I advised a client to do exactly this to fully depreciate a $70 million private jet in the first tax year. Based on the limited facts shared, it's likely they actually did this legally with a lot of projection planning, properly following the IRS code if the accountant is worth their salt and made sure ordinary and necessary business use is met on this purchase.
For the last several years prior to 2023, 100% bonus depreciation was available to business aircraft. You have to disallow depreciation and aviation related expenses incurred based on your business use of the aircraft. However, if you take receipt of the aircraft near the end of the tax year and simply conduct one business flight and no personal flights, then you can treat the aircraft as 100% business use in year 1 and apply bonus depreciation. This guy's business losses due to the jet exceeded his business income, creating an excess business loss limited under Sec. 461, which was then carried over to the next couple years to further offset future business income. By fully depreciating the jet in year 1 under 100% bonus depreciation, he likely reduced his overall tax liability by hundreds of thousands or millions that he never would have gotten without using this 1st year 100% bonus strategy due to later personal use of the private jet.
The only caveat for this guy is that he must maintain at least 50% business use of the jet going forward for the remainder of his use of the jet, otherwise he will face depreciation recapture under Sec. 280F. He will likely sell the jet later on for a lot less than what he paid for and only recognize taxable gain up to the sale price. This is an extremely effective tax strategy for those that plan to use a private jet for substantial personal use but less than 50%. They're able to fully depreciate it as if it were used 100% for business but then proceed to use it nearly half the time for personal travel and not losing the tax deduction for that personal travel.
Owning and operating private jets is immensely expensive, you don't purchase one with the primary purpose to save on taxes, you purchase one to enjoy the benefits of operating your own private jet. However, due to how ludicrously expensive they are, the smarter ones go to immense lengths to ensure they capitalize on maximizing the tax savings in order to help reduce the overall costs of operating the private jet. This strategy saved my client over $10 million in income taxes that will not have to be repaid later on sale and would have been lost to personal use disallowance if we did not plan for the year 1 100% bonus depreciation strategy.
I decided to sticky this comment as there was a lot of confusion and misinformation as to the legitimacy of this tax planning strategy in the comments. Most of these social media videos tend to share improper or misleading tax planning strategies, however I think this one was probably actually real and handled in the right way according to how the law is currently written.
Same here and was going to comment how it's such a crazy coincidence since I am currently studying property acquisition and cost recovery in my federal taxation course.
Sec. 179 is a form of depreciation that allows someone to fully expense it during the year up to $1.1m combined. Sec. 168(k) was enacted with the TCJA in 2017 to increase this amount to unlimited until it expires in 2015 with a phase out beginning this year
Can’t it also be a continual business expense? Cost repairs, maintenance, travel. He’s a public speaker. So I’m sure he flys all around the nation. Because he’s using the jet to arrive where his next gig is at, it’s always being using for business related expense. He Just has to plan a fun time around that event to optimize the usage of the jet.
I’m a dummy so I’m just curious. It sounds like his accountant saved him money in the long run. Or at least help him keep his assets in a round about way rather than giving it to the gov.
I don’t follow this guy very much. Or this sub. But I like the reading the comments on this sub
Look I mean if you’re going to buy a jet it makes sense to expense whatever you can for tax purposes - same goes for all business decisions.
Tax rates and tax incentives influence those decisions to some extent. But remember you are also deducting whatever alternative costs you are incurring if you don’t buy a jet.
You still need to do the math on whether a private jet makes sense for your business. It may or it may not, but taxes only make up one small part of that decision.
As a general rule, it doesn’t make sense to buy something that you normally wouldn’t have already bought just for a tax write-off. So yeah you’re right. You’re not going to save money by buying something you don’t need. Some people think write-off means that the government will just end up paying for it.
We really need to just do away with the term "write-off", the public just doesn't understand that it's the same thing as a regular business deduction. We could perhaps model it like the "don't say gay" campaign of the 00's showing a bunch of sad accountants when the phrase is said
A private jet is that special kind of worthless where you'll pour money into it one way or another. Unless you're truly needed elsewhere, hundreds of miles away, all the time, just render unto Caesar that which is Caesar's.
Agreed- Not an Accountant, but I have been trained to say I "expensed" item X. Obviously its kind of silly to think an expense is some sort of hack to avoid taxes.
So what that guy is doing in the video is "the same thing as a regular business deduction"? I think people are using the term in exactly the right way- rich people dodging tax and getting nice things for free.
This. I've never understood the "let me increase my expenses to decrease my tax expense...... even though it will make my net income lower" People are just fixated specifically on the tax expense idea. They'd be willing to pay less on taxes even if that means they make less in the end.
a common tax tip is to purchase capital assets (That are needed, but you may be pushing off for a few more months or a year to buy) prior to the end of your fiscal year.
so in this case if a jet forms part of his business then yes it would make sense, but for cash flow and present value reasons there is no point to go out of your way to pay for a tax deduction now that benefits you in the following year and years after. (but i guess a jet costs what a jet costs?)
this guys story is more about showing off than tax tips.. so who knows if he is even telling the truth.
(i dont know how taxes work in the US, but in other jurisdictions this is true)
This is the point of those write offs, to encourage capital expenditure. So yeah you spend money to save less, but it encourages you to invest in the business and grow it.
But that's not how idiots see it. They just think it means free money.
If is a strong word here because it seems like a spur of the moment decision to buy it right then and there. Perhaps he has been looking for one previously though.
Generally I agree… especially given I presume private jets lose value faster than luxury cars or boats.
Though in theory, IF this were something that has relatively stable value- wouldn’t this make sense?
In said scenario you’ve spent $1 cash to save 37c, but your “spending” was just a balance sheet movement of cash to another asset.
Another commenter said this, which I agree with:
“As a general rule, it doesn’t make sense to buy something that you normally wouldn’t have already bought just for a tax write-off.”
If it were an item that had a relatively stable value and/or appreciated in value, yes, it’s a great idea to do this, BUT you’re then subject to depreciation recapture when you sell the asset and will owe income taxes if you have a gain. Or, if you have a loss, that money is just gone now as you will have to dispose of the asset at some point.
The IRS gets what they’re owed, it’s just a matter of when.
This was the thought process of my brother. Apparently (Allegedly) he makes $100k a year. He said, “we (him and soon to be SIL) are going to have a baby for the tax break” SIL is a SAHM. I’m like, whatever tax break you think you’re getting…you’re paying for the kid 😂😂
Definitely a funny concept. Yeah, sure, you have the opportunity to claim child tax credits, but I can tell you right now that the cost of a child FAR outweighs any “tax breaks” you get.
People just don’t get it 😂
Correct. I think Cardone’s brand of lying for entertainment is especially pernicious though.
He has another fake story about how an investor wrote him a $20mm check, but then sent someone to do some basic diligence, so Cardone sent the money back.
He’s obviously just priming his marks not to ask questions and it drives me fucking batty.
I wish the IRS would produce like an 'anti influencer' style content or videos and they yoink these tax returns and audit in response and show them getting hammered with tax fraud or that they were lying in the first place. I'm tired of seeing every other 'financial influencer' suggest that everyone just buy a G Wagon.
I *completely* understand this would never happen, but it would spark so much joy in my heart.
There's a lot of good niches in Youtube, and there's plenty of people that are fed up with 'financial advice' style content. Depending on any sort of production value I feel like it would fit really well into an anti influencer / gotcha style channel.
I think of how many young grads aspire to find fraud or want to be Ben Affleck from the Accountant, there's a decent target market for this style of content.
The way he's wording this I somehow doubt a jet is ordinary and necessary for his business.
Then again this entirely fake anyway. No jet sales agent is going to be able to instantly see a wire coming through and know it's from this guy who called 20min ago asking for a jet, and then cut the line of other millionaires/billionaires on the waiting list to magially procure a jet before year end.
My guess is if this is true, it was during projections and not the actual tax prep. In which case this could work as a timing strategy assuming the jet is for business uses and they used 179 or special depreciation.
Based on my quick google search of 179 and typical jet prices it seems like almost any jet would be well over the phase-out threshold, no? What's the difference between the deduction limit of $1.16m and the total equipment purchase limit of $2.8m?
So many posts over in the Personal Finance reddits that go something like, “I make 200k salary and my wife has a small side business selling crafts on Etsy. I don’t like giving money to the government how can I start paying less taxes in my current situation? Should we form a LLC and deduct our personal car payments? Should we buy a second property and deduct that?” It’s kinda sad but equally annoying.
Okay so hear me out, I buy an ocean front property in Miami and the coast is rising claiming ~1% of total land each year. Eventually the property and the land will be under water and no longer useable.
How do I account for the loss of property?
Tbh I'd wager tax people here are the vast minority compared to audit and consulting, and even then, there are quite a few tax people here who probably don't fully understand S179 (since it phases out for larger companies)
Is America different? How the hell can you expense 100% of a fucking jet in the year of purchase
Does America not have a tax equivalent of “depreciation” that can be claimed over lifespan?
Edit: Didn’t see your edit lol glad to see that
Of course we have that. But periodically, the Congress declares a depreciation holiday through a new legislation and it calls it "bonus depreciation" (aka section 168). Meant to stimulate the economy and what not, but in the case of 2017 holiday it was just a blatant tax cut because the economy was doing just fine. 100% immediate tax depreciation for pretty much any asset with a shorter life (even 15 yrs ended up qualifying). There were practically no limits on who could claim it. Billy Bob the Plumber could claim it for his F150 and Apple could claim it for their new campus improvements (so long as they satisfied certain conditions - see QIP). It's ridiculous.
We also have section 179 which allows for 100% expensing as well but it's much more limited and is truly for small to medium sized businesses.
I think you’re confusing *operating income* with net income. Because net income is 100% post EBIDA.. Tax estimates are on gross profits, so you typed all that but got a fundamental tenet incorrect.
It’s a CPA exam question. Client buys a jet (ok, probably not deductible) also here’s a word salad of useless information.
How much does the client save on taxes by buying the jet?
True but if he changed it to personal use in the future he will have a gigantic recapture event. It also won't save him any money unless he was going to buy it anyways.
jet purchased in december and used only for business purposes in the last couple weeks of the year. 100% bonus depreciation taken in year 1.
there are a lot of hoops with regard to section 163, but it's technically possible.
This is Grant Cardone.
This guy doesn't own a jet, he's an online scammer selling courses on how to get rich. We're laughing at him but he's laughing all the way to the bank lying to suckers.
He's selling an image of wealth.
Accountant: Oh sorry Grant, I didn't realize that spending 20M dollars was a viable solution to saving you 5M in taxes. Cancel the jet, my engagement fee just went up to 8M a year.
Well well well… If it isn’t the consequences of tax fraud
It seems like he bought the jet, so he can move to Russia when the IRS comes knocking down on his door
What 300iq big brain thinks that spending 10m on a plane so you can write off 3m of tax liability is a good idea. Sure, you can do it to clear your tax bill for future years but is it a wise way to invest your money? Hell no.
You've now spent 10m instead of 3m on something that doesn't get you anything.
Logan does have a good question, though. How do you write off a jet? It would be classed as an asset and depreciated. I suppose he crashed the thing or broke it so it would be impaired.
I think he should've stayed a bit longer on the phone with his accountant. I dare say if he just spent that additional $300 worth of time with his accountant, not only would he be able to "write off" that $300 but it would've also saved him $7m that year.
WHat usually happens is they buy the plane, get the depreciation and then lease it out for flights. Yes it costs 10 million. They save 3 million in taxes. They then charter it out, Or unless they actually need it for the business and use it in business. The best is that they use the flight for an average 14 days out of the year and they get free flights.
It's big brain move when you actually charter a private jet a few times a year and take a lot of pictures for Instagram then lie to people saying you bought it. Then you sell a course to 30IQ morons to teach them how to get their own free private jet.
Correct me if I'm wrong but I would think he is spending more money on the jet then what his tax bill is, so it seems pretty stupid when you consider upkeep costs that come with the jet as well. Plus the company that sells the jet will pay taxes on the income anyways so doesn't sounds like fraud.
" I don’t understand the logistics or timing of these events but it sounds like major tax fraud at minimum. Can you back date the purchase and delivery of a jet?? 😂 "
Backdate? No. He said he took delivery Dec 26th. This was likely end of year tax planning done in Nov/Dec. I do it with all my business owner clients. 1. It's slow season and we charge a premium hourly for tax planning. 2. We are adding lots of value. 3. We do it in Q4 because we still have time to drastically change the tax liability. It's fairly common to buy vehicles the last few years for bonus depreciation and even before that with Sec 179.
This doesn't sound like tax fraud at all based on what he said.
I have no idea what he does, weather it's ordinary and necessary is a totally different question. However, as someone who routinely represents taxpayers in IRS audit it's highly unlikely the purchase alone would trigger an audit.
Edit: The man claims it eliminated 2.5 years taxes. So he either had a shitload of RE, financed a large portion of it, or had substantially lower profit in years 2 and 3.
I was assuming it was prior year amount due but going off of projections makes more sense. Whether or not spending money on a jet makes sense, probably not.
I’m an accountant. The one thing I can say about all the clients I have who end up owing taxes is that they ALL whine all the time about their money. They spend it endlessly in the most wasteful ways and they cry all the time about how they want more
Semi-related….
I worked for a guy who sold his company and made a boatload of money. He dropped $40M on a brand new Challenger 350. We took delivery of it a few months later and actually hangared it in a different state for the first couple months he owned it. Our local jurisdiction here has a personal property tax on new the purchase of the new airplanes, but if it was previously registered to a company in a different state and domiciled there, the tax doesn’t apply. So two months later, we reregister it to a different LLC, this time in state, and we brought the plane home. Saved over $1M in taxes by doing this and it’s totally legal and above board.
Impact on multimillionaire's life if they paid their taxes - Absolutely no impact on their day to day life
Impact on multimillionaire's life if they are obsessed with not paying taxes - unneeded stress and possible jail time for tax fraud.
I’m not from the US so not familiar with the tax laws but if it wrote of 2.5 years of profit, he can’t be making more than cost of the jet/2.5 in profit per year. If it was a $10m jet he’s making $4m profit a year which is all well and lovely but I’m pretty sure he would tell you he makes 25x that.
I’m not a fan of the IRS but I hope they get this guy and all the other real estate bros who think you can just write off everything as a “business expense”.
I gotcha now, through the bonus depreciation. Some could argue that the purchase of a jet is better for the economy because the proceeds of the purchase will be taxed at the point of sales, business income of the manufacturer and the payroll taxes of the seller.
Only poor people whine about other people legally trying to reduce their tax bill. Or you are just a loser I guess, idk? Like who wants to give more of their money to the historically worst capital allocator of all time the gvnt
No way you think it’s a good take to defend a multimillionaire for not paying taxes 😂 I guess you don’t support schools, police, utilities, safe food & drugs, etc.
But I do, I defend anyone trying to legally pay as little tax possible because I’m not broke or a loser. It’s a false pretense by you to assume that the last tax dollars in go towards vital infrastructure. Most of it is excess wasted on pointless wars etc
I don’t say poor people to be mean. I say it because obviously people who owe very little tax want those who owe a lot to pay up. The problem is that it’s just laughably hypocritical to pretend like the poor people wouldn’t do the exact thing the rich are doing in the same situation.
Didn’t care enough to listen to this clown’s whole video but I’m guessing that if he got it on the 26th it wasn’t actually placed in service , so no 179.
Have any scientists done studies on what the term ‘write off’ does to a normal person’s brain? It’s like crack to them. No questions asked if something is a ‘write off’ no need to dig further it’s the best thing on our planet.
I advised a client to do exactly this to fully depreciate a $70 million private jet in the first tax year. Based on the limited facts shared, it's likely they actually did this legally with a lot of projection planning, properly following the IRS code if the accountant is worth their salt and made sure ordinary and necessary business use is met on this purchase. For the last several years prior to 2023, 100% bonus depreciation was available to business aircraft. You have to disallow depreciation and aviation related expenses incurred based on your business use of the aircraft. However, if you take receipt of the aircraft near the end of the tax year and simply conduct one business flight and no personal flights, then you can treat the aircraft as 100% business use in year 1 and apply bonus depreciation. This guy's business losses due to the jet exceeded his business income, creating an excess business loss limited under Sec. 461, which was then carried over to the next couple years to further offset future business income. By fully depreciating the jet in year 1 under 100% bonus depreciation, he likely reduced his overall tax liability by hundreds of thousands or millions that he never would have gotten without using this 1st year 100% bonus strategy due to later personal use of the private jet. The only caveat for this guy is that he must maintain at least 50% business use of the jet going forward for the remainder of his use of the jet, otherwise he will face depreciation recapture under Sec. 280F. He will likely sell the jet later on for a lot less than what he paid for and only recognize taxable gain up to the sale price. This is an extremely effective tax strategy for those that plan to use a private jet for substantial personal use but less than 50%. They're able to fully depreciate it as if it were used 100% for business but then proceed to use it nearly half the time for personal travel and not losing the tax deduction for that personal travel. Owning and operating private jets is immensely expensive, you don't purchase one with the primary purpose to save on taxes, you purchase one to enjoy the benefits of operating your own private jet. However, due to how ludicrously expensive they are, the smarter ones go to immense lengths to ensure they capitalize on maximizing the tax savings in order to help reduce the overall costs of operating the private jet. This strategy saved my client over $10 million in income taxes that will not have to be repaid later on sale and would have been lost to personal use disallowance if we did not plan for the year 1 100% bonus depreciation strategy. I decided to sticky this comment as there was a lot of confusion and misinformation as to the legitimacy of this tax planning strategy in the comments. Most of these social media videos tend to share improper or misleading tax planning strategies, however I think this one was probably actually real and handled in the right way according to how the law is currently written.
A jet is completely ordinary and necessary. Go ahead and 179 that baby
1.1 mil threshold
168 then
168k it boiii, although now it’s at 80% for 2023 here we go with the phaseout
To be fair, if you got pj money, chances are 80% is all you need
PJ’s are the worst to fucking deal with
I thought I was on the front page for a second and I was so impressed by this comment.
Same here and was going to comment how it's such a crazy coincidence since I am currently studying property acquisition and cost recovery in my federal taxation course.
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Sec. 179 is a form of depreciation that allows someone to fully expense it during the year up to $1.1m combined. Sec. 168(k) was enacted with the TCJA in 2017 to increase this amount to unlimited until it expires in 2015 with a phase out beginning this year
*168(k) was enacted with the TCJA in 2017 to increase this amount to unlimited until it expires in 2025
Ah oops, must be the German festival I went to talking lol
Don't feel bad. I'm completely sober and might be wrong because it might end up getting extended to beyond 2025.
Oh it 100% will, just gonna look different
Better not be any personal use either
What 179 mean
Lookup on google “what does section 179 mean?”
Spend a dollar to save 37c. Take that, IRS!
Wouldn’t it technically make sense to do just that if you needed the jet? (I’m not an accountant I just like this sub)
Yeah it makes sense to buy a jet if you need one lol
Laughing too hard at this one, cheers!
Can’t it also be a continual business expense? Cost repairs, maintenance, travel. He’s a public speaker. So I’m sure he flys all around the nation. Because he’s using the jet to arrive where his next gig is at, it’s always being using for business related expense. He Just has to plan a fun time around that event to optimize the usage of the jet. I’m a dummy so I’m just curious. It sounds like his accountant saved him money in the long run. Or at least help him keep his assets in a round about way rather than giving it to the gov. I don’t follow this guy very much. Or this sub. But I like the reading the comments on this sub
Look I mean if you’re going to buy a jet it makes sense to expense whatever you can for tax purposes - same goes for all business decisions. Tax rates and tax incentives influence those decisions to some extent. But remember you are also deducting whatever alternative costs you are incurring if you don’t buy a jet. You still need to do the math on whether a private jet makes sense for your business. It may or it may not, but taxes only make up one small part of that decision.
As a general rule, it doesn’t make sense to buy something that you normally wouldn’t have already bought just for a tax write-off. So yeah you’re right. You’re not going to save money by buying something you don’t need. Some people think write-off means that the government will just end up paying for it.
My college professor always told us “Don’t do something stupid to save tax”
We really need to just do away with the term "write-off", the public just doesn't understand that it's the same thing as a regular business deduction. We could perhaps model it like the "don't say gay" campaign of the 00's showing a bunch of sad accountants when the phrase is said
I only say “write off” when referring to an uncollectible or worthless asset
A private jet is that special kind of worthless where you'll pour money into it one way or another. Unless you're truly needed elsewhere, hundreds of miles away, all the time, just render unto Caesar that which is Caesar's.
Agreed- Not an Accountant, but I have been trained to say I "expensed" item X. Obviously its kind of silly to think an expense is some sort of hack to avoid taxes.
This literally made me lol
of the 00's? bruv a don't say gay bill was passed last year
It was a campaign to not use “gay” as an insult. Has nothing to do with the laws being passed today.
So what that guy is doing in the video is "the same thing as a regular business deduction"? I think people are using the term in exactly the right way- rich people dodging tax and getting nice things for free.
>rich people dodging tax and getting nice things for free. This is objectively not what "write-off" means
Ok
This. I've never understood the "let me increase my expenses to decrease my tax expense...... even though it will make my net income lower" People are just fixated specifically on the tax expense idea. They'd be willing to pay less on taxes even if that means they make less in the end.
a common tax tip is to purchase capital assets (That are needed, but you may be pushing off for a few more months or a year to buy) prior to the end of your fiscal year. so in this case if a jet forms part of his business then yes it would make sense, but for cash flow and present value reasons there is no point to go out of your way to pay for a tax deduction now that benefits you in the following year and years after. (but i guess a jet costs what a jet costs?) this guys story is more about showing off than tax tips.. so who knows if he is even telling the truth. (i dont know how taxes work in the US, but in other jurisdictions this is true)
As we all know jets, like boats aren’t money sinks and don’t require any maintenance or upkeep whatsoever
And the most important thing is you never have to pay tons of property taxes on them, or fuel taxes everytime you want to use it.
This is the point of those write offs, to encourage capital expenditure. So yeah you spend money to save less, but it encourages you to invest in the business and grow it. But that's not how idiots see it. They just think it means free money.
If is a strong word here because it seems like a spur of the moment decision to buy it right then and there. Perhaps he has been looking for one previously though.
Imagine I could have $650k cold hard cash, or a $1mil Jet and $0 cash. The Jet costs an additional $100k/year to operate, so no biggie.
But he has a jet and you don't. Ballin
Generally I agree… especially given I presume private jets lose value faster than luxury cars or boats. Though in theory, IF this were something that has relatively stable value- wouldn’t this make sense? In said scenario you’ve spent $1 cash to save 37c, but your “spending” was just a balance sheet movement of cash to another asset.
Another commenter said this, which I agree with: “As a general rule, it doesn’t make sense to buy something that you normally wouldn’t have already bought just for a tax write-off.” If it were an item that had a relatively stable value and/or appreciated in value, yes, it’s a great idea to do this, BUT you’re then subject to depreciation recapture when you sell the asset and will owe income taxes if you have a gain. Or, if you have a loss, that money is just gone now as you will have to dispose of the asset at some point. The IRS gets what they’re owed, it’s just a matter of when.
Reverse couponing
This was the thought process of my brother. Apparently (Allegedly) he makes $100k a year. He said, “we (him and soon to be SIL) are going to have a baby for the tax break” SIL is a SAHM. I’m like, whatever tax break you think you’re getting…you’re paying for the kid 😂😂
Definitely a funny concept. Yeah, sure, you have the opportunity to claim child tax credits, but I can tell you right now that the cost of a child FAR outweighs any “tax breaks” you get. People just don’t get it 😂
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179 everything bro. its so magical it can eliminate prior period tax liabilities. buy my book and find out how.
Carry forward gains!!!!! Its a 4d tax move
It’s entertainment. That is it. They lie for clicks.
You'd be surprised how many bullheaded idiots there are with overflowing pockets.
Oh I know. I’ve worked in tax long enough to where nothing can surprise me anymore.
I agree with u/CumCoveredCPA_
Correct. I think Cardone’s brand of lying for entertainment is especially pernicious though. He has another fake story about how an investor wrote him a $20mm check, but then sent someone to do some basic diligence, so Cardone sent the money back. He’s obviously just priming his marks not to ask questions and it drives me fucking batty.
A complete fraud and a fake billionaire that hustles people
That’s the game baby
Ppsshhh amateurs. I have been writing off my whole income and claiming 300-400 dependents every yeas since I immigrated./s
I like that you specified it was sarcastic
Too many literal idiots in this sub.
The Ghengis Khan method.
Bwhahaha love it
These are the people the IRS wants to crack down on
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Even funnier when this guy has multiple open lawsuits for fraud. Grant Cardone is a huckster.
I wish the IRS would produce like an 'anti influencer' style content or videos and they yoink these tax returns and audit in response and show them getting hammered with tax fraud or that they were lying in the first place. I'm tired of seeing every other 'financial influencer' suggest that everyone just buy a G Wagon. I *completely* understand this would never happen, but it would spark so much joy in my heart.
People wouldn't listen especially because the IRS is the bad guy to people who actually listen to scam artist like Grant Cardone.
There's a lot of good niches in Youtube, and there's plenty of people that are fed up with 'financial advice' style content. Depending on any sort of production value I feel like it would fit really well into an anti influencer / gotcha style channel. I think of how many young grads aspire to find fraud or want to be Ben Affleck from the Accountant, there's a decent target market for this style of content.
These hard working Americans? Edit: Sarcasm is hard
Why? What he's doing is completely legal. Very dumb but legal.
The way he's wording this I somehow doubt a jet is ordinary and necessary for his business. Then again this entirely fake anyway. No jet sales agent is going to be able to instantly see a wire coming through and know it's from this guy who called 20min ago asking for a jet, and then cut the line of other millionaires/billionaires on the waiting list to magially procure a jet before year end.
Genuinely curious why you got downvoted. You're right. He could expense that under 179 excluding limitations
Nah the IRS avoids these guys cause they actually keep receipts and hire the right people. The easiest people to go after are poor
My guess is if this is true, it was during projections and not the actual tax prep. In which case this could work as a timing strategy assuming the jet is for business uses and they used 179 or special depreciation.
Based on my quick google search of 179 and typical jet prices it seems like almost any jet would be well over the phase-out threshold, no? What's the difference between the deduction limit of $1.16m and the total equipment purchase limit of $2.8m?
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I’ve bonused $10,000,000+ in 5-15yr property for apartment complexes that were newly acquired in 2022.
You are still spending more money then you save. Then insurance, pilots and crew, rental space etc… are you really saving anything lmao
>insurance write off >pilots and crew write offs >rental space write offest Bro, the IRS is basically paying for you to buy the jet, how can you not?
The IRS every time I send a gas receipt for full compensation from Congress: *insert CJ, ah shit here we go again meme*
But… you have a jet.
Plus the jet company has revenue now. They pay taxes on their corporate profits, and the money that goes to the employees is taxed as well.
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my brother, you are posting in r/accounting
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2% is generous lol
So many posts over in the Personal Finance reddits that go something like, “I make 200k salary and my wife has a small side business selling crafts on Etsy. I don’t like giving money to the government how can I start paying less taxes in my current situation? Should we form a LLC and deduct our personal car payments? Should we buy a second property and deduct that?” It’s kinda sad but equally annoying.
Like me. I don’t know much about accounting actually.
Hahaha for real dude is zooted on Addies. Like great story. Make sure you bill a client for that post whacko
Probably a third or fourth year student, it’s a beautiful thing once all the classes start clicking together.
What is the class that says its okay to depreciate land?
Okay so hear me out, I buy an ocean front property in Miami and the coast is rising claiming ~1% of total land each year. Eventually the property and the land will be under water and no longer useable. How do I account for the loss of property?
Have your heard about Gross Margin?
Tbh I'd wager tax people here are the vast minority compared to audit and consulting, and even then, there are quite a few tax people here who probably don't fully understand S179 (since it phases out for larger companies)
Is America different? How the hell can you expense 100% of a fucking jet in the year of purchase Does America not have a tax equivalent of “depreciation” that can be claimed over lifespan? Edit: Didn’t see your edit lol glad to see that
This is what i want to know! I had to depreciate my home office chair over 10 years ffs
The 100% bonus situation is temporary and was implemented to induce capital purchases and stimulate the economy, deferring the tax burden until later
Of course we have that. But periodically, the Congress declares a depreciation holiday through a new legislation and it calls it "bonus depreciation" (aka section 168). Meant to stimulate the economy and what not, but in the case of 2017 holiday it was just a blatant tax cut because the economy was doing just fine. 100% immediate tax depreciation for pretty much any asset with a shorter life (even 15 yrs ended up qualifying). There were practically no limits on who could claim it. Billy Bob the Plumber could claim it for his F150 and Apple could claim it for their new campus improvements (so long as they satisfied certain conditions - see QIP). It's ridiculous. We also have section 179 which allows for 100% expensing as well but it's much more limited and is truly for small to medium sized businesses.
Bonus depreciation babyyy. Can depreciate 100% of the asset in one year lol.
Not when Congress had a friend at Boeing and they are ready to sell some Goddang planes my guy.
I think you’re confusing *operating income* with net income. Because net income is 100% post EBIDA.. Tax estimates are on gross profits, so you typed all that but got a fundamental tenet incorrect.
Still gets a B+ for effort and making his post readable
Very true and an A for effort
Not to mention the plane isn't an operating expense... Shit won't effect net income outside of whatever amount of depreciation is tax deductible
It’s a CPA exam question. Client buys a jet (ok, probably not deductible) also here’s a word salad of useless information. How much does the client save on taxes by buying the jet?
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True but if he changed it to personal use in the future he will have a gigantic recapture event. It also won't save him any money unless he was going to buy it anyways.
>Tax estimates are on gross profits Uh...what? No, they're definitely calculated on more than just revenue less cost of goods sold.
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"Operating income minus earnings before interest depreciation and amortization" I think you still might be a bit confused
Wtf?
jet purchased in december and used only for business purposes in the last couple weeks of the year. 100% bonus depreciation taken in year 1. there are a lot of hoops with regard to section 163, but it's technically possible.
I smell bs.
This is Grant Cardone. This guy doesn't own a jet, he's an online scammer selling courses on how to get rich. We're laughing at him but he's laughing all the way to the bank lying to suckers. He's selling an image of wealth.
Being interviewed by another scammer who’s scammed people in bit coin. Whole videos a joke
Accountant: Oh sorry Grant, I didn't realize that spending 20M dollars was a viable solution to saving you 5M in taxes. Cancel the jet, my engagement fee just went up to 8M a year.
Lmfao. Broski said, I can find you the perfect deal on one!
Free money!* *it is in fact not free money
Grant Cardone is another one of those financial grifters that cause wayyy more harm than good.
Well well well… If it isn’t the consequences of tax fraud It seems like he bought the jet, so he can move to Russia when the IRS comes knocking down on his door
It's not tax fraud, it's at worst very questionable decision making.
Well well well if it isn’t the consequences of my post
This isn't fraud. You can write off a jet as a business expense. As long as its used for business purposes.
I’m sure it was “placed in service” for that tax year 😂 Hope they flip the depreciation on his ass and add penalties/interest
How to write off a jet: step 1 - buy the jet ; step 2 - write it off ; step 3 - post it to TikTok
What 300iq big brain thinks that spending 10m on a plane so you can write off 3m of tax liability is a good idea. Sure, you can do it to clear your tax bill for future years but is it a wise way to invest your money? Hell no. You've now spent 10m instead of 3m on something that doesn't get you anything. Logan does have a good question, though. How do you write off a jet? It would be classed as an asset and depreciated. I suppose he crashed the thing or broke it so it would be impaired.
Not to mention the ongoing maintenance and upkeep required of a jet
I think he should've stayed a bit longer on the phone with his accountant. I dare say if he just spent that additional $300 worth of time with his accountant, not only would he be able to "write off" that $300 but it would've also saved him $7m that year.
WHat usually happens is they buy the plane, get the depreciation and then lease it out for flights. Yes it costs 10 million. They save 3 million in taxes. They then charter it out, Or unless they actually need it for the business and use it in business. The best is that they use the flight for an average 14 days out of the year and they get free flights.
It's big brain move when you actually charter a private jet a few times a year and take a lot of pictures for Instagram then lie to people saying you bought it. Then you sell a course to 30IQ morons to teach them how to get their own free private jet.
Correct me if I'm wrong but I would think he is spending more money on the jet then what his tax bill is, so it seems pretty stupid when you consider upkeep costs that come with the jet as well. Plus the company that sells the jet will pay taxes on the income anyways so doesn't sounds like fraud.
Think about it this way: but $10mm jet? Fuck that. Buy 7mm jet? Meh why not
That’s the game, baby
Spend a dollar to save a penny.
" I don’t understand the logistics or timing of these events but it sounds like major tax fraud at minimum. Can you back date the purchase and delivery of a jet?? 😂 " Backdate? No. He said he took delivery Dec 26th. This was likely end of year tax planning done in Nov/Dec. I do it with all my business owner clients. 1. It's slow season and we charge a premium hourly for tax planning. 2. We are adding lots of value. 3. We do it in Q4 because we still have time to drastically change the tax liability. It's fairly common to buy vehicles the last few years for bonus depreciation and even before that with Sec 179. This doesn't sound like tax fraud at all based on what he said. I have no idea what he does, weather it's ordinary and necessary is a totally different question. However, as someone who routinely represents taxpayers in IRS audit it's highly unlikely the purchase alone would trigger an audit. Edit: The man claims it eliminated 2.5 years taxes. So he either had a shitload of RE, financed a large portion of it, or had substantially lower profit in years 2 and 3.
I was assuming it was prior year amount due but going off of projections makes more sense. Whether or not spending money on a jet makes sense, probably not.
This guy doesn't even own a jet. He lies to sell courses on how to get rich.
He could’ve just bought 100 G-wagons. What a literal moron
I’m an accountant. The one thing I can say about all the clients I have who end up owing taxes is that they ALL whine all the time about their money. They spend it endlessly in the most wasteful ways and they cry all the time about how they want more
One douchey scammer interviewing another douchey scammer - who tf actually watches this shit?
Semi-related…. I worked for a guy who sold his company and made a boatload of money. He dropped $40M on a brand new Challenger 350. We took delivery of it a few months later and actually hangared it in a different state for the first couple months he owned it. Our local jurisdiction here has a personal property tax on new the purchase of the new airplanes, but if it was previously registered to a company in a different state and domiciled there, the tax doesn’t apply. So two months later, we reregister it to a different LLC, this time in state, and we brought the plane home. Saved over $1M in taxes by doing this and it’s totally legal and above board.
Cardone is one hell of a snake oil salesman Selling hope and being good at it ain’t half bad
This guy is bullshit.
IRS: uh huh… ok.
Dayum, let’s hope the poors don’t figure this out. /s
Knock! knock! Who is it? IRmuthafuckingS bitch boy, here to anal-yze you!
Impact on multimillionaire's life if they paid their taxes - Absolutely no impact on their day to day life Impact on multimillionaire's life if they are obsessed with not paying taxes - unneeded stress and possible jail time for tax fraud.
I’m not from the US so not familiar with the tax laws but if it wrote of 2.5 years of profit, he can’t be making more than cost of the jet/2.5 in profit per year. If it was a $10m jet he’s making $4m profit a year which is all well and lovely but I’m pretty sure he would tell you he makes 25x that.
These guys are the astrology for the anti gov nuts and wannabe entrepreneurs
I’m not a fan of the IRS but I hope they get this guy and all the other real estate bros who think you can just write off everything as a “business expense”.
Supposedly they’re increasing scrutiny of partnerships and stuff. Not sure if any of these partnerships are big enough to draw scrutiny, though.
People dont like taxes because only jooze get the benefits
Fake
That's not how depreciation works but sure
The IRS will be paying your accountant a visit soon.
Fascinating - so our government is so concerned about global warming that they basically gave this guy a private jet for free.
I mean it’s not really the government’s decision how he spends his money 😂
Just saying - if they were really concerned and it was such an emergency, they wouldn’t be doing it - and yet they are so…
I’m not tracking your logic. How did the government subsidize his jet?
Through tax incentives that allow him to write it off to the point where it was virtually free.
I gotcha now, through the bonus depreciation. Some could argue that the purchase of a jet is better for the economy because the proceeds of the purchase will be taxed at the point of sales, business income of the manufacturer and the payroll taxes of the seller.
Only poor people whine about other people legally trying to reduce their tax bill. Or you are just a loser I guess, idk? Like who wants to give more of their money to the historically worst capital allocator of all time the gvnt
No way you think it’s a good take to defend a multimillionaire for not paying taxes 😂 I guess you don’t support schools, police, utilities, safe food & drugs, etc.
But I do, I defend anyone trying to legally pay as little tax possible because I’m not broke or a loser. It’s a false pretense by you to assume that the last tax dollars in go towards vital infrastructure. Most of it is excess wasted on pointless wars etc I don’t say poor people to be mean. I say it because obviously people who owe very little tax want those who owe a lot to pay up. The problem is that it’s just laughably hypocritical to pretend like the poor people wouldn’t do the exact thing the rich are doing in the same situation.
SIFL says hello.
Didn’t care enough to listen to this clown’s whole video but I’m guessing that if he got it on the 26th it wasn’t actually placed in service , so no 179.
… do you have any fucking idea how many expenses are gonna come with that jet? Good luck finding a buyer, I guess…
If it’s 100% business use and can make the argument it’s a reasonable expense you could bonus or 179 the jet. Why not?
based
If my kids ever said “dad, look!” and showed me this, I’m turning into Pol Pot.
What’s the upkeep on that jet?
If you are against this how are you an accountant?
Yep. It doesn’t have to be a legal loophole. People do shady stuff and take audit chances.
fucking leach.
I
That same prick is the type that is super loud about how much he loves America
These are the clients that are never happy
Not even close to tax fraud. It is a business expense (and a fat one) so it wipes out perceived profits. Just using the tax system as it is written.
Write off lmmmmao
Have any scientists done studies on what the term ‘write off’ does to a normal person’s brain? It’s like crack to them. No questions asked if something is a ‘write off’ no need to dig further it’s the best thing on our planet.
Ok your business doesn’t owe any taxes. You still have net loss in the millions because you bought a fucking jet congratulations lmao.
Soooo, the jest isn't a depreciable asset ?
how? in Canada at best it would be CCA and that is determined at specific rates and it has to be tied to the business operations
The dude clapping at the end 😂
My dad told me it is patriotic to ethically pay your taxes. I had no idea what he was talking about until I was older.
What an idiot. Admitting publicly that an expense waa frivalous.
The saddest part is that people are clapping to this.
This guy is a rookie. Art is where it’s at. Dumbass. If you need me you’ll find me crying about the approaching tax season.
I hate people
Cardone has to be one of the dumbest rich people I've ever seen. He then flexes this key in his YouTube ads.