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How to lower your taxes using the same tactics as billionaires: step 1. Hire a team of accountants and legal advisors

ryandrake 8y ago
Is that really all it is, though? Hire wizards and they cast spells to make your taxes lower? I think being able to lower taxes has more to do with your billionaire status (there are more loopholes and deductions for wealthy people) and less to do with hiring professional help. Nearly 100% of my income is W2 labor, and I always do my own taxes. A long time ago I thought I'd hire a CPA to do my taxes, to double check that I was doing mine optimally. Total waste of money. He cost about $400 (I understand that's a pretty good bargain these days), and found no additional deductions, and was kind of a pain to deal with. For working class and middle class people, there really aren't that many ways to get creative with your income to reduce your tax bill.
- AlexTWithBeard 8y ago
  It's not about some special status, it's purely about money: casting the magic tax-lowering spell requires a lot of mana. I'm sure your accountant could have set up a charity, put most of your assets there, the charity would hire yourself as an independent contractor... But it will cost more than it's worth.
usaar333 8y ago
As sibling notes, step 1 is to actually have substantial complex income where accountants can do planniung. There's not much trickery that can be done with ordinary income since it is handled simply and rigorously. Gains from financial transactions (capital gains, debt, etc.) are much more complexly handled and more ambiguous. * Accounting creativity can be employed with capital gains taxes because it is only paid on asset sale by the asset seller. So you can "move" the taxes around by donating and gifting. Move states to avoid high state income taxes. Better yet, if you die, your heirs never pay taxes -- this leads to all sorts of trust structuring that allows basis step up and estate tax bypass. * Debt (this article) is another example. If you read the article, cancelled debt is taxable, but you can make it a bit ambiguous whether the debt was cancelled or just merely restructured.

Is that really all it is, though? Hire wizards and they cast spells to make your taxes lower? I think being able to lower taxes has more to do with your billionaire status (there are more loopholes and deductions for wealthy people) and less to do with hiring professional help. Nearly 100% of my income is W2 labor, and I always do my own taxes. A long time ago I thought I'd hire a CPA to do my taxes, to double check that I was doing mine optimally. Total waste of money. He cost about $400 (I understand that's a pretty good bargain these days), and found no additional deductions, and was kind of a pain to deal with. For working class and middle class people, there really aren't that many ways to get creative with your income to reduce your tax bill.

AlexTWithBeard 8y ago
It's not about some special status, it's purely about money: casting the magic tax-lowering spell requires a lot of mana. I'm sure your accountant could have set up a charity, put most of your assets there, the charity would hire yourself as an independent contractor... But it will cost more than it's worth.

usaar333 8y ago

As sibling notes, step 1 is to actually have substantial complex income where accountants can do planniung. There's not much trickery that can be done with ordinary income since it is handled simply and rigorously. Gains from financial transactions (capital gains, debt, etc.) are much more complexly handled and more ambiguous. * Accounting creativity can be employed with capital gains taxes because it is only paid on asset sale by the asset seller. So you can "move" the taxes around by donating and gifting. Move states to avoid high state income taxes. Better yet, if you die, your heirs never pay taxes -- this leads to all sorts of trust structuring that allows basis step up and estate tax bypass. * Debt (this article) is another example. If you read the article, cancelled debt is taxable, but you can make it a bit ambiguous whether the debt was cancelled or just merely restructured.