Skip to comments.8 types of income the IRS can't touch
Posted on 03/16/2008 6:50:31 AM PDT by RKBA Democrat
Want to keep the tax man away from your money? It's easier than you think. There are lots of ways to increase your wealth without having a chunk gobbled up by the IRS.
It's not that the agency doesn't want your money. It's just that the tax law prohibits the IRS from touching it. And with a bit of planning, you can start to cut your current tax bill and put money in your pocket now.
Let's look at a few examples....
(Excerpt) Read more at articles.moneycentral.msn.com ...
bump,,,and ,,, marked
Complex, social micromanagement by the IRS does indeed leave some areas free from taxation ... if you or your employer are willing and able to contort to the micromanagement. It’s time for a flat tax or NRST!
“Its time for a flat tax or NRST!”
I would agree that a flat-tax is overdue. The problem is that the ability to reward and penalize via the tax code is not a power Congress is going to give up. The best you can do for now is to plan your own finances accordingly.
You are right on the money (pun intended)!
Neither will the American public readily allow politicians to change a tax system they hate but have grown accustomed to. And too, many Americans are just leary of playing "tax system musical chairs" when they already have a chair and politicians are the disc jockeys.
It seems like the home gain exclusion could be used to pay almost no income taxes. Say you and your spouse are employees of your own corporation that pays a minimum salary. After two years the corporation buys your house for up to $500,000 more than you paid for it, with seller financing. That $250k/year is tax free. Now the corporation sells it back to you for a $500k loss, so the corporation pays no taxes for having no profits. Rinse and repeat. Obviously you’d have to structure it so the IRS doesn’t think you’re just working the system but couldn’t the basic idea be made to work legally?
This thread is life altering. I think I will buy a foreclosure and sign up for a tax deductible online university, get formally educated in investing. Becoming a professional investor is one of the few jobs that can’t be outsourced. This is the only way to go in the new global economy.
Very nice to know!
Ya, it was a fun ride, but I think that merry-go-round has stopped. All kind of flippers are filing bankruptcy or letting the financier eat it.
I have been seeing people do exactly that. One of the reasons for the real estate boom and someone eventually will be holding the bag.
Bump for later.
“...that the IRS can’t touch”
With a stroke of the pen, the law of the land can be changed to fix that any moment the legislature is in session.
“With a stroke of the pen, the law of the land can be changed to fix that any moment the legislature is in session.”
Thus insuring an income for those who specialize in keeping their clients one step ahead of the game.
bump for later
Bookmarking for later
Right up until they figure that out and take action to close those "loopholes for the rich" that take food out of the mouths of babies and elderly people who would otherwise be living on cat food.
/angry economic illiterate socialist rant
The article didn’t include being a legislator with your office in Washington DC either.
The possible ways not to paid taxes may be legal but I’m just assuming that everyone of them will raise a big red flag to the IRS. Thus, making you a bigger target to them and also wanting the IRS to possibly make an example of you. But I may be incorrect.
I’m scanning FR today for articles to read and comment on AFTER St.Pat’s... Got to prepare for this eve & tommorow you know...
Cross the border illegally. With no paperwork, the IRS can’t tax you.
Or just sell weed, blow and meth.
Millions already do this, I guess us schmucks who do pay taxes are the losers.
“The possible ways not to paid taxes may be legal but Im just assuming that everyone of them will raise a big red flag to the IRS.”
And if the strategies are legal, it could raise flags of several colors with the IRS and still not matter. It’s still income that isn’t taxable.
That sounds like something Eliot Spitzer would do.
A flat tax is still an income tax, it still requires you to pay lawyers and accountants to file taxes, and it empowers the IRS.
The only real answer is a Fair Tax that does away with the IRS. Only until the IRS is eliminated, tax accountants, tax lawyers, and the whole ilk will Americans have a chance to regain their prosperity.
Slaves arguing over the best way to redecorate the cell.
I have a criminal mind. It’s just that getting rich legally is easier and has less jail time.
Pay into a tax benefited indexed universal life insurance plan with growth and a tax free death benefit. Take an annual pay-out after five-ten years and it’s tax free. See Missed Fortune 101 or Last Chance Millionaire.
I am thinking of making the jump soon myself, looking to invest in property and maybe open a business. Do you have any advice or literature regarding this? Thanks!
save on taxes bump
“Becoming a professional investor is one of the few jobs that cant be outsourced. This is the only way to go in the new global economy.”
Yup. And it’s very clear that tax policy rewards investment work vice labor. If you earn a dollar at your job, you’re going to be paying say 25% Federal income tax, 7.5% for social security, plus state income tax of say 6%. Or roughly 37% of every dollar earned, and quite possibly more. Compare that to what you would pay if that same dollar were earned as a long term capital gain, with a top Federal rate of 15%, but perhaps lower.
And we wonder why the work ethic seems to be going by the wayside.
“The only real answer is a Fair Tax that does away with the IRS.”
And what makes us think that the IRS, politicians, and all the other people who benefit from the current system would agree to close up shop? The “Fair tax” is a nice idea, I just don’t see it happening.
My real estate agent says they might eliminate this exemption if democrats take the white house. I am wondering what to do, I’m retired, disabled, ‘cash poor’ but own my home (no mortgage). The home is worth about $300,000, and costs me money in property taxes and maintenance. I could sell it and take that capital gains exemption while it’s still the law, but would then have to rent an apartment. Also, the $250,000 gain is not taxed, but if you keep the money on hand in CD’s or whatever, then the income on it IS taxed.
You have a clever plan where you keep reinvesting in houses, but my health and limited resources won’t allow me to do that. I’m afraid of missing out on an opportunity by not selling now, as there are so many dire predictions about the economy.
Do you think this capital gains exemption is safe for a while, or in danger as the govt desperately tries to raise more taxes? Any ideas or advice for me? Thanks!
Rent a portion of the house either as a small apartment or as roomates depending on what zoning permits.
The NRST is the way to go. A flat tax is STILL an income tax. The IRS would STILL exist. The un-constitutional 16th Amendment would STILL be around.
Scrap the code, abolish the IRS!!!
“Scrap the code, abolish the IRS!!!”
Yes, that would be nice. We’re just never going to see it. Being able to reward or punish economic interests via the income tax is something that Congress is never going to give up.
I’d prefer to spend my time and effort minimizing what I pay under the current rules as they are or are likely to be rather than spending my time lobbying for a “fair tax” or other systemic reform that we’re just not going to see this side of heaven.