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A sales rep posted his paystub on Reddit last month. $718,080.87. $638,497.61 of it commissions.
He titled it: "4.5x'd my OTE."
His first comment: "Just hype and no one really to share it with."
That last part is the thing.
When you hit a number like this, something happens that nobody talks about. The number stops feeling like a number. $638,497 in commissions starts to feel like the baseline. You assume you'll do it again. The urgency to do something smart with it quietly disappears.
You tell yourself you'll figure it out later.
That decision compounds in the wrong direction.
If you're at a number the people around you have never seen, you can grab 20 minutes on my calendar. We'll go through your situation and you'll leave knowing exactly what you should be doing with it right now.
The IRS absolutely understands your income level. They're very comfortable with it.
A $718,000 year without a tax plan generates a check in April that most reps aren't ready for. At this income, we're talking six figures owed on top of whatever was already withheld. Skip the quarterly estimates and there are penalties on top of that.
Lifestyle creep handles the rest. The commission hits. It feels like a lot. Spending adjusts up. Next year's income gets assumed. Then it doesn't repeat exactly the same way.
There are specific moves that make sense for a rep at this income level right now.
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Mega backdoor Roth. Most employer plans allow after-tax 401(k) contributions up to the IRS annual limit. Converting those to Roth means tax-free growth on a significant chunk of income.
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Deferred compensation. A big commission year is the right time to run income through your company's deferred comp plan. Push taxable income into future years when you'll likely be in a lower bracket.
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Quarterly estimates. Getting these right is the simplest way to avoid writing a check to the IRS that's larger than it needs to be.
None of this is complicated. It just requires someone to walk you through it before the year is over and the window closes.
If this is where you're at, reply to this email with "plan" and I'll walk you through exactly where to start.
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