The Difference Between Rich And Wealthy
By Lawrence
Bloomberg has an article today on Sheldon Adelson. It describes how he (and many others) avoided paying majority of his estate taxes. It is pretty much an open secret among the wealthy families in US. For normal people, it is something good to learn about.
First of all, you know you are wealthy, not just rich, when you do not need to pay your share of estate tax,
Democrat leader Harry Reid once said that paying tax is voluntary … I guess this is what he means.
Jokes aside, once you gain success with your trading, you can too help your kids and family out without being penalized by the the system. By setting up trust funds for your kids with a reasonable stake to start with, you can trade the money in the trust fund account so that all gains stay in the trust. It is similar to having a family business and transfer partial ownership of the company slowly over time to your kids and relatives so that the tax impact will not be as damaging when the time comes.
A friend of mine does it for his niece for like 20 years now. He is still single at his mid-50s. Last time I talked to him his niece is set for life if she chooses to live off the money from the trust.
Disclaimer: I am not a tax lawyer or accountant. Be aware that tax laws varies from country to country. So seek advice from a professional if you are interested in exploring the idea.
