pay no taxes wrote:
Say you own a business and are a sole proprietor. If you immediately re-invest any profits in things such as advertising, can avoid accruing a tax obligation?
Advertising isn't an investment, it's an expense. Your profit is revenues - expenses, so yes advertising reduces your tax obligation.
If you mean a true investment, such as taking profits and investing in land for expansion, then it's a different accounting situation.
EdP wrote:
Silky Johnson wrote:Yeah, go to Somalia, where they have basically no property rights and people fear for their lives because justice is almost non-existent. Look at where their dedication to liberty has gotten them. Those silly libertarians need to understand that property rights and the rule of law are important.
Am I doing it right?
I lean slightly to the Libertarian persuasion, and I think you are confusing libertarians with anarchists. Libertarians strongly believe in property rights and the rule of law. I am confused where you are getting your info from.
I think your sarcasm detector may be broken. Sorry if it wasn't clear, but I was being sarcastic.
testerosa wrote:
I don't know about avoiding all taxes, but could you avoid a lot of them if you start your own business and operate it out of a house that you also live in?
Then if you own the house, couldn't part of your mortgage could be tax deductible as a business expense (rent for the business). You could buy a company car, company cell phones, pay for utilities on the house, internet, computers, cable TV, etc. and this would all be tax deductible. Who is going to check whether you are using the company car (of the company YOU own) to drive on personal business? Could this work?
You can deduct expenses related to a home office, but that area must be used solely for business purposes. You'd be able to deduct a portion of your, mortgage, utilities and taxes. However, taking a home office deduction is one of the biggest red flags you can put in your tax return. You'll then owe taxes, interest and (potentially) penalties. I would not recommend this strategy.
Blowing.Rock Master wrote:
How about paying yourself a small salary and a large dividend? Wouldn't you avoid most of the FICA tax that way?
This is a better strategy than the home office idea, and probably widely used, but your salary has to be reasonable. Disproportionately large dividends are a great way to attract the attention of the IRS. You run the risk of having your dividend recharacterized and then owing taxes, interest and penalties on the amount.
EdP wrote:
I lean slightly to the Libertarian persuasion, and I think you are confusing libertarians with anarchists. Libertarians strongly believe in property rights and the rule of law. I am confused where you are getting your info from.
Yet Libertarians believe that they can have property rights and rule of law without having a government, without public education, without healthcare, or any of the other foundations of civil society.
Just a bunch of people (everyone?) running around with guns to protect their "rights." Like, in fact, Somalia. Did I get that right?
dd wrote:
Don't earn any money, and you can be free of the oppressive burden of taxation. Or move to a place like Somalia, and enjoy society in that libertarian paradise where you expect nothing from the government and can do whatever the hell you want (assuming you survive). But, if you want to live in a civilized society, help pay for it. If you really think taxes are so bad, you can console yourself that for all the bitching people do about them, they are lower than just about any other non-3rd world country.
Oops! Someone missed the distinction between smallest effective government and lack of government.
Libertarians want to protect fundamental rights; rights that humans can exercise with or without others. If it requires someone else for you to exercise it, it's not a right.
Also, Somalia is actually one of the richest countries in the world relative to more regulated nations of equitable size and value of national resources.