Am I Paying Too Much in Taxes?
How to Know—and What You Can Do About It
If you’re self-employed, running a business, earning investment income, or simply making a good living in California, it’s easy to wonder:
“Am I paying more in taxes than I should?”
In many cases, the answer is yes — not because you’re doing anything wrong, but because your tax strategy hasn’t kept up with your income or complexity. At Velin & Associates, Inc., we help professionals, creators, and business owners uncover missed opportunities and reduce tax liability legally and effectively.
Here’s how to evaluate whether you’re overpaying, and what to do next.
1. You’re Taking the Standard Deduction… but Have Lots of Expenses
If you’re not itemizing and you:
- Pay high state or property taxes
- Have a mortgage
- Donate to charity
- Have out-of-pocket medical expenses
…you may be missing out on deductions that exceed the standard deduction.
We often find that professionals in California can benefit from itemizing—especially in light of recent (and upcoming) changes to the SALT deduction cap and other federal tax rules.
2. You’re Self-Employed… But Not Using the Right Entity
If you’re a YouTuber, dentist, Shopify store owner, TikToker, or Amazon seller and you’re still operating as a sole proprietor, you could be paying thousands more in:
- Self-employment taxes
- Medicare surtaxes
- State franchise minimums
Switching to an S-Corporation or multi-member LLC could allow you to reduce taxes through reasonable salary planning, dividend distributions, and deductible business expenses.
3. You’re Not Strategically Timing Income or Expenses
Tax planning is not just about how much you make — it’s also when you recognize income and how you record expenses.
For example:
- Could you defer income to a lower-tax year?
- Should you accelerate expenses (e.g., equipment, software, marketing)?
- Are you taking advantage of Section 179 or bonus depreciation?
Without proper timing, you may be paying taxes early on income you could have deferred or missing deductions you’re entitled to.
4. Your Investment Income Isn’t Tax-Optimized
If you have capital gains, rental income, or dividend-producing investments, taxes can eat into your returns.
Are you:
- Using tax-loss harvesting to offset gains?
- Holding investments for long-term capital gains treatment?
- Placing interest-generating assets in tax-deferred accounts?
Even wealthy investors often pay more tax than necessary by not managing asset location and harvesting strategies effectively.
5. You’re Missing Tax-Free Savings Opportunities
High earners often underutilize tax-advantaged vehicles like:
- Health Savings Accounts (HSAs)
- Solo 401(k)s or SEP IRAs
- Backdoor Roth IRAs
- 529 education savings plans
- Defined benefit plans (for late-career professionals)
These accounts not only reduce taxable income today — they can help build wealth tax-free for tomorrow.
6. You’re Not Planning for the Long Game
Paying too much in taxes often isn’t about this year — it’s about a lack of long-term tax strategy. That includes:
- Structuring for a business sale or exit
- Planning for retirement income
- Navigating California residency rules
- Preparing for estate and inheritance tax shifts
- Timing large charitable contributions
High-income earners in California can especially benefit from multi-year tax projections to avoid bracket creep and unexpected liability.
So… Are You Paying Too Much?
If you’re not working with a tax strategist — or you only talk to your accountant at filing time — chances are you’re leaving money on the table.
At Velin & Associates, Inc., we provide:
- Strategic tax reviews
- Entity analysis
- Year-round planning
- Tax-saving implementation
- Audit-proof documentation
We specialize in supporting:
- Creators & influencers
- Online sellers (Amazon, Shopify)
- Dentists & medical professionals
- Real estate investors
- High-income freelancers & professionals
Let’s Find Out What You’re Missing
A second opinion on your taxes could save you thousands. Let’s review your current strategy, clean up inefficiencies, and build a tax plan that works as hard as you do.
Velin & Associates, Inc.
8159 Santa Monica Blvd STE 198/200
West Hollywood, CA 90046
📞 323-902-1000
📧 dmitriy@losangelescpa.org
🌐 www.losangelescpa.org
CPA for YouTubers | CPA for Shopify Store | CPA for Online Commerce | CPA for Creators | CPA for Filmmakers | CPA for Amazon Business | Amazon Business CPA | CPA for Dental Practice | Dentist CPA | Dental Business CPA | Online Commerce CPA | CPA for TikTokers
Our firm provides the information in this e-newsletter for general guidance only, and does not constitute the provision of legal advice, tax advice, accounting services, investment advice, or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other competent advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation. Tax articles in this e-newsletter are not intended to be used, and cannot be used by any taxpayer, for the purpose of avoiding accuracy-related penalties that may be imposed on the taxpayer. The information is provided "as is," with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.