I have 500k in excess cash in the business. No business overhead. Avoiding taking as income because of taxes. What can I do with the money?

What would you do with $500,000? Latest Quora question answered. Check it out and follow me here.

A lot of people here have already given some “if, then” specific statements, so I’ll make that part brief: If your business is organized as a C-corp (which I assume, because you have “excess cash”—otherwise it would be in your personal bank account), then you have already paid corporate taxes on it, and you just need to worry about paying personal taxes on anything you take out.

My specific recommendation is that you don’t take a lump-sum out of the business. Instead, increase your salary, but keep it at a reasonable level, so you can deduct higher salary expense against future business income (and potentially decrease the excess cash).

My general recommendation is that you reinvest in the business—that is the power of corporations. You just keep pulling a nice little salary, but reinvest business income in equipment, employees, etc… You can even lease office space from your personally owned building(s) and build up a real estate empire that way.

Finally, a little excess cash isn’t necessarily a bad thing. Warren Buffet keeps something like $20 Billion in cash, because he wants to be “nimble” and have the ability to move on an opportunity when it arises. Having a nice cash balance will prepare you for both opportunities and rainy days.

Hope this is helpful! With the issue you’re dealing with, you must have some serious domain expertise in some area, so grab my Amazon #1 best-seller for FREE. It teaches people how to turn that knowledge into a profitable, online business. Cheers!

Author: Steve Buller

Steve owns the E-learning brand I Quit My Job To Help You Quit Yours. He teaches people how to leap from employee to entrepreneur: 1) Learn how to make money on day 1 through affiliate sales, and 2) Learn how to build an online business in an area you love to generate automated income until the end of your days. Steve has started multiple businesses and operated one franchise. His passion is leveraging his experience to help people get away from the toxic corporate environment and live a life of more impact, freedom, and fun. Steve has his Masters in Professional Accounting and is a licensed CPA in the state of Washington. After starting his career in public accounting with Ernst & Young, he worked with multiple tech and biotech companies in the Seattle area. He worked as the Financial Controller, directly under Bill White, CFO at Intellicheck Mobilisa, a public company traded on the NASDAQ.

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