Telling the New Tax Hikes to F*ck Off

[MJ DeMarco]

The escalation of taxes is just beginning.

This is a great article that explains some great defenses ...

The Obama Tax Hikes--What to Do - Forbes.com

Some of the taxes are specifically targeted at me and I intend on AVOIDING SOME and hopefull MOST OF THEM. You see Mr. Politician, I don't live my life in a vacuum, whatever YOU TRY, I will COUNTERACT and DEFEND.

#1) I'm already heavy into munis, but now I guess Ill get heavier. Buy munis!
#2) S-CORPS!!!! Haven't I been saying this for years?

A great read.

So how will you deal with the new tax hikes?

PS: Keep things apolitical ...
I'm not asking how you FEEL about them.
I'm not asking if you AGREE with them.
How will you DEAL with them, if at all?

 

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[Pinnacle]

Re: Telling the Obama Tax Hikes to F*ck Off

I oppose all tax hikes, tax incentives (including those intended for us), and tax cuts. I am for mass tax elimination across the board. The only revenue the federal government should feed from is the income tax granted them by the Constitution...and even that needs to be repealed. A free society requires the presence of government but also requires its non-interference. One or maybe two flat taxes should exist at all. The massive explosion in production will bring the government all the tax revenue it needs to perform its proper function: protecting our individual rights.

We all should not have to dodge the idiocy of government or find new ways to capitalize on central economic planning all the time. This is why I'm so adamant about what I'm doing. Until we take the stand to change this (through our private decisions, not our popular votes), no matter how financially free you become, you will still be far from economically free. MJ's post is a perfect example.

 

[kwerner]

Re: Telling the Obama Tax Hikes to F*ck Off

I found this particularly interesting:

"The 3.8% investment tax, combined with the expected (and Obama- favored) Jan. 1, 2011 expiration of the Bush tax cuts for high-income taxpayers, would produce a 2013 top federal income tax rate of 23.8% on long-term capital gains from the sale of securities, up from 15% now. The top rate on interest, rents, royalties and certain "passive income" would rise to 43.4% from 35%."

 

[LagunaLauren]

Re: Telling the Obama Tax Hikes to F*ck Off

I don't know that it's "interesting" as much as it is "nauseating". Seriously, this is giving me a tummy ache...sux

MJ-Feel free to share your "defense" strategies against these new tax hikes on us!

 

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[PaulRobert]

Re: Telling the Obama Tax Hikes to F*ck Off

IMO this is a great example of the need to be financially literate and having a good CPA on your team. You can either let your money be sucked into a black hole and be gone forever or try and legally minimize the amount that you pay.


:thankyousign:

 

[Russ H]

Re: Telling the Obama Tax Hikes to F*ck Off

MJ,

I'm kinda shocked that this stuff gets you mad. It's all part of the game.

Have fun w/it-- don't get sucked into the drama.

Life's too damn short to get upset about this stuff.

(says me, the guy who is currently over $5,000,000 in debt)

-Russ H.

PS I prolly would have titled this post differently, given the "politics neutral" stance you have adopted on these forums. Seems to be a bit inflammatory (and even angry) to me.

 

[Pinnacle]

Re: Telling the Obama Tax Hikes to F*ck Off

MJ,

I'm kinda shocked that this stuff gets you mad. It's all part of the game.

Have fun w/it-- don't get sucked into the drama.

Life's too damn short to get upset about this stuff.

(says me, the guy who is currently over $5,000,000 in debt)

-Russ H.

PS I prolly would have titled this post differently, given the "politics neutral" stance you have adopted on these forums. Seems to be a bit inflammatory (and even angry) to me.

I think the only thing that churns some of our stomachs, Russ, is that these types of actions hurt people. It's not just that extortion via taxes makes things inconvenient for business owner/investors, but the things the government uses that money for damages all individuals of every socioeconomic class.

I need to be better about exercising more maturity in refraining from political talk. If we had the separation of State and Economics (like the separation of State and Church), then none of our concerns would ever have anything to do with politics.

*Knowing you, that debt is probably one of the most comfortable feelings you've ever had, since you use credit for assets.

 

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[Russ H]

Re: Telling the Obama Tax Hikes to F*ck Off

I think the only thing that churns some of our stomachs, Russ, is that these types of actions hurt people. It's not just that extortion via taxes makes things inconvenient for business owner/investors, but the things the government uses that money for damages all individuals of every socioeconomic class.

Pinnacle-

Every political administration in history has done things that hurt people-- I'm not excusing it, I'm just giving a perspective.

I can get my panties in a bunch w/the best of them when it comes to politics. I was originally supposed to work at my polling station the night of the 2000 Presidential election-- but had to speak at a management conference the next morning, so I flew down to San Diego that night.

Had I guy next to me in First Class who was on the airplane phone, giving us all the play by play as the states were reporting in. Once I got to the hotel, I wound up watching the reports until 4 am.

I am INTO this stuff!

But I have to say, I have learned how to be a better person using MJ's "no politics/no religion" rule. It's made me a better innkeeper, a better businessman, and probably even a better husband.

It's certainly made me a better person. I fight less, and listen more. And learn.

I haven't always looked on changes in Washington as a game. It was only through the eyes of my clients-- the multi-millionaires and billionaires-- that I began to see how funny the whole thing is.

Bottom line, the truly wealthy don't pay close to the taxes that the tax laws say they should. Pretty much every politician knows this (because they worked w/the wealthy to craft many of these laws). There are always alternatives-- "loopholes", as Diane Kennedy would say. The media doesn't talk about these loopholes, or the fact that so many rich folks pay less than the 50+ percent the politicians would have you believe.

It's all part of the game.

Look for the loopholes.

Make it a game.

You will live a happier life.

You may even live longer, with less stress.

-Russ H.

 

[Bilgefisher]

Re: Telling the Obama Tax Hikes to F*ck Off

I'll say that this is part of the reason we have no political discussions. Its more of a rant and rave then productive conversation. Now if you want to talk about the topic....then talk about what you will do about it. How you will adjust or how you will work to change things.

 

[Russ H]

Re: Telling the Obama Tax Hikes to F*ck Off

. . . if you want to talk about the topic....then talk about what you will do about it. How you will adjust or how you will work to change things.

That's exactly what MJ's OP is about -- what he's going to do.

But the title of the thread, I fear, will draw moths to a flame.

I almost didn't even read this thread, thinking it was inflammatory spam and would be deleted by one of the mods.

-Russ H.

 

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[Bilgefisher]

Re: Telling the Obama Tax Hikes to F*ck Off

That's exactly what MJ's OP is about -- what he's going to do.

But the title of the thread, I fear, will draw moths to a flame.

I almost didn't even read this thread, thinking it was inflammatory spam and would be deleted by one of the mods.

-Russ H.

Agreed, just trying to redirect folks to stay on topic.

 

[MJ DeMarco]

Re: Telling the Obama Tax Hikes to F*ck Off

I play the game and I play to win ... how I view "the game" is irrelevant.

So again, how will YOU deal with the Obama tax hikes? Every person on this website who receives dividends, passive income from real estate, and interest will be affected.

I didn't ask how you FEEL about them.
I didn't ask if you AGREED with them.
How will you DEAL with them, if at all?

----EDITED
Apparently, Russ has told us his plan in another thread started several weeks ago.
http://www.thefastlanetomillions.co.../25501-live-great-life-less-than-200k-yr.html

BTW: If anyone takes issue with the thread title, click "Report Post" and I will edit it.

 

[phlgirl]

Re: Telling the Obama Tax Hikes to F*ck Off

I think Russ told us about his plan (or thoughts surrounding it) a few weeks ago:

http://www.thefastlanetomillions.co.../25501-live-great-life-less-than-200k-yr.html

Kinda shocked, MJ, but it's your party.....

 

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[MJ DeMarco]

Re: Telling the Obama Tax Hikes to F*ck Off

I think Russ told us about his plan (or thoughts surrounding it) a few weeks ago:

http://www.thefastlanetomillions.co.../25501-live-great-life-less-than-200k-yr.html

Not all of us have read that thread (including me). As much as I'd like, I can't read every thread and know it's contents. If this is Russ' reaction to the coming tax hikes, a simple link would have avoided the derailment. Thanks for posting it. :thankyousign:

 

[faq88]

Re: Telling the Obama Tax Hikes to F*ck Off

I vote from this post forward, we just talk strategy!!! No more politics!!!

 

[faq88]

Re: Telling the Obama Tax Hikes to F*ck Off

I have question. What do you do to protect your stock earnings? Put them into a Roth IRA and have them locked away from you? How do I make earnings form stocks and not have the government steal them away.

Thanks

 

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[MJ DeMarco]

Re: Telling the Obama Tax Hikes to F*ck Off

I have question. What do you do to protect your stock earnings? Put them into a Roth IRA and have them locked away from you? How do I make earnings form stocks and not have the government steal them away.

Thanks

Dividends or capital gains? Or both? Both are targeted. I'm investigating becoming "trader status" over "investor status" ...

How to File a Return That Tells the IRS You're a Trader | Taxes for Traders | Financial Articles & Investing News | TheStreet.com

http://www.thestreet.com/story/716325/1.html

Wash sales are 30 days (you can't rebuy a losing stock for 30days without washing out the loss).

 

[Runum]

Re: Telling the Obama Tax Hikes to F*ck Off

Can a self directed IRA buy investment property in foreign countries? If I were wanting to set up a residence in another country and support myself with rental properties, how would this need to be structured?

 

[AroundTheWorld]

title changed.
Thanks for the article MJ. Hoping to find more like this in the coming weeks .... we all need to think strategy.

Thanks for the link Phlgirl. Looks like there are some great ideas on that thread.

Looking forward to strategy talk here. Obviously this is a big deal to a lot of us here, and writing big checks to the IRS is painful.

 

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[Sparlin]

A Commercial From Tax Talk

The Bad News: Health Care May End up like this!


http://www.youtube.com/watch?v=Xw0df0wNnVQ


Good News: Laughter is the best medicine!

 

[faq88]

Re: Telling the Obama Tax Hikes to F*ck Off

Going to be tough to show that your are a trader vs. an investor.

If you read some of the case examples you will have to be making very frequent transactions. Now I don't like the idea of holding onto a stock for more than a couple of months, but this only seems to apply to day traders. According to this example...

In Stephen A. Paoli (1991), the court rejected the taxpayer's testimony that he spent four hours trading daily throughout the year and found that most transactions occurred in one month. "His trading was deemed not to be frequent, regular and continuous," says Tesser.

Correct me if I'm wrong. I'm more curious how do I protect capital gains expenses? Can I use my capital gains for a real estate purchase and avoid the taxes?

 

[Kung Fu Steve]

MJ, can you explain why S-Corps?

I currently own two, but I don't know all the benefits of them. Why would you recommend them? I know LLCs are the "in" thing to do right now. But the biggest differences as far as I know is that S corps have to pay a salary to the owner and you do not pay taxes on accumulated earnings. (Again, as far as I know)

 

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[GlobalWealth]

MJ, can you explain why S-Corps?

I currently own two, but I don't know all the benefits of them. Why would you recommend them? I know LLCs are the "in" thing to do right now. But the biggest differences as far as I know is that S corps have to pay a salary to the owner and you do not pay taxes on accumulated earnings. (Again, as far as I know)

You answered your own question. The tax savings in the 'self employment tax' is the biggie. But you can elect to have your LLC taxed in the same way.

 

[GlobalWealth]

I have already taken several steps in anticipation of these tax hikes.

I moved overseas. That means I get (in 2009) up to $91,400 tax free income. I also get about $25,000 in housing allowances. So I give my wife a 1099 for $91,400 and both kids a 1099 for $5700 (max allowed where they pay no tax) and I end up with about $230,000 in tax free income.

I am living in a country that doesn't tax foreign sourced income, so I pay no local income taxes.

I am also shifting assets into gold held offshore. this is one of 2 unreportable offshore assets.

I am also considering (I mentioned in another post) getting back into RE investing. I sold all RE holdings in 07-08. With 2 partners, we are looking at a few properties. This should generate good possitive cash flow along with the normal RE losses.

 

[^eagle^]

Healthcare Reform Law-Timeline for Small Business | NFIB

Time line of tax rate hikes. Most occur in 2014.

Just trying to sort this all out since I am going into my first online business. CFTC is trying to tax forex earnings which is not even a commodity so its getting really complicated. Hope I can weather the storm. Getting my first paycheck from my business thats going right back into it.

Don't have the fiscal smarts that most of you have.

 

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[Rem]

Oh come on guys. Paying taxes is patriotic. :coco:


That's what Biden told us remember.

 

[LagunaLauren]

The tax savings in the 'self employment tax' is the biggie. But you can elect to have your LLC taxed in the same way.

I have LLCs that are taxed as S-Corps. Was recommended by my attorney and CPA. (They're in the same office, so they put their heads together for good solutions, legally and financially).

 

[Russ H]

Oh come on guys. Paying taxes is patriotic. :coco:

That's what Biden told us remember.

smmedia, if I could give you negative rep for your post, I would.

It's not fastlane.

It doesn't help other investors.

It doesn't map out or describe your strategy for profiting w/the new rules.

All I see is something that tries to be political humor.

I love political humor.

But not here.

-Russ H.

 

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[Rem]

snort

 

[PaulRobert]

I have LLCs that are taxed as S-Corps. Was recommended by my attorney and CPA. (They're in the same office, so they put their heads together for good solutions, legally and financially).

This thread was created at the perfect time. I just setup my LLC on Monday and I was already doing research on the way I wanted to be taxed. Looks like I am going for the S-Corp option.
What is also great is that my attorney and future CPA work in the same building and often do business together. :banana: