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Fleming Accounting Solutions Case Studies

See how we’ve helped clients manage their payroll, accounting, and taxes more effectively and efficiently.

Case Study 1:

Trucking & Welding Owner — Choosing the Right Entity (and Retirement Strategy)

Client profile: Solo owner-operator running a combined trucking/welding business (Schedule C).

Challenge: The owner wanted to reduce taxes without starving cash flow. We modeled three paths that created a $60,000 swing in total cash needed once taxes and retirement contributions were considered.

What we analyzed

Scenario A — Stay Schedule C (no retirement change) 

Estimated total federal/state taxes: ≈ $67,000 

Scenario B — Stay Schedule C + Maximize SEP-IRA (client said “SIP IRA”; we evaluated a SEP-IRA for self-employed)

Total cash outflow ≈ $100,000 (taxes + retirement funding)
Estimated tax drops from ≈ $67,000 → ≈ $60,000 (≈ $7,000 tax savings)
Trade-off: meaningfully higher cash needed today to fund retirement.

Scenario C — Elect S-Corporation (late S election year 1) 

Year 1: With no immediate wages required (late S election), tax savings ≈ $27,000 vs. Schedule C, without adding retirement contributions.
Year 2+: Begin reasonable wages; remaining profits pass through as distributions (not subject to SE tax). Also enables employer retirement contributions up to ~25% of owner W-2 wages, compounding future savings.

Outcome

Immediate impact: The S-Corp election (Scenario C) produced the largest near-term tax reduction (~$27k) while preserving cash compared to fully funding retirement in Scenario B.

Strategic plan:

Year 1: Late S election for near-term savings.
Year 2+: Implement reasonable comp, add employer retirement contributions to capture both tax deferral and long-term wealth building.

Why it mattered:

By weighing tax savings vs. cash-on-hand, the owner avoided an aggressive retirement funding plan that strained operations and instead adopted an S-Corp structure that improved after-tax cash flow now and opened the door to bigger, controlled savings later.

How Fleming Accounting Solutions approaches entity & tax strategy

Scenario modeling

We quantify tax impact, retirement options, payroll requirements, and cash-flow timing—then highlight trade-offs in plain English. 

Implement & maintain:

We don’t just recommend; we handle elections, payroll setup, retirement plan coordination, and quarterly tax planning. 

Iterate with growth:

As numbers change, we re-run scenarios so your structure fits your current reality—not last year’s. 

Disclosure: Results vary by state, income mix, deductions/credits, payroll levels, “reasonable compensation,” and retirement plan specifics. Figures shown are client-specific estimates and should not be relied upon as universal outcomes.

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