Best way to convert cap. gains into earned income?

Discussion in 'Professional Trading' started by funky, Mar 30, 2004.

  1. gms

    gms

    If you expect to bank several million and build an estate, an estate that you may want to bequeath to your children or others, why would you want to use up your unified credit now instead of leaving it intact so as to shelter whatever it can shelter when the time comes? You'll be able to devise much more creative solutions to offsetting taxes. Think trusts. In fact, you can work with irrevocable trusts right now while you're alive, and you may be able to include using them somehow in your plans, if you really want to give away money. BTW, I'm available as a beneficiary if you need one more person to gift your money to.

    Without using any part of your unified credit, of course as you know, you can gift $11,000 per person to an unlimited number of people. But they become sole owners of that money, so if you're expecting them somehow to reroute it to you (I'm not sure if that's your intent), I'll bet if you ever get audited, the gov't has some rule against whatever it was you did.

    Why don't you just sit down and consult with a good attorney? Find someone who deals both with trusts and LLCs is what I'd suggest.
     
    #31     Mar 31, 2004
  2. funky

    funky

    gms,

    i like to educate myself about what i'm getting into BEFORE i give my hard-earned money to tax professionals. there are sooooooooooo many people out there willing to take your money that it isn't even funny.

    :D

     
    #32     Mar 31, 2004
  3. MR.NBBO

    MR.NBBO

    Howdy funky,

    Looks like you might take the carribean plunge, cheers!-Tell mettox I said howdy.

    As far as "gifts" go...I believe the IRS will disallow these gifts & impose tax on them, then nail ya for tax fraud. The idea of "substance over form" comes into play here......if they are truley gifts & are not expected from the LLC, then they are gifts.

    Yet, if it looks like income being paid under the guise of "gifts" they'll nail ya. Insane how hard their crackin' down on offshore stuff now-so cross every t & dot every "i". I spent about 6 months & hundreds of pages of IRS site tax code learning + CPA.
    What I discovered was that all truely worthwhile loopholes where closed a few years back & that the IRS is nastier than ever.

    WHATS LEFT: The foreign income exclusion & housing-your on to that! PROBLEM: If Kerry get elected as President.....it's gone. OHHHHHH---then you moved for nuthin'. Tough gig.




     
    #33     Mar 31, 2004