Let me start by saying this is NOT a political article on whether you are for or against Trump. It’s how to legally pay as little tax as possible.
Over the last few days, the national news outlets have focused on how President Donald Trump has not paid US income tax for 10 of the last 15 years or he has paid a total of $750.00. Remember the debate between him and Hillary Clinton some 4 years ago, and she asked him directly about his taxes, and Trump said it was because he was smart. Does that make you mad? Is it unfair? Can you do that? Is it only for the rich?
If Trump paid little to no tax legally and ethically is it moral? Please read Mr. Ruml’s transcript of a speech he gave. Mr. Ruml was the Chairman of The New York Federal Reserve Bank of New York. He said in that transcript, the US doesn’t need Taxes to pay for anything because they can print as much money as they need to. As we see this is true since 2008 and with all the money printing for COVID-19 relief. Whether you agree with Mr Ruml or not he is qualified to voice his opinion. Tom Wheelwright also addresses this moral issue in his book Tax Free Wealth.
Is it a Patriotic Duty to pay your taxes? I have heard that before. Is there anything your government spends its money on that you dislike, hate or you are morally opposed to? Then you can use the tax code to keep control of your money and donate to causes you want to for example: Refugee camps, Schools, Churches, Humane societies or SPCA’s, Fire Houses and on and on. This way you CHOOSE what those “taxes” will pay for instead of let someone else choose for you.
The short answer is YES, YOU CAN DO IT TOO!
Thanks to my mentors, I have met with Robert Kiyosaki, Author of Rich Dad Poor Dad, and his tax advisor, Tom Wheelwright. Robert and Tom speak all over the world and discuss this very subject. They repeatedly hear from people that you can’t pay zero taxes in this country or that country. But that is not true if you know what to invest in.
Irwin Schiff, Peter Schiff’s father, wrote a few books I love and is why I started my journey to be an ex-pat. They are How Anyone Can Stop Paying Income Taxes and The Federal Mafia. Being able to meet with Peter Schiff was an exciting time for me.
When I was a Fireman and owned my landscaping company, I saw how much the US took in Federal Tax. I was taxed to death with Federal Tax, South Carolina Tax, Property Tax, Unemployment Tax, Payroll Tax, etc. There had to be a better way to get ahead in life.
My life changed FOREVER when I read Rich Dad Poor Dad. This book is a MUST read for everyone!
Fast forward to meeting the Real Estate Guys Radio, who introduced me to so many other people who explained this very complicated subject in easy terms.
Robert Kiyosaki also wrote Cash Flow Quadrant and created the board game Cashflow. When you read the book and play the game, you will learn that you are taxed based on how you make your money. Either as an employee, self-employed, business owner, or investor. If you want to change your tax, you must change your facts—the fact of how you make your money.
Tom Wheelwright says if you study a country’s tax code, it will tell you what that country wants you to invest in. The majority of my investors or clients are from North America, and those tax codes tell you to invest in things that help create jobs or housing like real estate. Even Oil and Gas gives you very large deductions. And with the CARES ACT/ COVID Bill, it brought a lot of the deductions that are retroactive to past years. Look at Donald Trump or Robert Kiyosaki and there are others. They are real estate investors and legally they can pay little to no income tax. Then donate to the causes they believe in.
How do real estate investors legally pay ZERO income tax? Here is just a few ways:
- Mortgage Interest Deductions
- Improvement Deductions
- Bonus Depreciation
- Travel Expenses
- New Cares Act
- Net Operating Loss
- Qualified Improvements
- Cost Segregation
These tools or incentives the IRS and Government allows you to use to lower your taxable income. Consult your bookkeeper or tax professional who understands real estate. Most importantly, make sure they talk to each other.
In a recent interview with my tax professional, Matt Nunn, with Provision we discuss how investing in real estate saves money on taxes. Matt does a great job explaining how he helps his clients save on taxes as a tax professional. A link to this webinar will be in your inbox soon. Stay tuned!
I’m not a tax advisor or CPA but this is my understanding, be sure to contact your tax professional or set up a consultation with Matt Nunn to discuss this subject further. If you’re interested in a consultation with Matt, email firstname.lastname@example.org and we’ll get Matt in contact with you.
The bottom line is that you have the opportunity to pay little or no income tax as long as you change your facts.