Get ready for tax season without the stress with smart strategies to help entrepreneurs and small business owners organize their finances, maximize deductions, and prepare for tax time with confidence.
IE 471: Smart Strategies for Preparing for Tax Season Without the Stress with Rose Han
Rose is the best selling author of her new book Add A Zero and a passionate voice in the world of personal finance education. She can be found on her website RoseHan.com or on her YouTube Channel.
Her mission is to teach people how to master their money so they can create a life on their own terms.
She emphasizes that money is a tool meant to support a meaningful life, not simply a way to buy a mansion, a yacht, or collect material things. Instead, she encourages people to use their finances to spend their time intentionally and pursue projects that truly light them up.
Her personal journey is a powerful example of what is possible. Rose dug her way out of one hundred thousand dollars in debt and became a millionaire in just seven years. She is the first millionaire in her family and did not grow up surrounded by wealthy role models, which makes her story even more remarkable.
Because of this experience, she is deeply committed to sharing the mindset shifts that make financial transformation possible, along with the practical tools that keep people moving forward.
She teaches everything from investing and taxes to budgeting and earning skills, blending both inspiration and strategy so others can build a life of freedom and confidence.
What’s the very first thing a business owner should do when preparing for tax season?
According to Rose, the very first step is simple and surprisingly overlooked. No matter what month of the year it is, whether tax season has just passed or is quickly approaching, the most important thing a business owner can do is get a bookkeeper.
She explains that many business owners wait until tax season rolls around, only to find themselves in a familiar scramble filled with panic and stress. Bringing on a bookkeeper early prevents that chaos entirely.
Rose notes that if someone is just starting out and only making their first few sales, it might be fine to handle things on their own. But once the business begins to grow, a bookkeeper becomes essential.
A professional can set up systems in QuickBooks, FreshBooks, or another accounting software, connect bank accounts and business credit cards, and begin categorizing transactions so everything flows into a clear profit and loss statement.
She emphasizes that this initial setup takes only a little effort from the business owner, and after that, most bookkeepers work on a monthly retainer and require very little involvement.
The business owner may need to answer an occasional question about a transaction, but usually not more than an hour a month. Rose stresses that this single step can save countless hours and a tremendous amount of stress when tax season arrives.
Should an entrepreneur set up their own bookkeeping to keep track of expenses or let the bookkeeper do this?
Rose explains that the answer depends largely on an entrepreneur’s comfort level with accounting.
Some people, like her, come from a finance background and are familiar with financial statements, balance sheets, and the nuances of categorizing income, expenses, and owner distributions. In those cases, a business owner may offer their bookkeeper more guidance or structure.
But she makes it clear that this level of knowledge is not required. A good bookkeeper already understands these details.
Entrepreneurs simply need to communicate how involved they want to be and provide a basic overview of their business model.
For example, someone might say, I am a coach, I offer one on one services, and my typical expenses include software and travel. With that information, a qualified bookkeeper will know what to do.
Rose also emphasizes that bookkeepers are far more affordable than many business owners expect. She notes that people often delay hiring help because they assume it will be expensive, when in reality there are many highly skilled professionals available at reasonable rates.
She shares that she has hired bookkeepers, video editors, and web designers through Upwork, often finding exceptional talent, including Filipino virtual assistants who specialize in bookkeeping and are known for being detail oriented and proficient in English, sometimes for around ten dollars an hour.
Her perspective is clear. The task that feels overwhelming or stressful can often be handled by a professional quickly and affordably. A couple hundred dollars and a few hours of effort can remove a major burden from an entrepreneur’s workload, making it well worth outsourcing rather than trying to manage everything alone.
Can you share a few simple strategies to make tax prep part of your regular business routine instead of a last-minute scramble?
Rose explains that while her system is not perfect, it has dramatically reduced the chaos she used to experience around tax season. Her approach focuses on building simple, consistent routines that keep financial records organized all year long.
The first strategy is the initial setup. All business accounts should be connected to an accounting platform such as QuickBooks, and a bookkeeper should maintain that system on a monthly basis.
Once this foundation is in place, Rose recommends establishing a monthly routine with the bookkeeper. Instead of scheduling meetings, she prefers asynchronous communication.
Each month, her bookkeeper sends a Google Sheet listing any transactions that need clarification, including the date, memo, account, and amount. Rose simply responds with explanations like this was getting my hair done for a video shoot or this was traveling for a networking conference.
From there, the bookkeeper categorizes everything accurately. Because this process happens every month, the books stay clean, and there are no overwhelming backlogs at the end of the year.
The second strategy is creating a checklist of important tasks that recur throughout the year.
Rose uses a project management tool called Asana, though platforms like Monday or Trello work similarly. She sets recurring reminders for all the tasks that matter for compliance and smooth tax preparation.
For example, she has a monthly recurring task to review transaction questions with her bookkeeper. Each January, there is a task reminding her to send out 1099s to contractors.
She also includes an annual reminder to make retirement plan contributions before the tax deadline, helping her stay on track with long term financial planning.
Another key routine is meeting annually with her accountant, who is separate from her bookkeeper.
After tax season wraps up, Rose schedules a meeting to discuss strategy for the coming year. This is when she reviews upcoming life changes, such as a possible move or a shift in business structure, and her accountant gives proactive guidance on tax saving opportunities and any accounts or structures that need to be updated.
Altogether, these simple habits create a steady rhythm. By keeping the books updated monthly and relying on recurring reminders for important deadlines and contributions, tax prep becomes a manageable, ongoing part of business rather than a stressful, last minute sprint.
What’s one underrated tax-saving strategy that more entrepreneurs should know about?
Rose points out that while many business owners are aware of common deductions, one highly underrated strategy involves maximizing retirement plan contributions. Beyond the widely known solo 401k, there are options that allow entrepreneurs to save substantial amounts of money while reducing taxable income.
A solo 401k functions much like a traditional 401k but is designed for self-employed individuals.
For 2025, an entrepreneur can contribute up to $23,500 as an employee. On top of that, they can make an additional profit-sharing contribution up to $70,000, effectively allowing a significant portion of business income to be sheltered from taxes.
Another popular option is a SEP IRA, which can be ideal depending on whether the business has full-time employees.
Rose also highlights a lesser-known strategy: a defined benefit pension plan. This type of plan is more administratively complex and requires professional setup, including actuarial projections and ongoing paperwork, often costing around $3,000 per year to maintain.
Despite the administrative work, the tax benefits are substantial. Over the past four years, Rose has been able to contribute nearly $200,000 annually in addition to her solo 401k contributions, all tax-free.
These strategies can drastically reduce taxable income, especially for entrepreneurs earning high six-figure incomes or more.
She emphasizes that these retirement strategies are generally available regardless of business structure, whether an LLC, S-Corp, or otherwise, making them accessible to most entrepreneurs looking for smart, strategic ways to save on taxes.
Are there a few simple strategies to make tax prep part of your regular business routine instead of that last-minute scramble?
Rose emphasizes that building simple, consistent routines is the key to minimizing stress around tax season. While no system is perfect, having structured processes in place can drastically reduce the end-of-year scramble.
The first step is setting up accounting software such as QuickBooks and having a bookkeeper maintain it on a monthly basis. Once accounts are connected and organized, she recommends a monthly routine where the bookkeeper sends a list of transaction questions.
Typically, this is done asynchronously through a Google Sheet, listing the date, memo, and amount of each transaction.
The entrepreneur only needs to provide quick explanations—for example, travel for a conference or a business-related purchase—and the bookkeeper categorizes everything correctly. Handling transactions in small, monthly increments keeps books accurate and prevents hundreds of questions from piling up at year-end.
Another important strategy is creating a checklist of recurring tasks to stay compliant. Rose uses project management software like Asana, though Monday or Trello work similarly.
Tasks can be set to repeat monthly, quarterly, bi-annually, or annually. Examples include reviewing transaction questions with the bookkeeper, sending 1099s to contractors in January, and making retirement plan contributions before the tax deadline.
Finally, Rose highlights the value of scheduling an annual meeting with a CPA. Unlike the bookkeeper, the accountant files returns and provides strategic advice.
Meeting after tax season allows entrepreneurs to plan proactively for the coming year, discuss life or business changes, and explore ways to optimize taxes.
By establishing these routines, entrepreneurs can make tax preparation a smooth, ongoing process rather than a stressful, last-minute sprint.
What’s the best way to prepare for that first meeting with a tax professional to make it as productive as possible?
Rose recommends that the key to a productive first meeting with a tax professional is preparation.
She notes that accountants will want a clear picture of both personal and business finances. This includes understanding what assets and liabilities you have, as well as reviewing your business profit and loss statement.
While your personal budget isn’t the main focus, having organized business records makes a huge difference.
She emphasizes the value of having a bookkeeper set up your accounting software, such as QuickBooks, in advance. Even if the records aren’t perfect, having them organized allows your accountant to quickly understand your financial picture.
Giving the accountant CPA or view-only access to your QuickBooks account is ideal, as they can log in and review the information directly.
Rose also points out that accountants typically send a detailed questionnaire before the meeting. Being ready with your financial information ahead of time, including a basic overview of your assets, liabilities, and business performance, ensures the meeting is efficient and focused on strategy rather than sorting through paperwork.
For those looking for additional guidance, she offers resources such as her Financial Freedom Cheat Sheet to help entrepreneurs gather everything they need for a seamless first meeting.
Are there specific questions entrepreneurs should ask to make sure they’re getting the right financial advice for their type of business?
Rose suggests that asking targeted questions is key to getting actionable financial advice tailored to a business. One of the first questions an entrepreneur should ask is whether their business is structured correctly.
Business structures—such as LLCs, sole proprietorships, and S-Corps—offer different benefits and obligations, and what was appropriate one year may no longer be the best choice as revenue grows. The right structure can open up new opportunities for tax savings and influence other financial decisions.
Once structure is clarified, Rose recommends asking how to optimally pay oneself.
Entrepreneurs have options, including taking a salary through a payroll processor or making transfers from the business account to personal accounts.
A skilled accountant can advise on the ideal mix of salary and profit distribution, potentially saving on self-employment taxes. She also notes that these decisions can be revisited throughout the year, particularly if income fluctuates or there’s a windfall.
Another important question is identifying low-hanging fruit for tax savings. While there are complex strategies, most businesses can benefit from simple, immediate opportunities, such as solo 401ks or defined benefit plans, that reduce taxable income without complicated setups.
Finally, entrepreneurs should ask about changes to tax regulations and laws that could affect their business.
Understanding new rules allows business owners to protect themselves while taking advantage of available tax strategies.
By asking these four key questions—business structure, optimal compensation, low-hanging tax savings, and regulatory updates—entrepreneurs can ensure they are getting advice that is both practical and customized to their unique situation.
What is the biggest mistake entrepreneurs make when it comes to their taxes?
Rose explains that the biggest mistake entrepreneurs make is being reactive rather than proactive.
Many business owners wait until tax season to address their finances, leading to stress and rushed decisions. By the time they are scrambling to file returns, any opportunities to implement tax-saving strategies for the previous year have already passed.
This reactive approach often results in leaving significant money on the table. Entrepreneurs may end up paying more in taxes than necessary simply because they are unaware of strategies such as defined benefit pension plans, solo 401ks, or other small optimizations.
Rose emphasizes that business owners work hard for their money, and being proactive with tax planning ensures they are keeping as much of it as possible rather than giving more than necessary to the IRS.
Financial Freedom Cheat Sheet
Rose offers a free resource called the Financial Freedom Cheat Sheet, designed to give entrepreneurs and individuals a clear, actionable path toward mastering their finances.
This tool includes the same systems Rose used to go from $100,000 in debt to designing a life on her own terms, making it a practical guide for anyone looking to gain financial control.
The Cheat Sheet features a Quick Wins Checklist and Net Worth Tracker, providing an easy-to-follow system that gives immediate momentum and a clear snapshot of your finances today and where you want them to be tomorrow. It also includes a Monthly Money Date & Financial Goals Tracker, sharing the exact process Rose uses to stay on track toward her financial freedom goals.
Along with her personal recommendations, this tracker helps users accelerate their journey and build lasting habits for long-term financial success.
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