Tax planning is the unsexy thing that’s quietly turning my broke-ass 20s into something that might actually resemble wealth one day.
I’m sitting here in my apartment in Austin right now, it’s like 3 p.m. on a random Thursday, there’s a half-eaten Torchy’s queso container sweating on my desk, and I just realized I forgot to pay estimated taxes again. Classic me. But here’s the wild part: even with all my screw-ups, tax planning has already put an extra $18k in my pocket over the last three years. No cap.
Look, I used to think tax planning was just something rich people did with offshore accounts and fancy lawyers. Then I became self-employed in 2021 and the IRS basically laughed in my face. I owed $27,000 that first year and almost threw up in the H&R Block parking lot. That’s when I decided to stop being an idiot about money.https://www.irs.gov/taxtopics/tc551
Why Tax Planning Actually Matters When You’re Building Wealth (From Someone Who Learned the Hard Way)
Most people treat taxes like death — inevitable and terrifying — so they just… ignore it until April. I did that. It sucked. But once I started treating tax planning like an actual strategy instead of a video game where the goal is “keep as much of my money as legally possible,” everything changed.
Here’s the thing nobody tells you: the tax code is written by rich people, for rich people. But some of the loopholes are actually accessible to regular degular humans like us. You just have to stop winging it. https://www.irs.gov/publications/p590b
The Backdoor Roth Mistake That Cost Me $4,200 (Yes, Really)
Okay, embarrassing story time. Last year I got all cocky and tried to do a backdoor Roth IRA. Thought I was a genius. Didn’t do the pro-rata rule math right. Ended up paying a stupid penalty because I had a rollover IRA from an old job. $4,200 gone because I watched one YouTube video and thought I knew everything. https://www.irs.gov/publications/p590b
Now I triple-check everything. And I finally rolled that old IRA into my solo 401k so I can actually use the backdoor properly. Moral of the story: tax planning is free, tax mistakes are expensive as hell.
My Current Tax Planning Obsessions (That Are Actually Working)
- Maxing my solo 401k — I put in like $69k last year and my taxable income dropped by that exact amount. Mind blown.
- HSA triple tax advantage is straight-up cheating (in a legal way)
- Bunch write-offs like a madwoman — new laptop, home office stuff, even part of my internet bill
- Quarterly estimated taxes on a calendar reminder titled “DON’T GO TO JAIL” in all caps
- Started an S-Corp this year and I’m saving ~$8k in self-employment taxes (still scares me but the math checks out)
The Mental Game of Tax Planning When You’re Building Wealth
Sometimes I lie awake at 3 a.m. convinced I’m accidentally committing tax fraud. Like, am I deducting too much? Is the IRS gonna kick down my door? Then I remember I have a CPA on speed dial and I chill out.
But seriously — the psychological shift from “taxes are something that happens to me” to “taxes are a lever I can pull to build wealth faster” has been huge. It’s the same money, just arranged differently. https://www.nerdwallet.com/article/taxes/quarterly-estimated-taxes
Final Thoughts (From My Messy Desk to Yours)
Tax planning isn’t sexy. It’s not going viral on TikTok. But it’s the difference between staying middle-class forever and actually building wealth that compounds while you sleep. https://www.nerdwallet.com/article/taxes/quarterly-estimated-taxes
If you’re self-employed, side-hustling, or just freaking tired of giving the government half your money — start small. Open an HSA. Google “backdoor Roth” (but actually read the IRS page this time). Get QuickBooks Self-Employed or something so you’re not drowning in receipts like I was. https://www.nerdwallet.com/article/taxes/quarterly-estimated-taxes
And if you’re in Austin and want to grab tacos and cry about taxes together, DM me. I’ll bring the queso.
P.S. None of this is tax advice because I’m not your CPA (mine barely likes me as it is). But it’s real talk from someone who’s finally figuring it out — one panic attack at a time.
