
Hacking the Tax Plan: Ways to Profit Off the Republican Tax Bill - AptExtrapolatio
https://www.nytimes.com/interactive/2017/12/12/upshot/tax-hacks.html?_r=0
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voidmain
I'm no expert, but this is weak sauce. If these are the biggest "loopholes" to
be found in a tax bill that doesn't just change rates but makes major
conceptual changes like switching to a territorial tax system, and which seems
to have gone from nowhere to law in like a month, the Republicans in Congress
must be geniuses. I think the 1986 tax reform bill took over a year to hammer
out, and still had plenty of "bugs".

It's more likely that this article doesn't even scratch the surface of the
weird incentives. (And, for that matter, that many of the proposals in the
article wouldn't work)

What I want to know is, are companies like Apple with billions of "cash"
overseas scrambling to buy foreign real estate or other illiquid assets before
the end of the year to get the lower deemed repatriation rate?

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joncrane
>I'm no expert, but this is weak sauce.

Agreed. I thought about what a good source for similar info would be, I
guessed reddit, and I was right:

[https://www.reddit.com/r/personalfinance/comments/7l3b6r/us_...](https://www.reddit.com/r/personalfinance/comments/7l3b6r/us_tax_reform_megathread_the_tax_cuts_and_jobs/)

(/r/personalfinance megathread)

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sytelus
Mostly linkbait... Some of their advice include:

\- Have your kids right away

\- Get lucky with the timing of your inheritance

\- Move to New Hampshire

\- try to earn more this year

\- Upgrade your private jet

So mostly not usefull at all...

However what struck me more is how high earners would immensely benefit from
the tax plan. So let's say you are CVP in big company and making $2M. At least
half of these will probably in stocks and you would be paying 15% tax - so no
problem there. However your cash still gets taxed at 35% or more. Now what you
can do is become corporation, get your paycheck only get taxed to 21% and pay
yourself living expenses. So basically you just keep your money in your
"corporation" invest it, grow it - all for just 21%. You can then pass this
whole thing off to your kids, again completely untaxed! In essence, people
making $1M or more got about 20% tax break while most middle class people are
probably getting 5 to 10% or so.

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SpikeDad
Even less that that. The exclusions and reductions for pass through are
permanents - the savings for regular folks are temporary.

When you figure out how much more health care will be middle class folks will
lose out. Just as the Republicans planned.

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valuearb
So their advice is to incorporate myself in order to deduct all my local and
state taxes? So I can pay 15-35% federal corporate income tax rates, plus
5-10% in state corporate income tax rates, then my state income tax rates,
then finally 15-20% in federal dividend rates?

Methinks someone didn't think their article through.

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ajoy39
you don't pay corporate taxes with a pass through LLC. You deduct your
expenses from your income, and the rest gets passed through the LLC to you as
personal income. So you're getting taxed on less because you can essentially
write off any expense that you can justify as being spent on the corporation
itself.

The downside is, usually, that you get taxed on ALL profits personally no
matter how much you actually withdraw from the LLC but if you are the only
member and you're just using it for tax purposes that's less of an issue since
you intend to take all the money anyway.

Disclaimer, I am not a tax professional, and I do not actually do the
taxes/distributions for the LLC I part won. This is just how it was explained
to me by the person who actually does those taxes.

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smileysteve
8) Turn Yourself into a Pass Through Business

If you've been contracting, driving uber, etc hopefully you've realized this
has been advantageous before. You get to deduct expenses without as many
limitations.

