Small Business Owner Turned Miner — A Case Study

How Bitcoin Mining Saved a Small Business Owner From a $680,000 Tax Bill

Blockware Intelligence Newsletter

Today’s story is about a general contractor where I live in North Carolina — a hardworking small business owner who builds custom homes, manages a crew of eight, juggles subcontractors, deals with weather delays, and answers client calls at all hours.

He’s also a father of four.

2025 was the best year he’s ever had.

But when tax season rolled around, the IRS tried to take $680,000 of his earnings.

Here’s how we fixed it.

A Breakout Year — and a Brutal Tax Surprise

He finished 10 custom homes in 2025, averaging roughly $850,000 per house. After paying for labor, subcontractors, materials, insurance, trucks, tools, fuel, and overhead…

He ended the year with approximately $1.7 million in net profit.

A massive achievement for a small business owner.

But his combined federal and North Carolina state taxes came out to roughly 40% of his income.

That meant he owed:

$680,000 in taxes

Six days a week, 12 hour days on job sites, managing employees, subcontractors, and interacting with clients 24/7

And the federal and state governments want nearly three-quarters of a million dollars…

The Typical Strategy: Buy Equipment You Don’t Need

Like most general contractors, his first instinct was:

“Maybe I should buy equipment to reduce taxes.”

It’s a common move in the construction world — his accountant even encouraged it.

He considered several large purchases:

• A new F-350
• A skid steer
• A telehandler
• A dump trailer
• A mini excavator

All of them are eligible for bonus depreciation.

But there was a major problem…

He didn’t actually need any of it.

Buying hundreds of thousands of dollars worth of machinery “for the write-off” would:

• Increase storage costs
• Raise insurance premiums
• Sit idle most of the year
• Produce no additional cash flow
• Drain working capital

He needed a better solution — one that didn’t sabotage liquidity.

The Tool Most Business Owners Don’t Know About

That’s when I showed him something most small business owners have never heard of:

Bitcoin mining hardware qualifies for 100% bonus depreciation.

Instead of buying equipment that rusts in the yard…

He could buy Bitcoin miners that run inside a data center, 24/7, producing Bitcoin.

Mining hardware qualifies as 5-year MACRS property, making it eligible for first-year expensing under IRS §168(k).

The entire $1.7 million could be deducted immediately.

The Lightbulb Moment

He wasn’t searching for some speculative investment. He needed:

• A large tax deduction
• That also produced cash flow

Bitcoin mining is the only asset class that offers:

• 100% bonus depreciation
• Daily Bitcoin production
• Hands-off hosted operations
• No equipment on your property
• No maintenance headaches

Once he realized that, the decision became obvious.

The Results: Zero Taxes + One Bitcoin Per Month

He purchased $1.7 million worth of S21 XP Bitcoin miners, hosted with Blockware.

The impact:

• 2025 Tax Bill: $680,000 → Nearly $0
• Hardware purchased: 268 S21 XPs
• Production: Roughly 1 BTC/month (~$100,000)
• Electricity costs: About $50,000/month

He’s effectively stacking Bitcoin at half-price, with all expenses fully deductible.

His construction business now doubles as a passive Bitcoin mining and accumulation operation

If You’re a Business Owner, This Matters

If you’re a business owner or high-income professional tired of paying far too much in taxes, hosted Bitcoin mining is for you.

Understanding how bonus depreciation works — and how Bitcoin mining fits into your tax strategy — is critical.

Sign up for a free consultation with a Blockware team member to learn more: https://mining.blockwaresolutions.com/tax