3 ms·
I can't find the quote now, but I heard something before along the lines of "a tax deferred is a tax avoided" as a principal for business. I'm not the wealth cl
by ip26 5y ago
I can't find the quote now, but I heard something before along the lines of "a tax deferred is a tax avoided" as a principal for business. I'm not the wealth class, but at the time I understood the idea was if you can kick the can down the road indefinitely through a never-ending stream of tactics, you can carry on with things & never actually pay taxes. In theory you have not escaped them... but in practice you have.
Like-kind exchanges are a good example. You can defer taxes on the basis of your rental properties for your entire life (and then your children can enjoy a step up in basis)
- Havoc 5y ago> "a tax deferred is a tax avoided" Once you get into more complicated tax structuring then yes you can defer it for very long. The extent to which that very long becomes indefinite depends largely on the country's tax laws. Some are more open to the concept of handing down wealth through the generations than others. Deferral opportunities are available to more normal people too. As per your rental example. Or self managed pensions in some countries etc. Or tax wrappers for stocks. Either people don't know enough or they've get their hands forced by paycheque to paycheque realities. The only stuff really out of reach for normal people is genuine offshore stuff. The overheads on that are quite chunky so you need millions for it to make sense.