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You're listening to the Master Passive Income Podcast Network.

Welcome to the Master Passive Income Show.

My name is Dustin Heiner, and I'm here to help you afford anything you want in life.

Create generational wealth and financial freedom by investing in real estate.

And in today's show, I'm going to be sharing with you the three most diabolical ways that that the rich get out of paying taxes legally and how you could do it as well.

All right, let's start the show.

Welcome to the Master Passive Income Podcast, where we talk about investing in real estate with a special focus on making enough money so you can quit your job and live the dream life.

And now, here is your host, Dustin Heiner.

What's up?

What's up?

Super blessed as always to have you here with me on the show.

I mean, honestly, week in and week out, you come back and listen.

It really gives me encouragement to want to continue to give you as much great information, insights on investing in real estate.

In fact, I recently had somebody send me a message on Instagram, send me a dm.

And if you want to send me a dm, please do.

I love chatting with everybody that listens to the show.

The Dustin Heiner.

T H e Dustin Heiner.

Follow me, because I'm literally showing you how to invest in real estate there as well.

Well, I got the message from somebody saying, well, Dustin, if I get all this information from you on your podcast, do I really need coaching?

Do I need coaching from you or anybody else for that matter?

And I said, that's a fantastic question.

The reason why is because there's so much great information out there, literally for free.

Honestly, if you talk to most of my students, they've Binged my entire podcast.

They listened to one episode like, man, this is good.

I want to listen to more.

So this is a couple more.

But then they go back to the very beginning because they know that I teach how to do this investing on the podcast, literally for free.

And I get people investing just by listening to the podcast because everything I teach.

So go back and listen to all the episodes.

I literally teach this on the podcast.

I have my books.

I literally give it away for free.

I have my blog posts, I have my Instagram account, YouTube videos, all this stuff.

So not just me, though.

There are lots of other people that teach and coach and give out free content on how to invest in real estate.

So I personally wish I would be able to go back and start all over.

It took me nine to 10 years to get financial independence, but that's because I figured out myself and it took so much longer.

Now that's 10 years of my life that I can never get back.

Now I'm very blessed, I must say, that even though I went, it took me 10 years, I now am where I'm at.

So I can't say it was all bad at all.

But if I could cut it down to five years instead of 10, you know, that's five years of my life back where I can be doing something else other than working at dead end job.

It's kind of like this.

If you have coaching from somebody or if you're working with somebody, if you are, if you have a coach for a sport, let's say you want to pick up golf, you've never played golf before and you're like, you know, I really want to learn how to play golf.

You can buy a, you know, just a regular set of clubs, you know, maybe a hundred bucks from a pawn shop and you can go out and you could start playing maybe after about five years, you're probably going to be able to break a hundred, you know, get under 100 strokes in one round of 18 holes.

Well, that's not that good to break a hundred.

I mean, when you get into like the 80s, definitely the 70s, you're really, really good.

But let's say it takes you and this is honestly what's going to take.

It's if you play by yourself about five years to be able to break 100, maybe even break into 90.

But let's say you got a coach, a coach that knows what they're doing, that's done it before, that is going to make sure that watching everything that you do to make sure it's done right.

And on top of that, you get a decent, a good, you know, decent set of clubs.

Maybe spend four or five hundred dollars on these clubs.

They're going to play better, they're going to hit better, they're custom fit.

I won't say custom, but they're fitted for you the right size and right everything, and they right.

So when you hit the ball, it feels great.

I guarantee you if you got a coach and you got some decent set of clubs in a year, if you practice, you're going to be breaking 100 easy.

You're going to hitting in the 90s, if not in the 80s, like you're going to do really well because you have somebody watching every single stroke, every single putt, every single drive, making sure, hey, you need to tweak this.

You need to change this.

Well, you can do it in five years or longer, but how about making it faster?

The fast track.

And just like with golf, you fast track your success.

Success would be hit in the 90s or 80s or even better.

You fast track your success now with coaching and anything too.

I mean, it doesn't have to be with me.

You could be with anybody.

But I want you to think about this.

The rich people, and this is why we have this episode today.

I'm going to give you the three diabolical ways that the rich actually get out of paying taxes legally.

And these are big things like these.

These save them tons and tons of money, which I'm going to walk you through.

But here's what the rich realize that you and I, we don't really realize until we start making more money.

When you're, when you're poor or middle class or you don't have that much money, you work at a job, you literally have more time than money.

You have more time than money.

So you realize, oh, my goodness, like, okay, I'm going to spend time instead of my money.

Well, after five years of playing golf on your own, you're going to have a lot of struggle, but eventually you'll get there, which is great.

But now, if you had a coach that four years extra, you know, if it takes you one year to break into 90, into 80, you have four extra years.

You're going to have four years of more fun playing golf, Playing it the right way, or won't say the right way, but playing well.

Same thing with real estate investing.

I personally took about 10 years because I had to do it all myself, didn't get coaching.

This is the reason why I'm big on it now, because I didn't do that.

I have students quitting their job in three, four, and five years.

If I took that ten years and condensed it down into five, and I got five years of my life back to do whatever I want to build businesses and get to where I am at now, my goodness, I would do that.

Take that in a heartbeat.

The same thing with that the rich do.

The rich, instead of having more time than money, they now have more money than time.

I now have four businesses that make me money, that put money in my pocket as well as take my time.

So now I have so much more money, but my time is limited.

And as you get older, too, you realize time is limited.

It's the one commodity that you keep spending.

And you can never make back or create any or earn any more time.

It literally goes away.

Now, the three diabolical ways that the rich get out of paying taxes legally is also the same way that they make money as well, which is just crazy.

Amazing how this actually works.

And my goal is to help you think like the rich.

Because when you start thinking like a rich person, you start acting like a rich person and you start getting the tax advantages or how do I say this?

You start using the tax code to your advantage.

You realize, hey, I didn't know this about the tax code.

Now I can save thousands and thousands of dollars.

Well, this is what they do.

And I want to pause for a quick second and share that.

Honestly, I really want you to invest in real estate.

Now, my new goal is to help 1 million people invest in real estate.

So two things I would ask from you.

Number one, if you get anything out of this episode, please share it with somebody else.

Number number two, I want to get you to invest in real estate.

Get my real estate investing course, absolutely for free.

Text the word Rental R E N T A L to 33777 rental to 33777.

I'll literally give you my course, show you how to find the area of the country to invest, how to build the business first.

You know, I always talk about that.

And how to find the right properties, how to make sure you're getting experts do the work for you and scale the business to where you're making $250 or more in passive income.

Scale it to quit your job.

I'll literally get to you.

Or go to masterpassiveincome.com freecourse.

But I really, really want you to invest in real estate.

Because the more that actual normal, everyday people own real estate that are good landlords, the better everybody's life gets.

Well, the first diabolical way that the rich save thousands and thousands of dollars in taxes legally is this.

They make money and then they buy real estate or an asset and then they take a loan on that asset, pull that cash back out and that is a tax free loan.

So that money goes into their pocket and then they spend it buying yachts or Rolexes or this, that or the other.

They use that money then to live on.

Now here's the amazing thing.

You might be thinking, well, why in the world you're still paying interest?

If you were going to pay a 40% interest rate or a 6% interest rate, which one would you choose?

You choose the 6% all day, every day and twice on Sunday.

But what you would realize now is that your tax rate, you might be a 35 or 40% tax rate, the more money you make.

Instead of paying 40% to the government in a tax, why not pay 6%, 7%, even 8 or 10% to a bank?

You're going to be saving 20 or 30% in your taxes.

So that's money back in your pocket.

So here's what you're going to do.

Actually, let me say it this way.

This is literally what I'm doing.

I want to buy a vehicle for my wife.

I want to buy, you know, an SUV or something like that that she can drive.

A newer one.

Ours is a little bit older.

You guys remember one of my podcast episodes?

We bought one in 2019 and it's been great, but now it's, you know, five, six years old.

It'd be nice to get a nice one.

I have the cash.

I could literally just go buy, you know, 40, $50,000 car.

But I made money $50,000.

Then I go buy a car for $50,000.

Well, in the meantime there, I'm taxed on that $50,000 from the IRS.

They take money out.

So I have to pay more, let's say $60,000.

I'm just, I'm not an accountant.

I'm just kind of throwing numbers out.

There might be 55, $60,000 because of the tax on that earned income, that money that I made, I have to pay tax on that and then I use the balance to buy the car.

How much better would it be if I took that $50,000, bought a house with it, that I can then get a tax free loan?

And that tax free loan puts money in my pocket and it gets me $50,000 out of taxes.

That's not a taxable income because I've invested that.

Now I.

Well, I'm also a real estate professional.

If I have to clarify because accountants might be thinking alarm bells, what's going on?

Well, I'm also a real estate professional.

Status by the irs.

That is the best classification you could ever think of for a real, or as a real estate investor or anybody.

Everybody wants to be a real estate professional because the tax code is literally written for us, which is amazing.

So you make the $50,000, you put it into a house as an investment and then you borrow against it.

You pull that money back out at a 6%, 7%, whatever it might be, then you take that money and go buy whatever you want.

So I just bought three single family home.

I used my cash to buy those properties.

So my cash is locked up inside of those properties, which is, it's basically hidden In a sense like the IRS has, sees that money put away, like it's not put in my pocket, I'm not saving it.

Then I'm now taking a DSCR loan, that's a debt service coverage ratio loan where I am now getting a 7% 30 year fixed on a bundled loan of three different properties.

And I'm pulling out about $300,000.

So in all I'm about $320,000 into all three properties.

That would cash flow me about $3,600 profit or gross profit.

So that's how much rent we would make.

Well, I'm going to take a $300,000 loan on a DSR loan.

Guess how much my mortgage payment is?

$1900.

So I'm going to be pocketing at least 12, 13 or 14 or maybe even $1500 depending on how much property taxes are and all that sort of stuff.

But let's say at best 12 or $1,300 in my pocket, plus I put $300,000 back in my pocket where I can do it all over again and buy three more properties.

Or I can take that $50,000 and buy my wife a car and buy more properties.

I can buy a yacht, I can buy another house to live in.

I can do anything that I want with that money and it is tax free because I have to pay back that loan.

Now the great thing too, that interest that I'm paying, I also get that as a tax write off on top of that.

Okay, so you guys get the picture.

You borrow from the real estate that you own, you make money, you buy real estate, then you borrow and pull it out tax free.

Instead of paying 40%, you're paying 6, 7%.

Okay, that's number one.

Here is the second diabolical way that the rich get out of paying taxes legally.

And again, these are high level tax saving strategies.

Very high level.

Whereas normal people that, that don't have these assets or aren't wealthy, it's going to be hard for you to take advantage of this.

I completely get this.

But there are so many other ways in the tax code that helps us regular people to actually get out of taxes.

But I want to give you one as a regular everyday person that you can do.

You want more tax write offs, all you need to do is start a business.

You buy one rental property, you probably don't even need to buy a property.

You just start a business and you start looking for properties.

You start driving to places, you fly to a location to look at a property.

Those are tax write offs because that's a business expense.

Your cell phone can be a business expense.

Your Internet from your house, because you're using that to look at properties and stuff, whatever portion, your accountant will take care of that.

But your Internet can be written off.

Part of your home, because you maybe work out of your house, that could be written off.

So just starting a business right now, which is what I tell all of you to do, we start a business, an llc, then we get all those tax write offs.

So that is one fantastic way that you can also, as a regular day person get immediately tax write offs.

And the second diabolical way that the rich get out of paying taxes legally is that they do not make money.

They have their entire life as a write off.

Now the rich, what they do is they create a business.

That business is around them as a person.

Maybe they're a celebrity, maybe they're a basketball star, whatever it might be, but they create their business around them.

So everything that they do is a tax write off.

Now there's going to be some legality or some tax law that they have to actually go through, but their accountants take care of that and they pay their accountants.

That's why the rich make so much money and save so much money, is because if they go on a trip, they are taking care of that as a tax write off.

And when you have a business, what you do is you utilize that business for business expenses.

Let's say you wanted to go to the Bahamas for a vacation.

Well, I'll be completely honest.

I've heard that people go to the Bahamas on a vacation.

They do a corporate meeting there.

They call it a corporate retreat or corporate annual meeting with their stockholders.

Well, who's the stockholder?

The one person like if I go to the Bahamas, I'm one stockholder and I'm going to have a meeting with myself and my wife and that's our corporate meeting.

And again.

Well, I'm going to say this not just again, because I'm going to say it might be the first time.

I'm not an accountant.

Definitely do what your accountant says.

But what happens is corporate companies take corporate trips.

They do corporate annual meetings.

You can do that exact same thing.

It just depends on how you do it.

You got to make sure it's legally.

Talk to your accountant, make sure everything's done.

And just like the rich, if you are able to build your business around yourself, around your brand, then you can have unlimited write offs.

But talk to your accountant.

I'm not your accountant.

Make sure.

That you solidify or verify everything that I'm saying.

Don't get in trouble.

I'm not an accountant.

You don't want to get in trouble because a non accountant told you what to do.

And the third diabolical way that the rich get out of paying taxes is they create a foundation around themselves, like the Bill and Melinda Gates Foundation.

That's a foundation that they created, that they put their money into.

They make millions of dollars, but then they hide it inside their foundation.

Now the key is that foundation needs to spend that money.

Well, it needs to spend that money to help people.

But who runs the foundation?

Well, it's their kids.

Well, I think they have one child.

But anyways, the kids of the foundation owners, they're the CEOs, the presidents, the secretaries, this, that and the other.

And so their kids are getting paid out of that money.

Now, let's say you create a foundation for your family and that foundation is a way for you to give charitably.

But you need to hire people to make sure it's given out well, that everything's accounted for.

Well, then you hire your firstborn and that firstborn is the CEO.

Well, they're working in your business and that is tax.

That million dollars is literally tax free because it's a donation into a foundation which will then give out.

Now the salaries that you pay your children, let's say you pay your kid $100,000 a year to run it.

Well, they're taxed on their own personal tax liability or they'll get a W2 as an employee of the foundation.

I believe it's a W2.

Talk to the accountant again.

But you can have that foundation actually pay your kid 100 grand.

Then they're taxed on $100,000.

But that a hundred thousand dollars is not taxed at you, which is probably a higher tax bracket than your kid.

And then all that money that's left over.

Let's say you have a million dollars and you have five kids.

Each one gets $100,000.

Well, that's $500,000 that's taken up out of that million.

And then you have $500,000 left over.

Well, you can sit that inside there until future when you actually need to give it out and give it to a charity.

You can obviously give it to a charity, which is a great way to do it.

But this is another diabolical way that the tax law is written to help the wealthy.

Again.

Now this is high level, but I want to give you a list of 200 plus tax write offs that you can take right now.

Check the link in the description where I have a link to master passive income where I'm going to give you all this.

I did a workshop with a fantastic company, nch Nevada corporate headquarters.

They are fantastic at tax and they gave us over 200 different tax write offs that you can take as a regular everyday person right now.

So go to the link in the description, go to my page, watch the video.

They literally walk you through so many more diabolical ways that the rich take money out of the tax system and not have to pay taxes legally.

And you can also get that list of over 200 ways to that you can deduct your expenses from your taxes legally.

Now this is high level and talk to your accountant.

But in the end what we do as real estate investors, number one, we make money and then we save money and then we give that money to our kids or the properties and the business.

We want to create generational wealth.

And what we're doing is we start small, buy one single family home, then we buy a multiple property, a multifamily property, a small 10 unit, 1215 unit, a small multifamily, start playing monopoly, getting a little bigger.

We want to go from small, medium to large deals.

Now I have 355 unit apartment complex units that are making me money without even working.

That's the beauty of real estate investing.

So I really appreciate you.

And if you want to create an automatic six figure real estate investing business, check the link in the description.

Go to masterpassiveincome.com freecourse I'll literally give you my course that anybody can use and you can use as well.

Masterpassiveincome.com freecourse obviously it'll be in description but if you change your life by investing in real estate and thinking like the rich, you will now have more money than time and you'll figure out all these fantastic ways that you can make and save more money.

We'll see you guys.

And that is it for today.

Go ahead and get my free real estate investing course Texas word rental the 33777 R E N T A L to 33777.

You can also join my real estate wealth builders group coaching, get all my courses.

All right guys, we'll see you in the next show.

See ya.