<story><title>Ask HN: How do I manage the profit of a successful website?</title><text>Some time ago, I started a subscription-based website that has slowly gained momentum and revenue. Currently, my monthly recurring revenue from this site is about $45k USD per month. I’m taking ~$14k&amp;#x2F;mo salary (which is far more than enough for my needs) and I’m paying one other dev part time about ~$6k&amp;#x2F;mo. My other expenses to keep it up and running are only ~$2k&amp;#x2F;mo. That leaves quite a bit leftover and I don’t know what I’m supposed to do with it. I have no desire to expand the operation for many reasons. I’m perfectly happy working on it full time myself and don’t want to change anything. My question is what am I supposed to do with that profit? Claim it all myself as income? Let it accumulate in the business account? The company is formed as an LLC and I am based in the US, for reference.</text></story><parent_chain><item><author>Serenacula</author><text>I don&amp;#x27;t think the spirit of the question was &amp;quot;how do I avoid paying taxes&amp;quot;, but more along the lines of &amp;quot;what the hell do I do with all this money I don&amp;#x27;t need?&amp;quot;.&lt;p&gt;I would suggest giving it to charity, OP. My mother always said even poor folks should be giving at least 15% of their income to charity, but if you have more than you need, no reason not to increase that number.</text></item><item><author>meetingthrower</author><text>If you have it as an LLC, any profits will pass through to you through your schedule C, and you will be taxed at regular income tax rates.  Your accountant will help.  But tax optimization can REALLY matter, and as a small business you have massive opportunities to very legally and ethically optimize your business and tax.&lt;p&gt;Top of mind, what you should really consider is:
a) setting up a 401K under the business to shelter some of the income tax free (you can also contribute a significant portion of profit tax free.)  Vanguard and Fidelity have no cost single member LLC 401ks that are super simple to set up.&lt;p&gt;b) thinking of your strategy to invest in this business, or grow another one.  Because any expenses are deductible, this is like having ~30% off any business investments courtesy of the federal government.&lt;p&gt;c) relative to a) above, is if you have a spouse, employ him &amp;#x2F; her in the business to the extent that you maximize their 401k contribution. (I did this for my spouse and even at $18K a year compounding the 401k has $300K bucks in it!)  Again, a small business accountant will be super familiar with how this works.</text></item></parent_chain><comment><author>pkrotich</author><text>It was obvious OP didn&amp;#x27;t know simple facts about taxes and income... based on his&amp;#x2F;her post. Getting that right is more important for the longterm and I think the parent was on point.</text></comment>
<story><title>Ask HN: How do I manage the profit of a successful website?</title><text>Some time ago, I started a subscription-based website that has slowly gained momentum and revenue. Currently, my monthly recurring revenue from this site is about $45k USD per month. I’m taking ~$14k&amp;#x2F;mo salary (which is far more than enough for my needs) and I’m paying one other dev part time about ~$6k&amp;#x2F;mo. My other expenses to keep it up and running are only ~$2k&amp;#x2F;mo. That leaves quite a bit leftover and I don’t know what I’m supposed to do with it. I have no desire to expand the operation for many reasons. I’m perfectly happy working on it full time myself and don’t want to change anything. My question is what am I supposed to do with that profit? Claim it all myself as income? Let it accumulate in the business account? The company is formed as an LLC and I am based in the US, for reference.</text></story><parent_chain><item><author>Serenacula</author><text>I don&amp;#x27;t think the spirit of the question was &amp;quot;how do I avoid paying taxes&amp;quot;, but more along the lines of &amp;quot;what the hell do I do with all this money I don&amp;#x27;t need?&amp;quot;.&lt;p&gt;I would suggest giving it to charity, OP. My mother always said even poor folks should be giving at least 15% of their income to charity, but if you have more than you need, no reason not to increase that number.</text></item><item><author>meetingthrower</author><text>If you have it as an LLC, any profits will pass through to you through your schedule C, and you will be taxed at regular income tax rates.  Your accountant will help.  But tax optimization can REALLY matter, and as a small business you have massive opportunities to very legally and ethically optimize your business and tax.&lt;p&gt;Top of mind, what you should really consider is:
a) setting up a 401K under the business to shelter some of the income tax free (you can also contribute a significant portion of profit tax free.)  Vanguard and Fidelity have no cost single member LLC 401ks that are super simple to set up.&lt;p&gt;b) thinking of your strategy to invest in this business, or grow another one.  Because any expenses are deductible, this is like having ~30% off any business investments courtesy of the federal government.&lt;p&gt;c) relative to a) above, is if you have a spouse, employ him &amp;#x2F; her in the business to the extent that you maximize their 401k contribution. (I did this for my spouse and even at $18K a year compounding the 401k has $300K bucks in it!)  Again, a small business accountant will be super familiar with how this works.</text></item></parent_chain><comment><author>Rastonbury</author><text>Because money is fungible, you can pay more tax or you can give more to charity. The answer is very pertinent because of this</text></comment>