You know that rich people have access to creative ways of avoiding paying taxes, but many of us don’t know what those are. We’re going to take a look at some of the most aggressive tax avoidance schemes used by the very wealthy in order to get off lightly when it comes time to file their annual returns.
Put It In The Freezer
If you have a large sum of money and don’t want to pay taxes on it, you can put it in the freezer. This is a very common method used by wealthy people who want to avoid paying their fair share. Because it’s cold inside your freezer, any cash that you put in there will be frozen solid and therefore unable to be used or spent until springtime when things thaw out again (and then only if your electricity doesn’t go out). Once this happens and the bills start coming due again–boom! Taxes are due immediately because now there’s no more time for avoidance schemes!
Send It Overseas
If you’re rich and want to avoid paying taxes, the best way is to send your money overseas. You can do this by setting up an offshore account in a tax haven like the Cayman Islands or Bermuda or even in another country entirely like Switzerland or Lichtenstein. The rich will often set up shell companies (which are just fake companies that have no real purpose) in these places so that they can hide their wealth from the government without technically breaking any laws.
Stock It Up In Options
Stock options are a form of compensation that can be used to avoid paying income tax. Stock options are a type of security, and they do have some tax benefits:
- Stock options aren’t taxed until they’re exercised (which means you get to keep all your profits).
- If you sell stock at a loss, you can deduct the loss from your other capital gains or income (depending on what kind of stock it is). This way, if one investment doesn’t work out as planned but another does really well–you don’t have to pay taxes on that first failure!
Play Shell Games With It
Shell companies are a common tool used by the rich to hide their money and avoid taxes. There are many ways they can do this, including:
- Using shell companies to move money around without paying taxes on it
- Creating fake transactions between countries so that profits aren’t taxed in any country
- Moving assets into trusts or charities that don’t pay any income tax
Swap It Out
Swap it out. Swap assets with a family member, friend or business partner. You could also swap assets with a trust that you set up and control. Or, maybe you’d like to use your favorite charity as an intermediary? If so, there are no limits on how much cash or property can be swapped for tax avoidance purposes. Swap away!
Play Dodgeball With It
The rich can play dodgeball with their money. It’s a game where players try to throw a ball at each other so it hits the floor, but if you’re rich and want to avoid paying taxes, you do it by dodging the taxman. You might be wondering how this works: Well, if you get someone else to pay for your expenses (like an expense account or staff), then those payments are considered taxable income–but only if they’re made directly from your employer or client. So if I hire someone full-time as my personal assistant and pay her $100k per year in salary, that would mean I’d owe 35% of my gross income (or $100k x 35%) in federal taxes–which would make me less rich than before! But what if instead of hiring an employee directly through my company name on her paycheck stubs and providing benefits like health care insurance coverage? What if instead she works full time without ever seeing any paperwork associated with me personally; all she knows is that “her boss” pays her salary through some third party like PayPal? Then there wouldn’t be any record linking me back up with those payments–and thus no obligation whatsoever under current law!
Go Corporate With It
One way that the rich avoid paying taxes is by using corporate structures. They can set up an LLC and then funnel money through it, thereby avoiding paying taxes on those earnings. This is one of the most aggressive tax avoidance schemes used by the rich because it allows them to keep their money out of government hands while still enjoying all its benefits.
Kick It Down With The Road
The rich don’t want to pay taxes, so they use their wealth to avoid them. They can do this by buying up roads and not paying taxes on them or the tolls that go along with using those roads. It’s pretty simple: you buy a road, then you don’t have to pay taxes on it! But there are also other ways that people get around paying taxes on things like gas and tolls–and sometimes even property tax (which is something we’ll talk about in another article).
Give It Away
Give it away. Charitable donations are one of the most common ways to avoid paying taxes, but they can also be one of the most aggressive. This is because you’re not just getting a deduction for your money–you’re getting an income tax break on top of that! Give it to family members who have lower incomes and won’t have to pay as much in taxes. If you give money directly to someone else (say, your son), then they’ll get a bigger deduction than if you gave it directly to charity; this means that when figuring out how much tax-saving benefit there is from making charitable gifts versus giving them yourself as cash gifts or investments in their name instead of yours, remember that even though both options will save some amount off your taxable income, only giving straight up would result in zero savings since there’s no need for anyone else’s tax bracket being considered at all!
Make It Luxurious
This is the most obvious way to avoid paying taxes, and it’s also one of the most popular. The rich can use their money to buy luxury goods that are not taxed as much as other goods, such as private jets and yachts. These items are known as “sin goods” because they’re considered sinful or immoral by some people (and sometimes even illegal). This isn’t just about buying fancy cars or expensive jewelry–it extends into all areas of life: lifestyle choices like smoking cigarettes; health care decisions like getting plastic surgery; even what you eat can be considered a luxury item! And if you think these things only affect celebrities…well…you’d be right!
There are many creative ways to avoid paying taxes that rich people have access to. Tax avoidance is legal, but tax evasion is illegal. If you pay less tax than you should, it’s not technically illegal because the law doesn’t require anyone to pay more than they should (except in cases where there’s an obvious mistake). However, if your intention is solely to avoid paying taxes and not because of any other reason such as financial distress or illness then this may be considered tax evasion by the IRS or other authorities who oversee tax collection in your country. There are many creative ways to avoid paying taxes that rich people have access to. Some of them involve putting your money overseas or in the freezer, while others involve playing shell games with stocks and bonds. If you’re not wealthy enough for these options, don’t worry–there are still plenty of others available!
