These next couple of articles will show you the US Tax Code as you probably have never seen it before. The tax code is over 70,000 pages of boredom and confusion and is designed so badly that even all the authors of the tax code really don’t have much idea of how the system actually works. You can be sure that the code is designed to be difficult and keep you, as the tax payer, intimidated and paying the most money possible to your old Uncle Sam.
Income taxes are the single biggest expense most Americans will ever have and yet very few people have a real clue how the system works. It is my belief that since you are going to pay taxes for your entire working lifetime and probably even some taxes after your death that you should have a handle on how they actually work and how to legally pay the absolute lowest amount of taxes allowable. To pay the lowest amount of taxes possible is your responsibility and not your tax preparer or CPA. Nobody will ever care more about your money than you do so think of this as your spring board to saving a fortune in income taxes over your lifetime. You will be amazed at how relatively simple it is to legally and dramatically reduce the amount of taxes you pay every year.
Let me say upfront that I am not a CPA or a tax attorney. I am just a tax payer like you that wanted to understand how I could get the tax system to work in my favor as much as possible. I have read countless books and listened to many live presentations from many experts on the subject of taxes. In these next couple articles I will be sharing information from a tax expert who has been teaching taxes all over the country to thousands of people for 20 years. He blew my mind when I saw him speak with all the great information he shared. We have become friends and had many business dealings together over several years. His name is Pat and he will be a huge asset for these taxation articles.
I am going to try to simplify some of the 70,000 pages of the tax code and supporting documents to help you capture more deductions and ultimately saving you $1,000’s of dollars on your taxes every year. A leading tax expert has graciously agreed to make one of his books available for FREE. Just go to www.wealthwithoutstocks.com and send an email requesting the booklet be sent to you right away via email. This book will show you little known secrets such as:
- Why people over-pay their taxes
- Two tax systems in America
- #1 Tax Strategy in America
- Profit Motive
- Business Trips VS Vacations
- Travel Rule Basics
- Ski Trips
- Meals & Entertainment
- Golf & Other Activities
- Dutch Treat
- Automobiles – Your KEY to a HUGE Deduction
- Motor homes & Yachts
- Medical Expenses
- Tax Deductible Gifts
- Insurance Premiums
- Deducting your Spouse & Kids
- Work Clothes
- New Business Start-Up Deductions
- Deductions for Employees W-2 Wage Earners
Obviously I can’t cover all of these topics in a couple of articles so I will just pick a few (5 to be exact) to give you an idea of what’s possible.
First we need to understand why People Over-Pay Their Taxes…
Most people over-pay their taxes for 3 reasons:
1) Fear of the IRS and being Audited. As long as you are following the laws in the Internal Revenue Code there is no need to fear an audit. The IRS just wants to make sure you are doing things right and following the laws.
2) Not keeping good records therefore missing out on deductions – Would you be willing to spend just a few minutes a day, (about an hour a month) to put $6,000 of your hard earned money back into your pocket? That would be a great use of your time. You have the ability to make that a reality but you will need the “know how” along with the desire.
3) Not knowing the rules – What’s deductible and what’s not. The follow up articles and free book will open your eyes to available tax deductions most people don’t even know about. Remember, to consult with your tax professional to make sure you qualify and are documenting your deductions correctly.
The U.S. Tax Code is very complex and confusing. No one, including any of the 100,000 or so IRS employees really understands it in its entirety.
TAXES – THE LARGEST SINGLE EXPENSE:
The average American pays about 30% of their gross income in taxes (Federal, State and Local), representing their single largest family expense. Taxes cost the average family more than housing and medical care combined.
Yet, few families ever realize the great expense that taxes cost them. While many people budget for food, clothing and other necessary expenses, they typically do nothing when it comes to planning to legally reduce their biggest expense: taxes!
We have all heard that middle class Americans pay the bulk of the taxes – there could be some truth to that. Let me explain. You see, for the average American wage-earner, a W2 employee, there are about a dozen tax deductions they are entitled to however if you are doing something in your life with the intent to make a profit on a regular and consistent basis, you can be entitled to 100’s of tax deductions.
Tune in next week for our next article to find out how to dramatically and legally reduce your income taxes!