How Politicians Lie to Sell Tax Hikes


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Transcript

Mike:

I know what we’ll do. We’re going to present this as a we’re only going to tax the rich.

Zach:

And people believe it.

Mike:

And people buy it. It’s like, that’s like, how long have you been alive? How many times- I look I’m 56 years old for 56 years. I have heard politicians say, we’re only going to tax the rich. And for 56 years, I’ve seen them every time they say that they’re lying through their teeth, guaranteed. They end up taxing. Everybody pays more tax, especially the middle class.

Zach:

Welcome back to retirement today. My name is Zach Holcomb alongside me. We have Michael Reese, founder of the prosperity planning system, certified financial planner and president and founder of Centennial Advisors right here in Austin, Texas. Today’s show we’ve been talking all about taxes, changes coming in the government on the tax code. Mike, I know you’re super fired up about this stuff.

Mike:

Yeah. And when we talk about prosperity planning, right? A big part of prosperity, we believe that you should live a prosperous financial life, right? Our goals help you make smart financial choices. So you can truly enjoy you know, the fruits of your labor, right.

Zach:

Retirement of your dreams.

Mike:

Yeah. There you go. And a big part of it though, is it’s hard to enjoy the fruits of your labor when the IRS wants to come along and take a bunch of your money. Right. And so, and, and right now, I mean already, they take a bunch of your money. Like we do tax planning all the time here. And especially if you have an IRA, a 401k, a 457, a 403B, all those, you know, retirement accounts, they’re already just an absolute cluster, something right. For a lot of people in retirement. Right? Right.

Mike:

These are huge accounts. I mean, you save a million dollars in your 401k. That’s a million dollars. It’s never been taxed by the time you get to retirement, it just creates a firestorm of taxes. Right. So we do a lot of planning to help you figure out what to do with that. Tax is already bad enough. But of course along comes the weasel politicians who say, we’re not getting enough of your money. We need more. Mostly because they don’t know how to balance a budget. And they don’t know how to like, I’m like, if I just imagine that, right. What if, what if- I love a Warren buffet says where he says, I got a great way to balance a budget. Just tell politicians if they cannot, if they can’t balance a budget every year, then they’re not eligible for reelection the next year.

Mike:

That would definitely get a balance in the budget right away. Right. But no, they are just basically, Nope. There’s no oversight of these people. Right? So you got a bunch of power hungry weasels in Washington, DC that want more of your money. They don’t think you’re giving them enough. They think you should give them more. Yes. But they know if they try to sell you on, if they try to sell their idea, by telling you the truth, that you won’t accept it. Because if they come out and they say the truth, which is, we want everyone to pay more tax, basically they know you’re not going to buy that. Right. But what do they know? They know, oh, I know what we’ll do. We’re going to present this as a, we’re only going to tax the rich and people believe it. And people buy it. It’s like, that’s like, how long have you been alive? How many times I look, I’m 56 years old for 56 years. I have heard politicians say, we’re only going to tax the rich. And for 56 years, I’ve seen them every time they say that they’re lying through their teeth, guaranteed. They end up taxing. Everybody pays more tax, especially the middle class. So it’s like, it w it’s like, how many times do you have to hear him say that before you finally realized what they mean? Anyway, I promised- see, you get me, Zach, you got me going again.

Zach:

I know, his face is getting red. He’s fired up.

Mike:

Oh my gosh. I hate these. I hate these people. I mean, it’s like, we worked so hard for our money. You know, why can’t we decide what to do with it? You know, I don’t want, I don’t want my, you know, my hard-earned money going to the IRS just so they can turn around and you know, basically wasted on their special interests. Right? So one of the things that they’re hiding in this whole discussion that it’s in there, but they don’t talk. They don’t want to talk about this, but it’s in there. What they want to do is they want to eliminate section 10 31 in the tax code. And I know what you’re doing. You’re sitting there. Maybe you’re in your car. You’re, you know, you’re sitting there maybe parked in traffic or, or parked on i35 and you’re sitting there and you’re like, Mike, you just went nerd on me. What is internal revenue code? 10 31. Right? Well, if you are a real estate investor, you know what it is.

Zach:

Oh yeah. They’re listening. Right.

Mike:

If you’re in real estate and guess what? There’s a lot of people invest in real estate that are not rich. Right. That just everyday people just like, you mean maybe they have a rental house out there, like, I’ve got this look, I’m talking to this couple. So Zach, you know who they are. But they, you know, this great couple. They actually came to us because they read my book in a library in Portland, Oregon. And they’re like, wow, this guy has offices in, in Texas. And they’re thinking about moving to Texas because that’s where their kids are. They’re getting ready to retire, move to Texas from Oregon. They’ve got, they’re not rich people. And they have these two rental houses. Right. And what they’re doing is they’re selling them and they’re going to reinvest that money in other investment real estate. And by doing that through 10 31 internal revenue code 10 31, what happens is, you know, they’ve got these gains, they’ve got a couple of hundred thousand of gains.

Mike:

They don’t have to pay tax on those gains because by moving it to, in you to a new investment property, they can defer those gains down the road. Right. And in fact, under the current code, if they die with rental real estate, they get a step up a basis at death. We talked that earlier so they can avoid all those gains for their children’s benefit. That’s great. Right. Well, you know those weasels in Washington,

Zach:

It’s got to go

Mike:

Can’t have that. Nope, no, no. What they want by eliminating 10 31, what they want to do is by selling their property, what they’re saying is I don’t care where you reinvest that money. We want to collect tax on that 200,000 of gain. Right? Well, you know, we want our, you know, oh, and by the way, at the same time we want to increase the tax and capital gains.

Mike:

So we want to increase the tax rate on the gain. And we want to tax the gain. We want to get rid of this 10 31 provision. Now it real estate investors they’ve been using this for years. I mean, this has been in the tax code forever. And the benefit of it is, you know, it encourages people to invest in real estate. Right. Well, I guess we don’t want that anymore. We just say, ah, we don’t want that. Let’s let’s go ahead and get rid of that one. So if you’re a real estate investor, what do they want to do to you? They want you, then we’ll eliminate 10 31. So every time you sell a property to buy a new one, right? They want you to pay tax right then and there, no way around it.

Zach:

Write us a check.

Mike:

Write a check. Now some of you out there might be sitting there saying, yeah, what’s the big deal, nothing wrong with that.

Mike:

Right. I mean, if I buy a stock, like if I buy a stock and I hold it for 10 years and I sell it, I gotta make capital gains in the stock. Right? Why is it that someone that buys? And even if I take that stock and I buy new stock, I still gotta pay tax on the stock. Why is it that someone invest in real estate? It’s a different rule, right? Why do they get a different rule? Well, here’s reality. The reality is, I don’t know, it’s the tax code, right? It’s silly. But I will say this, they’re selling you this tax, this new tax law. And so they’re only going to tax who?

Zach:

The rich.

Mike:

Do only the rich own investment real estate.

Zach:

Nope.

Mike:

No. So are they being honest?

Zach:

Nope.

Mike:

What are they doing?

Zach:

Lying.

Mike:

They’re liars. Politicians equal liars equals weasel.

Mike:

Right? Don’t believe it. When they tell you, they’re only going to tax the rich. It’s as a kid in, when I was a kid, I talked about this it’s liar, liar pa- did you ever do that? When you were a kid.

Zach:

We did do that.

Mike:

Liar, liar, pants on fire that applies to like every fricking politician out there. It seems like. So here we go at, this is the time, you know, a lot of times they talk about changing the tax code and you can pretty much ignore them. You know, that’s the other thing about politicians. They love to talk. They don’t do hardly anything, but they love to talk and they talk about all kinds of crap. But with the intention of doing nothing, I swear to goodness, half the reason, most of Washington DC hated it when Trump was in office, was Trump, whether you love him or hate him actually did stuff.

Mike:

And that kind of freaked them out. They’re like, wait a minute. We’re politicians. We’re not supposed to do anything. We’re just supposed to talk. Sure. But anyway, the point is right now, they’re actually planning on doing something. So now is the time you have pay attention. And so what we’re doing is we’re actually going to do a live event. Hey, we’re all vaccinated. I’m sure you are as well. We’re gonna do a live event. And we’re going to share what I’m going to do is I’m going to get up in front of you live. I’m going to say, look, here’s what they want to do. Here’s how it affects you. And here are strategies that you can employ right now today to protect yourself against what these weasels want to do. Right? So it’s important. Prosperity planning is all about keeping the money you’ve worked so hard, you know, to put, you know, you’ve built up these accounts, you build up these investments. You’ve worked hard. Prosperity planning is about helping you keep it, right. This is your money. Not the IRS’s. Let’s keep it in your pocket. So Zach, you know, this tomorrow night,

Zach:

Tomorrow night, yup.

Mike:

Starts at six 30,

Zach:

Yep.

Mike:

Fill us in with the details.

Zach:

Tomorrow night, we’re hosting retire tax smart. This is at the movie house in Northwest Austin on six 20, right across the street from Concordia university, starting at 6:30 PM. Sharp. We’re going to be talking all about the things that Mike shared with you today on the radio show. Now to sign up two ways you can do that. You can go to tax free, movie.com again, that’s tax-free movie.com. You fill out a simple form, click confirm, boom. We’ll send a confirmation your way with all the details about the event tomorrow night, 6:30 PM. Now, if you can’t go to the website, you can also give us a call. Leave us a message. It is after hours, 5 1 2 2 6 5, 5,000. Again, that’s 5 1 2, 2 6 5, 5,000. Now, Mike, I know you mentioned to me at the break. What if somebody is interested about this kind of stuff they’re concerned about it, but they can’t attend tomorrow night.

Mike:

Yeah. See, that’s the thing. I was just wondering that, you know, they think, wow, I want to hear about all this stuff, but I can’t, I just can’t make it. And maybe you are sitting there that’s you you’re worried about what they’re going to do with the tax code. You’re wondering, how’s it going to affect you? And what steps can you take? Well, guess what? Just call that same number instead of leaving a message to say, Hey, I want to sign up, just leave a message. 5 1 2, 2, 6, 5, 5,000. Leave the message it, Hey I can’t come, but I need to talk to someone about how this affects me. And we’ll set you up with one of the advisors here in the office. So again, 5 1, 2, 2, 6, 5, 5,000 or texts, rim, movie.com. All right, we’re up against it. We gotta take a break. We’ll be right back. We’ll wrap the show up, talking more about how the tax changes for the rich will affect the average, Joe.

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