Scribd
Upload
13 views10 pages

Avoiding Taxes

The document outlines six legal strategies billionaires use to avoid taxes, including avoiding stock sales, taking loans on stocks, owning sports teams, investing in real estate and oil industries, establishing trusts and foundations, and hiring specialized lawyers. These methods exploit loopholes in the tax system, allowing the ultra-rich to minimize their tax liabilities. The document emphasizes that these practices are legal and not related to tax evasion.

Uploaded by

edwardian
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
13 views10 pages

Avoiding Taxes

The document outlines six legal strategies billionaires use to avoid taxes, including avoiding stock sales, taking loans on stocks, owning sports teams, investing in real estate and oil industries, establishing trusts and foundations, and hiring specialized lawyers. These methods exploit loopholes in the tax system, allowing the ultra-rich to minimize their tax liabilities. The document emphasizes that these practices are legal and not related to tax evasion.

Uploaded by

edwardian
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 10

6 Ways how

BILLIONAIRES AVOID TAXES


Warren Buffet once said in an interview that he
pays less in taxes than his secretary.

Imagine being the richest investor in the world


and still not paying much in taxes.

This is not the only case with Buffet, every rich


individual somehow uses the loopholes in the
system to avoid taxes.
There are many ways the ultra-rich use to
legally avoid paying the taxes

And we want to share some of them with all of


you today!

Let's be clear from the start, we're not talking


about illegal activities like tax evasion.

So let's start with different strategies


used by them one by one!
01 Avoiding Stock Sales

Billionaires like Elon Musk, Warren Buffett, and


Jeff Bezos hold most of their wealth in the form
of Stocks.

And the stocks are taxed only when they are


sold. The tax on stocks is called capital gains
tax and it is generally lower than Income tax.

Also, some billionaires do not withdraw high


salaries because they are taxed heavily
instead they get paid in stocks.
02 Taking Loans on Stocks

As said earlier, billionaires do not sell stocks


and also do not withdraw a salary.

Instead, they take loans on stocks as collateral


to bear life expenses.

These Loans are not taxed because it is not


considered as an income.

Elon Musk regularly borrows money from


banks like Morgan Stanley, Goldman Sachs,
and Bank of America as a personal loan.
03 Owning a Sports Team

Owning sports teams allows billionaires to


deduct expenses and report losses, even if the
teams are profitable.

The tax code allows sports team owners to


claim deductions comparable to those for
depreciating assets like factory equipment,
even if the team's value increases over time.

Former Microsoft CEO Steve Ballmer who owns


the NBA team Los Angeles Clippers had used
various avenues to erase income through
deductions.
04 Investing in Real Estate and
Oil Industries
Industries like real estate and oil offer
abundant tax breaks, enabling billionaires to
eliminate their taxable income entirely.

Real estate developer Stephen Ross went a


decade without paying income tax and that
too with all legality.
05 Trust and Foundations

Establishing trusts or foundations can provide


legal avenues for managing and distributing
wealth.

All the assets of the rich are registered in the


name of the trust. Therefore they are no longer
personal assets.

Since these entities often have their own tax


rules and regulations, they may enjoy certain
tax advantages.
06 Hiring Lawyers

Wealthy individuals hire specialized lawyers to


help them avoid high taxes and protect their
assets

These lawyers charge a significant fee but they


ensure that their clients don't lose money in
taxes.

You might also like