ilmscore | Prediction Details
"The second way to use debt would be to buy bigger deductions. Let me give you an example. So let's assume now that you own a business and this business makes $100,000 of profit this year. This would be your taxable income, assuming that you have no other deductions. But let's assume now that you want to go out and you want to buy that G wagon and you want to be able to deduct this G wagon against your income. Well, if a G wagon costs, let's just say $100,000, well, that means you're going to be out all of your cash if you buy the G wagon with cash. Well, option number two is you put down $20,000 and now you finance the other $80,000. If you were to finance the other $80,000, now you only put down 20 grand, which means you still have 80 grand in your bank account, and now you have a G wagon, but now you also get the tax write off for the entire G wagon. Now, let's assume that you use 80% of the G wagon for your business and you use 20% of the G wagon for your personal life... Now, what you get is an 80% deduction on the value of the G wagon against your taxable income. 80% of the $100,000 G wagon is an $80,000 deduction against your taxable income. So now you get an $80,000 deduction against your $100,000 income, meaning you only have 20 grand worth of taxable income, but you have $80,000 in your bank account."
By Minority Mindset | November 12, 2023 | Pending
From video
How The Wealthy Pay No Taxes (And How You Can Too) | Jaspreet Singh 00:14:29 - 00:15:54
Interpreted Prediction
Financing a significant business purchase, like a G-wagon, with a down payment and a loan allows for a large deduction (e.g., 80% of the vehicle's value) against taxable income, even if the business only has a portion of the purchase price in cash.

Prediction Details

Topic
Using Debt to Acquire Larger Deductions

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