@thelegacyinvestingshow — 60x breakout

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Preston Seo @thelegacyinvestingshow

@thelegacyinvestingshow

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Why it worked

The post uses a relatable scenario (high salary vs. taxes) and a clear, comparative example to illustrate a complex financial concept (S-corp vs. W-2 taxes). The direct comparison of tax bills makes the information easily digestible and impactful.

Summary

This post compares the tax burden of a W-2 employee earning $300K with that of an S-corp owner earning $300K after expenses. It highlights how S-corp owners can potentially save money through deductions like QBI, resulting in a lower tax bill compared to W-2 employees.

Structure

1Introduction of W-2 salary and tax burden
2Introduction of S-corp earnings and salary
3Explanation of QBI deduction for S-corps
4Comparison of tax bills
5Reference to full math in caption

On-screen text

Preston Seo @thelegacyinvestingshow Your $300K salary sounds impressive until roughly $85K goes to federal taxes. Your neighbor's S-corp earns $300K after expenses. Pays him a reasonable $100K salary. He claims a 20% QBI deduction on qualifying profits. Your W-2 wages don't qualify. His tax bill? $68K. Yours? $85K. Full math in the caption.

Original caption

The difference is about $17K. Here’s the math. YOUR W-2: $300,000 salary − $16,100 standard deduction = $283,900 taxable income. - Federal income tax: $68,134 - Employee payroll taxes: $16,689 - Total: $84,823 - You keep: $215,177 HIS S-CORP: Starts with $300,000 after operating expenses, before owner compensation. Subtract his $100,000 salary and $7,650 in employer payroll taxes. Remaining profit: $192,350. His qualifying profit gets a 20% QBI deduction: $38,470. His salary doesn’t. Salary + profit − standard deduction − QBI deduction = $237,780 taxable income. - Federal income tax: $52,546 - Both sides of payroll taxes: $15,300 - Total: $67,846 - He retains: $232,154 personally and in the business That’s $16,978 more, without another purchase to get the QBI deduction. But a $100K salary must be reasonable for his work. QBI eligibility depends on the business and income, and it isn’t exclusive to S-corps. If you own a business, ask your tax professional what an S-corp would save you after the added costs. Save this breakdown for that conversation.