AuthorTopic: How to Be a Millionaire and Pay No Taxes  (Read 151 times)

Online Eddie

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How to Be a Millionaire and Pay No Taxes
« on: November 12, 2018, 07:59:58 AM »
The journalists haven't figured out crypto is a new away to avoid taxes, by borrowing against it. Too new. You heard it from me first.

The article below says it's not a good time to be rich.

Bullshit, it's ALWAYS a good time to be rich. Journalists are all socialists at heart. And dumb too, most of 'em. (Present company excepted, of course.)


10 ACCOUNTING TRICKS THE 1% USE TO DODGE THE TAXMAN




It’s not a good time to be rich. Currently, the world of finance is going through more scandals than British comedian Jimmy Carr has one-liners (but more on him later). And everywhere you look, there’s illegal shifting, trading and sharing of information between the wealthy.

But what about the legal and quasi-legal tricks used by the rich to hang onto their money? It’s a sad fact that most of the methods used by the top 1% to evade the taxman are, if not moral, at least allowed within the letter of the law. Hold onto your purse strings as we list the 10 dirtiest accounting tricks the rich use to keep their cash.

10. TAX HAVENS


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Hanging onto money using the world’s many tax havens has a long and dishonorable history, with areas like the Channel Islands’ freedom from taxes dating back as far as the Norman conquests. This trick is based on the fairly simple idea that if taxes are high in one location, you can gain an advantage by registering your location as being somewhere else instead.

It’s been a significant asset to corporations, but a number of celebrities have also taken advantage of global travel and relocation to avoid paying income tax. U2, David Bowie and The Rolling Stones are just a few of the names that have dodged the taxman by spending time abroad. It isn’t even a big disadvantage; in practice, residents can usually return to their country at a later date, or on visits.

Tax evasion through offshore havens occurs on a huge scale. A recent study by the Tax Justice Network found that approximately $21 trillion is currently being hidden in offshore tax havens. One of the most prolific offenders is the Cayman Islands, which is home to more than 85,000 companies – making it one of the few territories with more registered organizations than people.

9. SHELL COMPANIES


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A shell company is a type of company that only exists on paper, allowing the person who uses it to funnel money through it and avoid paying taxes. Typically, this type of corporation has a legal existence but provides few or no actual products or services.

One classic way of using these companies is buying and selling through them, which means that the owner does not need to report international operations conducted through the shell company and will be able to avoid any taxes on the profits. Shell companies are also used to conduct various other pieces of shady business, including selling supermarket brand goods without impacting the value of the main brand.

Republican presidential candidate Mitt Romney recently got into hot water over claims that he has been evading the government’s claims on his finance, with one of the accusations that he channeled his income into a shell company in the tax haven of Bermuda. You could say he shares his party’s belief that the government should stay out of private citizens’ affairs…

8. EQUITY SWAPS


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An equity swap is another shady method of tax evasion. Basically, it’s an official agreement that allows two parties (say, two rich individuals or companies with in interest in reducing their taxes) to exchange the gain and loss of a set of assets without actually transferring ownership.

One of these swaps is generally pegged to a fixed rate, like LIBOR, which means that the participants can expect a fixed return, either in one payment or at several predetermined points.

This exchange of value allows the parties to avoid transaction costs and, in some cases, local taxes pegged to certain locations. This is obviously a sneaky bonus for people who want to avoid high taxes in a particular area while still getting the benefits of owning assets in another.

7. AVOIDING CAPITAL GAINS TAX


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Capital gains tax automatically kicks in from the sale of certain valuable properties, such as shares, and acts as a deterrent on investors cashing them in. Obviously, though, a number of rich people are interested in avoiding this and have found legal loopholes to allow them to do so.

One cunning way of dodging capital gains tax is by borrowing from an investment bank with the shares as collateral after purchasing options, which set their price at a fixed rate.

This sneaky option allows the borrower to avoid triggering the capital gains tax that would come with actually having the money at hand, while giving them the free cash – and allowing them to repay the loan – either from the profits of using the money or by handing over the shares themselves. Talk about making your money work for you.

6. EVADING THE ESTATE TAX


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Different places may call it the death duty, the estate tax, or the inheritance tax. But whatever the name, one thing’s for sure: most countries have ways of taking a percentage of a person’s possessions and capital once they have bequeathed it after passing away. While this may arguably be considered unfair, the methods some millionaires use to dodge this tax will make your hair curl.

The main problem with estate tax is that it only focuses on the actual property and capital owned by an individual, and there are a number of exceptions to the assets that it can target. One especially effective way of dodging it is to set up a GRAT (grantor retained annuity trust – basically a trust fund), which invests the money for you: any income earned over and above the interest is completely free of income and estate taxes.

Estate tax isn’t called the last “voluntary tax” for nothing: virtually anyone with the savvy to have earned any money in the first place can set up this loophole, and it’s completely legal as well.

5. SHELL TRUST FUNDS


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This scheme, which exists in forms such as the Jersey-based K2 fund run by Peak Performance Accountants, has allowed wealthy individuals to pay as little as 1% income tax per year. Subscribers to this kind of “tax plan” pay money into a trust fund, which accepts their money as “donations.” The fund then offers its members cheap loans, which the borrowers subsequently, shall we say, “forget” to pay back. Thus, by disguising their salaries as loans, the members can write off much of their income tax.

This scheme hit the headlines in the UK recently when it was revealed that comedian Jimmy Carr and thousands of other members were using it to eliminate most of their taxes – and this was after Carr had previously appeared in a sketch lampooning Barclays for only paying 1% tax.

This little legal loophole may have technically been within the law when it was devised, but it still looks like one of the shadiest tax dodges on the market to us.

4. INCORPORATING


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In legal terms, there are many advantages to being a company and few to being an earner in the top tax bracket. As a result, a large number of celebrities have incorporated themselves in order to avoid various forms of tax. For example, by channeling your wages into a nominal “corporation” you are able to pay yourself a small, interest-free wage, claim expenses, and reduce income tax.

Others have devised even more cunning loopholes: take, for example, Mitt Romney’s recent maneuver of claiming the management fee of his corporation as a capital gain rather than income, which reduced his actual rate of tax rather sharply.

3. PAYMENTS IN KIND


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Payments-in-kind was a former tax loophole that has, fortunately, been rendered obsolete by tighter regulation. Previously, it was possible for executives to receive their payments “in kind” – so rather than receiving a regular wage, they would instead be paid in valuable, tradable commodities, such as gold, silk, or other consumer goods and benefits.

These could then either be sold or “traded on” for additional commodities, which could be used by the executive. Effectively, it reintroduced a mutated form of the old barter system as a tax loophole.

One more modern example is payment-in-kind securities, which give companies the option of paying investors in additional securities rather than cash.

Despite its advantages, the system had an obvious flaw in that being paid with a truckload of gold bars every month would overload even the most powerful executive’s car. There’s a reason we started using money in the first place, after all.

2. LIFE-INSURANCE BORROWING


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This is an especially clever use of borrowing against an asset – in this case, the asset being a life insurance policy. The way this loophole works is this:

An individual takes out a policy with a large cash dividend – for example, one million dollars. This gives the individual involved a lot of leverage when it comes to borrowing, since most banks will lend up to 90% of the surrender value of the policy. And because this sum isn’t income, it isn’t eligible for income tax or capital gains tax.

This has major advantages over actually earning the money, since earning $1 million would undoubtedly result in taxes of nearly 50%. If you want to be an instant millionaire (or just add to your considerable fortune), this may be the right kind of tax evasion scheme for you.

1. REAL ESTATE BORROWING


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Another sneaky way to use assets to make tax-free income is to put mortgages on your current properties until the rental income equals your expenses. This has the advantage of allowing you to borrow money against the value of those properties free of tax: for example, if the property was valued at $2 million and you can borrow 75% of the equity, this would give you $1.5 million of tax-free borrowing.

The money cannot be taxed because, technically, it isn’t income: as with the previous loophole, it’s officially classed as a loan. Unfortunately for the little people, this just proves the truisms of the world of finance: the more money you have, the easier it is to get more.
What makes the desert beautiful is that somewhere it hides a well.

Online Eddie

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Re: How to Be a Millionaire and Pay No Taxes
« Reply #1 on: November 12, 2018, 08:07:33 AM »
Look, everyone who has some kind of savings or retirement uses tax advantages. 401K's are the biggest tax dodge of all, it's just that people accept that one because it benefits THEM instead of some vague 1% guy that the MSM trains them to envy and hate.

I use numbers #'s 1, 2   and 7 every chance I get, and if you don't.....you''re just screwing yourself.
What makes the desert beautiful is that somewhere it hides a well.

Offline RE

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Re: How to Be a Millionaire and Pay No Taxes
« Reply #2 on: November 12, 2018, 08:10:22 AM »

Bullshit, it's ALWAYS a good time to be rich. Journalists are all socialists at heart. And dumb too, most of 'em. (Present company excepted, of course.)[/color]


Not ALWAYS.  Sometimes its a really BAD idea.

<a href="http://www.youtube.com/v/lo5BBHtn4tM" target="_blank" class="new_win">http://www.youtube.com/v/lo5BBHtn4tM</a>

RE

SAVE AS MANY AS YOU CAN

Online Eddie

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Re: How to Be a Millionaire and Pay No Taxes
« Reply #3 on: November 12, 2018, 08:21:13 AM »
Suicide is painless.

What makes the desert beautiful is that somewhere it hides a well.

Offline RE

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Re: How to Be a Millionaire and Pay No Taxes
« Reply #4 on: November 12, 2018, 08:27:28 AM »
Suicide is painless.



Maybe in some cases if you do a good job at pulling it off, but you are of course still quite DEAD afterward.  Do you really prefer death to giving up your wealth and priviledge?

RE
SAVE AS MANY AS YOU CAN

Online Eddie

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Re: How to Be a Millionaire and Pay No Taxes
« Reply #5 on: November 12, 2018, 08:41:59 AM »
No, this is a silly conversation. Those people were Nazis who committed suicide because Germany surrendered.

The smart Nazis are still alive, some of 'em. Or at least they died of old age.

The guillotine approach to redistribution of wealth is a concept that already failed, rather spectacularly.

Humans all look alike, and it's easy to hide wealth. Lots of rich people do not appear to be rich at all. You can't even figure out who they are, other than a few high profile celebrities.

First, I'm not particularly rich, and second, the whole concept of white male privilege is specious.But even if I were rich, the idea that somebody in this country is going to come after me because I'm worth a couple of million buck is ridiculous. Won't happen. Thee are 9 million families in the US with net worths of over a million bucks. It's chump change.

« Last Edit: November 12, 2018, 08:43:47 AM by Eddie »
What makes the desert beautiful is that somewhere it hides a well.

Offline RE

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Re: How to Be a Millionaire and Pay No Taxes
« Reply #6 on: November 12, 2018, 08:51:32 AM »
No, this is a silly conversation. Those people were Nazis who committed suicide because Germany surrendered.

The smart Nazis are still alive, some of 'em. Or at least they died of old age.

The guillotine approach to redistribution of wealth is a concept that already failed, rather spectacularly.

Humans all look alike, and it's easy to hide wealth. Lots of rich people do not appear to be rich at all. You can't even figure out who they are, other than a few high profile celebrities.

First, I'm not particularly rich, and second, the whole concept of white male privilege is specious.But even if I were rich, the idea that somebody in this country is going to come after me because I'm worth a couple of million buck is ridiculous. Won't happen. Thee are 9 million families in the US with net worths of over a million bucks. It's chump change.

This is more rationalization and confirmation bias.  ::)

It's quite EZ to identify you as rich, you just have to know where you live.    You just need to know the profession/criminal racket  you pursued to become rich. You just need to observe the carz you drive.   It's fucking tatooed on your forehead.

There may be 9M families with a net worth of 1M, but there are another 341M without that.  That is not good odds for the folks holding the money.  30:1 generously in your neighborhood.  Give it up or have it taken from you by force, at the cost of your life and the lives of your loved ones.  It's up to you.

RE
« Last Edit: November 12, 2018, 09:00:22 AM by RE »
SAVE AS MANY AS YOU CAN

Online Eddie

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Re: How to Be a Millionaire and Pay No Taxes
« Reply #7 on: November 12, 2018, 09:27:32 AM »
Sure. Hordes of socialists invading my neighborhood. Keep dreaming.

I drive the same cars most working families drive here. One pick-up, one economy car. The MB is dead and needs to be hauled off.My uniform is Levis and T-shirts and dirty boat shoes. I own one suit, bought to perform the wedding. I never dress rich. I need a haircut most of the time, like now.

And if somebody did manage to climb over all the bodies in my front yard and overcome me by illegal and amoral force..... on that fateful day, there isn't anything here worth that much. I don't even have a smart phone.

My money is in investments, not under my mattress. Killing me would be a meaningless act of random violence, that wouldn't net anybody anything. If people squatted in the half dozen properties I own, they'd just ruin them and have nothing, if I'm not there to do the repairs.

And if you kill all the dentists, good luck with your next toothache. You can fly to Mexico, maybe. Maybe your local commissar will give you the money. LOL.
« Last Edit: November 12, 2018, 09:41:08 AM by Eddie »
What makes the desert beautiful is that somewhere it hides a well.

Offline RE

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Re: How to Be a Millionaire and Pay No Taxes
« Reply #8 on: November 12, 2018, 09:35:16 AM »
Sure. Hordes of socialists invading my neighborhood. Keep dreaming.

I drive the same cars most working families drive here. One pick-up, one economy car. The MB id dead and needs to be hauled off.My uniform is Levis and T-shirts and dirty boat shoes. I own one suit, bought to perform the wedding. I never dress rich. I need a haircut most of the time, like now.

And if somebody did manage to climb over all the bodies in my front yard and overcome me by illegal and immoral force..... on that fateful day, there isn't anything here worth that much. I don't even have a smart phone.

My money is in investments, not under my mattress. Killing me would be a meaningless act of random violence, that wouldn't net anybody anything. If people squatted in the half dozen properties I own, they'd just ruin them and have nothing, if I'm not there to do the repairs.

And if you kill all the dentists, good luck with your next toothache. You can fly to Mexico, maybe. Maybe your local commissar will give you the money. LOL.

I'm not dreaming, I relate to you history.  Who got nailed in the French Revolution?  The educated "scientists" and doctors for the most part.  You think Amerika is "exceptional" and this can't happen here?  We can't get another Robespierre in Ameirka?  We already got another fucking Hitler in Trumpovetsky.  It doesn't match with what you want to believe, which is that BAU will continue for the rest of your life, and it might play out that way if you are lucky.  But if this does come one fateful day before you are dead, do you give up your wealth or do you die to defend it?  Inquiring minds want to know.

RE
SAVE AS MANY AS YOU CAN

 

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