people fall kind of one of four categories, and our free spenders are people who they don't even think. To look at the numbers. It's not like, they're, they're, it's they're flawed. They're just literally not even thinking about it. They're like, I want to make this decision. I'm making it. Whereas keepers are like, I want to hold on to all this money. No matter what I know I have, they probably have plenty, a robust amount of cash they're sitting on, but nothing ever feels like enough. And then balance seekers really that person who's okay. I know I need to spend money to make money. I know I need to have people who help me in my business, but I need to have some money saved for a rainy day and finding that balance between all of them. So knowing your money personality type really helps you. Say, all right, hold on. Before I make that decision, I have to practice the pause 48 hours, look at my numbers, see what supports my decision, and then take action. Love
2:37
that. That's what I mean. So as a CFO, I really know a lot about it, but do they basically just come to you and say, before we make anything, we're just going to give this to you, and you're just going to do an analysis for us, and
2:50
then it'll help us decide which way to go with it. Yeah, for our clients, that's amazing. Yeah, for our clients, when our clients work with us, especially as when we're their CFO. Now we act as our client's money team in kind of three capacities. We always start with the bookkeeping. So you can't do anything without bookkeeping in place. So I was astounded when I started my business 10 years ago, and I was starting to talk to business owners and help me build a budget, help me build a business plan, help me grow. And I'm like, Hold on. Where were you? What just happened? Where are you spending money? Where are you making money? Because we have to use that in order to look into the future. So everything starts with bookkeeping, and then we also work with our clients to do budgets, projections, goal setting, kind of look into the future as their CFO. And then we also do the taxes and tax planning. So our clients will often email us and say, Hey, I'm thinking about making this big decision. I'm hiring somebody joining a new mastermind conference coaching. How does this play into my financials? Yes, it's a business deduction. Yes, it's a write off. But how will that affect my profitability? Am I going to make money for the year, or is this going to put me at a loss? Yes. Oh my gosh, what
4:04
an amazing service. And I'm thinking to myself, when you hear CFO, I think like you have to be a large business, a large corporation. And I'm sure people listening, because these are therapists that have private practices, some of them, not even group practices, just solo is a CFO? And that, can somebody afford that? Can they use that service in their business? Tell me about that, because I'm sure everybody listening sweet. I might need one of those. Okay, so
4:29
my passion in my firm has been to bring access to these strategies. Right? These are things that historically were only available to big corporations, big companies, big CEOs. And so when I left corporate 10 years ago, I said, I am bringing access to this level of support, to the solopreneur, to the person who's hiring one or two team members, like I want every single person to get access, because how do you make a bigger impact in the. Economy. How do you make sure entrepreneurship is successful? It's making sure that your solopreneur is supported, so that you can grow right, so you can have the business of your dreams. So we have pricing that meets our clients where they're at. Our pricing starts for clients who are doing under $100,000 a year in revenue. We have a pricing tier that starts at 175 per month for somebody who's doing under $100,000 a year, and then our pricing goes up from there. So as you have more transaction volume, more complex financial situations, our pricing goes up from there. But the CFO services are a very quick add on that is very affordable. So if you're somebody who's I love this idea of goal setting. I love the idea of planning in my business, but I can't actually do it on my own. Like I'm not doing it on my own. Like I do too, right? Like I just, it's easy to
5:53
tell other people, but it's, yeah, I'm not going to do that. I can't do that. I don't want to do that. Yeah, I
5:59
don't want to Yeah. It's the same as, like, a running plan or a workout plan or a diet plan. Exactly. That's why we sell accountability to each other. Like, I have a fitness coach who helps me hit my hit my goals and plan my workouts and stuff. Like, I'm not doing anything crazy, I just I want to be accountable to it, and so we do the same thing for for our clients, is hold that accountability to help them set their goals, plan for the future. Think about their personal spending. As a travel therapist, you have a lot to think about of how you're going to budget personally and professionally, and so having somebody to help you tie that all together to make sure that you can do both. It's so important.
6:41
Oh my gosh. Okay, you guys, this is turning into a job interview. Now I'm going to hire her. Shay, take the subject. I'm just kidding. Okay, amazing. Thank you for talking about that, because I'm sure people were thinking like, Yeah, I can't hire a CFO. So let's talk about tax write offs. Let's just talk about what we can do if we don't have the money or we're not ready to hire somebody? What can we do in the meantime around tax write offs and getting a better understanding about that? Because I do get that question all the time. It's if I'm living in Airbnbs, can I still somehow write off part of the office space? There's all kinds of questions like that. My travel time, driving from place to place, is that like traveling for my job? There's a lot of gray area around that, but I'd love to hear your top six. So yeah.
7:26
So first things first is we have to keep our business and personal finances 100% separate. So in order for you to be able to maximize your tax deductions, we have to have your personal and business expenses separated. So having a business checking account, a business savings account, business credit card, that's 100% separate from your personal This is even more important for what you guys do, because we really need to know when you're working and when you're Yeah, when you're there personally. So who are you showing up as? Am I showing up as my business right now, or am I showing up as me personally today? And that is how I'm going to spend money, and is also going to allow you to effectively pay yourself when you keep those two things separate. Last thing I'll say about keeping them separate is that when you commingle business and personal, you do what we call piercing the corporate veil, and you're exposing your personal assets to exposure, so that if you get audited or sued, you are now exposing your personal liability. You are not personally liable. So we really want to use our LLC to our benefit and say, This is my business, and I am only going to use my business funds for my business. Does that make sense?
8:47
It does. It sure does. Yeah. I get that question all the time, because many people that listen to this podcast are like, multi passionate entrepreneurs. So we have therapy practices, but also a coaching arm. And in my case, I have three coaching arms. I have three separate businesses on top of the private practice. So it does get complicated, but that, I think that's great advice to separate it out so it's not confusing or intermingling funds. It could be really clear, especially if they want to work with somebody like you, they can just see the numbers immediately. This is what's coming in everywhere. Yeah, and
9:19
I would encourage you if you have different arms of your business. So one thing that we do a lot with our clients is have them separate their different arms of their business in QuickBooks. It's called locations or classes. You could have a separate bank account for each. However, at a minimum, I would have a separate payment processing system for each so that you can tell at any month how much did you make from each division of your passions, right? Like, where are you actually making money from? You might not care today, but in six months, one year, two years, if you have too much on your plate, you're like, I need to cut back in one area. How are you going to know which one is making you money and which ones you're not so? So the data. I always tell people, I don't want you to be obsessed with the numbers. I don't want you to only make decisions with your numbers. I'm actually a very intuitive person. When we take personality assessments here at kickstart, we do a lot with predictive index as a team. It's really funny, because over and over again, I get reminded that I actually lead with intuition. Like, it's amazing. I will send my teams, my team messages, like, I can't put my finger on it, it's just my gut, something's telling me, and then that's good, because then it leads me into the numbers to then say, okay, what are the numbers confirming this? Or are they leading me in a different direction? So I want you guys to have that data. So when your gut is telling you something, you can follow the numbers.
10:44
I love that. Yes. Okay, good. Number
10:47
two is determine it annually if you are structured in the best way, meaning, should you be an LLC, or is it time to become an S Corp? We want to make sure that you are struck. We don't want you becoming an S corp too soon, but we want to make sure that when it's tax advantageous, that you are becoming an S corp, because there are great tax strategies and advantages available for you if you are an S corp, and I don't want anyone to miss out on that. So if your business is bringing in between 50 and $75,000 a year of net income. It's time to start talking to your money team about becoming an S corp.
11:30
Gotcha. Yeah, that's a good one. My my accountants definitely moved me into an S corp. And I was like, oh, in my mind, it's basically, you just pay taxes on what your salary is, right, instead of all the money, and that really helps with the taxes. Is that really dumbed down version of what that means that was so perfect.
11:46
So okay, when you become an S corp, you will then put yourself on payroll, so you are now an employee exactly your business. So you're an employee of your business. You're paying yourself through payroll, so you'll have to pay yourself a reasonable compensation through payroll, and when you're paying yourself that reasonable compensation, you are lowering the amount of net income in your business. Because you are now a tax benefit to your business like you, you are reducing the amount of net income. Now, if you go and take owner's draws as well as take salary, your owner's draws are not lowering your net income. They are like going up to the cash atm of your business. So just know that as an S corp, you could still pay yourself through payroll and take owner's draws, but that's the tax benefit, is that you're able to do both, and you're still paying taxes on the net income of your business. However, you're going to pay less in self employment tax because you are an employee of your business. Yes,
12:44
yes, that's what I meant to say. You did great. Great. Yeah, thanks. Okay, so what's number three? What? What's the third thing we need to look at and think about, alright,
12:57
what I mentioned earlier, how are you showing up in your interactions. Do you show up as your business or you personally? It's an overlooked strategy. I'm gonna I'm gonna use my myself as an example. I will go to, let's say target, and I have a cart full of stuff, but I know that there's five things in that cart that I'm gonna use for business, and there's about 10 things in that cart that I'm gonna use for personal. Most people say, I'm not gonna be that person at the cash register and I'm just gonna put all 15 things in my personal card. However, you just lost that business deduction. Yeah. Now I want you to think about the advantage of this details every time that you can pay attention to the small details of how you're showing up. Am I in this moment showing up as my business or personal and then paying with the correct card? So if I'm having a meal where I am discussing business, I am paying for that with my business card. If I am here, showing up with my spouse, enjoying a night out. I pay for that personally, right?
14:06
Yeah, yes. Okay, yeah. I have so many questions about that. Okay, go ahead, I have a friend like she she's Kim, put that on your business card. I'm like, but I don't think that's a business expense. She'll be like, working, and she'll go out to lunch that day, and she'll say she's working so that's a that's an expense, like a write off, because it's like a work lunch, is how she thinks of that. And to me, that's that is not a work lunch, yeah.
14:31
Okay, so here's the thing about meals. You can only deduct 50% of your meals, so you can put that on your business card. You're she's only getting 50% of the deduction anyway. If she was audited, she would have to be able to she would need to have the receipts to say, here's who I had lunch with. Here was the business purpose, and this is why it's a business lunch. Now she might get a really nice auditor who doesn't look at the. Details, or she might get an auditor who is a real stickler for the details, and then she'll be paying penalties and interest on that. There is a balance to this. So meals is one that I don't think, I think it's easy for people to say that's a business deduction, when it's really only 50% Yeah, okay, okay, and that's fine. That leads us to my next point. It's like the perfect I needed. I never want anyone to spend $1 to save 40 cents, meaning, when you are spending money, I don't ever want anyone to spend money just because it's air quote, a tax deduction. It hurts my soul when I hear business owners get advice from their CPA. It's around fall every year, like Thanksgiving time you're really profitable, make sure you go spend $20,000 otherwise you're going to pay taxes on it, yes, for the love of God, do not go spend $20,000 if you are going to spend $20,000 anyway, right? Like I wanted to buy a computer, go buy the computer. I want to sign up for this conference next year. Great. Go sign up for the conference. But don't go look for conferences because you're going to pay taxes. Don't go look for a computer because you're going to pay taxes. We don't want to spend money just to save money on taxes. I will never forget my client, Nicole. She she actually wanted to open up a a office building, and she was running more of a virtual practice historically, and then she was going to open up a an official building in March the next year. It was like November, and her previous tax accountant said, You're gonna, you're gonna pay a ton of money in taxes. You have a ton of net income. Go ahead and take about $30,000 as bonus and whatever other expenses you have. She listened to him. We started working together in like January, and this poor girl ended up having to take out so much money in debt because the CPA didn't take into consideration the fact that she had goals. She had something that she wanted to do the next year, and she needed that cash. She needed the cash in her business in order to be able to pay to open up that location, and she has been carrying that debt since, because that the next year, she wasn't profitable. She had this giant build out. She was building a team. Yes, she would have paid taxes, but, but it would have been less than if she would have spent all that cash. So we never want to spend money just to save money on taxes.
17:42
Oh my gosh, that's such a good point. I that just freaks me out. Could you imagine? And then you're in debt because of it, and then you're paying like, interest, potentially on a credit card or a loan or something. Oh my gosh, yeah, yeah. Oh, wow. Okay, all right,
17:57
next, so next is our home office, and this is a often overlooked deduction, because a lot of us don't want to be bothered with it. We don't want to be bothered with the details of it. Now it depends on whether or not you're an LLC or an S corp. If you are an S corp, you are allowed to have what we call an accountable plan. You can write an accountable plan for your business that allows you to reimburse yourself you personally, tax free for any shared expenses. So if you are renting a space from you personally to conduct business, you then can pay yourself rent for the space in which you're going to be working, and any other expenses that you are paying for personally. But the business has a benefit to it. You can include that in your accountable plan. If you are an LLC, you have to then calculate the percentage of the home office and relationship to the space in which you're working, which can be very complex, especially as you're traveling from Airbnb to Airbnb. So having an accountable plan as an S Corp is going to allow you to pay rent to yourself for the ability to work.
19:17
Interesting. I wonder if I have that like I've not heard that mentioned.
19:21
Yeah, if you are an S corp, you need to look at having an accountable plan. So when we work with our clients, when we do taxes for our clients, we make sure that they have an accountable plan. This is one of the best ways people say, How do I take more cash out of my business without paying taxes on it? This is how you do it. You pay yourself. You can reimburse yourself throughout the year through your accountable plan. Mm, hmm,
19:45
Wow, interesting. I'm gonna have to look into that for sure. Okay, all right, good, good
19:52
tip, yeah, alright. And then if, and then as you're traveling, if you're an LLC taking, taking a percentage of your space. The idea is going to be to keep really close records. So you're going to want, depending on how long you're staying in a space at any given time, it's going to be to really take, keep very good records. Okay, you know, sit
20:15
doggy in the background for those Yeah. Can
20:17
you hear it? No, okay. Jump around. Great
20:21
tip. Yeah, and my business is complicated, and I still don't even know if it's right, but it's because my brand is the traveling therapist. I'm able to write off part of the travel to the Airbnb is because it's part of my business, like I have to be able to live in Airbnbs and promote that I'm living in Airbnbs to promote my business. So there's, I don't know how they do it, but there's some sort of write off around the rents I pay in my Airbnbs. But that's a whole other story, because
20:45
that's part of your brand. Yes, yes. But if you're just traveling, and it's not part of your brand to be the traveling therapist and you are just actually traveling, you do have the option to be able to write off part of that space. Interesting,
20:59
that's really interesting. I'm gonna have to ask about that. Okay, so is that? Do we have another tip? I can't remember, we're at the bottom or of that. All
21:07
right, we have one last tip, okay, is our mileage. So this is, again, one of those details, and I get it. I'm talking about a lot of details today. When we have good record keeping, we're able to maximize our deductions. So keeping the mileage that we are using now if we're going to a workspace and back, that's going to work and back, but if we're leaving to run errands for business, like we're going from location to location for work, those are all miles that we can deduct. Only way that you can deduct your entire vehicle is if it's owned by the business. However, don't forget to deduct your mileage. Okay,
21:51
that's got me thinking. I wonder if I can deduct from Airbnb to Airbnb, because that's traveling to a different place for my business. I need to ask them about that. Hmm. Talk to
22:01
your CPA about it. Every piece of advice that I always give, I tell people I'm not the one filing your return, unless I am right, yeah, unless you're working with our firm, but your tax accountant can help you decide if these strategies are the best fit for you and their comfort level. There's been things throughout the years where CPAs have said to our clients like, yeah, you can write off that boat. You took your clients out. Or we don't feel comfortable with that. We don't live we try to stay pretty black and white when it comes to the IRS. We want to protect our clients from an IRS audit, so we're not allowing things like a boat write off however. You need to discuss with your CPA, because they're the ones signing off on your return their comfort level with those strategies. My goal is to educate you. We have our podcast business by the books, where every week, we talk about different strategies, to use your numbers to make business decisions, to maximize your tax strategies. And we do that because there's so much to talk about, and I want you as the business owner, to be educated enough to be able to take advantage of the strategies available for you. Nice,
23:13
amazing. Thank you so much for sharing all that. I'm sure people listening are going to be like, Oh my gosh, I gotta look into all of this, that's great. I really appreciate it, of course. So how do people find you? How do they work with you? They want to use your business and what you can offer them?
23:29
You can go to kickstart accounting. Inc.com, is our website. We do have a handout. If you go to kickstart accounting, inc.com/gift you can get all of these deductions with podcast episodes and the blog. So if you're somebody who's like, I really need a checklist for this. Danielle, go download the the gift there, where you can get the these top tax deductions with the podcast. For more information on each one of these topics, we are accepting new clients right now. We love working with therapists. We have worked with so many therapists over the years. I we understand the complexities of your industry, and we absolutely love it. Come and book a call. We would love to opportunity to talk with you and to be part of your money team. Yes, thank
24:12
you. It's amazing. I might look you up after this. All right, let's see. Because she's told me for a while I need she's like, You need a bookkeeper. She puts everything into QuickBooks. But I don't even know what the differentiation is, but I guess it's just like a bookkeeper would be more like, we're gonna like, you're saying, look into the numbers. We're gonna be paying attention to what's going on. She really just puts it into categories, and then they do my taxes, so there's no interaction. That's the
24:36
big difference. So a lot of tax accounts who do the bookkeeping for you. They're doing bookkeeping for tax, right? Like they're just throwing everything into the system so that they can file your return. Their goal is very simple, file the return their attack? Yeah, our goal is very different. We are setting up your QuickBooks in a very special way, because we want you to be able to use the numbers throughout the year to make business decisions. So we have our own strategic framework that we use to set up your quickbooks file. We go in and maintain your transactions. So we're in there, processing transactions week over week, and then this really cool thing happens at the end of each month, we send you your financial statements with a really easy to read snapshot, and the snapshot allows you, as a business owner, to be able to look at it at high level and say, Oh, that's how my revenue is doing, right? That's how I did last month. That's where I spent money. Oh crap, I'm doing really great. I need to start saving money on it for taxes, or, Oh, my God, I lost money last month. What did I do? I need to cut spending so that I am not losing money month over month. So that snapshot is an accountability partner to help you be able to make those decisions, so you don't end up in November, December with your tax accountant saying, hey, go spend a bunch of money. Because, yeah, right, like you already know how your business is doing and you made those decisions back in in the summer, because you're not waiting till the end of the year to throw your bookkeeping together. So that's really the power of having a Money Team. Is that when you have a Money Team, the bookkeeper is going to hold you accountable month in and month out, to seeing what your progress like what just happened, and that way you can make business decisions in that moment. Gotcha
26:18
amazing. I can't wait to go check you out.
26:23
We would love to work with you.
26:24
Thank you. Thank you so much for coming today and everybody listening. Of course, everything will be in the show notes, so you can reach out to Danielle and work with her and her team. Thank you. Thank you. Thank
26:33
you for having me.