Kiyosaki talk. Write off RE with business??

[Account Closed]

Hi, I was watching a kiyosaki vid, and I heard him talk about Jared Kushner not paying taxes in regards to 3 forms of income. I’m not totally sure what’s being said here and I’m not asking for the “safe” “sounds really legal and compliant” answer necessarily. I want to know, is there loopholes on RE through owning a business that would keep you from paying taxes at all on a flip or does that only pertain to rental properties, or none of the above? Or to be specific, I’m curious if there’s a way to legally write off the profits of a house flip, if there is a connection with the use of the house to say a construction business during the time of ownership. I’m not looking to break laws; just asking about what’s possible with the existing tax laws.

[Michael Plaks]

Prepare for a highly opinionated rant.

First, @Account Closed, stop polluting your brain with Kyosaki, Grant Cardone etc. They do not teach business. They are mindset gurus preaching how you're entitled to be wealthy yada yada yada. And they make good money from preaching and products. I know crowds love these motivational shows and books, but I don't. Most successful investors that I know did not need to be high on these motivational drugs.

Jared Kushner does not do flips, I suspect. Flipping is a job. A very hard job, with very unpredictable results and very high taxes. Wealth is built with rental properties, not flips. Most of the tax benefits come on the rental side, too.

Wholesaling or flipping may be necessary if you need to make current money to live on. Profits from such businesses are taxed high and cannot be "written off" or otherwise magically shielded from taxes by any legitimate approach. You may be able to somewhat reduce taxes thru some tax planning but never eliminate them.

Also, I cannot agree with your thinking that giving up 50% of the profits to the govt is a deal breaker. Would you rather have $0 taxes and $0 left for you or $25k for you and $25k for the govt? Yes, the less taxes the better obviously, but high taxes should not stop you from making money.