How the Ultra Rich use Holding Companies for Tax Savings

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#taxes #taxfreeliving #taxexpert #taxreduction
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• Avoid These MISTAKES B...
Did you know you can have multiple LLC businesses within one holding company? Not only can you save taxes with this strategy but also protect your assets.
Here's are some tax deduction tips that can help you save you massive amounts of money on your taxes and stay on top of your business finances.
In this video we discuss: How to Start an LLC for Asset Protection - Holding Company Structure
Watch this video until the end to avoid overpaying Uncle Sam and to start making the most out of your real estate business!
*Disclaimer: I am not a financial advisor nor am I an attorney. I am a licensed Enrolled Agent. This information is for entertainment purposes only. It is highly recommended that you speak with a tax professional or tax attorney before performing any of the strategies mentioned in this video. Thank you.
*Disclaimer: I am not a financial advisor nor am I an attorney. This information is for entertainment purposes only. It is highly recommended that you speak with a tax professional or tax attorney before performing any of the strategies mentioned in this video. Thank you.

[@towsendmorrison9736]

*Most* *people* *think....* *Investing* *in* *crypto* *is* *all* *about* *buying* *coins* *and* *holding,* *till* *it* *rises,* 🙅 *come* *on* *it* *takes* *much* *analysis* *to* *be* *a* *successful* *crypto* *trader.* *I've* *made* *$16,000* *in* *two* *weeks* *of* *trade.*

[@joshuajames9839]

OMG!!! *$16k* how's that possible. What's your strategy?

[@towsendmorrison9736]

@@joshuajames9839 I trade with a professional broker *Mr.* *David* *Morrison* he brings me massive returns.

[@andrewdavid7070]

I also trade with Mr. David, haven't you heard of him? He is the best to trade with.

[@martinkroos3329]

*$16,000* That's really big. I trade on my own, but I've only made $2,800 in a month

[@williamsmark5062]

Wow!! I thought I was the only one trading with Mr. David, I just withdrew my profits of $25k after investing $3,500, in two weeks of trading

[@scottpaschal9905]

I would like to point out that the additional wright off would be $4,450 otherwise it's just $26,000 and not $30,000.

[@AfroSenpai]

I'm looking forward to this after I become a millionaire, thank you Karlton for dropping knowledge.

[@WinnersTVNetwork]

Why after? Before is the key,so you can become a millionaire faster!

[@adventuresona700dollarhard5]

After? Good luck becoming a millionaire, paying 40% in taxes.

[@wholesomenesstv]

Great Video Kaltron. You are simply amazing . One little error. Standard deduction for 2 kids is $25,100 not $25,550. Thanks for always sharing your knowledge. This is toooooo GOOD!

[@mikesanchez9298]

and then doesn’t that leave $4,900 and not $450 left over?

[@jarrettgilliam3159]

​@@mikesanchez9298absolutely correct

[@Traviswolf-v7v]

Protect this man

[@lmacatol]

Couldn't you just do those deductions on the companies instead of moving it to the parent company? I honestly don't know and am curious. Thank you for the videos you put up! They're educational and informative and digestible.

[@johnboholst2163]

Its depends on your country, i'm in Australia but i believe there are similarities. In Aus the top personal income tax rate is 45% for incomes over $180k per year. Where as the business/corporate tax rate is fixed at 28%. You want to move as much of your income into the 28% business tax rate. In Australia, you would start this strategy once you are looking to earn over $120k where your on 32% - 37% tax rate.

[@hendrixhein]

Thank you for explaining the concepts in simpler terms, Karlton! These videos are very educational and practical

[@bo560]

Amazing info & right on time for what I’m setting up. Thank you Karlton!!!!

[@theRealestBarbieD]

I love all the plants in the background 👏 Love all your videos! 👏

[@user-kk9ig9wl5m]

Larlton, would the holding company or parent company be an S Corp? and how would you pay yourself out oh or would you still pay yourself through a salary from the holding company?

[@GoodFellasTacosProfile]

Couple questions. First, what if you don’t have kids? Second, why can’t each LLC just do this? Why create another llc just for management. Seems like all these write offs can just be done on the same llc.

[@Desmondavid]

Exactly. That’s my questions. If the LLC’s are assumed single member owner it’s already assumed they are pass through entities and that the net profits fall on the owner of that company hence the AGENT (the holding company) which means the home office usage, cell phone, internet, retirement, gas bills, can be filed in that subsidiary instead of waiting to file with the parent company and doing the same thing. I could be wrong. I just need clarification lol

[@Nads2020]

Great video. Some numbers need to be fixed. 12550*2=25,100. Leaving over 4,900 for other reductions

[@timcraft2934]

good info, what would be the advantage of having crypto assets (prior to large gains) in holding company compared to holding as an individual

[@lifewithjusto7777]

Any other better suggestions on whipping out the 30k tax bill if person doesn’t have kids because question still stands it’s just moving money around if I’m still being taxed on 30k

[@LeonGenesis]

Hope to see more videos on tax strategies for Holding/Operating Companies!

[@gbpanther30]

I would love to hear this same scenario without kids.

[@kamillesuarez7178]

Agreed!

[@dna1149]

Yes, everyone keeps talking aboit generational wealth, but we don't have kids.

[@irshasher3602]

Especially considering that in order to pay the kids, they have to actually be providing reasonable services for the amount they are being paid. Otherwise the IRS is going to deny the deduction and slap the owner with a negligence penalty.

[@jarrettgilliam3159]

​@irshasher3602 not to mention it's your kids money now unless you are going to steal it back

[@macpro5937]

And your kids need to be at least 7 years old.. and they could have just worked directly for each LLC and achieved the same result. This is 100% moving money around and using the same available tax strategies that can be used in individual LLCs. Nothing specific to a holding company.

[@wnlybliard1]

Thank you so much ill be watching many of your videos in the future! as i am currently in the process of setting up a holding company to parent my 3-4 LLCs. This was quite simple and informational.!

[@Jahguaar]

I am committed to self-development & thriving.

[@kennedironey2025]

If you don't have kids, is there a different strategy for offsetting the money in the parent company?

[@TheTalkWithT]

Thank you, this information is super helpful and i love how you explained it.

[@GoGetFree]

Simple, comprehensive, and financially nutritious.

[@markblack1513]

If the holding company is an S-Corp that is offshore, would I then pay myself a reasonable compensation as a US resident and have the rest of the net on that holding corp tax free in a offshore that has 0 corporate tax rate?

[@combatdouglas1306]

Check your math on the offset. It was not 450 to offset. Not 25,500 rather 25,100.

[@OffroadTreks]

This is the best explanation of upstreaming I have ever seen.

[@surveytestmoney2550]

It would be nice if I could find someone to explain it from a non RE standpoint for ppl who want to (or already has) started a business. All these videos I come across are all about real estate owners. Not business owners so it's frustrating to follow along.

[@annettemarie2076]

I can see why I will need someone like you sooner than later.

[@_boardwalkmusic]

Man this was crazy info. Instant subscribe!! Bless you man!!

[@marinawong9662]

I don’t think the retirement account is owned by the LLC. Maybe you mean the beneficiary of the retirement account is the LLC?

[@SmoothAsSUEDE]

Peace!! Love the segments and knowledge that you share, Karlton, and absolutely loving the lavender shirt here!!🔥🔥💯

[@marlonbrown2944]

Thank you for sharing your knowledge.

[@jarrettgilliam3159]

Im confused, the kids made money and you wrote off expenses but where did (you) make any money?

[@nguye1971]

Amazing… you forgot to factor in the annual filing expenses for LLC #4

[@abbielopez7279]

Bro, mind-blowing!! Thank you for breaking it down like that. Great content. Love the videos

[@aubreybibbsjr.1501]

Is an asset purchased with the consolidated profits from the subsidiaries considered an expense for the holding/parent company? Rhetorical.

[@Kreestopher]

You do such a good job explaining everything!

[@KMinor4]

Great video Karlton as always. I have a question, should my biz credit cards be in my holding co name or operating co name? Thx you

[@dshearer7102]

Just wanted to throw this out there.. Is there anyway to include a strategy with stocks or a licensing agreement with this managing company to increase above that 30k level? And what if you had a licensing agreement with an offshore company not domiciled in US Tax jurisdniction.. Thanks and great video!

[@swissy5608]

The way we did it 10+ years ago was to make a London holding company (unless you were British) and a Netherlands IP holding. But I’m not current, which is why I myself am looking at videos like this lol You can easily send 1 to 8% of revenue to NL for royalties. That’s a great form of income to get. But I suppose you could just as well send it to the states. I needed Euros, and your mileage may vary. If you live mostly in USD, I don’t see why you’d bother with NL when you can just easily get another Wyoming or Delaware LLC for IP. I’d also say look at how Apple is organized. They’re quite smart.

[@x4ddy]

If you use your children for deduction would that take away anonymity of your holding company in anonymity holding company states ?

[@is_ma_el]

To be honest, I did this by accident. I didn’t know I created a holding company until a few months ago. I realized I started to make two companies outside my main one because I was not seeing profits though I put in a lot of time and effort and now I’m trying to figure out how I can do what you said in this video. Would be nice to have a chat and help in this matter.

[@SUNofNY]

Why not just pay your kids the $12K from the base LLCs?

[@FidelHimself]

Valuable info. I appreciate this!

[@vineelp]

Very helpful video Karlton! I don't see patreon link in the description. Can you please share it?

[@therapturedmichelle]

Could children who are business owners employ a parent (mom or dad) and get the same benefit if they don't have their own children yet or ever?

[@allie8442]

Love the Ron Paul clip.

[@andrejerry2778]

VERY good information! Thanks, Karlton

[@ScottyFranchyze]

That was great brother 🙏🏾

[@valerie23guzman]

Omg that's exactly what I needed to hear, can I consult with you?

[@yannickluna6229]

Could you not also set-up the holding company as an S Corp?

[@Peaceful24543]

If I open a Holdings company before opening a REI LLC, does it mean I have to file tax returns for 2 companies? Thanks a lot🤝👍🙌😊

[@leaderofthepack6952]

I think this segment is over my head???? I need to go back and listen and take notes this time

[@robhtp3817]

WooHoo ~ I believe I’ll be contacting you within the year to strategized my empire! Thank you once again Karlton for your knowledge and insights! These education gems are just what us small business owners need.

[@WFox-zs3oe]

Does the holding company have to legally own the LLC to benefit. Can I take my from my LLC and put it into my personal account, then take the money from my personal account and put it into the holding company. The reason I ask is because a holdings company cannot be majority owner of an government contracting entity. Which I have

[@JoWabbie]

how exactly do you send the fee to your management company? send a check, transfer, or invoice your LLCs?

[@iammoamp]

Great content as always, Karlton. I appreciate what you share. We'll be in touch fairly soon. For now I do have a follow up as I watch this for the umpteenth time: the 10K expense for each LLC, it was shown as a culmination of 30K write off. Ideally is that more so a 10K write off for each LLC? Let me know because we're growing as we speak 💍

[@AVOfutbol]

Sweet info dude!

[@bothBlenders92]

Thank you for this, you're making a difference 🚀🚀

[@kevinmeyer8068]

Numbers don’t add up. $30,000 payed from three LLC. 2 kids have deduction $12,550 each which equals $25,100 not $25,550 stated in video. It says you would deduct cell phone for $450. in the video that total would come up to $26,000 short of your $30,000 by $4,000. i feel the correct number is $25,100 with another $4,900 to be found to wipe out management fee.

[@jignaparekh7150]

Can the management company be S-corp? And operating businesses under it be an Assumed business instead of LLC?

[@michaelre8933]

So with a holding company does the subsidiary companies income flow through to the parent company or still to the personal income ?

[@lmacatol]

Also, one last question. Do the kids have to be your dependent? I have a step son he lives with Dad and in Have my son. Also how old do they have to be to be able to get "work".

[@lydiabutler8634]

Is this a universal strategy or specific to the US?

[@thomasforbes7621]

Excellent as always 💪💯

[@ryderscottmc92]

Is there a cap on percentage of income from the main LLCs that can be paid as a “management fee” to the holding company?

[@securityteam4871]

AMAZING INFORMATION

[@annettemarie2076]

Great class

[@dariusboone3689]

This was gooooood!!

[@robertmorris9349]

You're giving out GOLD

[@bjornbhGN]

Do LLC's 1-3 have to be collecting Passive Income for this to model to work?

[@pdab1768]

Hey @karlton Dennis how old do the kids have to me in order to be able to start paying them?

[@funguy29]

Can the parent management co. be created after the child LLCs ?

[@czarrevs3616]

Great info. What if you don't have kids?

[@juanquezada4457]

Bro thank you! Do you have any business info I can reach you at?

[@vish937]

Karlton, your youtube videos are chalk full of knowledge and the way you dissect each topic is clear and to the point. I've learned so much that is tangibly helping me and my family. Your click funnels on the other hand..yikes.. made me feel like i was being recruited to sell Herbal Life, or join your church. and for what though? You have so much great info, i personally would have continued down the funnel had you kept the theme of actionable advice, instead of showing me a picture of a dark tunnel and spending 30 mins telling me how you had to dig yourself out of it 😂 funny but not funny. From a fan.

[@cenellharrell]

Is the parent company under the Trust as well?

[@bfourney]

Isn’t the IRS highly suspicious if you’re paying other companies you or a relative also own? Doesn’t that automatically trigger audits and what not?

[@island97]

It only becomes an issue when the expenses are "fabricated" I.e don't exist/excessive . It is understood that a company will have basic expenses like rent/utilities/salaries/ etc . As long as it's reasonable, you won't be in trouble .

[@floatingodds]

Great video! If you pass the $30k to the holding company and purchase a $30k investment property through that holding company do you have to pay taxes on the original $30k?

[@zach.nicholz]

Yes because investments are still taxed unless it is being put into a 401K. Investments are generally not write-offs or tax deductible outside of a Traditional IRA or 401K where it goes in before tax and is taxed when drawn upon later in life.

[@floatingodds]

@@zach.nicholz thank you. Could an investment ever look like a business expense? “A company that provides corporate housing”?

[@zach.nicholz]

@@floatingodds Technically, no. Unless it is a traditional IRA or 401k as mentioned, you cannot deduct any investments. The only thing you can deduct is mortgage interest for rental properties or improvements and services done on that property that you can use as a deduction to the property when it is sold. Other assets that are true investments cannot generally be deducted as an expense. But it is super important to have the correct definitely of an investment as something that brings you money because some people will claim that things like business cars are "investments" when they don't bring in any money unless they are collectibles or you are an uber driver ;)

[@MrArtVein]

@@zach.nicholz hey can you clear this up, for s and c corps I did see something about innovation being a tax write off. Like that's how Amazon paid so few taxes, the money went right back into the company expansion. What is the IRS looking for in this scenario? Patents and development expenses? Or something else entirely?

[@zach.nicholz]

@@MrArtVein I'm not quite sure about C-corps to be honest. I don't want to give you any false info or anything I don't "know" for a fact. Sorry!

[@HOODBOSS]

Good stuff

[@JajuanBurton]

thank you!!!!!!!

[@michigan_616]

Thanks for the visual aid, for me, its challenging to understand the concepts without. Had one question, is the management company different than the holding? If yes, does the holding own the management company?

[@knpstrr]

WTF kind of numbers at 7:30 ?? 12,550 x 2 = $25,100. And anyway 30,000-25550=4,450... not 450. Nevermind that the $25,550 is wrong.

[@GymWithJaz]

Thank Youuu!!!!!

[@jamesishmel2814]

Thanks 🙏

[@absmith17148]

how do you offest the 30k if you don't have kids?

[@IamunapologeticSERENA]

How could I get a consultation with you

[@E-ZE-DUZIT]

I'm a Mailcarrier that already itemize with GoodWill receipts. I also do Covered calls with TD Ameritrade but only making about $10,000 from covered calls in my 2nd year of it. Are there any other tax advantages I can receive?

[@kims7387]

goodwill receipts itemized how, why? thanks for sharing the info.

[@bmzpower]

yesss thank you 💯💯💎💎🔥🔥

[@combatdouglas1306]

Concept works.

[@joeannhill3766]

Thank you your impressive.

[@annettemarie2076]

Very exciting

[@lifewithjusto7777]

Finally thanks

[@robsomething4435]

If the management company claims up to the standard deduction on a child, do you lose the actual standard deduction on your personal income tax?

[@sabrinamorfa1345]

Yes but the standard to claim a dependent is much less than filing individual tax returns for each child. Each child gets to claim the $12,400 rather than you claiming the measly $2k as a dependent and only a couple of grand on the additional child credit if you even quality for it; chances are you won't quality for much because most people who own businesses tend to make "too much" for this additional child credit to be worth anything.

[@ellenoir5678]

LLC #1#2#3 are "series co" of LLC #4 being the parent co.? So we only using LLC#4 EIN number for banking purpose or is each LLC stand alone and we have EIN for each one?

[@sabrinamorfa1345]

Unfortunately, each one needs it's own bank account and EIN. There's just more paperwork involved and more licensing/registrations. Each LLC would need to be registered within your state and/or licensing your state or county requires to run that business. So even though you have 2 children (example from video) to wipe away $12,550, you have to consider the payroll taxes you need to pay.

[@ellenoir5678]

Okay 👌 cool thanks

[@lurueanthonyofficial]

Pay your kids as a contractor so no payroll taxes are required…..and part of their duties could be 1: lawn service for the properties as an up charge on lease agreement 2: general duties as assigned

[@Darkside-me4my]

@@lurueanthonyofficial if your kids are under 18 and you have a sole proprietorship or LLC you don’t pay payroll taxes. You would only have to pay payroll taxes if you pay them out of a C or S-corp.

[@digeratiart]

Great content, I need your services: how can I get in touch?

[@STARSFashionArtLove]

Please help me set up my management company for my restaurant's LLC 🍱

[@youngatnaruto]

Next video please how to protect half of your assets from being stolen by the court in the event of a divorce

[@youngatnaruto]

@@richdibo I know lol but she does so with the help of the court and I was just being facetious

[@adventuresona700dollarhard5]

Your assets can be protected in an LLC, but it has to be done before you’re married. You can’t use businesses post-marriage to hide assets owned by both parties.

[@marcelinojrdeperalta2215]

How can the taxes collectors prove that payers give their money to the kids?

[@Blue_Angel.555]

this is gold!! I dont have kids!

[@drewyoungs]

Do I have to look at your Porsche?

[@combatdouglas1306]

Taxation is theft per the 1923 S.Ct. defining what income is and is not. Never Overruled ergo good law.

[@kylezarnoff8999]

“Taxation is theft!” 🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣

[@karyjimenez2472]

What if I do not have any kids?