Tax Strategies for Glampers

So, you’ve got a dream property and are keen to dive into the glamping business—congratulations! But hold on a second; while you’re envisioning cozy tents and delighted guests, there’s another critical aspect to consider—your financial strategy, particularly taxes.

I know firsthand how daunting it can seem to balance managing your earnings while safeguarding your assets. But, like me, you might find it’s not as cumbersome as you thought.

Taxes: The Unseen Beast

In a recent Glamping Guy Tribe session, I connected with Peter, Lance, Eric, and Jeff hailing from all corners of the U.S., including Maine, Georgia, Arizona, and Texas. Our topic du jour was taxes and finance, crucial elements often underestimated in their power to save us money and protect our growing businesses. This discussion unearthed several strategies that I think can bring significant value to any glamper looking to fortify their financial foundation.

Here’s a quick dive into our conversation.

Many business owners, especially in niche markets like glamping, ponder how to structure their enterprises. Do you need more than one business? What are the implications of opting for an LLC or an S corp? And what about partnerships or IRS filings? These questions can feel overwhelming.

Yet, my newfound knowledge can streamline these decisions. Thanks to Mark Kohler, a tax lawyer and entrepreneur whose work resonated with me, I’ve come to see how a structured approach can simplify tax season woes. I’m thrilled to share how such structures can shield our assets while facilitating business growth.

The Power of the Trivecta

Mark advocates for what he calls the “trivecta” strategy. Here’s the gist: If you’re a small business owner, consider separating your operations into different components—an LLC can represent your working operations, and another entity might handle your assets. This distinction not only highlights the revenue-generating facet of glamping but also preserves the wealth inherent in your properties and ensures their protection.

In practical terms, this means establishing two companies: one for operations and one for assets. For me, my operations fall under Monument Glamping, while Rickenbacker Ranch shields my property and major assets. The crux is maintaining separate financial pathways for business operations and tangible assets, ultimately minimizing the tax hit and protecting invaluable assets from potential litigation.

Here’s an interesting tidbit—consider configuring your operations company as an S corp, which allows you to pay yourself through W2s, effectively reducing self-employment tax exposure. Essentially, instead of the 15.3% self-employment tax, you might end up paying closer to 8 or 9%, translating into substantial savings.

Furthermore, all business expenditures, from the UTV used in operations to your tents, become potential write-offs. These financial maneuvers, when executed thoughtfully, integrate seamlessly into your 1040 filing, thereby enhancing your tax efficiency.

In Conclusion

What I’ve shared today is just the tip of the iceberg from our tribe sessions. As I explained to my fellow glampers like Eric, Lance, and Jeff, this trio of strategies has transformed my approach, aligning my glamping operation with broader business goals.

Our tribe isn’t just about me; it’s about us. We share, we learn, and we grow as a collective, navigating the complexities of running a successful glamping operation. So, do you think you’d bring something unique to the table? You’re invited to our next session. Just head over to glampingguy.com/tribe to join our collaborative space and contribute your insights.

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