We are publishing the tax secrets of the .001%

Re:We are publishing the tax secrets of the .001% by tootie on Tuesday June 08, 2021 @12:23PM (#27437276)

That's not a tax loophole though. You still have to pay back the loan with interest. And it has to be paid with cash from somewhere. People like Bezos do this primarily to retain their equity because it's worth more than money to them. It's their ownership stake. For others, they are just betting the assets will appreciate more than the cost of the interest. It's income optimization not tax avoidance.

You can do the same thing with a HELOC. Otherwise you'd have to sell your house and pay cap gains then spend the net profit. I don't think a HELOC is tax dodge.

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Re:We are publishing the tax secrets of the .001% by jjeaff on Tuesday June 08, 2021 @11:02PM (#27443768)

HELOC definitely isn't a tax dodge because the first $250k-$500k of profit on the sale of your home is not taxable anyway.

But there is something to be said about being able to defer taxes effectively forever. Only the ultra-wealthy are able to do this.

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Re:We are publishing the tax secrets of the .001% by tootie on Wednesday June 09, 2021 @09:31AM (#27447642)

This doesn't defer taxes, it defers realizing profits. The loan payments have to be made with cash that came from some source which can likely be taxed. Anyone with assets can do this proportional to their assets. Admittedly most people don't have sufficient assets to make it worthwhile. Nor do they exercise the voting rights on stocks. But really any middle class investor with a nest egg could do it.

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