U24 – Cryptos and Risk Management
0:05
Hey there, Brad.
0:09
Thanks for putting the call together.
0:51
So, Brad, did you want me to go ahead and begin here?
0:58
Sure. Let me see, I’m going to say a couple things first.
1:04
Guys, welcome, and glad you all are here. Does that made it? We’re gonna record it so that we can give it out to everybody, John! We’ve got like, probably, I don’t know, 270 people. This is Kevin Cages, scrape. You’ve probably seen them online. Talking about XRP is a youtuber is really, really good and much loved by everybody in the group. So guys, basically, it’s all about tax. It’s all about LLCs here and you know, I’ve had a couple of personal consultation slips with John and I set up an LLC. We actually did it on the phone a couple of weeks ago, right? After one of these calls and purpose of the whole thing is just to set up a structure. You know, like the LLC in order to protect assets, and avoid, and deferred tax.
1:58
So it’s an LLC written in a specific way, booked out, and will in one or another state, New Mexico. It’s great because they don’t charge any fees, yearly seasoned staff. But the way John writes it, and he’s been doing this for a long, long time, this is kind of his language, this is the language he talks, you know?
2:27
He he, she puts a blockchain immunity trust. That’s seems fairly complex when you read it, right into the thing.
2:36
It’s a trust component for cryptographic currency tokens and assets. And then he makes you a PMA, a private membership association, which is what comes with certain rights, and John will talk about that. Maybe other legal entities don’t have, etcetera. He’s gonna go over the whole thing.
3:02
But that’s the basis of it.
3:03
So, I put the agenda kind of into the window before. That’s the one that John has as well, and then he’s going to fill in with whatever else he wants to talk about, And then we’re going to ask all kinds of questions. Be sure to write them down, so you don’t forget. I know this stuff is complicated. It’s not really our language. It’s his language.
3:24
So, just do the best you can at understanding, and we’ll go from there, and then John will tell us how to get in touch with him, where to go to set up one of these things. John, everybody’s concerned about taxes, obviously, and, you know, they all get that message coming through from the IRS and various ways that you have to go crypto to crypto and whatever gains you’ve got. You know, everybody’s nervous about that, you know, because it’s put out by all these youtubers as real, you know.
3:57
So, anyway, with that, I will leave it to you.
4:03
Well, thank you, Brad, and yeah, that’s what you’re seeing, is sales pitches. These are sales pitches and nothing’s changed.
4:09
And well, I’m gonna back up but I just want to address what you just said.
4:14
There are no new tax laws for cryptographic currency, kryptos, or just property. And there are no new taxing statutes or anything like that.
4:23
You’re just being scared into doing something so that you will create a tax liability, and I’ll explain what I mean by that.
4:29
But, my, and thanks, Brad, for putting together this guideline here. I’m going to follow this guideline here, the bullet points.
4:35
And I did make some notes for myself, so, it looks like I’m reading, I’m probably reading. But, anyways, about, about myself, I’m, I’m 52. I started doing this in college.
4:46
I’ve been doing this work for, I guess, 28 years, since the mid nineties.
4:51
And it came out of, uh, just disbelief that there was some, let’s call it conspiracies or whatever about the whole legal system.
4:59
And as I did more research, I saw, I saw a niche market that I could actually work in and help people and do really well. And I really thought I could, when I decided that, and I got into it in the early nineties, actually, towards the mid nineties.
5:12
And, um, it was, it was, let’s say, way worse, are way better, however you wanna look at it than I thought.
5:17
And so I just continue doing my research, and I arrived at some basic conclusions.
5:22
And the first types of situations I found myself in, and if, if I could just describe what I do, I cannot say I’m a board member, because I’m not an attorney, I’m not a CPA.
5:31
So I’m not, I don’t have letters out from my name, I simply am an entrepreneur. I’m an investor, and whatever you’re doing, I’m probably doing, I’m heavily in Kryptos. I’ve been buying them since 20 13.
5:42
And, um, in the nineties, I was helping people out, let us say financial problems.
5:48
And what I discovered is that the reason why people had certain problems with finances is because they had the finances, which sounds kind of funny, but say by default, if you go to an attorney or a planner, you’re by default going to be creating all kinds of disability for creditors and third parties that you don’t like to take your stuff.
6:10
And so, when I saw that common denominator with all the cases that was working, let’s call it.
6:15
working situations. I was helping people. Excuse me, Just a second, let me Like him.
6:27
Somebody’s got to mute themselves. Yeah, and now I can mute it. I just don’t see the mute button anymore, for some reason.
6:37
Sorry about that.
6:40
OK, all right, sorry about that, OK?
6:44
So, anyways, what I did is, I discovered that the common problem that people had when they came to me for the financial problem, I’ll explain what that is.
6:52
They were being levied against by the IRS or they were being sued by somebody or some other jeopardy was being placed on their cash and property rights.
7:02
And so, the reason why they had this problem is because they actually had the property rights.
7:07
So, how do you get rid of the problem, get rid of the property rights? That’s what I concluded back then, but I didn’t know how to do that effectively until I tried a couple of things.
7:15
So the bottom line is that the core principle that I’ve developed is that I can share the property rights in a group that’s innocent.
7:22
I know that, like Brad said, that’s my language, so I’m not trying to speak over anyone’s head, but I try to use common language. This is pretty common as I can make it.
7:30
If I have a debt liability too, a bank, the bank consume in levy my bank account, no problem there. The laws allow that in any country. But if the money in my bank account is not mine exclusively, the bank cannot do that.
7:45
And how would it not be mine exclusively? Well, if my brother was on the account also, and my brother didn’t have the debt liability with me, Now, if my brother signed on the debt liability and we both had it together, then we’re not safe, That bank can then take the money from the both of us. In that case, we can add yet another person.
8:03
So, this is the basic idea.
8:06
If you divest your exclusive right and property, you avoid the liability, and I know this call us about taxes, and we can talk about that. And that’s the most compelling. But what you’re going to find out, is these ideas span just about every ability you could have to manage risk. Because they can be applied and all kinds of situations.
8:24
And I’m gonna give you some examples here, Um, but basically, my, and this is what I tell my clients, too, When you’re talking to, someone about, Let’s call it advice, or no information, or direction on what to do with money.
8:38
You should know who you’re talking to, so I’ll just briefly tell you, I’m somewhat of a millionaire, OK?
8:44
Been that way for about 20 years, and I’ve lost millions of dollars, I’ve made millions of dollars. I’m not, I’ve never had a net worth of more than $10 million.
8:52
But, I’m an investor, and I’m an entrepreneur.
8:55
And so, the way I interact with clients is as if they were my peers, or I want them to be my peers, or that they’re my partners. I look at it that way.
9:05
I don’t look at it like, I’m going to advise someone on something that I would never touch. If it’s something I’m going to tell you, it’s probably something I’ve already done.
9:13
So that’s I do a little bit differently than other professionals. I do not bill by the hour. And the reason why I don’t is because I believe that in many cases while people are exploited by that, but also it demonstrates, in some cases, it demonstrates and competence.
9:27
Because if I bill by the hour, then it’s that arrangement is in my favor. So I have a competing interest with you.
9:32
If I bill you based upon a solution that you’re calling me for, then I need to solve the problem, right? I need to deliver. And I think, then we don’t do not have a competing interests. So that’s a little bit about me. I don’t know if that’s enough. You guys can ask me whatever you want.
9:46
No, I’ll just tell you.
9:48
So, my experience has been managing risk, let’s say, working cases, not as an attorney, I don’t practice law.
9:56
I do not do accounting, I definitely need help with accounting if I need that. I gotta go to an accountant or bookkeeper CPA or whatever. Sometimes I have to go to an attorney for help on things, but I am fairly competent in those areas.
10:09
So, yeah, I just say, I just share with people my strategies about managing risk.
10:14
Now, there’s no real title for that.
10:16
Yeah. So, Kryptos, I’ve been buying since 20 13.
10:20
And, so, so, Braz given me this one point. Here, I’m gonna get into this.
10:25
Um, the need to, for the correct LLC and Kryptos, OK, an LLC is a tool. It’s a tool that I like, because you can’t really mess it up.
10:36
It’s hard to mess it up, put it that way. So, I know that I can leave it with my client, who’s just learning in some cases.
10:42
And he’s not going to mess it up and call me back in three months or two years with a big problem.
10:48
So far, that has been true.
10:50
But the reality is that you can pretty much use any contractual arrangement you want, you can package it in an LLC, you can use it trust.
11:00
You can use a partnership. You can even use a joint stock company.
11:03
You just have to understand what types of risks you’re dealing with. So, if you come to me and say, Hey, my friend said, you set up an LLC, can I have one? I want to set one up.
11:12
I think they’re great, and I would ask you, OK, what are you trying to do with it, because it has to suit the purpose for which you’re, You’re asking me to set that up.
11:20
As far as a correct LLC goes, an LLC is just, it’s a limited liability company. It’s accepted by statute here in the 50 states.
11:28
It is recognized around the world.
11:29
In some countries, it’s not, but you can get an LLC in a business relationship with a bank in your country, even if the country doesn’t officially recognize a limited liability company.
11:40
Otherwise, you can use a partnership.
11:42
You can use other trusts, you can use other arrangements, so I’m just saying, I choose an LLC here in the states because it’s easy to use, and it’s easy to not mess up. Let’s just say you’re not going to mess it up very easily.
11:56
So, I just had someone call me today, and he said, he understands the concept to watch all my free videos. And he said, I went registered the company, and did I do, OK?
12:04
First, my first question is, who’s the owner And he set it up in a way that is suitable for what he was trying to do, and he understood that.
12:12
And I said, there’s, there’s everything’s fine there, You don’t need any changes, really. And so, we just talked about how to use it, and that’s the other side of it.
12:19
I can set up a limited liability company or partnership, but if I don’t know how to use it, just like flying a helicopter, I can spell helicopter, but I can’t fly one.
12:26
So, the liabilities that you want to avoid, you can incur them in an LLC if you don’t understand how to use it.
12:34
So an LLC is one thing, but then your accounting practice is something else. So what people don’t realize is, they asked me, OK, why does my LLC not have to file a tax return?
12:44
If I put $50,000 in it, and it’s now worth $2 million, and the reason why it doesn’t have to file, and I’m talking about the 50 states.
12:51
I don’t know about other countries, but I believe they’re similar.
12:55
It’s because the the filing obligation comes from filing.
13:00
And I know that’s a real subtle concept. You guys are probably saying, What? What did he just say?
13:05
The accounting practice or filing a tax return creates a tax liability.
13:09
Now, sometimes you have a tax liability without filing.
13:12
With an LLC, there is no tax liability until a return is filed.
13:17
So you get to choose and the reason why that is, is because you get to choose what type of liability you have. You get to choose it as if it’s an S corp or a Partnership over. It’s a sole proprietor. Or, there’s all kinds of options.
13:27
OK, that’s why and you can also defer any tax liability, so, you can actually run an LLC with high volume dollars and not have any problems whatsoever And here’s how I figured this out in the nineties when I was dealing with IRS and I call them IRS takedowns.
13:44
So, for one reason or another, the IRS has taken down a company.
13:48
That’s the till take.
13:49
That’s where you’re running a business like a chiropractic service and for some reason you have a half million dollars in Iris, the bill debt, whatever and they are levying your receivables before you get them.
14:02
You can’t run. You can’t run your business that way. You’re running off savings and it’s not going to last long. So what I do is re-organize the company. That means I keep everything that weight as I leave it the way it is.
14:12
I don’t change the accounting function. I set up a separate company.
14:16
I reroute all the merchant processing to that other company.
14:19
So, I cut off the IRS. I literally cut them off so, they cannot do the levees Anymore. They could send a thousand levies to the bank and there’ll be zero dollars in there.
14:25
And all the clients money is going to a company that’s a neutral innocent party.
14:31
Third party, and let’s call it, a payment processor.
14:34
And I set this up in a way where it has no liability to anybody.
14:38
So the IRS cannot levy that money, even though it can see where it’s going.
14:42
Then my client can, and he and I can work together and we can still keep the business running, pay the bills, and the IRS can’t touch the money, and then they will be so friendly. And they’ll come to the table and say, Hey, can we work out a payment plan? And, you know, and the rest is, you know, kind of interesting, as you can imagine.
14:58
So, so, in that case, you know, I’m putting out a fire.
15:00
I’m pulling something out of the fire if I’m going forward and I’m looking at a possible windfall of some kind or a new business venture, it might make a lot of money. I can plan ahead and I can decide what my accounting practices is going to be. I can decide how I want to manage my risk, and I think that’s what you all are mostly interested in. If we’re talking about kryptos, so that’s what we can, You know, we can use the LLC going forward, too.
15:20
Take money that we earn. Maybe it’s after tax money. Maybe it’s from your savings, Who knows? Maybe you sold your house or your boat or something and you put that money into kryptos or maybe you re-allocated like I’ve been doing in the last few years, is selling my silver and going into, you know, kryptos, it’s almost a no-brainer.
15:35
And then when you get that nice windfall when it’s time to take profits and time to get out of the asset because sometimes you want to take profits and get back in, but when it’s time to leave that asset, you can do it in a way that allows you to do something like you would do in a 1031 exchange except without asking permission.
15:52
OK, so, a lot of the benefits we’re getting, for example, a lot of you heard about how they set up the statutes in Wyoming.
15:58
How you get certain tax benefits, or liability or liability coverage or benefits under the statute. Well, that is nice, and I’m glad to see Wyoming did that.
16:09
It does require, in many cases, litigation. So there are costs to get those benefits. You have to be in court. There has to be something, some legal process going on. What I’d like to do is write the contract, right? The company’s in a way that gets me those same benefits, no matter what state I’m in.
16:25
So we can get those benefits by simply changing the property rights. We can eliminate risk, and we can get certain benefits.
16:31
Just has to use your imagination. And sometimes we don’t use our imagination. We use what someone else did, which I try to do a lot of times, and I could, I’ll talk about that shortly.
16:40
Um, let me just give you a couple examples, I know you have some bullet points here, but um, how bulletproof is this method, OK?
16:51
The way I change the property rights, I make it to wear, Let’s talk about bulletproof, meaning, is my client’s property, at risk?
17:00
if he continues using this structure, the way I showed him, even if he’s not sophisticated.
17:06
And the answer is yes. Now, there’s, there’s a couple of kinds of risks here.
17:09
When I’m talking about risk, I’m talking about a tax debt, or I’m talking about being sued, and having to deal with that, not only having to deal with the actual debt, but having to deal with the costs of litigation to defend yourself against it. So, my first measure that I’m trying to accomplish is allowing my client to avoid the cost of litigation if I can do that. I already won the case, I don’t even care if I really won the case. I just won the case because I don’t have to deal with it. It’s a piece of paper, and it won’t affect or adversely affect what I’m doing.
17:40
So that’s that’s why I say it’s bulletproof, because I’m looking at all the risks, not just how much tax IO it’s everything.
17:47
And yeah, it’s bulletproof, and it’s like I said, we’re creating an innocent party and we’re using it as a property owner.
17:53
Sometimes the innocent party, I mean, most of the time, I’m writing it as a group.
17:59
So, for example, let’s say it’s a partnership, Mo, Larry and Curly, OK, partnership, three guys.
18:06
And together, they can own things, OK.
18:10
Let’s say they can own cash in a bank account.
18:13
Well, if Mo has a debt to somebody that somebody can’t take the money out of Mo, Larry and Curly Bank account because it’s not just mo’s and the other two people are innocent parties.
18:24
So the individuals in the group prevent the one who’s not innocent from having his property taken.
18:31
Right. And that’s how I set these up. There’s options. I mean, we have different variations on how to do it. So I had a group come to me, it was a four partners, and they already had a partnership contract.
18:41
I didn’t change anything on that, all I did was give the partnership a name and make that named partnership, the owner of the limited liability company, so now I just put the partnership into limited liability company and the reason why I did it was for simplicity and for interaction or user use as a conduit to the banking system.
19:00
And that’s what we’re doing: a limited liability company is a conduit to the banking system because the banking system is a policing system, it’s actually the government. They’re collecting information. They’re gonna use it against here. So, I use an LLC for that purpose because I can control the risk and that way. If I want to use my family trust with the bank, that’s probably not a good idea because I have to give up certain information, right? Dealt with an LLC.
19:21
Alright, same with pretty much anything else. So, the name might give to my group, my own, or sometimes. It can be designated as a private membership association. It can also be designated as a partnership.
19:31
So there’s all In fact, it operates as a trust.
19:34
So I don’t want to I don’t want to throw a bunch of terms that confuse you guys, but you can ask me about what I mean by those specific things.
19:39
But as far as being bulletproof, yes, It is bulletproof in the sense that not only would you not have the risk that you’re trying to prevent, but you don’t have the risk with defending against the risks you’re trying to present.
19:52
Prevent, Which is the cost of litigation, This also does a lot for dealing with them, insurance I’ll give you a great example.
20:02
A gentleman called me a couple of years ago, and he was running a factory, and he said his attorney told him to get $3 million of litigation insurance. So I like to think I have a sense of humor.
20:13
And, so, I don’t know, this guy, I just talked to for NaN already, and I said, OK, so, let me ask you this question, Who asked you to get litigation insurance? and he started laughing?
20:23
You know, and I said, well, of course, you know, of course, your attorney would do that, he wants to get paid first, and you have a competing interest with your attorney by default. That’s what it’s about.
20:31
Yeah, he’s an unbelievable hours, that’s all he cares about, and he wants to be ensured that he’s gonna get paid, so I said, well, let’s look at the risk. What kind of risk does your attorney believe?
20:39
that’s going to cause him to need to go to court for you?
20:42
And so we dialed it in, and it was a customer, it was the customer demographic, not not employees or third party vendors.
20:50
It was, the customer in that business, had a high propensity of suing that type of business owner.
20:57
So I said, well, first of all, let’s look at how we mitigate that. Forget.
21:00
Go into court. Let’s just cut that out.
21:03
Let’s look at the relationship with the customer, so you want to have your your interaction with a customer with an employee’s proper training, so that they’re going to be on good terms. You want to have good policies. Friendly policies, faire policies, good refund policy, customer service. That sort of thing, OK, That’s done. Then. You have a written contract. And he didn’t have a written contract. The attorney would even recommend a written contract, you see, that’s another thing too. If you don’t have a written contract, then you create more liability, you allow more liability.
21:30
So I’m trying to explain how why this is so bulletproof.
21:35
I can isolate risk, as I’m telling you, I can export risk with this method.
21:40
So we, we dial that in a little bit, then, we start talking about the contract. And I say, OK, let’s look at the contract.
21:45
Let’s have it to where you and your customer don’t have a competing interests because right now, it looks like you do, Let’s make it to where you each mutually indemnify and hold harmless, each of each other nally that, let’s put, you know, put some money on this. basically.
21:58
Let’s, let’s make it to where, if there’s a dispute that it has to be, if you can’t resolve it, it has to be worked out through a mediator, and that’s the third party neutral party, OK? And you have to do that first. And if that doesn’t work out, then you get to sue either party, consider either party, but I said in the contract, Make it to where if the if, if one of you SOOs each other without go into mediation first, then you lose your Right. To Sue. The case gets dismissed, and you can’t resolve it anyway.
22:24
There is no remedy that way. You have to just do something else. So it is very strict about not going to court. So that just killed like 90% of the risk.
22:34
And then I said, Let’s do just one more thing.
22:36
Now, this is what I want to share with you all, Because you’re all. I know you’re saying, What’s this guy talking about? I just want to know about taxes.
22:43
I showed him how to export the risk of being sued in the first place. But let’s just mitigate it. Let’s just bring it down to where we have a small risk now, right? There’s a teeny tiny risk now.
22:52
Do we need that attorney anymore? Probably not.
22:55
So I said, then make your contract with your customer, not with your core company because it’s one thing.
23:00
Like if your customer sues you and let’s say it’s completely out of his mind and he’s going to lose and maybe your attorney will defend it for free, OK, here’s the problem. You have a public perception. Maybe.
23:12
Maybe you have a good name, and a good reputation. And maybe, you know, people’s stereotype perception of being sued is that you must have done something wrong. That’s why Sujit, right, you don’t want that. You don’t want that lawsuit to interfere, and maybe your vendors are going to say, Hey, look, man, we’re going to cancel our contract because your customers are doing it right. You don’t want that. You don’t want that drama.
23:29
So, what we can do is export that relationship from your core company, two over here, Set up a company and make that company, the contracting party with your happy customer.
23:40
And if he becomes unhappy one day and ends up in court, it’s between the customer and your no name company, which you have to deal with. But the rest of the world doesn’t get to see that.
23:50
So, that’s an, that’s an example of how to, let’s look at intelligently.
23:54
Let’s look at what the risk is, and then let’s find the proper tool to reduce it to nothing, OK.
24:00
That’s why I do like to say what I’m doing is bullet proof and taxes, really?
24:06
Allright joke, as far as risk, that it’s such an easy thing to deal with and you’ll find out that actually the tax collector, at least in the states I can tell you, is actually as evil as the IRS is. They’re actually one of the friendliest creditors, OK, If you know the system, it’s not bad.
24:21
I’m not saying invite them to Thanksgiving dinner, though, but still.
24:24
So, how, quick question. Yeah. What if you don’t have the Curly and Larry and you’ve only got Mao OK? You can name a group.
24:34
And the group doesn’t have to actually be like, you can tap on the shoulder. They can exist. So, the common group I always go to unless you tell me otherwise is your whole family.
24:44
So, imagine, like, you probably have 57 people alive in your family, you can call right now, they’re somewhere on the planet, OK?
24:50
So, I’m gonna just give that family named John Smith’s society and so there we go. That becomes the managing member, single member of your LLC.
24:59
All right.
24:59
And so now I’ve I’m sharing that those property rights in a group and I still have a single member LLC, but it’s not me.
25:05
I have an innocent party now I do not have charging order protection charging our protection prevents a creditor from reaching into the company. I don’t have that, but it won’t matter, because the owner of the company is a completely neutral party.
25:19
Got it.
25:21
Um, I make the relationship look very much like you are working for your church and you might have a lot of debt, but your church is not responsible for that. And the creditor cannot reach into the churches money for your personal debt.
25:34
So, that’s the way it looks Right. All right.
25:38
Yeah. So, let’s see.
25:41
Yeah, OK, as far as auditing, I mean, don’t be afraid of an audit. Yeah. It’s a nuisance.
25:47
I have my own strategy on doing audits. If you guys want, we can cover that.
25:50
But I know it’s not really pertinent to this call, but auditor, manageable, And what are the chances of this structure being audited?
26:00
This structure can be pulled into your personal audit, but it’s not likely going to be audited. I’ve never seen it anyways. I mean, it could be, I suppose the iris cannot add anything on the iris. It’s not the audit.
26:11
It’s the the ability of the IRS to summon things and then if the things aren’t delivered, the IRS can go into the district court and get a contempt order against the custodian of the records.
26:23
That’s what people are concerned about.
26:25
And it’s not a problem to produce records to the IRS at an audit, Even if, like, set up Brad situation. And two years from now, he gets audited, and he just lays out everything we did in front of the IRS, which he would never have to do, by the way.
26:39
But if he did that, it wouldn’t matter, because there’s nothing unusual about what I did.
26:44
So, that’s why I just say, you know, don’t be afraid of the IRS. Just be pragmatic, don’t lie to them, and tell them, you know, tell the truth and do the right thing. So, if you have a personal gain on something, just report it. It’s easy.
26:55
Don’t go out of your way to structure a one thousand dollar cash amount from the sale of your asset so that you can buy something with it and then try to make it look like it’s a loan or something. It’s just too complicated, right? But when it comes $2 million or $100,000, those are real easy to structure in a way that’s not taxable.
27:17
So, yeah, anything can be audited.
27:19
I have not seen anything I’ve done be audited.
27:22
In fact, um, a lot of the methods I used get people out of the audit.
27:26
What happens is, a lot of times, I only give the IRS 1, 1 hearing.
27:31
I give them one meeting, OK, with my client, and a lot, Sometimes it depends on the situation, Sometimes, I’ll do a, um, a transcript of the audit so that, I have better control over what they do, but, um, they do that and they end up with, let’s say my client has a huge bill, like, sometimes I’ll have penalties. They’re just really unfair instead of arguing with the penalty.
27:51
I just want to make sure my client is going to be filing timely and stay current going forward, and then he might have a big debt. I’ve got some clients right now with huge debt. Like, half a million dollars or so. And they’re literally running the clock on the IRS, so they’re not going to pay the debt, they’re uncollectible.
28:05
And their current, going forward and for and for 10 years, it will be like that, but in 10 years, that large amount of money will be zero, it will, it’ll timeout.
28:13
So, that’s what I’m concerned with, I’m not concerned with the audit because a lot of times, the purpose of an audit is just to try to get more money out of you.
28:20
The reason why I don’t care about that is because I can make my client uncollectable, OK? And even if you can’t, sometimes I cannot do it totally.
28:29
It is still manageable, so even if they come up with a debt, we can still do things.
28:35
The steps to do it correctly, OK?
28:36
So if you’re going to manage something that’s going to produce money, or income, or, or you’re gonna buy a big asset, or sell a big asset, look at what your risk is, and then decide how you’re going to manage it, because sometimes you can do it very simply.
28:49
Um, I’ll give an example.
28:52
You guys want to talk about taxes.
28:54
A, gentlemen, I set up a few years ago, a company, and then, about a year or so later, his partner decided to buy him out, and it was over a million dollar purchase.
29:04
Buying out his half, half share of the company, 50% ownership, and his attorney told him that there was no possible way to avoid capital gains tax. And, of course, he called me. And so, I asked to look. I already knew what I was going to tell him, but I didn’t want to tell them.
29:16
First, I wanted to show him in the company documents that I didn’t even look at yet. I just ask them, Can I, can you get your partner to send me the contract for the your company? It was, I think it was. Yeah, it was an LLC. His company was an LLC or an S corp.
29:30
So anyways, I went through there and I showed him there was a two page section and, and it was all the rules about stock, ownership, and the company and all the tax situations, OK?
29:41
And in spite of all those rules, the very last line of all those two pages it said if the conveyance is for estate planning purposes, disregard the foregoing.
29:54
It’s like I showed a mic look, liquid. It’s saying here.
29:57
If you can pay the stock for estate planning purposes, you can disregard all those rules pertaining to taxation and that’s right there in the document. I didn’t tell you that.
30:06
And he goes, OK, so what does that mean?
30:08
And I was explaining, estate planning means that, you were doing something where your, your property rights are not going to.
30:16
Even though they may be retitled, your interest in them will not change. So it’s called the beneficial interest.
30:22
So if he had the beneficial interest, 100% in his 50% of the company, and he conveyed that before the sale before his partner bought him out, he conveyed it over to a new company that, we just set up.
30:34
An innocent neutral third party, kinda like we’re doing for the kryptos.
30:38
He conveyed it with a contract, then his partner bought it from that company, not himself.
30:44
The conveyance was for state planning, which I put in the contract.
30:48
It was funny, because, after all this, you know, drama and the attorneys saying, No, you can’t do it.
30:53
And I send them the contract, and then I got this e-mail back saying, Hey, give it to my attorney. He said, Yeah, great, thanks, this will work. You know, after all that, they’ll never work.
31:02
And just one little thing is conveying property for estate planning is 0 taxable 0 tax liability, OK, that’s another reason why for example.
31:12
If you don’t know, Brad, explain this job.
31:13
But if you get, let’s say you’re, you have a Coinbase account and you’re trading a coin to coin to coin and you hear all this news oh my gosh, if you’re doing that no. It’s taxable. Trading between coins is taxable.
31:24
Well it is as soon as you report at the moment you report it.
31:27
But I can I can show you, if you go look at my site, ACEP coins dot com. You’ll see there’s a there’s an example in there.
31:32
I’ve got about 15 of these and people that have received 10 ninety Nine’s from Coinbase.
31:37
Now sometimes they’ll have sold some of the coins for dollars and that’s taxable then for the most part they haven’t. in some cases they sold nothing and they got a 1099 for a certain dollar amount.
31:46
On the 1099 the IRS cannot write this or the company.
31:49
Cannot write a dollar amount.
31:54
On the 1099, they cannot write it in terms of cryptographic currency.
31:57
They have to write it in dollars, so it’s erroneous if it’s written in dollars.
32:01
Plus, the trades between coins is with the same owner.
32:05
So for example, if I go into my Coinbase account, and I train traded back and forth I’m going from litecoin and bitcoin, but I’m owning those accounts. Those are my wallets.
32:14
I’m the beneficial owner. That beneficial ownership did not change.
32:18
Therefore there’s no tax liability.
32:20
There’s no disposition of assets, and to correct a 1099, all I do is write to the IRS. I use their form letter, I asked him for it.
32:29
I think it was in 20 14.
32:32
I asked the IRS for a form letter to ask them the Secretary of the Treasury for a determination letter.
32:39
So, they sent me a six page letter format that I can use and I basically retype everything. And I, I put it in the form that I needed, and I put my legal memorandum in there, and I sent to the Secretary of the Treasury. And I include the 1099, and I include the Client’s 10 forty’s, whether or not they’re filed, because sometimes it’s before they file. So if it’s before they file, we just send a copy of it.
32:58
And we tell the IRS, we are asking you to determine the following.
33:04
This 10 99 is erroneous, and it will not be included with the 1040 and therefore, it’s not taxable, and the IRS writes back and says, Take no further action, that’s there cryptic way of saying.
33:13
Yeah, you don’t have to do anything else, what you said is correct.
33:17
So that’s how I know. I mean, it’s nice to get confirmation and what’s funny is sometimes Iris does not write back, but everything else is same.
33:24
But sometimes they do.
33:26
Um, did you want me to pause for a second, Brad?
33:29
And maybe you guys want to, it’s like I get a tendency to talk really fast and I’ll never stop.
33:36
You guys want to ask me some questions. Any other, any questions thus far?
33:40
Is that what you’re saying? Yeah, and I’ll just, if you can, yeah, Robert’s asking about deferral and avoidance. Yeah, you’re avoiding taxes and you’re deferring attacks, as long as you want.
33:50
So if you’d like that idea that you can defer this initial, let’s say, windfall, and you want to re-allocate or spend the money or whatever. And you want to avoid the tax on that.
33:59
You can do that. And then, at the next event, where there’s going to be a tax, you can do that again. So, you can continue that deferral as long as you want.
34:06
You choose. Now, when you take some of your profits and you buy your house or pay off your mortgage, which I don’t recommend, by the way, or you buy some assets, you have to do it a certain way. So that you don’t create a new tax liability when you went to all the trouble of avoiding it in the first place. So that’s another thing that I show people how to do. We can talk about that, too.
34:26
Yeah, OK, I can put the website in there. I don’t want to distract too much. But, um, there’s an article I wrote.
34:33
I’m sorry, I don’t remember. I think it was July of 2019.
34:38
It was requesting it a determination letter, or the question of the article was, did you get a 1099 from the, from Coinbase or something OK?
34:44
So in this I’m showing you an example.
34:50
It’s on the blog there on the website, eisa coins dot com.
34:54
This is an example of their response when they do respond.
34:59
All right, so, let’s see in this. Yeah, so yeah, you’re going to avoid it and defer it for as long as you want, you control that.
35:07
Anyone else?
35:08
If you could just raise your hand. Do we do that here?
35:12
There’s no raising hands that I have ever found, but you can just unmute yourself and jump in.
35:20
And that’s a good question. Rich is asking about the stable coins when I, when I suggest taking profits.
35:25
A stable coin is just like any other coin, that is not a disposition of assets. Remember the beneficial owner stayed the same.
35:31
You went from your holdings to your stable coin to wait to go buy a backend.
35:35
For example, that does not create a taxable event, that is not a disposition.
35:42
And here’s a, um, an example. So let’s say I go to Coinbase.
35:47
So I buy only true UST, stable coin. I do not buy any other coin when I go to Coinbase.
35:52
Then I move my true USD off to my favorite hardware device, bit phi, whatever.
35:58
And then I allocate to the coins I want.
36:00
So it’s on my device, It’s not on Coinbase.
36:03
And then, when I want to take profits, here’s two ways to take profits.
36:07
I can go back to Coinbase and I can sell and take dollars, I can do it in my name or my LLC LLC name.
36:14
Or I can go from my ledger, I can isolate the coins I want to spend.
36:21
So I’ve gone into Coinbase, bought $2, Gone to my hardware with my ledger, re-allocated, made a bunch of money, took a portion of that.
36:31
Open escrow made an offer on some real estate. Opened escrow put my Bitcoin in escrow.
36:38
Had the escrow agent Selle for dollars in escrow which does not create a tax liability for anybody and then pay the seller and then I take the title to the property.
36:49
So the only trick on that is either I take the title as a borrower, or I take the title as the trustee of the owner.
36:57
So that way, I don’t take the title in my name and leave it like that.
37:01
That’s an example, without even really using a structure and a fancy bank account, you just do in your personal name.
37:13
Brad, if you heard this before I probably told you these stories. Right?
37:17
Yeah, somebody.
37:21
Um, But yeah, the escrow. Yeah. The ESCO is a great example.
37:25
I mean, you’re coming to me for having me sell you a company. I’m more than happy to do it and I love doing it and I’m available for the whole year. That’s the deal. I mean, you can set up a company that’s easy. You’re paying me for the service. I charge 697 has set up.
37:37
The company, includes a whole year of consulting one-on-one and you include the fees to the state fees. You can make it to where there’s no annual state fees and you can also make it to where I like to do it. So, there’s no registered agent fees every year.
37:53
It’s kind of a trick, but I like to do that.
37:57
But yeah, and so I want to, I want to explain it that way, Any questions?
38:03
Because if not, I’m going to, I’m gonna go through one of my stories.
38:08
Example, you were so my mom not moving into your house. Was that the example, you just don’t know?
38:16
Well, I was just saying how to move money out of Kryptos into something, buying something without creating a tax liability. And the way you would do it is to sell your kryptos while in escrow.
38:29
So you’re converting your property, your, your crypto property into some other kind of property without taking a gain.
38:39
So, let me, let me just let me jump in there and just save because you and I talked about this on the phone a couple of weeks ago. So.
38:50
What John was suggesting that if you can find an escrow company that will take, let’s just say, Bitcoin, it could be stable coin, it could be, but he likes to use Bitcoin just because it’s the industry standard.
39:04
You give them your Bitcoin, they transfer it into cash, when it happens in escrow, nobody’s liable, But it’s finding the escrow company that will do that once the escrow company realizes, Wow, this could be a big market for us.
39:20
Know, they’re much more willing, but it’s finding that escrow company who knows that it’s, you know, it’s, it’s gonna be really good for them because a lot of people are coming into money here with, with, with this bull market. However, aside from that, John does have, his partner bought an exchange in order to set up, you know, their own escrow company, she can take it and do it himself. He just did a little while ago a million dollar deal, right and in bitcoin by some real estate, it goes into escrow.
39:56
You give them the bitcoin, they transfer it into cash and you know And then the property either goes into your LLC’s name or stays in the LLC unable to because the bitcoin went out of your LLC. Or if you want it to go into your name and you have to have it in your name.
40:15
You do a mortgage back um through the escrow company or from the LLC. Well, why don’t you take that. Once you take the title. Within a short period, you want to record a mortgage on the property, and so you decide who, that lender is going to be, it can be your same company, your trust. It could be a new company. It could be your Uncle. Bob.
40:34
Just, it has to be real, the numbers have to be real and you have to have a record of the mortgage payments, right? Which is easy to do.
40:42
And that basically transferring money from yourself to yourself in one way or another.
40:46
Yeah, there is an arm’s length there, I mean, it is still arm’s length. There there are more sophisticated ways of doing it. But that’s the general idea, You can do. The same thing with a car.
40:56
The biggest risk, I think, I mean, that’s an easy transaction.
40:58
And like Brad was saying, yeah, there will be, escrow agents, that they’re going to see this is a niche market. We can do it right now. We can clear. we can buy or sell coins or dollars.
41:08
We can do $7.5 million worth per day per client.
41:13
So if you’re liquidating or whatever buying real estate and you’re just go get your own escrow agent, OK. And if he or she or that company cannot do it, they’ll just call us and we’ll do it.
41:23
We will source it, We’ll sell it back to your agent and there’s a fee of course and you’re gonna, it’s it’s going to be, you’ll save a lot of money doing it that way.
41:32
So yeah, now, um, kind of go on.
41:36
Is it absolutely.
41:40
Sure and Andres is asking about so this is the pitch, OK, I’m going to I’m just going to quote him here.
41:45
He’s asking in the chat window, you know, reading IRS website It says that trading coin to coin should be treated as coin to fiat fiat coin Sure, and if you have a $100 bill in your pocket, you should put it in my pocket.
41:58
You just should do that. That’s a sales pitch having come on.
42:03
You Let me just give you an example here. This is maybe a funny story you can have with your conversation with your accountant.
42:11
Imagine, if you’re so smart that you took 50 grand and you went into Kryptos, and you traded back and forth, and you knew when to buy and sell, at what time. And now, a year later or so, or nine months later, you’re 50 grand is worth $2 million.
42:25
So, you tell your account, and that scenario, he’s gonna say, Well, yeah, you gotta report it, man. It’s taxable, OK, fine.
42:31
So how much tax to IO and he’ll tell you like a percentage or or a dollar amount, Whatever the conversation is, going to, you know, move into it.
42:37
And then you ask them, OK, so how do I do that? How do I pay the taxes I owe on it?
42:43
And he says, Well, you’re. You’re going to have to just, you know, buy your 10 40 and write them a check, and then you say, Well, I only have crypto coins.
42:49
I don’t have dollars, Am I required to go get some dollars or sell my coins? Am I required to sell my coins to pay this?
42:57
And you start realizing that the coins are not being taxed.
43:01
It’s the dollars, because you cannot pay the tax on the coins.
43:06
Look at all your taxing rigs. They all have rates on dollars.
43:13
That’s probably, That’s my analogy anyways. I don’t know if that’s.
43:18
The best one. But I was talking with an accountant in the UK about a year and a half ago and he was just going up and down all the rules for HMRC, right? This is their IRS over there.
43:30
And after he was done I said OK so that sounds pretty strict.
43:35
It’s like yeah and I said where are you reading that from?
43:39
And he started laughing and he said well it was the HMRC website. I said, OK. Well what laws have imposed new taxes on cryptographic currency?
43:48
And he couldn’t tell me.
43:50
And I said, so what are we talking about here? What’s changed?
43:55
It’s, your perception has changed.
43:57
And he admitted that.
43:58
He’s, like, Yeah, you know, you got me, after all that ranting and raving.
44:03
All right? Let’s see.
44:07
So, what does the IRS looking for here?
44:12
Tell the truth to the IRS if they if they ask you on a tax form if you got crypto say, yeah.
44:17
Even if you did it, technically, it’s not yours because the way I write these things is not yours. I would still say yeah, because I still have the beneficial interest. Just say, yeah. Here’s the one thing I would say be aware of.
44:28
If your accounting person wants you to fill out disclosure forms regarding kryptos, do not do that. you’re not required to, especially if the form involves saying it under penalty of perjury.
44:39
Here’s why There are severe penalties for lying to the IRS. It’s like five year prison sentence.
44:45
I think if you’re convicted, on a 10, 40, 10, 40 are filed every year under penalty of perjury.
44:52
That alone is your one thing you have to do.
44:56
You’re not required to do it twice.
44:59
You testified to something once, and that’s enough. If someone else asks you to fill out a form …
45:04
perjury or another type of disclosure, no, you do it one time on a 1040.
45:08
That’s what I tell the IRS when they want to audit my client, I tell them you’re gonna get, you’re gonna get to audit. I’m not gonna, I can’t fight you on that, but you get one meeting, and you better make sure you get all the documents, Because we’re not gonna do this again.
45:20
And I transcribe it.
45:22
And that’s the end of it.
45:23
That’s all they get.
45:24
So just know that if you’re already on the hook for the 10, 40, every year, you’re not on the hook for something else.
45:30
That’s another penalty of perjury situation.
45:34
See what you have, everything in the LLC, OK?
45:38
Not saying, let’s put everything in there, but where you want to minimize risk, yeah. It’s a great tool to use. I use one LLC for different types of cash flow, so I don’t have to set up all kinds of bank accounts for all kinds of companies, and I can own assets in different ways.
45:51
So, um.
45:54
How do you use the money? How do you cash out?
45:56
OK, like, I, like Brad, and I explain on buying the House, you could do it that way.
46:00
You move the money, you can literally sell your coins in the LLC account and then spend the money from the LLC, and then the trick is how you take the title, you can take the title in your name, or whether it’s a vehicle, vessel, aircraft, real estate, an investment, a new house.
46:15
Even paying off the mortgage, which is a different type of risk.
46:19
You either take the title of the thing in a company or a trust, or when you put it in your name, you put a lien on the property that’s legitimately and it has to be have let’s call it economic reality, OK, It has to have a real interest rate, real terms, and all this stuff.
46:39
That I don’t want to get into too much detail, but um, The big risk and paying off your house For example, a lot of people want to pay their mortgage I don’t know why, but I think paying off a big chunk of it is a good idea.
46:50
I think having 25% mortgage is a pretty good idea, 50% is OK, 80% is not necessary. Really, I think that’s too much debt to have on a personal liability, a house is a liability, and be clear on that.
47:03
Know what a liability that asset is, So something you’re living in and paying for, and that’s costing you money as a liability, Instead of paying off your mortgage, let’s say I’ve had lots of clients come to me with like, I just got 50,000. They would tell me, I just got 50,000, $150,000 from inheritance. My friends had to call you.
47:20
And they’re like, I’m gonna pay off my mortgage, but he said, No, I should call you first, because I said, OK, my typical conversation is out of the 150 set that aside, and take out 2 or 3 or $5000 of that, and let’s work on a plan, which will take us literally about an hour, to buy an asset. Depending on your needs and your lifestyle, and what kind of asset we’re talking about, this asset will be enough to partially or fully offset your mortgage payment.
47:45
So, now I’ve got a debt over here and I’m not going to pay it off. I’m going to acquire an asset and I’m going to balance it off, right? So, zeros out or close to it.
47:53
And then when I’m done paying off, selling the debt, I’m still going to have the asset.
47:58
Hopefully, this is a very good habit.
48:00
Any, any good banker who’s willing to tell you, the truth, will tell you it’s a bad use of capital to pay off personal debt early because you miss out on something called internal rate of return or net present value of your cashflow and you give it to the bank. And the bank will even make more money than you could have made with the, my name is got. It’s like a gift to them.
48:21
You would, you’d be shocked. You’d be angry to know how much money they make when you, when you pay your mortgage off early, when you refinance your house.
48:27
Oh my gosh, it’s like stealing, It should be illegal and state taxes. OK, state tax different from Fed, OK, well, we’re talking about Fed. Usually we’re talking about income tax, state tax. You have your income tax. You have your conveyance tax. Or give an example, in California.
48:41
And Florida, if I’m gonna sell a house that I live in in one of those states, California, or Florida, they have this huge. It’s a documentary stamp tax.
48:50
Now there’s a video on privacy fight on the YouTube channel.
48:53
Privacy fight is one word. Go there, search on it. It has to do with the PMA.
48:57
I used, it was in Oregon, real estate, residential real estate, and it was a New Mexico LLC.
49:05
And because the LLC was out of state, the title company was trying to create a tax situation which it was taxable, but we actually were able to get out of the tax situation legally and we did it twice in like six months. It was amazing. And they try to, they try to finagle it in a way where they could create the tax liability, it didn’t work, and they had to give my client all the money. So.
49:23
But what we do in California is we would convey the property to an LLC for estate planning purposes, and just so you can check this out, there is a cyclic. three page form. You fill out with your quitclaim deed. The quitclaim deed is how you got the title to the real estate, OK?
49:39
You quit the claim on the real estate, and we transfer the title with a quitclaim deed. And when we read, when we recorded it with the county, where the property was, in California, we included this exemption form.
49:53
And the exemption actually says on there that the conveyance is for estate planning purposes.
49:58
Even the government recognizes, so if you have an estate tax situation like that, it would be, um, a documentary stamp tax, which is really a tax on the Disposition of Assets. It’s a sales tax, OK. It’s an exaggerated sales tax.
50:12
You can deed the property to an LLC, let the LLC get whatever income is gonna come from the sale and then the deed that the conveyance itself.
50:23
The tax can be avoided just by filling out the proper exemption form. And you’ll find sometimes in some of the counties, you have to be up on your game a little bit. Some of the carriers will pretend that, it doesn’t exist.
50:33
I don’t know why they do that, but, uh, I mean, like, what’s it to them? But anyways, just be aware of that.
50:39
Um, when do I need to get my coins into the LLC?
50:44
Like it’s just like with real estate, when I went to dispose of an asset and it’s in my name. I want to take it out of my name, for estate planning purposes, and then I want to dispose of it. So the place I put it, is the thing that can handle the liability. So, I’m gonna put the thing I’m going to sell, I’m gonna conveyed over to the limited liability company, or the trust or whatever vehicle I found, it’s the best way.
51:02
Then I’m going to Dispose of the Assets. So, same thing for coins. You can just go in and best and bind, buy, buy, buy, and trade, and and your account can triple and …, and all this stuff.
51:11
And then, when it’s time to liquidate and take profits, do it in this way. Use a company or an LLC or some vehicle whereby you can pass on the liability or defer it forever, OK?
51:25
Alright, and there’s some good questions here I’m going to jump to that real quick.
51:29
Know it was a shortlist Brad, and I’m looking at your list of questions, which is ideal, but it’s going to take a lot of time to do this, which is fine if you guys are in for it. I went for it. All right.
51:42
US based Yeah. You can do this in Australia.
51:45
I don’t even know what the tax laws there. You can do it in the UK.
51:49
This is why, OK, there’s a 30 minute video on Privacy fight, it has out on the thumbnail. It has a picture of the globe.
51:55
So, so watch that video. I forget the title.
51:57
But um, the reason why I do it, I explain it this way. Because I want people to know they can use it in other countries.
52:03
So, yeah, we use an LLC here and I will use an LLC as much as possible. Because I just like those, it’s easy, everybody recognizes it. If I, if I can’t have one, I’m gonna use a partnership.
52:13
And the whole idea is that I want to divest my exclusive rights and something now if, like because I fell 10 forties if I get money direst once it’s cut.
52:23
But my brother and I never filed 10 forty’s together, right?
52:26
So if my brother and I make a bunch of money, we wouldn’t have a tax liability. We could put $100,000 into a deal and make a million dollars the same week and still not have a tax liability.
52:35
Until we take our shares out, you can ask any accountant.
52:39
There is no tax liability now, if we didn’t take our portion out, and we just file the tax return to the IRS and said, Hey, we are a partnership, and here’s our tax treatment. And the irises will say thank you very much and take its cut, no problem.
52:55
Or we could take our new found well and roll it over into another deal as a partnership.
53:01
If we want to do that, we can do that, So we can do in any country.
53:07
OK, and switching over to SBAR.
53:09
So F bar Filing for $10000, for an account, it’s not 10000. Go. Look at your rules, here’s what you guys want to do.
53:17
Going off shore.
53:17
OK, if you’re a US citizen, you are never offshore and I have an article on this to US citizens or never offshore.
53:25
Go to ace of coins dot com on the block, be very careful about this. This is way worse than the IRS. F bar is under the Financial Crimes Network.
53:34
Financial Crimes Network brings in total 18 implications, OK?
53:39
And I believe Title 31, which is Civil Penalties and Criminal Penalties, for not disclosing foreign interests.
53:45
And those include being a signer on a bank account.
53:49
Being a board of director member on a corporation off shore.
53:54
I don’t believe it includes owning real estate offshore.
53:57
So be very cautious about having any off shore companies or financial interests or corporate interests. If you really need to do things like that, there are ways of doing it legally.
54:09
Let me know, we can talk about that, but most everybody I’ve talked to, it’s not necessary. You don’t need to go off shore unless you really actually have a project off shore. OK, if you’re making money off shore. Great, There’s some structure that I could recommend to you.
54:21
And there’s … Brown.
54:23
Yeah, considered.
54:25
Yeah, that is for right now, and for the foreseeable future that organization Legally does, not is under no obligation to report on anyone, and it does not report on anyone, even if it wanted to report.
54:36
It wouldn’t be recognized ironically. So if Caleb and Brown took your account information like Bank of America would If you went to Hong Kong at Bank of America, they would definitely report on you. You know that. But Halem of Brown would not, and even if it did the, Iris wouldn’t touch that information, because it’s not under a treaty.
54:52
It’s not under some sort of relationship, OK, for right now, I don’t think it will be. I don’t see that happening. I don’t think it’s regarded as a financial institution, yet. Maybe they want to be, I don’t know. So it’s, it’s that one.
55:05
Know, that one situation, where it’s really unique, and I just am an advocate of Calama Brown for that reason, OK.
55:12
So, um, but F bar, aye.
55:16
I’ve had a couple of cases on this. It’s ugly, they’re just, they’re there. You can never comply, OK.
55:22
So, what you want to do is look up the, form 5, 471, PDF, IRS Form 5, 471, and not just the form.
55:32
You want to look up the instructions for the form.
55:36
And just to validate what you may experience, I’m going to say this.
55:40
I’m gonna put this here.
55:42
Yeah.
55:46
When you go look for the instructions, and I believe it’s about six pages long, the first page should make you angry. Because you’re going to conclude very quickly that they wrote this in a way to just say, F, U. If you go offshore if you’re a US citizen and we’re gonna beat the **** out of you and that they will do that. So, that’s what this is for. I’ll tell you, if you think you, do you think you can comply, and you don’t mind filling out these disclosure forms, You know, that’s fine.
56:10
But they have the ability, and I have cases right now where they are doing this. People came to me. They’re on fire with this.
56:18
The Iris can at anytime in the future in the next 99 years, if they want, say that you didn’t do them correctly and void the statute of limitations, the IRS can do that unilaterally as if there was no statute of limitations.
56:35
So be very cautious about the off shore stuff.
56:37
There is a right way to do off shore.
56:43
Yeah, and the in the UK as well, I mean, Australia, Canada. I kind of cheat in Canada, here’s what we do.
56:51
Well, UK two.
56:52
So in UK, Canada, for eat, for convenience, we use an LLC here in the states.
56:57
We do our accountant, Caleb and Brown, and then later on, we take our time and do our banking. Sometimes with the LLC, we domesticated in Canada.
57:05
Now I’ve done those and we don’t go to the government or service. What we do is.
57:10
Once everything’s running fine, the way you want it. I have you go to a bank that you want in Canada, for example, and ask what the bank would want to see in order to do business with your limited liability company.
57:20
And then most of the time, it just says you have to register with your province as what’s called an extra provincial company.
57:28
And that’s called domesticating your LLC, and then the bank will deal with you in Canada, even though the Canadian laws do not recognize an LLC, but you can still do it. Same thing with the UK, and anywhere in the UK, and in Europe, actually, if it’s not friendly where you are, I mean, probably most countries, modern countries, recognize LLCs, but if it’s not easy to do, you can actually go to online.
57:52
You can go to I believe it’s the Republic of Ireland. I could have that mistaken with Northern Ireland. I’m sorry if I mix that up.
58:00
But in Ireland, it’s very friendly to register a limited liability company.
58:05
And bank there, where you’re located in Europe, wherever you’re located in Europe, they’re very friendly to people in Europe.
58:11
So if you really want to do that, check that out.
58:16
Alright, I hope that helps you guys in the UK.
58:19
Minimum investment for crypto is when you would say, worth moving it.
58:22
OK, um, but for me, personally, I just use an LLC for everything.
58:29
So what’s the minimum amount of money then I’m going to use an LLC to manage to avoid risk.
58:37
I do it as a matter of course, but if it’s, I don’t know, I can just make up a number $50,000.
58:44
Let’s say tax on $50,000.
58:46
If you Don’t like paying tax on something, or if you think there’s too much of a risk on something like, for example, maybe you don’t like $50,000 in your name, For whatever reason, like I wouldn’t be comfortable with $50,000 in my name.
59:00
I don’t mind a million dollars in my company.
59:02
I would move it into a company. So if you’re not comfortable with it in your name, that would probably be the point at which you would use a company of some kind.
59:13
Yeah, if you guys are in Australia, I can say, you know, show you a couple of things.
59:16
What I tried to do first is find out what you want to do if you’re just investing in kryptos.
59:22
I would, I would use an LLC here in the states. I mean, for me, it’s so easy to set up. I could do, like, an hour, you know, if you really wanted to, Or Colorado.
59:30
I mean, we have nice jurisdictions here, and the, uh, your local people, your bank there will just want, sometimes just a certified copy of the articles.
59:41
I mean, most banks are going to ask that anyways, and today they will accept the copy of the certified copy. And then in Australia, I think Australia does LLCs.
59:48
I don’t remember, but I kind of don’t care because I know that I can again, if I set up a company in the states, I know that I can get my bank in Australia to open an account and I believe your disclosure obligations are somewhat greater than in the states.
1:00:03
KYC is about the same, but I’ve just seen them asked for more documentation on companies. Here in the states are pretty lax about that.
1:00:10
If you have so you could probably get an account here.
1:00:14
As a foreign sinor, I don’t try that too much.
1:00:17
But I know that they would recognize a foreign passport and they would do it over the Internet, not that it’s necessary.
1:00:22
And so, you want to check your laws, too. Like if you’re in the UK, Canada, United States, and probably Australia, New Zealand, you’re probably having this worldwide surveillance of wherever you’re using money and corporate interests. So, just be cautious about that. I don’t know what the rules are over there.
1:00:39
Yeah. And a lot of people wanted to do the company now. Sometimes it depends on how the conversation goes. I try to get a feel for what the person really would want to do. Because if you’re not sure, Or you’re kind of new.
1:00:50
I don’t like to say, yeah, this is the best thing, ever, you know, Even though I think it is, I’d like to let you think about it. And so, I won’t, I won’t push you. I’ll just say, you know, It’s one of the things you can consider.
1:01:01
So, give yourself time. If you’re new to these concepts, and you have 50,000 or $150,000 in kryptos, and look at, is, we still have a road to go before. We want to take some profits. That’s my opinion. You have plenty of time to decide if you want to use a certain type of vehicle to manage that.
1:01:21
You don’t have to do it today.
1:01:23
You can buy, buy, buy, and not have a liability.
1:01:28
OK, Let me go back to our list, Brad, and see.
1:01:35
OK, when do I need to get my coins into the LLC?
1:01:38
Yeah, well, it’s when you want to win, you’re gonna start when you’re gonna create a liability.
1:01:44
So buying is not a liability.
1:01:46
So you buy, buy all you want when it’s time to take profits or move your property somewhere or liquidate you want to use a vehicle, an LLC or a trust or something so at the time you’re going to have the liability, you can set that up.
1:01:58
Now, sometimes it might take a week or two, sometimes it takes a day, it depends on the situation. But yeah, when you’re going to have that liability, put that company in its place.
1:02:08
Yeah, you can, you can go to a stable coin, that’s what I’ve been doing and you take profits and stable coin and go back in, We’ve got a long way to go. We got a year. It’s going to, it’s going to be nice.
1:02:17
Yeah, guys, I’ll just say to them, it took me, and John probably, two weeks, to set up my LLC. from the time, I said, let’s do it, we got on the phone, he set it up while we’re on the phone, he was typing away. He was in New Mexico, doing his thing set.
1:02:32
The whole thing up, and then I think by the next day or two, you had the wretch number over. And all the documents poured into telegram. Here you go, download those. I got when I got my articles notarized, because I think kill them brown, wanted them notarized. I send it over to Caleb and Brown. It took us further two weeks from there.
1:02:57
And I got my account in the company name over there. So that’s my first exchange that I’ve got in the company name, but the fact is because you can trade in your own personal name, and you’re just going coin to coin to coin.
1:03:12
And then when you’re ready, all those coins are going to go over to Caleb and Brown and the exchange in the name of the LLC. Correct. I’m just gonna transfer them over. Then, they’re in there, let’s say it’s all in stable coin.
1:03:25
Would then, maybe I’ll transfer one big wad of stable Coin over there, you know, and thrown. And then I just deal with it from there.
1:03:32
John, Somebody brought up and it seemed like a really good idea to me because Kale them brown will wyer your money.
1:03:42
They’ll do the transfer they’ll go from stable coin, and they’ll they’ll they’ll shoot the money over to you in USD What about that, it’s the fact that it comes into your bank account. right? It’ll, it’ll go to the same named account holder. So it makes sure it’s your LLC at Caleb and your LLC in the states. That’s the only way they’ll do it to the LLC.
1:04:04
They won’t do it to the bank account … account and I’ve already I’ve already set up a bank account in the name of the LLC. Which is my standard bank that I have all my companies in.
1:04:15
So, it would just go into that. That’s right. Another thing I like to recommend is, instead of wiring money, which is certainly fine. I don’t like to do international wires just because the banks full with the money.
1:04:25
So, we have a chance to avoid that.
1:04:27
We can actually go, and this is why I say, move large amounts of money. It’s easier to do that, then like one thousand dollars, it’s easy to remove a million than a thousand. I can go from my Bitcoin, through escrow to an asset, and I don T have to wire money.
1:04:40
So that’s one way I would rather do that or I would move from my wallet in Kelvin Brown to my wallet Coin Base and sell for my thousand dollars.
1:04:49
I want that then wire the money or 50,000 or whatever.
1:04:53
Just keep that in mind.
1:04:55
John, can I ask a question? The question? Yes?
1:05:04
My business, I have a regular business, person and business, whatever it. And it’s added kryptos two expansions, you know, been doing it through, use the see through circle, and just adding some Bitcoin.
1:05:21
How can we express that?
1:05:24
Ooh.
1:05:27
Yeah.
1:05:29
And, yes, you’re breaking up. I think you’re on your phone.
1:05:34
Yes.
1:05:37
Yes, I am the phone. I just, I just, I’ll ask on reading, I write down, I’ll write down. I’m sorry.
1:05:44
Perfect. No worries. No worries.
1:05:47
Can you hear me? Now? Can you make this better?
1:05:49
OK, OK, I’m sorry. What if I just, my regular business, is adding … to manage it?
1:05:57
How can we transfer not to the LLC or the trust you are mentioned? That’s going to require a disposition of assets?
1:06:06
You can’t get around that. Yeah. You can do it. Yeah, because I’m assuming your current business files tax returns, so it has a different tax treatment.
1:06:14
If you want to take that property under a different tax treatment, you would have to dispose of the asset an account for it and then you’re out. You’re out in the clear. That’s like, kinda like liquidating your 400 and K and then you’re out.
1:06:25
So. Yeah. But it’s possible. Oh, Yeah, There’s a way to do it. And I would do it, too. I mean, I would get under a different tax treatment, as soon as possible. Yeah?
1:06:38
That’s a good question. I haven’t heard that one a long time.
1:06:40
Yes.
1:06:43
There’s something else I want to share with you guys. Just give me a second here.
1:06:51
Yeah?
1:06:54
You want to minimize taxes.
1:06:55
So, OK.
1:06:59
Well, you can minimize taxes by not taking a gain. You can eliminate them.
1:07:04
So you don’t, you don’t take a gain, You move the money over to another asset, and then you manage the cash flow in a different way, which gets into some detail You structure the transaction as well, alone or funding another party.
1:07:17
So if I want to buy a house?
1:07:22
I’m not saying you have to do it this way, but I have an LLC that has this coin, this coin value. Now it’s a million dollars, OK?
1:07:28
And I just gonna set up another LLC and then I’m gonna, I’m gonna put this million dollars now.
1:07:34
I sold my coins already, It’s in this LLC at Coinbase and I’m gonna just write a check and deposit it into my new LLC and then that I’m going to use to buy the house and I’m going to title the house and the name of that LLC.
1:07:49
I can just do that.
1:07:51
I don’t know if that, I mean, that’s how you would minimize taxes.
1:07:54
It’s not your money.
1:07:55
You’re moving from one company to another, That official interest, a the same.
1:08:02
The other thing is, you’re not gonna get tax deductions on that type of structure because it’s not filing, it’s not going to do 1099.
1:08:08
And, the money you take out of the LLC for yourself, it has to be taxable if it’s personal.
1:08:14
And how do you report it? Well, it’s not going to be W two, it doesn’t have to be 1099 because the LLC that doesn’t file a return is not going to send you a 1099. That’s your company.
1:08:23
You would just declare the income however you would miscellaneous income, or whatever you want to call it.
1:08:27
Just don’t lie.
1:08:29
So, you have to decide what that is.
1:08:32
Um, there’s another thing you can do.
1:08:38
Instead of avoiding the risk, now, this is for some places where it’s not possible to completely avoid the risk, you could diminish the risk. You could diminish the taxable value. Now, I’m going to explain it briefly.
1:08:50
An example of how we do that here with a traditional S corp.
1:08:56
And I know there are structures around the world that you can do that. So if you’re in the UK or something, you can talk to your accountant about this type of deal.
1:09:02
What we call it, here’s a grant tour, Retained, annuity trust and I’m gonna put the text here just so you guys can check it out, but it’s a grand tour, retained, annuity trust. What you’re doing is putting a windfall in there before taxes.
1:09:18
You’re diminishing the value over a period of one year.
1:09:22
That’s going to be your taxable amount is now half after the first year.
1:09:26
After the second year, you can get 100% reduction in taxable value. So your taxable value will be zero.
1:09:33
It has to have it’s an S corp with an annuity and I don’t do those. I’m not qualified to do them. Some CPA’s will do them.
1:09:41
They’re known as a grad.
1:09:42
G R A T, OK, there are other ways to do it, to strip the equity of something that would be taxable, And we get into some complexities there, I rarely do those, but you can do it, where you’re faced with a tax you can’t avoid.
1:09:55
You can strip the value of that and Well, there’s some other mechanism, but I just want to share that one thing with you.
1:10:02
So, if you want to have a discussion with an accounting person or do some research, you can check that out I would use it grat if like, for example, I want to give money in my Alyssa, my brother, and he’s real queasy with this conversation, right? So I would just tell them, No worries. You’d have to do what I do. I know a couple of years ago, I set some money aside for you from my windfall.
1:10:25
The taxes already covered, because I stripped all the taxable value and here you go.
1:10:30
Here’s a million dollars and I would literally give him the control of the grat, the S corp, it’s after tax money and he can do whatever he want it. Now I can also give it to them.
1:10:39
So there’s all kinds of ways to use a graph.
1:10:42
Let’s see here, because it’s your LLC transfer from sandby. How do you minimize, yeah?
1:10:46
Minimized, by not having a gain, you can borrow money out, move from Company to company, company to trust.
1:10:54
There’s all kinds of variations.
1:11:00
You guys want me to give me my contact info?
1:11:04
No. Brad left that here.
1:11:06
Yes.
1:11:07
Definitely. How, how do you want people? I’m sure a lot of people are gonna want to set up LLCs with you. I see that Andrus asked, what’s the basic price to set up an LLC? I think it’s like 700 bucks and you can order it through and fill out the form on, is it privacy fight?
1:11:22
Well, …
1:11:24
dot com has a PDF order form, that’s probably the easiest way, if you go to the bottom of the page.
1:11:31
Just open up the file, it’s a PDF document, save it on your computer, check the 697, so cost $687.
1:11:38
And if you pick New Mexico, it’s $50, there are no annual costs after that, no hourly.
1:11:44
I do whatever you need for the year, we can have private consultations.
1:11:48
You can, the best way to get that to me is by Telegram.
1:11:52
You can also send it by e-mail, but let me know I telegram, because I’m paired an e-mail right now, so I’ll have to go look for it. So, send me that, or here’s what I really need.
1:12:01
I need to know what you want to call the company, the state you want to want to set it up, in, which I recommend, I’m gonna give you a list of states I recommend, but tell me the name, you want to call, it, the alternate name.
1:12:12
Tell me the legal name of the sign, or like, how does your name appear on your legal document?
1:12:16
So when I write this up, the bank will accept all your documents along with my document, your driver’s license, my documents.
1:12:22
And then that’s everything.
1:12:24
I mean, unless you have, if you want to use an address you already have access to, you can do that. If you want to use a New Mexico company and you don’t have any address in New Mexico, I’ll get that for you.
1:12:34
It doesn’t cost anything. I actually use office space, It doesn’t cost anything.
1:12:38
So, then what I’ll do is I’ll write the documents and send it so you can look it over and make sure everything’s good on your, you know, all your information.
1:12:44
When you approve it, then I’ll go ahead and file it, give you thought approved documents, and then I give you a set of instructions with some video links.
1:12:52
And that helps you get through everything. And all the documents I give you are designed so that you can open your accounts with the least friction.
1:12:58
And trust me, you will have some friction because the banks, No, they’re just, they’re designed to defeat what it is that we’re doing.
1:13:05
OK, we want privacy, we want some intelligent risk management, They don’t like that.
1:13:10
But, we will get our Accounts open, OK.
1:13:12
He gives you two sets of, kind of, two sets of documents. one that’s gonna go to whatever institution, and one that you keep for yourself, in a folder that says, do not send this out off, right.
1:13:27
And also, John, there’s, there’s a set of videos. I’ve actually purchased the whole course, You actually have a course that walks through a whole bunch of stuff on this, On video, and you can do it in four parts. I think It is I I just bought the most, Because I figure.
1:13:44
Yeah, When you’re making so much money on crypto this, guys, this is peanuts. This is nothing to exactly, exactly, to try to protect from the tax. man. You’re talking tens, if not hundreds, If not millions of dollars so much.
1:14:02
No, there’s no question.
1:14:03
Can you just go over that course a tiny bit, and yeah, what I want to show you is the boring mundane keystrokes you would use to enter a company and register it with the state and then get your account open. OK, then I talk about how you would select the data, so I’ll do that again briefly here. You you want to decide who the owner is going to be. It can be a single member.
1:14:23
It can be a PMA, it can be a trust, what you want to call it. Who’s going to be the manager?
1:14:27
I like to use member managers, the address you want to use.
1:14:31
And once you have those ideas, then I like to write it down, keeping a file, and that way when I’m sitting here preparing the document, I can just read, read everything, and type it in. That’s what I’m showing you in the video.
1:14:41
And then some of the videos I’m showing you, examples of walking you through a transaction. And we were, we’re gonna get into way more detail on that.
1:14:50
And we’re gonna get into some more re-allocation strategies, which I’ve never done before. So I’m going to bring some people on board that that’s what they do for a living. So this will be this will be learning for me, too. But, my videos, I’m showing you, that just the basics of what everyone’s concerned with is how to get out of the gate, and how to manage the basics of the tax situation, how not to get in trouble, What you don’t have to do, and what you do have to do.
1:15:13
Alright. And, and realize that there are people around, that kind of push around.
1:15:18
So, just, you know, when you’re dealing with the rest of the world, kinda. And hopefully, you’re gonna learn what you’re doing, you’re gonna know and have confidence in what you’re doing.
1:15:26
So, that’s the purpose of my videos, it so that you’re not gonna get easily push around by people that, you know, like attorneys who try to bully you around.
1:15:34
Hopefully, that’s what, know, we’re going to cover. That’s the boring stuff. That’s what you got like, with four videos, I think it is right there.
1:15:42
Millimeter, hm, We’re going to add a lot more, so, Yeah, I appreciate doing that.
1:15:47
Sure.
1:15:50
Yeah.
1:15:51
I want to remind you, again, check out that video on a privacy fight where I’m talking about the woman in.
1:15:58
She has a property in Oregon and in New Mexico, LLC, and, uh, twice we got around that whole issue. And so, this is the kind of thing, and I never had a case like that before.
1:16:07
But because it was set up in a way that gave us the the versatility to do whatever we wanted, we were able to use residency and non residency together to avoid that withholding and the capital gains tax.
1:16:24
So, Wow.
1:16:34
Well, I can’t think of anything else.
1:16:35
I mean, John, thanks for everything you’ve been sharing, and I think it’s been great stuff, you mentioned, you’d go over the states.
1:16:45
Besides New Mexico, OK, thanks, thanks for reminding me the best states in my opinion, and here’s how I choose them. Those are the states that leave you alone, OK?
1:16:54
They’re state taxing authority, they don’t bother you, like, the California Franchise Tax Board, run farhan fast, and those guys, if you’re in California, and you have a California address, it’s so bad in California that you cannot register in another state, and use your California address, because that state is supposed to tell on you. And then California will send you a bill for not registering in California, which is gross. It’s, like, $800.
1:17:17
So, the best states are New Mexico, I say number one, Colorado is like right next to them.
1:17:24
Arizona, Wyoming, those would be the top four.
1:17:29
Then, Florida, and Georgia, and Pennsylvania. Now, Pennsylvania is like New Mexico. It has a one-time filing fee of one hundred $25, and there’s no annual reports and no fees ever after that. It’s always going to be good.
1:17:45
Ohio, I believe there’s no reports, but it’s $99 a year.
1:17:49
Then let’s see.
1:17:53
Yeah, Arizona, I don’t think there’s a report every year.
1:17:56
So, those are the best states, I think, is what six states?
1:18:00
Person, Wyoming, Arizona, Colorado, New Mexico.
1:18:05
Now you can go, there’s probably 15 or 20 good states like, you can go to Utah and Idaho and, know, probably South Dakota. I don’t use those too much, Michigan’s OK, I would stay away from New York, Stay away from Illinois.
1:18:19
They were from Texas, they’re from California, stereo, from Kentucky, sometimes we do Kentucky, it depends on, you know? Just the state gets involved, right. The state starts sending all these forms to fill out and have to deal with the state.
1:18:32
Um, Oregon and Washington, I’d stay away from those states.
1:18:39
They’re still OK, but, you know, the ones to stay away from California, Illinois, Texas, New York.
1:18:47
Most of the people I work with, I mean, we’re like it looking at 80, 90% New Mexico. I love New Mexico because I can so I can just quickly registered. It’s done.
1:18:57
Colorados fast, Ohio’s fast.
1:19:02
Florida takes about a week to approve Arizona. It takes about a week, but they’re also good states, Wyoming.
1:19:07
Now, Wyoming, That one, we have to pay a $25 a year, and this is because I found an agent that will do it for $25 a year, a registered agent service. The reason being is that they’re always, they always go, go and check to verify that they have the, we have an agent that we have to pay. For some reason, they just do that in Wyoming this reason. So, I’ve had to adjust. So, if you wanna go to Wyoming, My recommendation is, It’s fine. It’s a good state. It’s just, there’s a, there’s going to be an annual fee of $25.
1:19:49
I’m sorry. I didn’t mean that, I didn’t mean to leave someone out. He asked if I would do a call with his estate attorney.
1:19:55
I don’t mind doing that, but I would like to know in advance what you want to discuss, because I’m not a bar member.
1:20:00
You know, I don’t give legal advice, and I’m not, know, by any means an account, so I don’t know. I mean, I don’t wanna get into a discussion. I’m, I’m not going to try to convince someone that you know of a certain thing, so if I can help solve something or clear up something, that’d be great. I’m more than willing to do that, John, That was me. It’s Robert. So, maybe I should just talk to you first. Yeah, and then talk to him about this. Yeah.
1:20:26
Especially since we’re talking about And this is, Yeah, I did talk to one accountant, and in the end, she just finally said, listen, just agree to disagree. That’s like, OK, whatever. That’s fine, I mean, I haven’t had a problem with the IRS.
1:20:43
I’m always writing.
1:20:45
I used to write a lot of books on the subjects, and since the nineties, I’ve been writing books on this, I don’t publish anymore, but I would go travel across the country to go to audits.
1:20:54
In fact, I’ve been in district court on people that were going to be held in contempt because of an audit.
1:21:00
I was not representing them, but I was going there to talk to the judge about the whole thing.
1:21:04
And they know what I do. And, you know, they know that I help people. I guess, I like to call it helping people. They don’t like to call it that, but, I’ve not had any problems with them. So.
1:21:16
Maybe they just haven’t gotten around to me, I don’t know.
1:21:23
I’m going to upload this to YouTube, just so you know, and I’ll, I’ll give you guys the link.
1:21:28
John, can you get it over to me?
1:21:29
I can, I will. I’ll put it up in the group and make sure that people see it.
1:21:36
Yeah, thanks. Yeah, in Washington, state is tolerable, OK? Washington state is tolerable. I believe the fee is $200 a year.
1:21:43
They do kinda get in your business, but they’re OK, I would do an in-state LLC if you’re running a brick and mortar business in state because you’re gonna have a need for that.
1:21:52
Um, and yeah, if you’re in California, it’s like I said, it’s easy, you could just go on the internet and registered company in New Mexico. The problem is, if you don’t understand what deals going on, California has a deal with all the states. So, if you’re a California, if you have a California address, and you put your name and your address on it.
1:22:11
Foreign companies, application for a company.
1:22:15
Registration, that state will notify the Secretary of State for California And California’s just going to send you a bill for not registering in the state as if you did register in the state.
1:22:26
That’s just how they do it. So, the way I do it, if you’re a …, when I see California address on your order form, I just ignore it. I just go and get you in New Mexico address.
1:22:34
We just go with that.
1:22:36
So that’s how we handle them.
1:22:40
Another question for you.
1:22:43
Why don’t you know, personally, one of my goals is to say, having Passerby, like everybody else, you know, we want to have class.
1:22:53
So, let’s say if you put $500,000 in Celsius, you SDC they give you 10% APY around $2000 a month.
1:23:06
Yeah, we manage that on, on the, on the, on the LLC you trust. How can we manage that? We want to use that passive income that monthly, APY, you pay me for no monthly expenses, how do we manage that?
1:23:21
OK, the fact that you have personal expenses. I’m gonna assume it’s personal expenses.
1:23:25
that is going to be taxable anyway, so it doesn’t matter who’s paying that, but if you want to have a choice, you can make your LLC the account holder, or the contracting party, so that way, when you get the dividends, or the income, or whatever money it is, that event itself is not going to be reportable or taxable.
1:23:40
But the fact that you’re gonna pay a living expense is reportable and taxable.
1:23:44
So, ultimately, if it’s for, like, paying the light bill or something, it’s still going to be, you know, taxable income.
1:23:52
But if I bought my Tesla with Bitcoin, since I can do that now, says Elon Musk. Yeah. Just, yeah. Do that. Is that taxable? It’s not going to become a taxable income, if you title the vehicle in a company name or trust name.
1:24:08
They’ll copy, right?
1:24:09
Or you put a debt on it, like, the way you do it is you go to the dealer and tell him that the money being paid for it is actually a loan, and you’ve given the name of the lender and he’ll take care of all the paperwork for you.
1:24:19
So, as long as you do it that way, yeah, you’re fine.
1:24:24
John, in that scenario, can’t you have the LLC extend you personally credit line, and you just draw a credit line personally and use that as your personal expenses? Yeah, you can do that. I just don’t prefer that you could do that. I just, I just hate to be at an audit explaining that to the IRS because they see that so many times and they’ll probably just it depends on the auditor, they might just disallow it or something.
1:24:46
So, what I would suggest, if you’re going to use a loan to pay living expenses, you want to use a whole life insurance policy because that is what it’s designed for.
1:24:58
That’s why I say, don’t borrow money and go on vacation. Don’t make it a loan to go on vacation. That’s not a usual thing.
1:25:04
Yeah, take a loan to buy a card, that’s a usual thing.
1:25:06
That’s just from my experience and seeing all the different cases, I’ve been involved with the IRS. I would just avoid that type of situation. So a personal living expenses aren’t paying my light bill, pay my mortgage going on vacation.
1:25:16
All that’s gonna have to be, if I don’t wanna pay tax on that income, my Personal living expenses.
1:25:21
I’m gonna borrow enough money from my whole life policy which takes 1 or 2 years to mature. I’m gonna borrow enough to pay my annual living expenses quarterly or semi-annually.
1:25:32
So that that way I can I can borrow the money out, pay the interest in advance. And then I’m working with after tax money. And then I can do that and there’s no loan situation needed because I’ve already satisfied all that.
1:25:44
I didn’t want to get into that too far. But that’s like, wow, yeah, I’m, you know, there’s a lot here guys, I mean, we could talk for two days and we can go on for two days on this easily.
1:25:57
Yeah, like our one?
1:26:03
I don’t know why. You’re asking me, I cannot canal on the US citizen any visa start?
1:26:07
You can, you can be in another country with your foreign passport and you can, you can open a company here in the states and then you could probably open up a bank account for it.
1:26:16
In fact, just check on it for me. Just go call up a bank and say, hey, I want to do this thing, and they’ll tell you what’s needed.
1:26:23
So, yeah.
1:26:27
Yeah, and I do accept payment by crypto. Make it easy on me though.
1:26:31
If you would please bitcoin or litecoin, you know that the bigger ones that’d be fine.
1:26:36
Just let me know, in the Order form or by the telegram will pay you a doge, OK. I don’t know. I mean, like, you guys don’t know what I do with it after I get it.
1:26:49
So, it’s just whether or not it’s going to be convenient for me. That’s all I care about.
1:26:55
Kidding.
1:26:57
I appreciate you doing this, Brad. I hope it’s, you know, answered questions.
1:27:02
People are great. A great start, I think, to understanding you covered so much, I needed it in a way that I think is mostly understandable. You know, you go all over the map. And it’s hard but I’m taking notes furiously And yeah. A couple of things. Are you OK with people? Can they join our Thursday thing where you answer questions and stuff for you. I’m OK with that.
1:27:27
Yeah, I’m OK with that. If you guys want to someone’s give me topics already. I Yeah. Please.
1:27:33
You’re welcome to send the link out. I believe you send the link out to others.
1:27:37
It’ll be fine. OK, I can do that.
1:27:39
And are you OK with people having your e-mail address over proton mail? Yeah, that’s fine. It’s singleton press at proton mail dot com. I already had it ready to go. Just yeah, just keep in mind. I’m literally a 1100 e-mails behind.
1:27:55
I’m doing my Dan just to catch up.
1:27:58
I keep telling you, you need an old lady who has a really good account. I’ve had that before. I’ve had 30 people in my office, OK, doing stuff for me, and they were great. I can’t, but it takes It, takes awhile to get that up there.
1:28:11
And there’s this is such a specialized area that I don’t want to ***** it up, and I’m so there’s a tradeoff So I know being patient.
1:28:18
That’s why I say if you do telegram.
1:28:21
Like with Brad. I know it took two weeks, but if we had that conversation, the day one, we could have done it.
1:28:26
I, in fact, I did one today in Colorado and in 20 minutes, so I can do that.
1:28:33
So just, you know, work with me, a telegram, and when I see it, I’ll do the best I can.
1:28:38
Quick question, real quick, I’m going back to this one, but a quick example is trying to pay off a few properties or their home, or whatever they are.
1:28:52
Profits might be crypto, Instead of doing that, you know, you just took a percentage, maybe, so that you can pay off monthly, maybe borrowing, um, staking nodes. Or third example, you know, like this.
1:29:10
Just, Yeah, right?
1:29:13
If you’re willing to come off a lump sum of cash to pay off a debt, and let’s just say it’s an asset, an investment, Um, consider taking most of that lump sum and ask yourself, What can I do with it to make money with it? And like you said, take some of that money and make that payment.
1:29:30
If that’s what you want to do, but use that money.
1:29:33
Mean, what’s the point of not having that? You want to have debt? I’m just give you a couple of numbers.
1:29:37
I’m just gonna say, I’m, I’m gonna say on a, on a personal liability, like a house, like a big ticket item, I’m going to have 25 to 50% debt on it, on a, on an investment, and asset, I’m going to have 80%.
1:29:49
I’m gonna have more on a business asset.
1:29:52
I think that’s a better way to manage risk.
1:29:56
Yeah.
1:29:59
It’s good, practical to, I mean, it’s, Well, it’s one that you could pay cash for an asset. Just don’t keep, keep it like that. Because, think about this. If I pay $10 million for a hotel because I can, and then I just sit on it and I’m making good money on it, what have I done? I bought an asset. Great, I’m making money on that great, but guess what I am. I’m, by default, my own lender. Am I qualified to be a lender know? heck, no. I don’t know anybody in the lending community. I don’t know it, underwriting, I don’t know, I can’t pick up the phone and get someone to reinsure me or anything like that. I’m out.
1:30:27
So, I’m in dangerous water.
1:30:29
I may not see it, right, so just realize that, let the people who are taking a certain risk. Let those people take that risk.
1:30:37
I’m not a lender, right.
1:30:40
I might be a real estate investor, so that’s why you don’t wanna pay cash for assets, Are questions. Yes.
1:30:49
So, in the example that, that they were given just now about, you know, hey, an offer home, would it work if you had your LLC purchase the home from you?
1:31:03
Yeah, you could do that, all, your, you don’t.
1:31:05
It doesn’t have to be technically a purchase, You could just assign it to the company.
1:31:09
You don’t have to show money changing hands.
1:31:13
You just follow quitclaim deed, I don’t know why you’d want to make it look like a sale.
1:31:20
I mean, is there other different owners of the LLC then, were the title holders of the house?
1:31:28
I mean, is it the same people?
1:31:32
Right? I mean, the idea is to be able to still accomplish the goal you know, and finding that loophole.
1:31:40
And being able to pay off your home for say no, but, you know, without having to actually, take income or take, like you said, again, you know, from, from your assets, in crypto and still be able to accomplish that goal of getting rid of that per se, under your personal.
1:32:00
Because, you know, just to find a way to transfer. It, don’t take again and make it disappear. Make a gain work for you for a long time. That’s what you’re doing, if you take a gain of half a liability will then it disappeared.
1:32:12
So, did your liability, but now your gains gone, take that gain or part of it, and then improve your cash flow with it.
1:32:19
I mean, maybe not always you have to do that, but on big deals, on big ticket items I would.
1:32:27
You want you want some debt?
1:32:31
Somebody is, Andreas has asked me, with a family trust, recommend, do I recommend open the LLC under the trust.
1:32:41
Yeah, OK. You can use it trust as the single member owner of the LLC.
1:32:46
Or you can use a PMA I like using a PMA.
1:32:48
because I don’t need a trust document, but yeah you can use your own trust if you’d like your trust. Yeah.
1:32:55
Tax free, if you sell the house, OK, yeah, there’s there are exemptions too. So, if you retain the title, I don’t know what the tax exempt thing is. If you sell your house, it depends on the, you know, the laws over there.
1:33:08
I mean, you’d have to go, you know, read that and find out how that works.
1:33:14
If the LLC bought the house, you could pay, or you could buy, with kryptos with the LLC and get the free of taxes.
1:33:22
Um, oh, I see what you’re saying.
1:33:26
OK.
1:33:28
Yeah, that’s, I don’t know. You could probably do it. You could sell it to you, Sell your house, to your LLC to get a tax benefit.
1:33:35
I suppose you could do that.
1:33:37
Guys, look, here’s one thing I’m gonna leave you with.
1:33:40
Try not to think about making financial decisions for the sole purpose of a tax benefit.
1:33:47
Trust me, you’re gonna miss out on things, you’re gonna miss some important things and you might get yourself in trouble, OK?
1:33:53
Make sure you’re, Your decision is based upon return on capital period, not how to pay less taxes.
1:34:03
Especially when you got lots of money, don’t think like a consumer.
1:34:08
Kind of like your your approach when you first started, not just go straight to what is going to be homework, just go on with it.
1:34:17
No, yeah, you get right to the right to the punchline.
1:34:22
Yeah.
1:34:25
Alright, guys. All right. Awesome. John, you have been absolutely the best.
1:34:30
I can’t thank you enough for the appreciate that, Yeah, if you guys want to set up something else, We can go for specific things, But definitely I hope that gives you some good leads.
1:34:39
At least.
1:34:41
Yeah, This.
1:34:43
so, Brad, Brad, thank you so much for putting this together, man, John as well and it’s been amazing and thank you guys spread Yep, absolutely.