Hi
Shifting income is a time-honored tactic of the wealthy to save taxes. Income is “shifted” or moved to a family member in a lower tax bracket.
Historically, shifting was done by moving
money-making assets to a company or trust “owned” by the kids. Years ago Congress decided that the kiddies shouldn't be letting daddy get out of paying lots of taxes by simply shifting the income. Congress started to place limits on how much passive income a kiddie could receive before the “Kiddie Tax” kicked in and the child had to pay income tax on his or her passive income at daddy's rate.
While the kiddie tax clipped the wings of shifting income, it is still a
useful tool that can be used in different ways. Find out more in my new article at
http://www.legalees.com/shift-taxes-someone-else/.
Lee Phillips
P.S. This is only a tiny part of the discussion of how to structure your finances for maximum protection and tax savings covered in my new two hour course, Advanced Tax Tactics 2.0, that will be released in the next couple of weeks. Watch for the announcement. It is really a great course and should give you thousands more to spend each
year.
