Hey michael, make a video or just reply here with ideas of how one can have money in a structure, that can be invested into stocks with regular buys and sells, but not paying tax every single year on the profit just at the moment of actually taking cash out from the account… i know Estonia lets you do that with the system they have, usa with the ira stuff, sweden with the isk, finland had something too, germany had some gmbh that could be set up for that… maybe do a video that compiles them or bring up other ideas like that here… specially of its a structure that could be compatible with more and more other countries in general, using trusts? Enlighten us :)) Right now im living in Italy, if you could bring an idea that works with this country in specific too that would be ideal. Thankss for all the work you do
As you said this varies by country & other nuances. Usually there's a trust structure that achieves this but that's fairly expensive to set up and maintain so you need the scale to justify it
@@OffshoreCitizen yeahh how much to set it up? And for the yearly maintenance? I was seeing some usa trusts that arent that overly expensive, maintenance under 1k a year. For someone who will be living out of the usa and anyways the money will go to usa stocks in usa broker, so we always have the usa jurisdiction as a risk, i think a cheap usa trust could be an option. How do u have certainty this means not having need ti pay tax here in Italy? I wouldnt want to do that and then the government here can claim something… I want everything done all correctly/legally all good. Im still in the planning stage so i can imagine how it would all work, if you can point to specific things to research about, links, videos etc… i would be happy to see. Or just use this for the next video “The ideal and ultimate solution for big money investors living in high tax countries to be able to compound without yearly taxes” and explain the concept, it would really elevate your channel with the investing community a whole lot. Thanks for all you do.
@@OffshoreCitizen Eh, it was ok. There's a new type of audit nowadays (not like when they would come to your home or business and go through everything for days - I've seen that up close back in the late 1970s). So basically, in 2015, I received a big envelope with a letter stating that an audit of my 2013 return had been already been performed and that I should immediately pay a certain amount to make things right. There was absolutely no explanation of what was supposedly incorrect on my return. However, there was a direct number of the agent who had performed the audit, which I called right away. I was told that the person was on vacation for 2 weeks and to leave a detailed message. I said that I wanted to know exactly how they came up with that amount of taxes owed. After some weeks, I was contacted by the agent who said that she reviewed the audit again in the meantime and saw that *she* had made a mistake and yes, some tax was owed, but not even half of the original amount demanded. She also discussed the details of where the mistake was made. I was instructed to tear up the previous audit and bill and then they sent me a new one. Later, I received multiple mailings over the course of probably a year and a half or possibly 2 years inviting me to participate in a survey about my audit experience (because it was a new way to audit). I just ignored them.
Fantastic content. Its very possible to reduce taxes in Australia to a low % if structured in a similar way. I.e. trading company, shares held by a trust. Once method can be continuually re-investing into the business so no taxes are paid (because theres no income) - all the while growing the value of the business. When its time to sell the business, there are CGT concessions available where you can pay potentially tax on 25% (or less) of the gain.
The part I don't understand is if they take this 1 billion $ loan, how do they pay it back? They need to sell something and pay taxes to pay it back. Isn't it the same as paying taxes in the first place. ( ? interest write off, this seems like a job for an expensive accountant.)
Question: Would it be possible to ask your bank to freeze $5M of your money and give you a loan of $5M thereby not extracting any cash from your companies earned income and thus not needing to pay tax on the loan money? smaller net individuals don't have the benefits that Elon has.
@@rithondhar8171 even if they hold the loan value in cash? Seems odd...I mean they cannot lose no matter how you look at it, not putting up stocks or property...CASH. Hold $5M lend $4.5 or $5M
This question doesn't make any sense because you are confusing the company ownership with personal ownership. You, as a person, can't use company's money as an asset to borrow against, in order to receive loan in personal name.
Would love to see a video on best places to setup brokerage account. (for active traders, possibly LLC?) Is it possible to do this while living in a higher tax country? love your videos
Thanks for the video. One thing I always think for the borrow strategy is what happens if your company is acquired? Is that the same income generating event and hence facing a hefty tax bill?
When you borrow against your assets, I guess it needs to be worth it when you factor in the interest...are they borrowing to invest, or for cash flow for living expenses?
@@stevemyers2092 correct me if I'm wrong, but let's say you pay $1000 in interest - that will reduce your taxable income by $1000 and you will save ($1000 x your marginal tax rate). So interest was still a net expense. I guess the higher your marginal rate, the more worth it it is
In some countries those super rich pay congressmen to "lloby" in benefit of their field of operation using the argument of "strategic" or "labor generator" or, whatever....
Fantastic content thanks for sharing again. It would be amazing if you made a video on asset protection like foundations and holding companies combination.
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I love videos like this that point out how most of what people think they 'know' is wrong.
Excellent and highly valued information, Michael. I hope people can learn and benefit from it
Thanks, that's the goal!
Anything you'd like to see next?
@@OffshoreCitizen Yes! More videos on building wealth and alternative investment besides stocks/bonds, property/land and crypto/NFC please🙂
Short answer: they don't because they don't need to.
All they need to do is to optimize the laws.
Hey michael, make a video or just reply here with ideas of how one can have money in a structure, that can be invested into stocks with regular buys and sells, but not paying tax every single year on the profit just at the moment of actually taking cash out from the account… i know Estonia lets you do that with the system they have, usa with the ira stuff, sweden with the isk, finland had something too, germany had some gmbh that could be set up for that… maybe do a video that compiles them or bring up other ideas like that here… specially of its a structure that could be compatible with more and more other countries in general, using trusts? Enlighten us :)) Right now im living in Italy, if you could bring an idea that works with this country in specific too that would be ideal. Thankss for all the work you do
As you said this varies by country & other nuances. Usually there's a trust structure that achieves this but that's fairly expensive to set up and maintain so you need the scale to justify it
@@OffshoreCitizen yeahh how much to set it up? And for the yearly maintenance? I was seeing some usa trusts that arent that overly expensive, maintenance under 1k a year. For someone who will be living out of the usa and anyways the money will go to usa stocks in usa broker, so we always have the usa jurisdiction as a risk, i think a cheap usa trust could be an option. How do u have certainty this means not having need ti pay tax here in Italy? I wouldnt want to do that and then the government here can claim something… I want everything done all correctly/legally all good. Im still in the planning stage so i can imagine how it would all work, if you can point to specific things to research about, links, videos etc… i would be happy to see. Or just use this for the next video “The ideal and ultimate solution for big money investors living in high tax countries to be able to compound without yearly taxes” and explain the concept, it would really elevate your channel with the investing community a whole lot. Thanks for all you do.
I've been subjected to an IRS audit and I certainly wouldn't count myself in the "ultra wealthy" category. Just be aware, folks. Anything is possible.
How did that go for you?
@@OffshoreCitizen Eh, it was ok. There's a new type of audit nowadays (not like when they would come to your home or business and go through everything for days - I've seen that up close back in the late 1970s). So basically, in 2015, I received a big envelope with a letter stating that an audit of my 2013 return had been already been performed and that I should immediately pay a certain amount to make things right. There was absolutely no explanation of what was supposedly incorrect on my return. However, there was a direct number of the agent who had performed the audit, which I called right away.
I was told that the person was on vacation for 2 weeks and to leave a detailed message. I said that I wanted to know exactly how they came up with that amount of taxes owed. After some weeks, I was contacted by the agent who said that she reviewed the audit again in the meantime and saw that *she* had made a mistake and yes, some tax was owed, but not even half of the original amount demanded. She also discussed the details of where the mistake was made. I was instructed to tear up the previous audit and bill and then they sent me a new one.
Later, I received multiple mailings over the course of probably a year and a half or possibly 2 years inviting me to participate in a survey about my audit experience (because it was a new way to audit). I just ignored them.
Clearly that new way of auditing was working poorly and would have benefited from your feedback.
Fantastic content.
Its very possible to reduce taxes in Australia to a low % if structured in a similar way. I.e. trading company, shares held by a trust.
Once method can be continuually re-investing into the business so no taxes are paid (because theres no income) - all the while growing the value of the business. When its time to sell the business, there are CGT concessions available where you can pay potentially tax on 25% (or less) of the gain.
Hi,great content👍 is it possible to make video about optimizing in Finland?
We have an older video on it th-cam.com/video/1dblIafchRU/w-d-xo.html
But we'll work on an update :)
Why move then?
The part I don't understand is if they take this 1 billion $ loan, how do they pay it back?
They need to sell something and pay taxes to pay it back. Isn't it the same as paying taxes in the first place.
( ? interest write off, this seems like a job for an expensive accountant.)
Question: Would it be possible to ask your bank to freeze $5M of your money and give you a loan of $5M thereby not extracting any cash from your companies earned income and thus not needing to pay tax on the loan money? smaller net individuals don't have the benefits that Elon has.
Maybe 1-2 million, as stocks are volatile. They will not give anyone the full amount.
@@rithondhar8171 even if they hold the loan value in cash? Seems odd...I mean they cannot lose no matter how you look at it, not putting up stocks or property...CASH. Hold $5M lend $4.5 or $5M
@@rithondhar8171 otherwise I'll just move to a low/zero tax location. Problem solved.
This question doesn't make any sense because you are confusing the company ownership with personal ownership.
You, as a person, can't use company's money as an asset to borrow against, in order to receive loan in personal name.
@@hendrixansel9750 No his question still applies to a business bank account. But yes is sounds ridiculous
✅Informative!
Thanks, that's the goal!
Anything you'd like to see next?
@@OffshoreCitizen Suggested topic; What are the best banking options for expatriates and global travel?
Would love to see a video on best places to setup brokerage account. (for active traders, possibly LLC?) Is it possible to do this while living in a higher tax country?
love your videos
Thanks! And thanks for the suggestion!
How did you like this video?
Great 👍
Thanks!
Were any of the secrets surprising?
Thanks for the video. One thing I always think for the borrow strategy is what happens if your company is acquired? Is that the same income generating event and hence facing a hefty tax bill?
You're going to probably pay off the loan as a result of a distribution
When you borrow against your assets, I guess it needs to be worth it when you factor in the interest...are they borrowing to invest, or for cash flow for living expenses?
Stock growth must exceed interest payment, otherwise it isn’t worth it
if the interest is a write off...it doesn't come into play one way or the other.
@@stevemyers2092 correct me if I'm wrong, but let's say you pay $1000 in interest - that will reduce your taxable income by $1000 and you will save ($1000 x your marginal tax rate). So interest was still a net expense. I guess the higher your marginal rate, the more worth it it is
Loss carryovers are awesome for saving on taxes. 👍
In some countries those super rich pay congressmen to "lloby" in benefit of their field of operation using the argument of "strategic" or "labor generator" or, whatever....
Does that surprise you?
@@OffshoreCitizen Not at all.
Very interesting
Right? Did you find any of it surprising?
Fantastic content thanks for sharing again. It would be amazing if you made a video on asset protection like foundations and holding companies combination.
and trusts, family etc.
Try checking this one out th-cam.com/video/_eDvpzMig-E/w-d-xo.html