Ways to Cut Down Your Tax Bill

I've been digging into how to lessen my tax burden, especially with capital gains tax. I'm planning to sell some crypto (mostly Ethereum) later this year, you know, when Bitcoin hits around $200k. The tax hit for me will be 33% of my earnings from Bitcoin once I convert it to Euro. I've been working for over 30 years, paying taxes like clockwork, and honestly, I can't stand the idea of shelling out that extra 33% on my profits. Some folks seem fine with paying taxes, but I’d rather find a way to avoid it if possible. I’m sure a lot of you feel the same way. It’s kinda wild how the business crowd has all these resources to minimize their tax burdens, while regular workers like us are just trying to figure it out from scratch. I've gathered a few links from my research on this topic, and I’m sharing them for us to chat about. How do you feel about paying taxes on your gains? Have you thought about ways to cut down on what you owe? The Nomad Capitalist This is a business that helps people lower their tax bills, started by Andrew Henderson. He shares advice on how we can apply what he learned to our own situations. There are some hints on their ABOUT page about how it can be done. Top 4 countries with the best offshore banking options for 2021. Info on what offshore banking is and where to find it.

I thought it woould be interesting to find out which countries do not TAX crypto, Here is a list of 10 which is dated this year but verification will need to be done as the laws in some countries may have changed. Further investigation will be needed to find out what the criteria is per country in order to avail of the TAX free laws. 10 Countries That Don't Tax Bitcoin Gains (2021) 1. Belarus 2. Germany 3. Hong Kong 4. Malaysia 5. Malta 6. Portugal 7. Singapore 8. Slovenia 9. Switzerland 10. Bermuda

-Reserved-

Who wouldn’t want to legally sell their crypto and pay only 1% tax, sounds like something impossible, even though we know there are countries where taxes are pretty low or non-existent. I checked the link for The Nomad Capitalist and of course I was interested in who is in the team, and I must admit that I was quite surprised that except for the CEO and another male member, all the others are women from Serbia (it is easy to conclude by name and surname). Apparently Andrew Henderson really liked it there, so he decided to surround himself with women from that country. I don’t know how much they charge for their services, but I’m sure it’s not cheap - but services like this aren’t for those with little money anyway - without $300 000 a year in incomes or net worth $1 + million, you can’t claim their services. It would be interesting to hear if anyone has experience with them. An interesting topic on Reddit -> A disgruntled Nomad Capitalist client's rant ...

Yep - nobody wants to pay tax ! I believe you need to ask yourself a few questions, which I’m sure you have already. These would include - - relocation options for you and your family - immediate decisions will impact on future tax returns - many jurisdictions are changing slowly but surely and they can retrospectively re inspect your tax returns There are many so called ‘ crypto tax experts ‘ - my advice would be to prepare some crypto related tricky questions and see how well any of these prospective ‘ crypto tax experts’ answer these questions. You’ll know soon enough whether their advice is worth listening to . This is a new field for accountants and I believe many have little or no knowledge in the field .The money sharks will be circling   One last point, see if your accountant accepts crypto payments

I am in favor of a low-tax policy, mostly because in general politicians do nothing more than increase spending that in most cases is unnecessary. I think it's fine to pay taxes for the state to build/maintain roads or help the underprivileged etc. That said, as I believe that much of the money I pay in taxes is political spending that should be dispensed with, I support everyone trying to pay as little tax as possible, especially in a legal way. In my case, my Bitcoin holdings are not life-changing, so I am not considering emigrating or anything like that, but maybe in a few years I will consider it. There are many things to consider here: in certain countries it is not enough just to emigrate to avoid paying taxes, you have to acquire the nationality in a new country and renounce the nationality of the country of origin, otherwise, you will be taxed anyway. In other cases it is useful to simply leave, but you have to take into account the factors of each one, if you are very rooted in your country of origin, with your family and friends, maybe it is not worth changing your life just because of more money. This is a bit off-topic but when I see him the way he speaks, I always think he is gay (I am subscribed to his channel) . The only think that makes me wonder is all those beautiful women around him.

It's not ok for me paying my taxes but it is a liability for us therefore we have an obligation on paying our taxes as well as the other citizens we have living in the same country, to be fair we don't really carry the same burden when it comes to paying our taxes as it scales up depending on which tax bracket you belong and I think it is only fair that the lower income earners have lesser tax liability than the ones earning higher ones. I think for your case you are experiencing a higher tax liability because you have yielded a higher gain during that year thus placing you on a higher bracket. If you want to reduce your tax liability you should do more research in your country where you are living. For example since I think you are living in a European country there are some countries in their like Germany where you will be exempted for tax if you held your crypto position for more than 1 year. There might be similar laws you have in your country which reduce or completely remove your tax so really there is a lot of options in which you can lessen your obligations.

Serbia, hmmm the postal address on the site is HOng Kong! Interesting read Lucius, this gives an insight into the fees they charge. OK Then, I guess I wont be [or qualify for] using the services of the Nomad Capatilist, but I guess being an earner in the 7 to 8 figure range, $500 or $8500 could be deemed a very beneficial cost. Yes it seems like the best way to lower the TAX liability is to move to a favourable location, and indeed this can be difficult when there are family members directly involved, it a major consideration. I posted a list of 10 countries which appear to have TAX free laws on crypto, post #2. There are indeed a lot of Crypto TAX experts and also advisors for offshore banking, beware of the money Sharks indeed. Indeed, Its one thing availing of the TAX free laws in a different country but there are certainly criteria to avail of these. We also need to bear in mind the criteria in our residing country for TAX free status. I.E move to Germany for 1 year to avail of the TAX free laws but potentially still be liable for TAX in your normal country, you might have to be a non resident of your own country for more than a year.

Maybe you can benefit by putting the bitcoin in a mixer or sell it on a P2P exchanges. I don't know much about tax evasion but I think that you already listed offshore which is a really great idea and I think that you should pursue it because you are not that hot in the eyes of the government and the tax department, hell you can even create your own shell company and funnel the money there. Don't ask how I know this, I just binged Ozark so I have some ideas.

It is quite normal that a team can be made up of people from different countries, and that a company headquarters can be where CEO thinks it is best for his business. The thing would be more credible if each team member had their own Linkedin profile and some references, this way it looks more like good PR and nothing more. The fees are reasonable for those who are rich to be able to afford it, but the much bigger question is what do you get for what you pay. If you read some of the posts from Reddit, you could see that there are some very dissatisfied customers who didn’t get what they were hoping for. It's actually about someone having x countries that they claim are tax-friendly, and selling that information to all customers - and most of it is publicly available anyway. Croatia has a similar tax policy as Germany when it comes to cryptocurrency taxation, with the difference that the time period after which the tax is not paid is 2 years from the date of purchase.

Even if Germany has that kind of law I didn't say that you need to move to Germany because of it. My main point is that you must know your own domestic laws in order to know if you have ways to lessen or even completely remove your tax liability which is possible even in capital gains. Also I didn't mention anything about just focusing on finding tax exemption laws because this will rarely come in our taxation policies. You have mentioned in your OP a company that can reduce your tax liability I guess you only need a lawyer/CPA to know some tricks in order to lessen your tax liability they'll be more familiar with the law and they'll surely help in your case when it comes to taxation.

Nice move buddy, Mostly develop countries are like getting taxes from individuals who had huge earnings. If you wish to stay somewhere else then forget the taxes getting from you. What yoi should investigate instead should be the people, their traits, attitude and culture to rely on. I will start with one country that I love the most which is Japan. Japan is considered as bitcoin friendly country but still when spending bitcoin they will get a tax from you. Yet, you will be amazed how good the Japanese people are that even in basketball substitution both incoming and outgoing players will going to bow down as sign of respect. Other than that Japan has the safest city in the world which, the Tokyo city. Low crime rates and people has the initiative. Japan is also an advance country with good technology and education. This is just an example on how you should spend your money for your retirement. Actually it is not about good living because you have it already and good places could no longer can appreciated. But if you know how to appreciate common around things around you then you can just stay in your place and can live happily.

33% tax rate even for long term capital gains? Such a ridiculous amount to be honest. But no matter how much the rate, you are liable to pay the taxes if you bought the cryptos using exchanges where you registered using KYC but I don't want to pay 33% so I will go with p2p for 10% loss of price on long term is great deal though.

yes 33% is quite high and I believe there are lots of wealthy people availing of the opportunities to reduce what they have to pay. Interestingly here is an example of two good friends who managed to evade this [its slightly off topic though] The two elderly heterosexual men married to avoid inheritance TAX which is also 33%. Ant this was perfectly legal !

Actual term should be avoiding not evade and every investor and business class people know how to avoid the taxes legally that is why they are getting more richer and paying less taxes than their employees.

Totally agree Findingnemo, the business class can aviail of legal ways to reduce the amount of TAX they pay, they also have access to financial and legal advice from accountants and solicitors which they already have connections with. When it comes to TAX I like all the terms used to avoid, evade and dodge they all amount to the same thing!

But to your government these things are not same, you can avoid but it is a crime to evade so even if you are earning you can avoid it by knowing the strategies but never possible for a salary class people. So start your business then you will be having more money to spend because you are going to pay less taxes.

All you have to do is employ the same methods that these companies use. https://itep.org/55-profitable-corporations-zero-corporate-tax/ NOW, I assume you don't know what they are since you are posting here so you can hire a tax lawyer who will reduce your tax liability to zero GOING FORWARD only.  Be advised they are not cheap but if you will save more then the cost then its obviously worth it. You should have really thought about this before you invested in crypto and you would not owe any US Taxes

You’re comparing apples and oranges here !! OP can’t employ the same methods a these US based huge corporations. OP appears to be 1. From Europe 2. An independent/sole trader 3. Does not employ anyone 4. And so on ...... You’ve quoted the original post , but do not seem to have read it ! Anyway , hopefully you’ve gained some help from this thread , good luck with the future

The "huge corporations" are only taking advantage of the laws they had put in the IRS code for their benefit and anybody else lucky enough to come across the information (usually through a tax attorney).   They can be very complex and some a so simple I often wonder why more people don't do it. To make a point, in the USA corporations are equal to humans in law. But I say they are even better because you can move your corporation, trust, LLC or whatever to any legal jurisdiction on planet earth.  Like a human would move to another country.  Except one huge difference.  Once your company resides in a crypto friendly jurisdiction then you begin to comply with their tax laws and you are no longer subject to IRS taxes. Americans are always subject to IRS and all other laws and regulations as long as they live and wherever on planet they may be. My companies reside in a jurisdiction that taxes any crytpo profits at 0% as long as it is incurred in any other country on the planet or off planet as the case may be. The companies purchased and own the crytpos so there is no tax due to America IRS authority. So, as you can see the better method is to have your company purchase the crytpos to start and avoid the IRS all together.   this is one of the more basic strategies to minimize taxes IN THE USA. This is free internet advice so please do consult with professionals, I can only relate my experience in this matter, which is considerable.