https://www.youtube.com/watch?v=w5g0JiO7OdE

1 00:00:00.000 --\> 00:01:00.000 it's not how much you make it's how
much you keep and inside of this video i'm going to share with you in a
single presentation everything that i have ever learned in paying over
30 million dollars in taxes in the last five years which was miserable
and probably paying 500 000 million in tax preparation stuff so tax
products experts accountants audits all of that stuff all the fancy
things that the rich people don't want you to know i'm sharing it all
with you here in this video it's a presentation it's a little different
than i normally have so let me know if you guys kind of like the longer
form i know some of you guys said you did and so if you're new to the
channel my name is alex mozy welcome to mozy nation and enjoy and by the
way i have nothing to sell you after paying 22.68 million dollars in
taxes in the past five years here's everything that i've learned about
saving taxes in one presentation and if you don't know who i am i'm
gonna prove to you that those numbers are legit in a second but let's
get forward and at the end of this i'll give you my six consolidated
takeaways that you can immediately use to save yourself taxes make more
money all that kind of good stuff and a bonus set of beliefs that have
served me well up to this point in my life quick intro my name is alex
from rosie and my wife and i own six portfolio companies that do about
85 million dollars a year and i

2 00:01:00.000 --\> 00:02:00.000 have nothing to sell you if you're new
to mozi nation welcome we own all of those into the portfolio company of
acquisition.com which is our holding company and we just recently sold a
66 taken two of those companies at a 46.2 million valuation which you
can look up on the internets yourself if you are skeptical which would
be totally realistic and reasonable of you considering the many tubers
and interweb urs that exist that are probably saying things that are a
little bit stretched from the truth all right so let's dive in so quick
confession um i used to be obsessed with tax savings so it was literally
like took up a very large percentage of my time i spent roughly 1.6
million in legal and accounting fees to figure out the structure that i
have today and so this will be a culmination of all my applied knowledge
and beliefs related to taxes to date as a u.s citizen in a single
presentation and hopefully save you five years of learning and all the
money that i have spent so enjoy my gift to you all right so here's the
four beliefs about taxes that have improved my life and probably made me
a lot of money up to this point so number one is that tax shelters cost
more than they save you might be like how is that even

3 00:02:00.000 --\> 00:03:00.000 possible great question i will dive
into it number two tax shelters decrease your net worth how is that even
possible as well balderdash alex i know it's crazy number three tax
shelters diminish your life how can it diminish my life i will prove it
to you in just a moment number four tax realtors don't make you a better
person you're like well that one i believed okay fair enough well i'll
show you each one of these and more so the problem with number one which
is tax shelters coffee more than they save is that what tax shelters
save you they cost you more in other resources so what they save you in
money they cost you more in other things alright so there's three
primary costs that people do not account for and that i myself did not
account for when i started this journey so long ago in the business
world number one is the cost of discovery and conversion number two is
the cost of upkeep and number three is the cost of unwinding and if
you're like i don't know what any of those things mean let me explain
all right so number one the cost of discovery is that 90 i'm going to
borrow this from charlie monger so 95 of solutions are swampland and 5
are

4 00:03:00.000 --\> 00:04:00.000 legit and so as he is my hero in many
ways not just in investing um i turned to him first to try and figure
out what the best kind of course of action around tax was the short and
simple answer is pay them and the reason for that is his quote here is
that 19 out of 20 of these things are not legit and are actually going
to get you into trouble and so the problem is the cost of discovery is
the is the the cost of the time and the attention that it takes you to
sift through all the crap to figure out the one out of 20 that is
actually worth it right and let's just assume somehow you're like you
know what you did all of that work you got on calls with accountants and
lawyers and your legal operating structure with every one of these
things and you ran through all the tests that i'm going to show you
later in this slide deck of the things that you should look for in these
types of structures and let's assume you did all that stuff then it you
have this huge cost of conversion right it takes a lot of time to vet
these things create new entities transfer all your stuff over
reincorporate recreate your new contracts for all of your clients etc
new banking relationships and all that

5 00:04:00.000 --\> 00:05:00.000 stuff so there's a cost of figuring out
which of these is actually legit which 95 of them are not number two is
if you actually happen to find something that might be legit right not
even including the cost on the 19 that didn't actually you know we're
not actually legit then you have the cost of converting them but that's
just cost number one cost number two is that okay now you've converted
your thing you have the cost of upkeep all right so what you have to do
now is you have to trade valuable attention for less valuable money by
percentage all right so i'll give you a couple stories to drive this
point home so a very close friend of mine um traveled 104 days a year
back and forth between puerto rico and the united states so basically
every weekend he'd fly back home and then you know on monday he'd fly
back out and he did this every single day because he didn't want to pay
us taxes right but guess what he was traveling 104 days a year and we
were on the phone and i was like hey man do you think it'd be possible
that you could make 30 more money if you didn't travel 104 days a year
hmm he was like i didn't really think about it like that i was like yeah
but you should and the thing is so we're trading

6 00:05:00.000 --\> 00:06:00.000 this very valuable time and attention
for less valuable money by percentage all right number two is i i have a
different friend who uh counts his days in new york city to go back and
forth and it's like guys like can we can we not figure out a way to to
just make more money within the current vehicle a different friend of
mine actually missed their baby's birth because they had to get their
days in right like what are we trading here and then finally on a more
tactical level a close relative of mine uh was like hey i think you
should do this captive insurance thing with me and i said okay let's
look into it so we looked into it together and i'd already looked at
captives a couple times because you know there were some tax savings by
the way they're very marginal in my opinion and definitely not the b
cost of upkeep and so every month every quarter you have to allocate a
certain percentage of funds and decide how much of those funds you need
to allocate into the insurance vehicles so that you can stay legit in
terms of are we really using this for insurance are we gonna actually
take claims out of it and then what is a reasonable amount

7 00:06:00.000 --\> 00:07:00.000 that we can put in here and you're
constantly allocating attention to this thing that does not provide
value to the business number two and this is what i did not know when i
was getting into this game is that one there was the cost of discovery
and cost of conversion two you've got the cost of upkeep and three and
here's the real one that no one tells you about especially the people
who are trying to sell you these tax shelters is the cost of unwinding
and fines all right and so not only do they cost more than they save up
front they often don't even end up saving you anything in the long run
and here's why most of the big tips and tricks get unwound in a matter
of years and the reason for that is because the irs is three to five
years behind and so when they see a loophole they close it right but
they close it three to five years later because they're so understaffed
and all that kind of stuff right and so often people will get fined
because they uh they're evading taxes right and so they'll say you were
not using this clause for the manner in which it was intended so now you
owe us taxes on three years ago plus fines plus interest and so then you
not only have the fines

8 00:07:00.000 --\> 00:08:00.000 in the interest but then you have to
spend the cost of the legal and the accounting and all the other stuff
to unwind the structure that you did under the wrong guys because you
pretended to use a structure in this way as it was intended but you
didn't actually do it in the way it was intended because you did it to
save taxes which is not the point of the clause and i have had this
happen to people i know very close to me right and the thing is is like
everyone has to understand this they write the rules and so what matters
most is what your intention is when you use these structures that are
complex like the tax code is an incentive system you have to think about
it like that they are putting penalties and incentives so that they can
move the economy in the way that they believe is right so the reason
real estate has a lot of tax incentives is because they believe that
they want people to reinvest in infrastructure in the company they want
people to develop land they want people to keep buildings from falling
apart and so they give lots of incentives to people to go invest in
those things if all of the tax incentives in real estate disappeared
real estate would not be nearly as attractive and a lot of

9 00:08:00.000 --\> 00:09:00.000 buildings would fall into disarray
because it wouldn't be worth it to people so then the country by
extension will vote to disrespect right and so the idea here is that we
have to read the tax hood as an incentive plan and that's just side note
number one but point is is that with these things they cost more to
discover cost more to convert cost more to upkeep and most of the times
will not actually end up saving you money in the long run which is why
tax shelters cost more than they save okay so that was number one
hopefully we checked that box off number two tax soldiers do not
increase your net worth and you're like how is that even possible i
thought the whole point of this is that they're gonna increase your net
worth i will show you why so what they save they cost you more and other
resources i'm gonna drive this one in all right so there's three pieces
here one is the people two is the thinking process and three is how
fortunes are actually built and number c you're going to want to pay
attention because it's something that i did not understand until way too
late in my entrepreneurial career so let's dive in all right so the
people so look at the richest people in the world a lot of them live in
the united states and not only that a lot of them live in california and
new york which is wild

10 00:09:00.000 --\> 00:10:00.000 right how is it the richest people in
the world can live in the highest tax tax places in arguably the world
how is that even possible maybe they know something that we don't which
is that they're using they they know how to build fortunes which i'll
get to in point c but the thing is is that if that were the case then
simply going to a tax friendly area is not in and of itself is going to
increase your net worth all right which i think is important and is as
an important side note is that when you also surround yourself with
people in those types of environments especially when people move to
very specific geographics only and solely for the purpose of tax
sheltering right what in my opinion what happens is they start thinking
increments rather than in orders of magnitude so let me explain so it's
majoring in the miners it's thinking how can i save 30 percent chunks
rather than make 30 times more money right and you've talked to those
people they're going to make the argument like well i know i'm going to
do both it's like no you're not because you're literally sacrificing
everything that you have to just save 30 when and i'll get to the big
picture

11 00:10:00.000 --\> 00:11:00.000 stuff in a minute but the big wins are
what drive your net worth right so you can spend all this time and
attention obsessing about stuff right these little doodads to save two
percent and one percent whatever that might end up getting unwound up
later and because it's probably swampland it's probably not legit
anyways or you could just bought bitcoin in 2014 and been done with it
the point is that the big wins the very few big wins are the things that
are gonna drive the net worth the most not the tax shelters and so
people disproportionately allocate their attention towards these savings
when that is not where the disproportionate amount of the net worth is
going to come from so don't surround yourself with people who are
obsessed with this stuff because they're thinking in increments not in
orders of magnitude they're not thinking how can i 10x they're thinking
how can i save 10 and that in my opinion is the wrong way to go about
building a fortune which if you're watching this channel and you're part
of mosination that is the point all right so see how fortunes are
actually made uh this one is one that i hope that you like slow down and
i will try to talk a little bit more slowly than this because i really
want everyone to to get this one okay so how forwards interaction made
you make and i grabbed this from jack

12 00:11:00.000 --\> 00:12:00.000 butcher f i think on twitter but this
is a loose loose uh paraphrasing but you make fortunes by taking a lot
of risk with a little bit of money you maintain fortunes by taking small
amounts of risk with a lot of money all right so just understanding how
fortunes are actually made right now let's dive into some some math in a
second so wealth comes from the appreciation of equities not income all
right so how is it that all these very wealthy people live in these
high-tech places it's because 94 of the force 100 growth came from
appreciation not income in other words what we build builds our net
worth not what we make huh interesting let's dive a little further into
this all right so let's let's let's put an example like you're in year
four of your business and so let's say last year your business made 10
million dollars in ebitda all right which is profit fancy word for
profit sort of all right now and you can move the zeros you can make it
a million you've made a hundred thousand it doesn't really matter all
right you make

13 00:12:00.000 --\> 00:13:00.000 100 million the point is let's just
say in this case last year bison made 10 million dollars in ebay our
profit all right and let's say you it's valued at 5x which should be a
50 million dollar business okay and you receive 10 million times 0.63 um
which should be 37 is taken out for taxes you get 60 6.3 million in
after tax dividends and let's assume that you're not reinvesting any of
it in the business and you're taking all those dividends just for the
sake of this simple example okay now you're like okay i guess that makes
sense now pause and hold that so you made 6.3 million and your business
is worth 50. got it now next year let's say you go from 10 million to 12
million indiabeta awesome good for you a little 20 growth very
conservative sounds good still valued at 5x and the value wait a second
goes from 50 million to 60 million huh but wait there's more you receive
12 million times 0.63 which is 7.6 million dollars after tax in
dividends and so if you look at your net worth increase the net worth
increase is

14 00:13:00.000 --\> 00:14:00.000 10 million dollars plus 7.6 million so
you had a net worth increase of 17.6 million so let me break this down
for you all right which is 60 million the new value of the business
minus 50 million right is the 10 and then 12 million times the 37 tax
rate gets you 7.6 you add the 10 plus 7.6 to 17.6 million but here's
where it's interesting if your net tax so you made 22 million dollars in
increased net worth and your after tax was 17.6 million then you were
effectively taxed at 21 huh and why is that it is because 56 of your net
worth increase was tax-free it was based on the appreciation of the
equities of the things that you own rather than the income that you make
which is why what you build builds your net worth more than what you
make all right so this one i really want to drive this home if you can
make the business that you have more valuable the income that you derive
from the business is not the primary value that you are actually

15 00:14:00.000 --\> 00:15:00.000 building right if you double the
profit of the business and you have a 5x multiple right you are you have
a double multiplier that is happening on something that you own in a
very real way compared to what you were actually taking out of the
business and so in a lot of ways like give yourself the salary live on
the salary that you have from the business but let the value of the
business compound and it doesn't even matter if you're living in the
highest tax state ever because here's what's even crazier this is valued
at 5x right if you look at publicly traded companies like some of the s
p right now is traded at 40 which is absolute insanity i'm not going to
get into that but that means that if i were to increase my ebitda in
this example by 2 million dollars there's a 40x multiplier which means i
increased my net worth by 80 million dollars so that is why these guys
can manufacture these fortunes because there's massive multiplier on
equities right so it's not the income that you make that's the thing
that's building your net worth and so letting that be the primary driver
of why you make your decisions and where you live when how you feel
about where

16 00:15:00.000 --\> 00:16:00.000 you live is going to create far more
wealth than the savings will right it's orders of magnitude not
incremental thinking all right which is why tax shelters do not increase
your net worth as much as people will make it seem all right so number
three is that tax shelters do not improve your life all right so a
little shift here is that i call this inverted priority so saving the
tax money will hurt other aspects of your life so let me explain so uh
one follow this line of reasoning i want to increase my net worth so
that i can live where i want to live with the people that i care about
so in order to do that i'm going to not live where i want to live or
spend time with the people that i care about to have more net worth so
that i can wait a second something doesn't make sense here and that is
correct it does not make sense because what we're doing is we're putting
the means of achieving the goal above the goal itself right and this
happens all the time because us as entrepreneurs we create this this
reinforcing cycle of conditional behavior we get this intermittent
resource which is how you create

17 00:16:00.000 --\> 00:17:00.000 addiction right of the work that we do
and we forget why we started doing the work which is we have this goal
don't get me wrong i think that work is the goal right but at the end of
the day if if we claim that we want to uh increase our net worth so that
we can have this level of freedom etc then we can't make the means which
is money be more important than the things so for sacrificing the goal
in order to get more means it doesn't make sense which brings me to
number two is why sacrifice a resource that i care about and that i can
get no more of for one that i need no more of and can generate at will
and as a side note has decreasing marginal utility which means that the
more of it you have the less valuable it is which is not the same with
time but anyways so number three um we can say and this is actually a
text exchange that i had with a different friend of mine um who you know
i was like listen you know we can be on instagram we can be on on
youtube and we can say money doesn't matter and blah blah blah but

18 00:17:00.000 --\> 00:18:00.000 it's a very different thing to say
that money doesn't matter or we can live that money doesn't matter which
means it's like if you can be making these posts and making these claims
about how you know you've really moved on from this and you've got this
bigger picture about life and perspective it's like but all you're doing
is sacrificing your life so that you can save little points here and
little points there it's like it's fake it's not true like you don't
actually believe that right and so i think there's one thing to be
taught to talk the path and another thing to walk the path and so if we
claim as entrepreneurs to want this freedom then i i hope to god we
don't we don't we don't flip the priorities and uh and sacrifice our
freedom to get more means and so i had a i had this was actually a real
conversation which was sparked this entire presentation um is that it's
hard to do the whole temporary argument so he's you know he was like
what if i just go there for a temporary period of time stack enough cash
then i'll come back it's like the problem is that the enough number is
going to change and it's very very hard to come back from paying zero
percent you know to paying a third or half of your net worth and tax or
half

19 00:18:00.000 --\> 00:19:00.000 your income and tax it's just hard
mentally i'm not saying like you can still do the rational argument for
why you're doing it but it's just like i think it's very hard
emotionally to do it and the thing is is that if we are hard driving
entrepreneurs which we are we set up these games and move the goal posts
on ourselves and so you know i i can promise you like my first freedom
number was four million dollars in after tax net worth and then i
immediately and literally when we had four i was like oh i think 10 is
actually more reasonable and then 10 went to 14 i have no idea what 14
was really like meaningful to me but it was and then from 14 it went to
20 and then 20 went to 30 because that's what ultra high net worth is
and then it continues like okay now it's 100. and the thing is is the
goal post continues to change because you become a cus you you literally
get exposed to higher levels of wealth and then what you say is like
okay well this this this level of wealth allows me to live but i want to
thrive and then when you're thriving then it's like well i want to super
thrive and why can't i have an island in every single continent that
belongs to me right the thing is you might and you might be listening to
this and be like i would never do that watch your tongue because a lot
of very smart people have

20 00:19:00.000 --\> 00:20:00.000 said the same thing and experienced
the same desire because we as hard driving people play to win and to
stay hungry you move the goal post but in moving the gold coast you
create a very difficult equation for yourself to be satisfied all right
and so as a quick story to this um i could have done and this is why tax
shelters diminish your life i could have done an intentionally defective
grand tour trust which is a fancy thing that basically functions like a
waterfall of trusts where um for every five million dollars of a sale
that you're going to receive you out you put it into a trust and the
reason it's 5 million is because that's below the the limit and you have
to wait three years before you can touch the money because that's after
the trust passes the statute of limitations on trust being unwound by
the irs you're like wow alex how do you know this because i've looked
into this stuff right and i could have saved myself about six million
dollars in taxes right roughly if i had done this right i think it would
have been more than that but whatever roughly but for what right to save
more money that i don't need and now to needlessly

21 00:20:00.000 --\> 00:21:00.000 give myself something to worry about
because i can't touch the money and i have to follow these stipulations
and for some reason something happens then i have the irs on my back and
then get audited right and that that little story that i told you
earlier about the the captive uh that relative of mine they ended up
getting audited and even if they do win what a headache just to save
like four percent like who cares right just go and make that much more
money without having the stress of a darn audit and if they do lose now
they're literally gonna have lost all the all the discovery time all the
upkeep time all the conversion time all the the the effort that goes
into it they'll have to pay the fines and then they'll have to pay the
cost of unwanting the darn thing right and all of the attention that all
of that took they could have been spending on increasing the value of
the thing that actually compounds tax-free which is their business crazy
all right okay so i didn't do the intentional grantor trust and i just
paid the darn taxes which brings me to point number four

22 00:21:00.000 --\> 00:22:00.000 which is that tax shelters don't make
you a better person all right so i only have two main points on this and
i will i will drive these these home because i think these are like as
as we've gone down these points uh they become increasingly meaningful
for me of actually how i make decisions and so these are the only two
things that i've really made the decision with which is number one is
reputational risk i believe that i will be a billionaire at some point
before i die at this point we have about 100 million net worth so my
wife and i and uh we're you know i'm 32 she's 29 and so like if i if we
just get 10 a year like we will hit it and that's if we don't make any
income and we don't grow businesses which that would drive me nuts and
so we will be doing that so i think that at some point we will do that
but who knows by then maybe billionaires everybody will be a billionaire
and an apple will cost a million bucks who knows but the point is is
that um i would never want to become a billionaire and then have
everyone say he did it and escaped taxes i just don't want that brand
i'm not saying there's nothing wrong with that like i don't think
there's actually anything wrong with that if you did it legally right um
but i would just prefer to be known as the person who paid his dues and
still killed it that's just me that's a

23 00:22:00.000 --\> 00:23:00.000 personal preference that's a
reputational risk for me right and i've said this quote before this
channel but i'll say it again like you only get one name and you have to
keep it for the rest of your life right and so it's like investing in
accordingly i can't imagine like that at that point in my life if i were
you know worth 2 billion or 3 billion and i could have been worth
remember guys like if you're saving 30 right on your taxes it's only
going to increase your net worth by that percentage like think about it
so it's like if you're worth 10 million and you had saved 30 of your
taxes you'd only be worth 30 more than that so it'd be like 13 million
right like and just think about it like that it's like so it's not like
this crazy like it's just that that's all it is right so number one is
reputational risk and for me i don't think i would ever sacrifice my
reputation for that marginal gain all right number two 85 year old self
test and this is my number one most tweeted tweet which is when i was 20
i wanted to be a millionaire now that i'm a millionaire i want to be 20.
and i overheard a version

24 00:23:00.000 --\> 00:24:00.000 of this which makes me realize that
when i'm 40 i'd rather just be 32 my age with nothing just to be 32
again which is a different frame on gratitude that i thought i'd share
which brings me to my 85 year old self test which by the way is probably
the most useful decision making frame i've ever made and it's probably
the thing that i use the most in thinking through everything in my life
all right and so when i think about my 85 year old deca billionaire
whatever and he's old and crass is hell and he's looking at 32 year old
self alex he laughs at me at the idea of sacrificing anything for money
sacrificing my youth to make more money that i won't need like i would
give half of my net worth back to live my life wherever i wanted to
during my youth and to make 12 more net worth if you're deciding between
states like will i care if i have 9 billion or you know or or 11 billion
or 9 billion or 6 billion when i die no i won't and so i feel like i can
envision this conversation that i have with myself it's like don't don't
sacrifice anything for me like i'm good i'm old like you're young

25 00:24:00.000 --\> 00:25:00.000 enjoy ever like just soak in life
because it's going to go away fast and like most of the things that
you're concerned about won't matter and you will always have more than
enough and you'll never go hungry and you'll always have people around
you who love you and so like just live and so this idea of obsessing
over these shekels that we're going to give back at the end of our life
just seems silly to me and that's at least why my 85 year old self
laughs at me for thinking about these things rather than just spending
time in the places that i want with the people that i love all right
which brings me why number four is that tax shelfers don't make you a
better person all right so so far we covered number one tax shelters
cost more than they save number two tax shelters don't increase your net
worth number three tax holders don't improve your life and number four
tax shelters don't make you a better person all right and so if you're
mosey nation you're like okay well what do i take from all this i'm
gonna give you six rules of thumb which is why i added an extra finger
onto that palm and then seven beliefs that have served me well i told
you i'm gonna make one presentation to rule all others for myself and
you so that i can also partially make this as an answer to a question
that i had which is what do you

26 00:25:00.000 --\> 00:26:00.000 do for taxes so this is it all right
so if you're not going to listen to any of the advice that i said up to
this point and just pay your taxes which by the way i'd like to thank
our special sponsor the irs for sponsoring this video uh six rules of
thumb for you all right so let's dive in real tax savings typically come
from three primary scenarios number one is when you give up ownership or
control that's what charitable giving is right that's why trusts tend to
be vehicles that people will use because if you do them correctly you no
longer own the money which is why you don't owe the taxes on it right
that's the idea all right so you either have to give up ownership or
control typically to do that and so some people when they really see it
they're like oh like so this isn't my money anymore it's like yeah now
you can make the argument like well you control it cause you control the
person blah blah blah but the thing is is like there's a lot of steps
there um and it's up to you but like that is like when the real saving
stuff comes from things like that number two is that they come from
depreciation so in the tax code just like i mentioned earlier with real
estate like the government wants like the tax code is just an incentive
plan right it's it's the government's way of saying we want you to do
this and not do this right and

27 00:26:00.000 --\> 00:27:00.000 so they allow you to depreciate assets
that you're buying uh which allows you to not pay taxes because they
basically function as losses right so if i buy a building for 10 million
dollars i might be able to depreciate 4 million of that building and if
i had made 4 million dollars that year then i could depreciate and have
zero tax which by the way is how most people who run real estate funds
do it is they don't give a lot of the depreciation of the people who are
investing and they as the general partners will take a disproportionate
amount of the depreciation from a company from the funds that they raise
so that they can pay no money which is how grant cardone doesn't pay
taxes right that's the idea that's how he does through depreciation all
right number three is deferral over elimination all right and so this is
also just a rule of thumb is that like a lot of these structures allow
you to defer the taxes rather than eliminate them and so the idea is you
basically defer them until you die but you're not necessarily
eliminating them so the three ways at least that i have seen that have
have been the most legitimate um across times et cetera is are these
concepts all right um that being said here's some of the

28 00:27:00.000 --\> 00:28:00.000 advice i have for you in almost all of
these structures there is hair you must find it make sure it's really
worth it factor in the cost of discovery factor in the cost is
conversion factor in the cost of upkeep in a savings cost factor in the
fee structure that they're going to impose upon you to do this whole
thing right and whenever you hear someone say the wealthy you've been
doing this forever it's just a sales pitch when they're like ah like the
vanderbilts have been doing the structure for a hundred years like it's
every single guy says that so just like just move on get over it right
but you have to factor in the money the time and the intentions it cost
you and it and could you allocate that into your business get a much
higher return something to think about right number three don't pretend
to know things that you don't know don't be afraid to ask questions
seriously anyone who makes you feel otherwise is not to be trusted all
right i always start and this is a very true every single person my
company would know this especially my finance team like when we hop on
calls with like experts and all this stuff i always say the same thing i
say hey i just want you to pretend you're explaining the structure to a
golden retriever all right who speaks spanish all right pictures simple
words i want

29 00:28:00.000 --\> 00:29:00.000 to understand and if someone cannot
explain something to you simply it's either because they're trying to
confuse you or they it's because they do not understand it fully think
about that people if you are confused and someone cannot explain
something simply to you it is because either they do not understand it
or just because it's their desire to confuse you and seem intelligent
neither of those scenarios are good for you so if they kind of cannot
explain it to you visually and simply i would say look run the other way
all right because either they don't have the right intentions or they
don't have the right skill level of skill all right so number four this
is one now you're like okay i checked all the other boxes now always ask
for people who've been doing this strategy for over a decade and asked
to speak with them the reason for that is because the irs will unwind
things three to five years after they impose a clause because they'll
find out that people are using it as a loophole in order to get through
and evade taxes all right and so what they'll do is that's why you need
to look at people who've been doing this for over a decade because
they've already gone through a full irs cycle and you can say okay
you've been doing this for 11 years you've never had any audits you've
never

30 00:29:00.000 --\> 00:30:00.000 had any issues okay great let me talk
to three other people because you might have just been lucky let me talk
to you know a handful of people and see what was the cost of upkeep what
was the cost of conversion or how much time per month you have to
allocate to making sure that this continues to stay you know within the
standards of the irs and then and then is it worth it right number five
always do background check on the person and the entities that the owner
associate with quick story on this one i had a recent person say hey i
think this thing's really legit i think it checks all the boxes blah
blah and so i looked into it which is not something i normally do
because i've kind of like made up my mind on this which is i just pay my
taxes but that being said i decided to look into this one and literally
on the first google search i had of the guy who owned the entity all
right there's two there's two red flags right off the bat number one is
that the entity was a brand new entity which means that they're spinning
up new entities uh all the time that is a big easy red flag of like why
don't you have the same entity why are you trying to always change
etsy's all the time that seems weird there's no reviews online etc okay
second is if and after i googled this person they

31 00:30:00.000 --\> 00:31:00.000 had literally been indicted for tax
evasion and i was like what and like one of the biggest tax of ancient
scandals in history right and uh and you know the guy made the intro was
like but they got to quit it and i'm like do you want the reputational
risk of being associated with someone like that right and if someone
someone might be like hey alex can't believe you forgive he was proven
like i get it there's just other people who haven't and for me i would
rather just not take the risk that's just my two cents all right so
always do a background check on the people and the entities this that
they own and are associated with all right and then finally don't spend
money on stuff that you wouldn't just to expense it all right this is
one that i hear all the times like just expense at expensive right i'm
saving x percentage on this like if you if you spend money that you
otherwise wouldn't in order to save money because you don't have to pay
taxes on the money it's cutting off your nose despite your face right
like it's like oh i don't want to pay 30 of 100 or 40 of 100

32 00:31:00.000 --\> 00:32:00.000 so i'm just gonna not even have a
hundred dollars right that just doesn't make a lot of sense to me now if
you were going to do it then by all means like if you want to reinvest
in the business and that that's expensible then great then wonderful as
long as it's the asset and here's the key point it's like if we can if
we can if we can figure out a way that it can become an asset that's
going to build value within the company and somehow it's expensible then
fantastic right that's the idea uh but spending money on stuff that uh
that you wouldn't otherwise just to not pay taxes is a very very very
silly way of living life in my opinion and ultimately not one that is a
good behavior that will build wealth over time all right so these are
just my six rules of thumb that if you're not going to listen to the
advice at least please do these things when you're thinking through some
of these other tax structures that you come with and then finally these
are the beliefs that i currently hold um i'm not saying you have to hold
these but these are the things that have served me very well all right
so number one is that attention is my number one most valuable asset
never do anything that takes it without disproportionate return number
two pay zero attention to tax savings teams focus on the making not the
saving

33 00:32:00.000 --\> 00:33:00.000 number three whenever it decides to
come up right number three there we go replace savings with orders of
magnitude so instead of trying to think in increments thinking orders of
magnets instead of saving ten percent think about how can i 10x and then
you'll never have to worry about the taxes again number four never count
your pennies on roads untaken all right it'll destroy your spirit and
have you focus on the wrong part of your life your past versus the
future so if you make one of the decisions to start living the place you
want to live or live in a state that you that you feel like being in
whatever right don't start thinking i could have saved 12 over the last
four years have i had that money right now like don't do that it'll
destroy your life and probably you might not have made that money that
you made now because you would not have been in this head space that you
are currently etc right at the end of the day there's just there's no
benefit to it so once you make the decision move on all right number
five this one and this is this is a big one all right just remember that
when i die and this is me right remembering that when i die the people
that i compare myself to will also be dead right and here's a crazy one
we will all be taxed at 100 as in we don't get to keep it no matter what

34 00:33:00.000 --\> 00:34:00.000 and so here's my here's the probably
the best analogy that i can give you which is a casino analogy and this
is this is kind of how i imagine really life in the game overall right
which is that i believe all of us are given a token in the in the casino
of life right and we walk in the door and we sit down to the table and
there's a bunch of other players around and we can and we get dealt
cards and we play the cards that we're dealt right and depending on our
skill uh in the game we can continue to amass and amass chips right and
we get these stacks and stacks and stacks of chips but the difference
between a regular casino and the casino of life is in the regular casino
you can take these big chicks go to the counter cash out take your cash
celebrate etc and then you get to go spend that money but in the casino
of life you have this big stack of chips and then when the grim reaper
taps you on the shoulder and says you can't play anymore you have to get
up from table and the chips stay on the table and what they do is they
push them right to the middle of the table and everyone keeps playing
with your chips and so for me when i think about it it's like do i just
want to be in a nice

35 00:34:00.000 --\> 00:35:00.000 casino or a shitty casino but at the
end of the day i have to give all the chips back and so for me when i
think about it like that it's like no matter what happens i'm getting
taxed 100 upon death and you might be like oh legacy it's uh to me
that's silly because sure multiply by a hundred generations of people
who don't know you change their last names and have mixed their their
genetics with you you know uh one half to the hundredth power and no
they're they're just humans and no they don't remember you and no
they're not your your descendants they're just humans and so all of that
stuff goes away with time and so it's like we're just here to play the
game and all of the chips that we amassed are going to get put back in
the middle anyways and why sacrifice the lighting and the niceness and
the types of people that i get to play the game with so that i can
potentially keep a higher percentage chips again the table that i'm only
going to give back at the end something to think about and then finally
money exists to buy us options therefore do not trade optionality for it
all right so um if you are new to this channel thank you um i make these
videos because no one helped me learn this stuff i had to learn the
stuff on my own or to pay a lot of money for these lessons either in

36 00:35:00.000 --\> 00:36:00.000 mistakes or in experts and advice and
so i hope that the pain that i experienced isn't in vain which is why i
make these videos i just hope that someone can benefit from it and i
like this visual here because we have these goals we fail we learn
principles we improve and then we have more audacious goals and my goal
for you guys is that you can just jump from audacious goals to more
audacious goals because you can just use the lessons that someone else
has already learned and suffered the pain of consequence for all right i
repurpose that from ray dalio's principles but i just really like that
visual and so um anyways welcome to moseynation if you're new appreciate
you enjoy the video hopefully some of these takeaways can be helpful in
your journey along taxes and entrepreneurship love you and i'll see you
next vid
