They’re not just working harder; they’re working smarter with the S-Corporation tax strategy.But before we dive in, let’s clear one thing up:*This only works for active income.That means flipping, wholesaling, commissions, construction, or property management income.It does not apply to rental properties or long-term passive investments — and putting rentals inside an S-Corp is one of the worst tax mistakes you can make.Let’s break it all down:Step 1: Why the S-Corp Exists (and Who It’s For)An S-Corporation (S-Corp) is not a special type of company; it’s a tax election.You can form an LLC, then elect for it to be taxed as an S-Corp.It’s perfect for people earning active income — anything where you work for the money:-Flipping houses-Wholesaling deals-Real estate commissions-Property management fees-Contracting or constructionHere’s why:A sole proprietor or regular LLC pays self-employment tax (15.3%) on all net income.An S-Corp lets you split your income between:a “reasonable salary” (subject to payroll tax)and “distributions” (not subject to self-employment tax).That simple shift can easily save five figures a year once your business income hits the six-figure mark.Step 2: How the Wealthy Use It to Build Explosive WealthHere’s the play wealthy entrepreneurs use again and again:They pay themselves smart, not just more.Set a reasonable salary — what the IRS expects for your role — and take the rest as distributions to cut payroll taxes.They reinvest the savings.The extra cash that would’ve gone to taxes gets redeployed into more flips, marketing, or acquisitions — compounding their growth.They hire strategically.Many bring family members into legitimate roles, shifting income and creating generational wealth legally.They layer entities.Example:S-Corp runs the active business (flipping / wholesaling / management).LLCs hold the long-term rentals.That separation protects liability and keeps tax treatment clean.Why S-Corps Don’t Work for Rental PropertiesHere’s where many investors go wrong — using an S-Corp to hold rentals.

Got 7 side dump loads of boulders delivered.  

That will mean you will have to pay it.

If after 2 years you are paying 3% in prepayment, is that ok versus paying it upfront in the higher interest ? 

You really need a pocket load of investors to make this work.  

I knew I would be paying the price but I knew I could afford to.  

Don’t wait until filing season to plan.This is the year to front-load improvements, run cost segs, and review your entity setup.I’m seeing too many investors miss out on easy deductions just because no one told them what changed.What’s your biggest tax question going into 2025?

View of the world- stock market, US debt load, China as a supplier, wars, Fiat currency status, personal job status, etc.  

And a model for others in good governance (Property Assessor).The Fed is Driving in the FogWell, another week has passed, and our congresspeople seem to be loading up their plates to continue the budgetary food fight.

What are other investors in the area paying annually per unit in insurance (approx range) and water + sewer + trash?