Tax-Free Wealth How to Build Massive Wealth by Permanently Lowering Your Taxes

After 31 years... Major Tax Reform -- and what it means to you True overhaul of the tax law only happens about once every 30 years. In the past 75 years, the U.S. tax law has only seen three major revisions; one in 1954, the next in 1986 and most recently at the end of 2017. I have been fortunate as a tax professional to be heavily involved in the last two reforms. In 1986, I was a manager in the National Tax Department (NTD) of Ernst & Whinney (now Ernst Young). My primary responsibility during my three years there was to create, teach and administer tax courses to the Firm's U.S. tax professionals. Just as I arrived in the summer of 1985, I discovered that much of NTD's resources were being devoted to following the tax reform bill that had been introduced that year. This gave me, as a young tax professional, some amazing insight into the legislative process as well as the horse trading for tax reform. President Reagan wanted two things; simplicity (the 1985 act was call the Tax Simplification Act of 1985) and he wanted it to be revenue neutral (no net increase to the deficit). It took another year before bill was finally passed as the Tax Reform Act of 1986. (Simplicity took a back seat to other goals of the reform.) In 1986 the big winners from tax reform were individuals, with significantly lower tax rates, insurance companies (who got by relatively unscathed) and businesses. The big loser was real estate investors (the passive loss rules were used as a last-ditch effort to make a "revenue-neutral" bill. The result a few years later was the Savings and Loan debacle accompanied by a massive real estate depression and the government bailing out real estate through the RTC (Resolution Trust Corporation). Fast forward 31 years to 2017. President Trump had promised economic stimulus and had stumbled out of the blocks with the failure to repeal ObamaCare. Everyone thought tax reform would take two years to complete like it had in 1985-1986. Instead, the Republican-controlled Congress was able to use slick procedural rules to pass major tax reform in record time (less than three months from start to finish). The result was a bill the consequences of which and application of which are still largely unknown. Known are the clear winners and losers. Losers include employees with lost deductions for moving, investment expenses and reductions in home mortgage interest and state income tax deductions. Winners include big corporations, with a major tax reduction from 35% to big corporations, with a major tax reduction from 35% to 21%, small businesses, with a 20% net income deduction, and real estate, with major depreciation incentives and the 20% net income deduction given to other small businesses. The key to remember is that very few people had the chance to influence this legislation. Everyone has the same chance to take advantage of the windfalls given to the winners. Employees can choose to be independent contractors and receive the 20% small business deduction. Service professionals who were left out of the 20% deduction can now become C corporations and reduce their tax rate to 21%. Investors who received tax benefits from the costs of investing in the stock market can either begin investing in real estate, with its massive tax benefits, or invest through their Roth IRA or Roth 401(k) and avoid tax altogether on the income and gains from their investments. Tax-Free Wealth is about using the tax law the way it's meant to be used - as a series of incentives to do what the government wants you to do. This Second Edition incorporates some ideas of how to use the new incentives. The reality is that the incentives don't really change that much. The government still wants businesses to hire employees, so businesses receive tax benefits for doing so. The government still wants investors to provide housing for renters (even more so now), so real estate investors receive large tax breaks for following through on the government's goals. Ene

Chapter Page
Preface xiii
Foreword
by Robert Kiyosaki xv
Introduction xix
Part 1 How the Tax Law Can Be Your Best Friend
Chapter 1 Taxes are Stealing Your Money, Your Time and Your Future 3
Chapter 2 Taxes are Fun, Easy, and Understandable 11
Chapter 3 The Two Most Important Rules 17
Chapter 4 Put Money Back In Your Pocket-Now 23
Chapter 5 Entrepreneurs and Investors Get All the Breaks 29
Chapter 6 You Can Deduct Almost Anything 39
Chapter 7 Depreciation: The King of All Deductions 51
Chapter 8 Earn Better Income 63
Chapter 9 Take Advantage of Your Tax Brackets 79
Chapter 10 Credits: The Cream of the Tax-Saving Crop 93
Chapter 11 Conquer Your Employment Tax Troll 103
Chapter 12 Lower Your Property, Sales, and Value-Added Taxes 113
Chapter 13 Estate Planning is Good Tax Planning 125
Chapter 14 Reducing Your Taxes in Other Locations 139
Part 2 Your Tax Strategy for Tax-Free Wealth
Chapter 15 Plan to Take Control of Your Taxes: Entities 153
Chapter 16 Protect Your Wealth from Pirates, Predators, and Other Plaintiffs 167
Chapter 17 Plan to Retire Rich, Not Poor 181
Chapter 18 Business Can be Your Best Tax Shelter 195
Chapter 19 The Magic of Real Estate 207
Chapter 20 Stocks Can Lower Your Taxes Too 217
Chapter 21 Commodities Can be Your Tax Friend 227
Chapter 22 Don't Fear the Reaper Audit 237
Chapter 23 Choose the Right Tax Advisor and Preparer 251
Chapter 24 What Are You Going to do With All Your Extra Money? 263
Epilogue: Tax-Free Wealth-A Few Final Thoughts 279