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Source: Bloomberg

Category: Digital Media, Taxes and Policy

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

5 Responses to “How to Preserve a Family Fortune Through Tax Tricks”

  1. RW says:

    I’ve argued before that corporate, estate and trust law now provides all the benefits of the traditional aristocratic system of fee tail (indivisible property) and primogeniture (1st born inherits all) with the bonus that modern financial structures and instruments now allow lesser heirs of the new plutocratic nobility access as if they were first born. That’s progress if you like.

    Time for a new New Deal and also time to revisit 18th and early 19th Century laws curtailing intergenerational wealth transfer. Our forefathers knew a thing or two about the danger aristocracy posed to democracy.

    • Northeaster says:

      “corporate, estate and trust law now provides all the benefits of the traditional aristocratic system of fee tail” -

      That is all my former firm covered, for the super-wealthy, where the average income was approximately $32 million, skewed by a few billionaires. Our ONLY adversary was the IRS, and we won a heck of a lot more than losing. This piece only scratches the surface. I remember dissolving five entities with the clients name spelled backwards, separated by Roman Numerals. They were strictly shells of course, in a state where no questions are asked, but if you know the law, no matter how poorly it’s written, you can benefit from it. In this case, law written for or by, those same very wealthy people.

  2. agensler says:

    i don’t see the trickery here.

    the grat and clat are statutory provisions, available for all to see and employ. and they only effectively transfer wealth to the extent that asset performance exceeds a hurdle rate which, in normal market environments, is not a slam dunk. zirp has been the mighty tailwind for transferring tremendous amounts of wealth free of tax through these mechanisms. scheming to expose and take advantage of tax loopholes that subvert regulatory intent don’t enter into the picture at all.

    as for the flp, i’m willing to get an appraisal on my house and drop it into a limited partnership where i’m the gp. if anyone out there wants to pay me the equivalent of the underlying value for a respective lp interest, i’ll gladly entertain such an offer.

  3. czyz99 says:

    A bewildering array of trusts, general partnerships ect lead to me making $42k for doing almost nothing and not paying any federal income tax.

  4. scecman says:

    Seeing how those CLATs work, I understand why someone would put money into a hedge fund. It appears the heir has a much better incentive to go for a big mkt return than accept a index-like return. Even if the hedge fund stinks, the lottery type return of possibly hitting a winner might make it worth it.
    Its probably worth doing with a portion of a family fortune.