Tax Taxtics
??Dean Anders? Finance Economist Corp Lawyer B.
No Money Acquisition Finance?? Cash Recycling Increase Capital at Zero cost; Self Fund 401k Plans, Salary Sacrifice - Save Tax Reduce Wage Costs; Rescue Failed IPOs, M&As, Private Equity Deals Free Acquisitions Finance
Tax management does not have to be looked on as Rocket science - just spend the time and a little bit of money to learn how to defer tax, convert income in to capital gain - and pay as little as 5% instead of a much larger amount to the IRS or to Banks
(when choosing Negative Gearing - while your tax burden decreases shifting accessible income to lenders costs you the interest payments instead - and still tax is then payable by the banksters and not by you)
A common financial misconception promulgated on the internet by a proliferation of Youtube videos - many by accountants (which is understandable, as most know little about Economics) - is the distinction between Tax Incidence and Tax Burden. Understanding the difference is the first step to being able to borrow money Interest Free and Non-repayable, which can help finance acquisitions and run your businesses
I could say it is as simple as putting money in my hand - by all means take the time to study and gain professional work experience as I did (30 years of University degrees etc.) Sorry to be facetious - but in a nutshell, Both Your Business and the Acquisition Target have tax dollars - on Business Profits and on incomes of workers, executives & owners. Look at even a 20% tax rate plus about 25% of the wages bill. That amounts to a lot of money you can close your hand on when you know how. Use that to at least make a down payment on acquisitions and to cover interest expense on loans; At times tax might only be deferred, or converted in to Gains - taxed at a lower rate - but if you defer tax, use it for acquisitions so it is a wise investment what it produces will by far cover any future tax payble
While I am Negative on Negative Gearing as a Tax Strategy I am in favor of borrowing to gain leverage which boosts ROI - In fact even using negative gearing to do so. At times I have done that borrowing the additional capital needed to service the interest expense.
That can dramatically enhance ROI and is a magnificent strategy when the growth of an investment is far greater than the interest rate - Just take care managing the Negative Element so you do not end up going in ever diminishing circles
*P.S. I taught Financial Planners in the early days how to gear investments & use leveraged investing software!