Chapter 806: Chapter 404: Foundation (2)
“Don’t try that on !”
Upon hearing this, David felt an inexplicable surge of anger.
Let’s not even talk about how The Big Three Groups used foundations to provide campaign funds for Congressn.
In Arica, the estate tax is extrely high; once the amount exceeds 2.5 million US dollars, a 50 percent tax must be paid.
This is why many tycoons like to make “naked donations.” To the unaware, it may seem that these tycoons are benevolent and socially responsible.
But in reality, their so-called naked donations are basically for tax evasion.
According to federal tax law, donations made to charity can enjoy a 10 percent tax deduction.
Therefore, to evade taxes, these tycoons create a public trust fund in their own na while they are alive.
Then they transfer all their wealth to this foundation in installnts, claiming externally that it’s for charitable purposes to enjoy the 10% personal tax deduction.
Under the law regarding foundations, for every billion US dollars donated, one can enjoy a 100 million tax refund.
Why donate in installnts?
The key lies in the personal tax deduction.
If too much is donated at once and the 10% tax deduction isn’t fully utilized, it goes to waste, hence the installnt donations to maximize benefits!
But this isn’t even the most outrageous part. After the foundation is established, the Arican Governnt will not intervene or have the authority to take control; it will be managed by either the tycoon themselves or their children.
No outsider has the right to interfere with the flow of funds, not even the Internal Revenue Service.
As for the internal regulations of the foundation, they are confidential; not only are they not disclosed to the public, even the IRS has no right to inspect them.
They only need to donate 5% of their total assets annually to charity, as per Section 3627 of the Arican tax law, to legitimately own these assets.
Of course, the foundation’s assets are no longer considered personal wealth but are deed societal assets.
Thus, the foundation’s future investnt inco is not subject to personal inco tax but taxed at a re 1%.
Here’s the crucial point, not 50%, not 10%, but 1%!
Any inco earned from investnts by the foundation is taxed at this single percent point.
All other tax evasion strategies, including those involving the Cayman Islands and the Virgin Islands tax havens, are far inferior to foundations.
When David initially thought of introducing legislation for offshore tax avoidance, he also considered a bill targeting foundations.
But after careful consideration, he decided to opt for the forr.
However, that being said, the foundations’ thod of tax avoidance might seem impenetrable to the IRS, but that doesn’t an David has no handle on them aside from introducing legislation.
At least now, David, through the system’s scrutiny function, had found so ways to deal with them from this manager.
“This… Inspector David, what do you an by that?”
Being confronted so bluntly, Mo Ang’s temper flared.
Who on Wall Street doesn’t have so capital or background?
And he was currently assisting The Big Three Groups.
So although he sowhat feared David, he still had so confidence.
Moreover, the foundation’s rules had been played to this date without any known foundation being investigated for tax issues.
Even if David managed to resolve the offshore tax evasion bill, without a specific bill targeting foundations, he couldn’t possibly be so rash as to investigate the foundations directly, could he?
“No other aning, I just suspect that your foundation is involved in so tax issues!”
David tapped his fingertips orderly on the desk, speaking expressionlessly.
“Impossible!”
“The funds in the foundation I control are mostly used for charity. How could there be tax evasion? Besides, Arican Federation law states that the IRS has no right to investigate our matters. I don’t need to answer any of your questions!”
Mo Ang rebutted decisively, his words even laced with an uncompromising tone.
But David wasn’t in a hurry; he leaned back slightly, relaxed, and said, “Indeed, according to the tax law’s provisions, you don’t have to answer any of our questions, nor do we have to inspect. But it seems you have misunderstood sothing. I didn’t ask you to answer any questions or imply I would inspect you!”
Hearing this, Mo Ang was dumbfounded.
If you don’t need to answer any questions and you’re not inspecting , then why call here?
What’s the purpose of investigating my foundation?
Before Mo Ang could ponder further, David spoke, “Listen carefully, according to federal tax law, neither the governnt nor the IRS has the right to investigate charitable foundations, but there is a prerequisite for that!”
“The prerequisite is that this money must… well, let’s not say ‘must,’ as it is intended for charitable use. But have you really used it for charity?”
No tax evasion thod is perfect in this world.
Foundations are no exception; their initial purpose was not for tax evasion but for charity, which is a significant loophole!
If it’s found that the funds are not heading for charity but into so individuals’ pockets or becoming funds for Congressn’s campaigns, the IRS has the right to intervene!
Reviews
All reviews (0)