How to Avoid Paying Taxes in 2024
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- เผยแพร่เมื่อ 30 พ.ย. 2023
- Tax evasion is illegal, but tax AVOIDANCE is highly encouraged and we have an entire tax code to substantiate that. In this episode we’ll discuss how you can save money by using retirement plans, investing in real estate, owning a business, and more.
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Bring confidence to your wealth building with simplified strategies from The Money Guy. Learn how to apply financial tactics that go beyond common sense and help you reach your money goals faster. Make your assets do the heavy lifting so you can quit worrying and start living a more fulfilled life.
You had me at avoiding taxes.
I wouldn’t recommend moving to Puerto Rico just for the Act60 tax benefits. Theres a ton of controversy surrounding them, and they are getting very strict with the rules to be eligible to be on Act60. Local Puerto Ricans hate it because its causing gentrification to the island with Non-Puerto Rican Americans moving in with no relation to the island and with more buying power buying up entire neighborhoods, public areas, and historical sites then going on to turn them all into private resorts, vacation homes, and Airbnb businesses. Because of all this a movement called the GringoGoHome movement has been growing big time and there have been many protests throughout the island to have Act60 removed. Also, many financial gurus and economists have said that Puerto Ricos Act60 is very likely to be taken down in the near future because its actually doing more harm to both Puerto Rico and the US economies. Channels like the Wealthy Expat and Nomad Capitalist have talked about it multiple times and explain why it’s a no go, and there’s better and safer places to move to a US territory to follow a bunch of strict rules just so you can get away with paying little taxes.
Congress has been demanding the Puerto Rican government take down Act60 because it’s losing the US billions of tax dollars and many people who are on Act60 are using it as a tax loophole to cheat paying taxes on the island by pretending to live there. Already over 100 people have been caught and arrested, and many more are under investigation by the IRS.
The only reason Act60 is still up is because the current corrupt governor Pedro Pierluisi and his party are using it as leverage to pressure congress to make the island the 51st state. And they are open about this plan, when congress ordered them to take it down, Pierluisi said he’ll only do it if they make the island a state first. Next year is the elections on the island and their party has been losing a ton of support because of all the corruption being exposed, and all the other parties are forming an alliance against them. If their party loses the governorship and they don’t get the majority in both house legislatures, then definitely Act60 is dead.
All in all, I’m not saying Puerto Rico sucks, I just don’t recommend moving your entire life there just because you want to pay less taxes, when there’s a ton of issues going on in the island.
Hopefully Brian teaches us how to form our own religion and avoid taxes entirely.
Speaking as a clergyman.
Our most effective technique is making a salary below the poverty line and having multiple children.
Our unique credits are a parsonage allowance which treats our primary residence as a deductible expense, a holdover from the days when the church gave the pastor a house next to the church. We can also file on the first year of ministry employment as conscientious objectors to Social Security, but most of us don't as the documentation from our ordination doesn't arrive before the first fiscal year
@@alexpietsch7997 I'm curious why there would be a religious objection to social security. And in the end, aren't you just depriving yourself of that retirement income? My parents would be dead in the water without social security retirement benefits.
@@alexpietsch7997 PS I can only respect a clergyman who makes under six figures. Pastors with jets make me puke.
@@Mark-oq9fl
It's a legal loophole admittedly. The wording of the tax code says a recognized minister of a religion conceived before a certain date in the 1910s can choose to elect out of paying social security taxes based on moral objections.
The intent of that was specifically for the Amish who view Social Security as a form of gambling.
However especially as economic education improved for younger Americans, many clergy born after 1980 know we aren't seeing a dime from social security (optimistic projections bankrupt the program in my late 40s) and then the question is one of a doctrinal belief against spending money on something we know will not work. Would the money care for more if kept in the hands of the minister, or do we simply pay the tax that will go to our elder neighbor in accordance with Romans 13.
And yeah, nowhere near 6 figures. I did get a raise to 25k effective January 1. I think the big churches (500+) may pay in the 90s in our state.
I'm hoping to use some financial planning and my youth to not take the salary when I'm in my late 50s and instead multiply the service and community ministry with that money.
Highly recommend the John Oliver video on televangelists when he created his own.
Brian and Bo did a good job going over the business list. We're at that point where we're selling the business (S-Corp) but we're keeping the building (real estate) but we've been able to pay ourselves rent over the years. The property is fully paid for as well so we can reap the benefits of selling the business and collecting enough rent to cover the majority of our post sale personal expenses. It definitely works well over time.
Instructions unclear, I now owe the IRS $20,000.😶
One of my fav episodes fellas! Always feel like I learn something new I should be looking into!🤑
Thank you, gentlemen. I really needed this.
-Joseph
Another option would be sending your money to the Cayman Islands, start a family office, and print IOUs.
One thing to think about with "low tax states" is all of the other tax bills. For example, my in-laws were shocked to pay 8% sales tax on groceries when they were in Gulf Shores AL. We pay 0% on food in the Midwest. So look at your total taxes, not just income taxes.
Yeah, wikipedia has a good article on this - "State tax levels in the United States" - they've got a few convenient charts that demonstrates the total tax burden (federal income, state income, sales, and property). (I'd link to it, but TH-cam doesn't seem to like external links.)
This is a very good mention! I live in NH and alot of VT folks come grocery shop in NH because there is no sales tax in this state.
Great information guys! I’m happy there are knowledgeable and qualified individuals discussing these types of topics to the public. Keep up the great work! P.S. It may be worth mentioning to folks that they should be careful with hobby income and mistaking it for a business
Some states have legislature that has changed their State taxes for seniors, reducing or eliminating them, starting in 2024. Some states also freeze property taxes for seniors so they won’t increase. If a Senior is planning their retirement those are a couple things it would be a good idea for them to consider.
TMGs should make a shirt with their logo that says "I'm so excited about this". I'd buy that
And on the back says “I love it”
Texas really isn't that low of a tax state when you factor in property taxes. For sure for high income earners the no income tax would make a big difference.
15:15 In a 1031 exchange, you can select (at any one time in the 45 day window) up to 3 replacement properties....not four.... unless you go with a much more complicated replacement property election. So most folks use the '3 potential replacements' rule. You CAN also buy less than the value exchanged, but you will have to pay taxes on some of the gain (boot) - so it should be close... if not more... especially if you have lots of gain baked in. Still might result in some savings. Love the content.
Awesome video!
For those of us that have student loans, we can also deduct interest payments even with a standard deduction. Wish they talked about that
I think that’s because… it’s a terrible way to reduce your tax liability 😂
@@joelplatt2651*Whoooosh*
Just completely over your head.
Unfortunately that has an income cap of around 85k for single earners/married couples filing separately and 175k for married couples filing jointly.
Yes and I believe you have to be using itemized deductions. Could be wrong but if so, it’s rarely worth giving up the standard deduction at these sub 200k incomes (accountants please correct me)
@@OopsFailedArtyou can use it on top of the standard deduction
I dont have time to be a landlord and it seems like prices are stupid right now.
Dear Money Guy Show I love your content! I just wanted to make you aware when listening to your show on You Tube there is a pretty constant staticky hum like a mic or cable is going bad. I just wanted to let you know.
😂😂😂 that first video clip 😂😂😂 my wife is an IRS agent. After she gets off work she attends my home and bedtime. She dosent watch this type of videos. My guess is like a mechanic working all day to go home to watch a DYI guys on youtube 😂😂. But I can tell you for sure... dont mess with IRS even cartel pays taxes that should tell you something
not even the Joker will mess with the IRS
In retirement a married couple filing joint should always make sure you have $27,500 of taxable income as that's the personal exemption. Even if you don't need the money one can move the money from a ira to after tax. Before you are forced with mandatory withdrawals.
Regarding S-Corps, isnt there a profit threshold you need to meet in order for it to even make sense pursuing?
Please do a show on how to avoid taxes on a big one time bonus!
in a s-corp wouldnt you just have to make sure you pay yourself market rate for your job title plus maybe 10% and take the rest as a dividend
Can you do a segment on pensions?
6:25 Or you can do BOTH if you have a 403b or 457b in addition to your regular IRA.
The part at 6:18 is wrong I thought? Isn’t it the opposite way around with Traditional being before tax but your taxed when you withdraw and Roth being taxed now but tax free on withdrawal?
Can you pay for qualified medical expenses using the capital gains free of tax since you're not pulling out?
Been trying to learn more tips for saving taxes. Augustus rule being a good one. Would love to see a video about how to structure things for a self employed individual. Not small business not high income. More average income small business
HSAs are great. Not only are they tax advantaged and can be used for retirement, it doesn’t have minimum distribution requirements and can be used for assisted living and hospice.
This means that if done right, it can help remove one of the largest and final financial burden that so often fall upon children.
Max out those HSAs people!
The primary residence capital gains exclusion topic is an interesting one to me, and I would love for you to highlight that more. I believe you can keep receipts of improvements you've made to your home, which can be subtracted from the $250k/$500k, right? I always thought that would be prudent, especially if you think you might downsize after your spouse dies. $250k isn't a lot given our recent hot housing market.
Yes, keep those receipts. Those home improvements can be added to the basis of your home, so in effect, you recognize less capital gains upon sale of your home. Great point!
An idea for a future show: spousal IRAs. I missed years of using it because everything said you needed income to contribute to your IRA.
Regarding backdoor Roths, why would the government close a loophole that generates present tax revenue for the government?
Bet me your net worth bo ain't excited about this one
I know better. My man Bo is always excited.
Bet. I'm a baby financial mutant with -20k
Content recommendation: best financial books
good video
I am a huge fan of the Roth retirements assets, combined with Dividend paying stocks in a taxable account strategy. As long as your income is under ~$44k or $89k for married/joint, you pay 0% on qualified dividends. And that number is indexed to inflation. And Roth withdrawals don't count as income - So you could literally hold $1mm in stocks in a taxable account paying you $35k per year, whatever you need out of your Roth, and you don't owe any taxes
I also like to use my Roth account to stack dividend-paying mutual funds. The number of shares increase as I reinvest the dividends tax-free so eventually I'll have lots of shares to sell as needed. It's a neat way to stuff more shares into a limited contribution account.
Isn’t the Roth IRA limit going up to $7,000 and 401k limit up to $23,000 in 2024? From $6500 and $22,500 in 2023.
That's what is being projected but the IRS hasn't announced anything yet.
Haha appreciate the share of my video, guys 🤙
IRS: "go on......."
🎯 Key Takeaways for quick navigation:
00:13 🤑 *Tax planning is essential to legally decrease or avoid paying taxes in 2024.*
01:59 🏦 *Contributing to retirement plans like IRAs and HSAs can help reduce current and future tax liabilities.*
05:38 🌟 *Employer-sponsored retirement plans like 401(k)s offer tax deductions and tax-free growth opportunities.*
08:03 💰 *Investing in capital assets can lead to lower tax rates, such as 0% or 15% for long-term capital gains.*
14:05 🏠 *Real estate investment offers tax benefits, including Section 121 exclusion, 1031 exchanges, deductions, and depreciation.*
20:37 📊 *Real estate investors can benefit from the qualified business income (QBI) deduction for passive income, available until 2025.*
21:46 💰 *Rental income from investment properties is considered passive income, not subject to self-employment taxes, providing potential tax savings.*
22:53 🏢 *Owning a business offers various tax benefits, including deductions, retirement contributions, and the ability to pay yourself rent for property use.*
25:11 📈 *Different business structures (LLC, S Corp, C Corp) have varying tax implications, affecting how you're taxed and your retirement contributions.*
27:10 💼 *Business owners can make substantial retirement contributions, potentially saving more in taxes than the cost of the plan, especially with cash balance plans.*
29:44 🏢 *Business owners can purchase real estate for their business and pay themselves rent, creating an additional income stream for retirement.*
31:21 💲 *Business owners with qualified businesses can benefit from a 20% deduction on net profits, potentially reducing their overall tax burden.*
34:20 🌎 *Choosing where you live can significantly impact your tax bill, with tax-free states offering substantial savings, and Puerto Rico presenting unique tax opportunities.*
36:36 🏡 *Strive for Financial Independence so that your choice of where to live is driven by lifestyle preferences rather than solely by tax considerations. Tax planning is important, but life offers more than just minimizing taxes.*
Made with HARPA AI//
Surprised you didn’t bring up marriage. This year I’ll save ~$35k in taxes filing joint with my wife vs single
This one always confused me but only bc my wife out earned me for years lol
I can tell the IRS is gonna enjoy this one
Why not touch on the fact that traditional Ira’s aren’t able to lower your taxable income once you get to certain income levels/ you’re covered by an employer sponsored retirement plan?
You have over a decade to work that into your tax plan though
IRS has entered the chat
❤❤❤
How many viewers of these videos reallze that these guys make 300k plus a year just by posting these videos? This is their full time job.
What is your point
Love your content. But please stay away from Puerto Rico unless you will really contribute to the island. Gentrification is really bad because of what you promoted.
Puerto Rico will be the next Hawaii
Dont get any income and dont have any taxable income
It's Nevada, not nevahhhdahh
The IRS: 👀
@TheMoneyGuy- okay sure! I'll definitely reach out! Wow! What an opportunity to speak with the money guy team!! I'm so excited! 😃
Please don’t go to Puerto Rico just to avoid taxes. Thats making life for locals more difficult. Go if you’re going to contribute and be part of society, not just extracting wealth.
avoid paying taxes is pretty close to tax avoidance... maybe use a better vocabulary as registered planners.
Bo screams into the mic
...why does the IRS need guns??
11:30, real estate, primarily single family and multi family homes should have never been investment vehichles
@TheMoneyGuy- lmao, nice try.
Does that even work on people?
But what are they drinking is those cozies and mugs??
Easy....
You don't. Not even billionaires with the best accountants in the world... pay no taxes. They all do. Now, you can figure out ways to pay less, but it will NEVER be zero unless you make under $18,000. 😁
There's a really bad buzz in your audio on each video. Probably a bit more noticeable when using headphones. You can really hear it when you cut to the other "fraud guy" video.
Just don’t do it and don’t think about it. Just let the government figure it out..
Your how to avoid taxes is click bait it should be titled tax advantage accounts
Welcome to TH-cam
(tiktok tax advice) that is why IRS want to hire even more agents to catch all the cheaters. lol
No cheats in this episode- spitting straights facts and opportunities 👍
@@MoneyGuyShow sorry about the confusion. I meant the tiktok tax advice. you guys are great. :)
: )
You avoid paying taxes in 2024... by paying more taxes in 2025+ ?
They mentioned quite a few ways where you end up paying comparatively less taxes.
@@Jack-fw4mw Yes they did, some of it was quite insightful. I just took issue with the video title; I think what they mean is "How to Avoid Paying Taxes (2024 edition)"
We could lobby our representatives to reform the antiquated and unfair progressive tax scheme. Or even just reduce the brackets like Trump did. Or just even out the steps so lower middle class don't get punished just because the finally earn over $44,750 a year with that 10% increase.
But, they don't really represent us to the government, do they? It's the other way around. Looking forward to 2025 when the trump payroll tax relief ends.
Keep in mind. You still pay 12% up to 44,750. only what is over is taxed at 22%.
If you mke 46,750 you pay the 22% only on 2,000$
Do you mean to abolish the progressive tax scheme? So just raise taxes on the lower and middle class? Because in this year, we have had a deficit of $67 billion. If we assume you can't touch SS, Medicare, Medicaid, Military, or Interest (which would tank our credit rating), to cover that deficit in a tax revenue neutral situation would require Heavy cuts to at least some of: NIH (The thing that makes US medical research the best in the world), FDA, CDC, HRSA, Department of Agriculture, ACF (which has been consistently shown to be a net tax benefit, due to the alternative to providing this help), Veterans Affairs, OESE (which, again, is crucial compared to the alternative), or OSERS (cutting this to avoid slightly higher taxes on the wealthy is just fundamentally cruel).
Do you want to update our progressive tax scheme to be even more progressive? Where we go back to the 50s and 60s and have a top marginal income tax rate of 70+% (when our economy was incredibly strong, income inequality was much lower, we had manufacturing jobs in the US, etc).
@@Jack-fw4mw i think i said reform not abolish, but something to ease the pain off of the working class? Yes. Read more. Type less.
@@Jack-fw4mw
"Do you want to update our progressive tax scheme to be even more progressive? Where we go back to the 50s and 60s and have a top marginal income tax rate of 70+% (when our economy was incredibly strong, income inequality was much lower, we had manufacturing jobs in the US, etc)."
Yes.