07/16/2026
Most people don't have a tax problem. They have a decision problem that eventually shows up on their tax return.
That's an important distinction because social media has convinced millions of people that tax planning starts with LLCs, S corporations, trusts, and exotic write-offs.
It doesn't.
It starts with making good financial decisions.
Here are three of the biggest tax mistakes I see:
1. Copying someone else's tax strategy.
Just because a wealthy business owner maxes out retirement accounts or elects S corporation status doesn't mean it's the right move for you. Tax strategies only work when they fit your income, cash flow, and long-term goals. Without the right economics, today's tax savings can become tomorrow's penalties and cash-flow problems.
2. Building complicated structures too early.
Some entrepreneurs collect LLCs like they're Pokémon cards. Multiple entities. Trusts. Holding companies. S corporations.
More often than not, they create more tax returns, more compliance, more accounting fees, and more audit exposure, with little or no tax benefit.
Here's the reality: Structure protects wealth. It rarely creates it.
3. Buying investments because of the tax deduction.
If someone leads with: "You'll get a huge tax write-off!"
Your first question shouldn't be: "How much can I deduct?"
It should be: "Can I lose my money?"
A tax deduction doesn't magically transform a bad investment into a good one.
Losing $100 to save $37 in taxes isn't sophisticated planning. It's still losing $63.
The wealthiest taxpayers I've worked with don't chase deductions.
They focus on economics first.
They build profitable businesses.
They invest in opportunities they understand.
Then they optimize the tax consequences.
The tax code generally rewards economic reality, not "clever marketing".
The biggest mistake I see isn't paying too much tax. It's making poor financial decisions in pursuit of paying less tax.
Good economics first. Tax efficiency second.
That's how real tax planning works.
What's the worst "tax strategy" you've seen promoted online?
