Beating the Tax-Man with Dan Thompson

Summary

In this episode of the Capital Gains Tax Solutions podcast, host Brett Swartz discusses strategies to defer capital gains tax with guest Dan Thompson, a financial expert with a Wall Street background. They explore the use of Deferred Sales Trusts to exit assets tax-efficiently and the leveraging of life insurance policies to create tax-free income. Thompson shares his insights on equipment leasing for tax deductions and the importance of simplifying complex financial concepts for wealth creation. The conversation also touches on the challenges of 1031 exchanges and the potential of cryptocurrency, offering practical advice for high net worth individuals seeking to preserve their wealth.

Takeaways

• 📈 The podcast focuses on capital gains tax solutions, emphasizing the importance of having a clear plan to defer capital gains tax through strategies like the Deferred Sales Trust.
• 💼 Host Brett Swartz is joined by experts in real estate, finance, wealth, and business to share insights and strategies for wealth creation and preservation.
• 🏦 Guest Dan Thompson has a Wall Street background and discusses his transition from traditional financial planning to alternative wealth-building strategies.
• 💡 Dan emphasizes the importance of simplifying complex financial concepts to help people understand and implement strategies for wealth building.
• 💼 Dan's journey from a stockbroker to an independent financial advisor led him to develop tools and strategies that are tax-advantaged and safer than traditional Wall Street methods.
• 🏦 The number one secret to beating the tax man, according to Dan, is using a foundational investment tool like life insurance policies packed with cash value, which can be leveraged into other tax-advantaged assets.
• 🏠 Real estate is highlighted as a key asset for leveraging and generating tax-free income, with strategies like cost segregation and bonus depreciation to offset taxable income.
• 💼 Dan discusses the use of equipment leasing as a strategy to defer capital gains tax, leveraging small investments into large tax deductions through Section 179.
• 🌳 Conservation easements, previously a strategy for tax benefits, were mentioned as no longer viable due to recent government changes.
• 💡 The podcast also touches on the challenges of 1031 exchanges, such as the requirement for like-kind property and the stress of finding suitable replacements within tight timelines.
• 💸 Dan recommends living well within one's means and saving a significant portion of income as a key to financial success, emphasizing the importance of passive income and asset management.

Q & A

What is the main focus of the 'Capital Gains Tax Solutions' podcast?

The podcast focuses on helping high net worth individuals and their advisors understand and utilize capital gains tax deferral strategies, such as the Deferred Sales Trust, to exit highly appreciated assets while deferring capital gains tax and preserving wealth.

Who is the host of the podcast and what is his background?

The host is Brett Swartz, who is joined by experts in real estate, finance, wealth, and business to share their insights and strategies on tax-efficient wealth creation and preservation.

What is Dan Thompson's background and how did he get started in finance?

Dan Thompson has a Wall Street background with experience in financial planning, mutual funds, and securities. He was intrigued by the potential of making money in the stock market since he was 15 and committed to becoming a part of the finance industry. He started as a stockbroker and later opened his own offices.

What is the 'Deferred Sales Trust' and how does it help in tax deferral?

The Deferred Sales Trust is a tax deferral strategy that allows individuals to exit highly appreciated assets and defer capital gains tax, providing the opportunity to create and preserve more wealth without an immediate tax liability.

How does Dan Thompson define his gift in the financial field?

Dan Thompson believes his gift is the ability to explain complex financial concepts in a simple manner that can be understood and implemented by people at various stages of wealth, from seasoned investors to those just starting out.

What foundational investment tool does Dan Thompson recommend for beating the tax man?

Dan Thompson recommends packing life insurance policies with as much cash value as possible, which can then be leveraged into other income-producing and tax-advantaged assets like real estate or equipment leasing.

What does Dan Thompson mean by 'tax flow' and why is it important?

Tax flow refers to the strategy of offsetting taxable income with tax deductions to reduce tax liability. It is important because as taxes increase, having an offset can help maintain or improve cash flow.

What is the significance of leveraging life insurance policies in wealth building?

Leveraging life insurance policies provides access to capital that can be used as a down payment for investments like multi-family properties. This not only helps in building wealth but also produces tax-free income in the future.

How does equipment leasing with Section 179 deduction help in capital gains tax deferral?

Equipment leasing allows for significant tax deductions under Section 179, which can be used to offset capital gains tax liabilities. By investing in equipment and leasing it out, one can receive substantial tax write-offs that can defer or even eliminate tax on capital gains.

What are some of the challenges with the 1031 exchange in terms of capital gains tax deferral?

The 1031 exchange requires like-kind properties of equal or greater value, which can be a burden when someone wants to reduce their asset load or exit a certain investment space. It also involves a lack of control, liquidity, and diversification.

What is the 'lightning round' and what insights does Dan Thompson share during it?

The lightning round is a quick series of questions aimed at gaining personal insights and advice from the guest. Dan Thompson shares his advice for his younger self, his favorite book, his leadership theme, his current curiosity about crypto, and his practice of living well within his means.

Outlines

00:00

🎙️ Introduction to Capital Gains Tax Solutions Podcast

The podcast episode begins with host Brett Swartz welcoming listeners to the Capital Gains Tax Solutions podcast. The show focuses on helping high net worth individuals and their advisors understand and utilize capital gains tax deferral strategies. Brett emphasizes the importance of having a clear plan and introduces the Deferred Sales Trust as a strategy for exiting appreciated assets while deferring capital gains tax. The episode features guest Dan Thompson, who shares his background in Wall Street and financial planning. Dan discusses his journey from a young man inspired by the stock market to a financial advisor seeking safer and more tax-efficient ways to grow wealth. Brett also mentions that listeners can learn more about Dan through his Wise Money Tools YouTube channel or website.

05:01

🏦 Strategies for Beating the Tax Man

In this segment, Dan Thompson shares his insights on how to beat the tax man. He starts by discussing the use of life insurance policies as a foundational investment tool, maximizing cash value to leverage into other assets like real estate. Dan explains the benefits of leveraging these policies to generate tax-free income and pass assets tax-free to heirs. He also touches on the changes in tax laws, such as the elimination of conservation easements. Moving on, Dan discusses the importance of investing in tax-deductible assets like real estate, which can provide significant depreciation benefits. He illustrates how leveraging life insurance policies can be used as a down payment for such investments, ultimately producing tax-free income.

10:01

💼 Leveraging Equipment Leasing for Tax Benefits

Dan Thompson delves into the strategy of leveraging equipment leasing for significant tax deductions. He explains how investing in equipment leasing can provide substantial tax write-offs, particularly under Section 179, which allows for immediate deductions. Dan provides an example of how a $50,000 investment in equipment leasing can lead to a $350,000 tax deduction, effectively offsetting a large capital gains tax liability. He also discusses the practical aspects of equipment leasing, such as the management and maintenance of the equipment by a company that handles the leasing process. The conversation highlights the tangible nature of equipment as an asset and the potential for depreciation benefits.

15:01

💡 Capital Gains Tax Solutions and Equipment Leasing

The discussion continues with Brett and Dan exploring the challenges of the 1031 exchange and other capital gains tax deferral strategies. Dan expresses frustration with the limitations of like-kind property exchanges and the burden they can impose on investors. He introduces the concept of equipment leasing as a way to defer or eliminate capital gains tax by leveraging funds to wipe out gains early on. The conversation also touches on the potential of cryptocurrency and the similarities between equipment leasing and oil and gas investments in terms of tax benefits and depreciation. Dan emphasizes the importance of tax flow and the role of tax incentives in encouraging economic activity.

20:04

📈 The Benefits of Multi-Family Investments and Leasing

Dan Thompson reflects on his career and shares his advice for his younger self, emphasizing the benefits of investing in multi-family properties earlier in his career. He discusses the stability and scalability of multi-family investments, contrasting them with the volatility of Wall Street. The conversation turns to the impact of the COVID-19 pandemic on equipment leasing, with Dan noting that leasing rates increased during the recession, making it a potentially recession-proof investment. The discussion also covers the tax benefits of equipment leasing, such as the Section 179 deduction, and how these benefits can be leveraged to defer or offset capital gains tax.

25:05

🌐 Final Thoughts and Resources for Listeners

In the final segment, Dan Thompson shares his thoughts on various topics, including his interest in cryptocurrency and his advice for living within one's means. He emphasizes the importance of saving and investing for financial freedom. Brett thanks Dan for his insights and encourages listeners to take action by exploring resources like Dan's Wise Money Tools website and Brett's book, 'Building a Capital Gains Tax Exit Plan'. The episode concludes with a reminder of the podcast's mission to help high net worth individuals and their advisors navigate capital gains tax deferral strategies.

Keywords

💡Capital Gains Tax

Capital gains tax is a levy on the profit made from the sale of assets such as stocks, real estate, or cryptocurrency that have increased in value. In the video, it is the central theme, as the podcast discusses strategies to defer or reduce this tax, which is crucial for high net worth individuals looking to preserve their wealth.

💡Deferred Sales Trust

A deferred sales trust is a strategy mentioned in the video used to defer capital gains tax on the sale of an asset. It allows the seller to spread the recognition of the capital gains over a longer period, reducing the immediate tax liability. The concept is introduced as a solution for those looking to exit highly appreciated assets with minimized tax impact.

💡High Net Worth Individuals

High net worth individuals (HNWIs) are persons with substantial financial wealth, often with investable assets. In the context of the video, these individuals are the target audience for the tax deferral strategies discussed, as they are more likely to have significant capital gains and thus a greater need for tax planning.

💡Tax Deferral

Tax deferral is the postponement of paying taxes on income or gains until a later date. The video emphasizes this concept as a key strategy for wealth creation and preservation, allowing individuals to use their capital more effectively and avoid large upfront tax payments.

💡Leverage

Leverage in finance refers to using borrowed money to increase the potential return of an investment. In the video, leverage is discussed as a method to amplify the value of investments and as a strategy to acquire income-producing assets that can generate tax-free income.

💡Life Insurance Policies

Life insurance policies mentioned in the video are used as a foundational investment tool with a focus on cash value. The strategy involves maximizing the cash value component of these policies to leverage into other tax-advantaged investments, creating a tax-efficient wealth-building strategy.

💡Real Estate

Real estate is a form of tangible asset that can be bought, sold, or leased for profit. The video discusses real estate as an income-producing asset class that can be used in conjunction with tax strategies to generate tax-free income and write off taxes through depreciation and other means.

💡Tax-Free Income

Tax-free income refers to earnings that are not subject to income tax. In the video, the concept is tied to the idea of building wealth through investments that generate income without incurring tax liabilities, such as through certain types of real estate or leveraging life insurance policies.

💡Equipment Leasing

Equipment leasing, as discussed in the video, is a strategy where one invests in tangible equipment and then leases it out to generate income. This method is highlighted as a way to achieve significant tax deductions through Section 179, which can help offset capital gains taxes.

💡Section 179

Section 179 is a tax code that allows businesses to deduct the full purchase price of qualifying equipment and/or software purchased or financed during the tax year. The video describes how leveraging equipment leasing with Section 179 deductions can provide substantial tax benefits and is a strategy for managing capital gains tax.

💡1031 Exchange

A 1031 exchange, also known as a like-kind exchange, allows taxpayers to defer capital gains tax on the sale of certain types of property by reinvesting the proceeds into similar assets. The video discusses the limitations and frustrations of this strategy, such as the requirement for like-kind property and the time constraints for completing the exchange.

Highlights

Introduction to the podcast focusing on capital gains tax solutions for high net worth individuals.

Host Brett Swartz emphasizes the importance of having a clear plan to avoid being the enemy of wealth creation.

Dan Thompson shares his background in Wall Street and financial planning, highlighting his transition to a safer wealth-building approach.

Thompson discusses his early inspiration from witnessing the wealth generated in the stock market, influencing his career choice.

The concept of using a Deferred Sales Trust as a tax referral strategy is introduced for exiting highly appreciated assets.

Thompson's experience with the Wall Street roller coaster led him to develop better wealth-building tools and strategies.

The importance of explaining financial concepts simply to ensure understanding and implementation across all wealth levels.

The number one secret to beating the tax man is leveraging life insurance policies packed with cash value into other tax-advantaged assets.

Conservation easements, a previously utilized tax strategy, were discontinued, impacting wealth planning.

The strategy of leveraging life insurance as a down payment for income-producing assets like multi-family properties.

Equipment leasing as a new approach to defer capital gains tax, with an explanation of how it works and its benefits.

The comparison between equipment leasing and oil and gas investments, focusing on the tangible nature of equipment.

The discussion on the recapture of tax benefits in equipment leasing and how it can be managed after five years.

Thompson's view on the potential of crypto as an area of wealth creation, drawing parallels to the .com era.

The advantages of equipment leasing during economic recessions, positioning it as a potentially recession-proof strategy.

The cash flow expectations from equipment leasing investments and how they are tax-efficient.

The frustration with the 1031 exchange process and the limitations it imposes on diversifying assets.

The introduction of the Deferred Sales Trust as an alternative to the 1031 exchange, applicable to various asset types.

Thompson's advice to his younger self about focusing on multi-family investments earlier in his career.

Recommendation of 'Rich Dad Poor Dad' as a key book for understanding wealth-building principles.

Thompson's leadership theme centered around time, compounding, leverage, and tax advantages.

The importance of living well within one's means and saving a significant portion of income as a core value.

Transcripts

and welcome to another episode of the

capital gains tax Solutions podcast

where we believe most high net worth

individuals and those who help them they

struggle with clarifying their capital

gains tax deferral options not having a

clear plan is the enemy and using a

proven tax referral strategy such as the

Deferred sales trust is an amazing way

for you to exit highly appreciated

assets defer capital gains tax so you

can create and preserve more wealth or

help your clients friends and family do

the same hey I'm your host Brett Swartz

in each episode I'm joined by some of

the best real estate Financial wealth

and business Minds in the world where

they share their deal stories ideas

inspiration so we can create uh so we uh

we can you know learn from their wisdom

and then so we can also create and

preserve more wealth I'm also streaming

or we're also streaming right now on

Expert cre Secrets as well and I'm

excited about our next guest he's out of

Boise Idaho but originally from the

California area and if you've ever been

frustrated and worried about that Wall

Street and the financial planners who

are telling you to take a risk for a

better return yet it doesn't seem to be

working maybe it's time to look for what

our guest is going to bring today he has

tremendous experience of Wall Street

background and financial planning mutual

funds Securities package Securities but

he went through the Wall Street roller

coaster with himself and a lot of his

clients and now he's here to talk to us

about a better way please welcome to the

show with me Dan Thompson Dan how you

doing good how you doing Brett good to

have you or good to be with you today

yeah doing fantastic it's great to have

you as well and by the way you can learn

more about damn I go to his wise money

tools YouTube channel or

wisemoneytools.com

um but Dan before we get started on

beating the tax man which is the title

and the um the episode uh focused today

would you give us a little bit more

about your story and your current Focus

yeah so I um something about money was

always intriguing to me what I remember

this story when I was 15 I was sitting

in the back seat uh my my dad and he had

a buddy that he was talking to my dad

never made any money sadly he uh he

worked really hard just never got

anywhere we lived uh just very meager

meager lifestyle but this guy that he

was sitting with was a very wealthy guy

and and the guy's name was Dave he said

that he made thirty thousand dollars

that month in the stock market

and I'm 15 years old and I'm you know

working for two bucks an hour uh for a

landscaper and I'm calculating real

quick okay that's gonna take me like six

years to make thirty thousand dollars

and this guy does it in a month so

really from about that moment on I just

I was committed I just somehow I either

got to be a stockbroker I got to be in

the money game because I don't want to

just live like a a poor guy my whole

life so

when I got into my early 20s I went

around and begged a bunch of firms to

hire me and finally one did and uh

I just I promised him I said no one will

work harder than me and I'll be you know

a great success for you well they hired

me

um and it was it was interesting because

I was the hardest working guy I was in

the office by myself so many nights but

after 18 months I realized that being

independent and being able to offer more

opportunities for my clients was even

better so I ended up leaving that firm

after 18 months opened my own offices I

had five offices and 60 reps around the

area and uh and then just his as the

markets ebb and flow and up and down

after the.com boom and bust of the 90s I

just had to find a better way so I kind

of went on a hunt and uh

just looked at everything and came up

with some really good tools to use

strategies that can really help people

out to build their wealth to grow their

wealth to do it tax advantaged and to do

it a lot safer than the typical Wall

Street Way excellent Dan I appreciate

you sharing that and you know I believe

you'll all be giving certain gifts to

enemies gifts have been giving us to be

blessing and help to others so if you

were to go back you know to those

younger years when you were just getting

started or even just now what do you

feel like your gifts are and how do

those help how you help and bless people

today

I think if I have a gift it's just being

able to explain things

um simple enough that whether you're a

very seasoned High net worth wealthy

person or you're just kind of getting

started in life

understanding just some very basic

concepts uh you know my I I wrote a book

recently it's just a simple book if it

takes you longer than an hour or hour

and a half to read something's wrong

it's just the Four Keys to Building

Wealth and that just again I think I've

got the gift of just explaining things

easy enough so that people can

understand them and then easy enough to

implement them excellent so uh making

complex simple and then you know helping

people to implement them uh let's dive

right into the topic at hand with that

in mind which is beating the tax man so

Dan Thompson what is the number one

secret to beating the tax man well what

we like to do is start with a

foundational

investment tool if you will and what we

do is we pack life insurance policies

with as much cash value as the companies

will let us have that's our biggest

battle every week is really just getting

the companies to let us put in as much

as our clients would like to and then

what we do from there is we want to

leverage that and we want to leverage

that into other assets typically income

producing assets and tax advantaged

assets this can be real estate equipment

leasing back in the day we were able to

do some conservation easements those got

wiped out this last year and then you

can even leverage within the the life

you can just Leverage average on

Leverage on Leverage and the whole idea

is to build this this bubble if you will

of growing your money in a tax-free

environment living on tax-free income

and then passing your assets onto your

heirs tax free as well excellent so it

sounds like the number one secret to

building uh beating the tax man is is

having a foundational investment tool

which you can then leverage into real

estate or other things that are tax

advantage and you can live off tax free

income is that a fair summary so far

Fair summary excellent you mentioned

conservation easements being wiped out

uh what do you mean by that well last

year was the last year you could do them

so we did quite a few of them but then

this year the government for their you

know their wisdom and their you know

great foresight decided to take them off

the table this year

excellent so let's move into secret

number two once you've figured out the

foundational investment tool and you've

leveraged and you're getting the

tax-free uh income what's the next

secret to beating the tax Man Dan so

again getting into assets that have some

opportunity to to write off taxes I'll

just you know as as everybody knows real

estate can be one of those assets when

you when you use leverage on let's just

say a multi-family uh project you've got

you know 150 units there's some huge

depreciation there and it can not only

Wipe Out the cash flow uh the taxable

cash flow I should say but it can even

carry forward for taxes that you may be

paying for years to come so that's a

great depreciation asset

absolutely yeah multi-family is a great

way to do that with just with cost

segregation and bonus depreciation and

we call that tax flow right to offset

the cash flow which is so so important

as taxes go higher

um and your cash flow might be going

higher you want to have an offset on the

other side and so

um are you so are you finding

um are you finding those that are um

your clients the people that you work

with uh they're they're leveraging their

like the life insurance policies to buy

the 150 units and doing that cost sag

and kind of putting that all together in

a picture how does that look yeah

usually we'll just use the life

insurance as the as the down payment and

then we'll still use Bank financing for

the majority of it but but yeah we'll we

want to build that foundational tool of

having the access to Capital inside the

life insurance because ultimately that's

going to also produce tax-free income

form down the road

excellent that's fantastic so um I'm

curious so now that conservation is or

perhaps out that you're helping clients

with that in the past or pointing them

through that direction what are some of

the ways you're helping people with some

capital gains tax referral if and when

they do go to exit these you know these

assets that have been depreciated

um with either cost sag or just you know

straight line uh what's what's the

strategy there to defer the capital

gains tax so there's quite a few things

that you can do I like what you uh what

you brought up early in your show and

obviously I'm very interested to hear

more about that but also uh charitable

trusts that can be used to uh to put

those assets inside of those trusts and

then they can defer or ultimately even

eliminate the tax the other thing that

we do is um use leverage into equipment

leasing using the 179 deduction that

gives you some very very uh sizable tax

deductions right off the bat and then

those can be carried forward to help

offset some capital gains in the future

as well let's let's Dive Right into that

because that's kind of a new new topic

here I guess leverage into equipment

leasing so what does that look like

let's say someone had a million dollar

capital gains tax how might somebody

leverage into equipment leasing what

would be the risk some maybe the some of

the returns and what kind of tax

write-off would they get with the

Section 179 Okay so let's just assume

we've got a million dollar tax I'm gonna

do some in my head so forgive my

calculations if they might be off let's

just say we've got a million dollar tax

taxable event capital gain 15 so we're

going to pay 150 000 in taxes A good

rule of thumb is and let me just pull my

little quick calculator up here so if I

need to get hundred and fifty thousand

dollars deducted

from my taxable income I'm going to need

about a

187 thousand dollar

tax deduction and then so in an

equipment leasing world we can typically

get a 80 percent tax deduction the first

year

which means I need to invest about

um

uh I need 187 000 sorry about that I

should have had some about 225 yeah yeah

so if I if I put a couple hundred

thousand no I don't even need that much

if I put about fifty thousand dollars

into equipment Leasing and that gets a

10x leverage so that means I'm going to

own five hundred thousand dollars of uh

of equipment and then I'm gonna get a

350 000 tax deduction which at a 50 tax

bracket let's just say is going to give

me about a hundred and twenty five

thousand dollars in a tax deduction so

that would easily wipe out 150 000 in

capital gains okay so about fifty

thousand dollars and you're gonna

leverage that like kind of like a down

payment uh with the bank and and uh then

that's going to get you

five hundred thousand dollars ability to

lease that out or that equipment you

bought that equipment right and then

you're leasing it out and then you're

gonna get that that write-off is that a

fair summary that's a fair summary okay

and you've worked with a company that

does all the back I mean so they do all

the leasing all the maintenance all the

insurance I mean they they carry the

whole project you literally have to to

get the um 179 deduction you you

literally set up your own business so

it's your it's your LLC your LLC owns

the equipment they just uh will take it

from there and get it leased out and

managed in maintenance and all that

stuff they have about 11

000 pieces equipment across the country

um and just about every state has a as a

location and this is uh this is

typically commercial I call it big dumb

equipment stuff that you know lasts

years and years

um but the depreciation on it's amazing

this is fantastic by the way it kind of

reminds me a little bit of oil and gas

right with some of the benefits there

how would you compare and contrast those

two Dan yeah the only difference is you

know oil and gas I mean it's it's

becoming more of a science it used to be

you know that oil cutting was somewhat

of a risk as to whether or not they

would tap into something I don't think

that risk is quite there the thing I

like about this is that it's a tangible

asset I mean and it's literally in your

name

um so that if you know push comes to

shove worse comes to worse you literally

could sell this equipment on your own

and uh and you know probably be pretty

close to whole if not

much greater than whole simply because

of that tax deduction that you got up

front got it and when does it come back

to to to buy you know like in an

investment real estate you can 1031

exchange right

um and you can even use the Deferred

sales trust when does it come back to

bite you on that equipment

year five in this case because it's a

five-year

um it's a 10-year am five-year balloon

so to speak so in year five they're

gonna sell the equipment they're going

to sell it for what it's what's owed and

the principal you put down so that's

going to be a recapture but it's a real

simple process all you do is turn around

and take your money and and do it again

and you're right back in the game and

um the guys that uh that we work with

they haven't paid taxes in 10 years and

um and make huge huge lots of zeros

every year excellent and then uh is it

we're also for ordinary income tax kind

of like oil and gas as well as well as

capital gains tax Passover active you

know is there any kind of restrictions

on that well I'm not sure on the

restrictions but when that comes back to

you it's going to come back as as

recaptured so it's going to be ordinary

income okay cool this is interesting

well I think we're learning Something

New by the way you can learn more about

all these uh wise money tools by going

to the wise money tools YouTube channel

and this is you you can hear from Dan

Thompson as he talks about these types

of strategies very interesting I know

we've done some business exits that have

had some equipment and depending on you

know uh which structure we use we're

also able to um to defer and move it

outside the taxable estate

I'd be curious on the the besides just

the tax flow I guess the cash flow

during that five-year term if I put um

you know fifty thousand dollars down am

I expected to make anything on my 50

after the you know Debt Service

um you know what's what's the interest

rate obviously that's changed with where

banks are at with rates going up about

100 in the past year so just real quick

any kind of cash flow in that 50 what

can be expected after expenses yeah but

I I always tell people about 15 percent

of your uh uh or the cash flow based on

the amount you put in so if you put in a

hundred thousand dollars you're gonna

expect about 15 000 a year and that

should be

um also

um depreciated or tax efficient because

there's still some depreciation left in

those in those last four years yeah

that's that's fascinating and I think

it's like anything like people aren't

used to like leasing equipment but if

you think through it and if it's big

enough equipment from companies that

need it I'd even imagine it actually got

a bump during covet right like cars went

way up I bought a a gun safe and that

gun safe went up in value I mean

something that's heavy you know

manufactured you know manufacturer takes

a lot of a lot of that with with with

supply chain challenges did you see that

bump there Dan during covet not only

that but what I like about this is it's

almost Recession Proof because in a

recession companies aren't going to go

put out you know a half a million

dollars for a piece of equipment they're

definitely going to lease so leasing

percent images leasing that goes up

dramatically in a recession which is

kind of nice yeah I love it and our

foundation of our of our structure is is

an installment sale and so the very fact

that people are using other other

leasing right which is really just an

install an installment or a loan right

to uh to allow somebody to get the

equipment to use the equipment to pay

you back solely over time and still get

the tax tax benefits through Section 179

and essentially by the way if you're

listening this is why the government

does this so because otherwise things

would stop right they can't force us to

to let someone borrow our equipment or

or they can't force us to buy or build

multi-family properties but they can do

tax incentives to to encourage

um through tax write-offs and deductions

and do it all in the beginning the other

thing too is they do the bonus or they

let it let it all uh happen in the first

year so that people you know take action

like right now right no the weight you

know And Delay which keeps the economy

moving so it's all about tax flow not

just cash flow that being said Dan are

you ready for the capital gains tax

Solutions part of the show sure all

right what's your biggest frustration

when it comes to the 1031 exchange or

just other capital gains tax referral

and assets like public or private stock

businesses you know cryptocurrency real

estate what would you say your biggest

frustration with the 1031 is well I

think everybody's got the same problem

that is that you would have to use a

like property and at least as equal or

greater value and sometimes when people

are doing 1031s or trying to back out of

stuff they're doing it ultimately to

lessen their load of assets and

sometimes that can be the burden yeah I

could agree with you more we call that

the uh the shotgun wedding Dan where

you're where you know you're like hey

I'm ready to move on or or I'm ready to

like be done with the toilets trash

liability but now I have to trade

something like kind for like kind which

maybe it's probably gonna if it's real

estate it's not liquid grab it by nature

or you have to give all control into the

Delaware statutory trust right we have

no control no liquidity no

diversification and

um it has to be equal greater value if

you're going to do it yourself you want

to maintain the control and so you

become in this part it's like do I give

up my freedoms with my energy my time

and my stress or even trying to get a

loan with the bank right now not as easy

it used to be right and or just the debt

is higher higher higher interest rates

in cap rates that still haven't changed

and it becomes kind of a a forced forced

wedding right a forced marriage where

you're running around with your hair on

fire for 45 days and then closing within

180 just not a great scenario by the way

that's why we do offer a capital gains

tax a solution called the Deferred sales

trust which eliminates the need for the

1031 exchange works for any asset of any

kind including cryptocurrency business

stock and um and of course it can save a

failing 1031 as well you go to capital

gains tax solutions.com it's capital

gains tax solutions.com that being said

Dan are you ready for the lightning

round yeah look can I just say one thing

on that sure I really I think that's

awesome and I I've got to get much more

involved in that because uh my wife as

an example just inherited a trucking for

a truck a Trucking terminal uh so they

have no interest in that so they're just

gonna sell it right didn't have any

weight at 1031 because they don't want

to you know stay in that space if you

will and then just the other day I had a

guy call me up and he's got the same

situation he's been flipping houses and

now he's tired of it but he's been just

10 31 10 31 31 and now he's like I've

got to get all this the one solution

that this equipment leasing does offer

is just by taking some of those funds

that they have available they can wipe

out a lot of the gains

um early on as well so between I think

what you do and some of the things that

uh that we offer we could probably have

some fun helping people avoid that tax

absolutely to be the tax man beat the

tax man all the legal way but do it in a

way that it gives you the freedoms that

perhaps you're looking for on your exit

thanks for sharing that Dan appreciate

that that being said let's jump into the

lightning round so Dan what would you

say is the one thing if you could go

back to your 25 year old self that you

would make sure to tell yourself to do

oh I would have done multi-family much

earlier

uh I wish I would have just I wish I

would have just forgot the Wall Street

way the traditional Financial advising

the get a retirement plan you know live

happily for Ever After because it just

doesn't happen it's too frustrating

markets are too volatile I would have

been in multi-family much earlier

absolutely by the way Dan was in Modesto

where I was kind of the bay area in

Sacramento at one point and um same

thing here my parents they did Fix and

Flip houses in in construction and had

some holes but mostly just you know

single family Mission Hills and Silicon

Valley and stuff but looking back they

would have bought multi-family they

would have renovated multi-family they

would own it long term because you can

scale it it makes just makes so much

sense

um so um but yeah that being said

question number two uh what's the number

one book you've recommended or gifted

the most in the past year

well I I still love Rich Dad Poor Dad I

think that kind of just tells the story

of how to do things right and then of

course uh you know Robert's got a a way

of just explaining these same Concepts

that we're talking about multi-family

leverage all those things absolutely

love that book question number three uh

what's the number one leadership quote

or theme that you strive to live by

oh I wish I would have given that a

little more thought but but really what

I try to live by is

um is I would have to say it's my four

Keys time compounding leverage and tax

advantages you put those into effect and

you're going to be just fine excellent

uh next question what are you most

curious about right now

uh crypto

I think there's some interesting things

going on out there I I wish I had a

crystal ball could tell you which one

was going to end up on top but I think

it's a lot like.com that sooner later

one or two or five or ten are gonna

really kind of shine and and lead the

way and the rest will fall by the

wayside like.com but uh it's an

interesting it's an interesting Arena

awesome all right second to last our

last question really Dan so after all

your success helping all the people

you've helped create and preserve more

wealth what would you say is the number

one thing that you practice is say

centered in your values and also stay

encouraged to charge forward to to gain

higher Heights

oh I'd say live well within your means I

would love to see people get into the

point where they can save 40 percent of

their income and not living you know on

rice and beans but just having enough

assets that are working for you passive

income and still having a great

lifestyle and I I just love the idea of

saving forty percent of your income

fantastic Dan Thompson I want to thank

you for being on the show I want to

thank you for sharing all your wisdom

with us we learned something new today

with leveraging

um equipment really cool as well I want

to encourage you to keep using your

strengths uh making things simple and

and help people take action to build

their wealth and their Financial Freedom

uh for those who want to get in touch

with you could you remind us one last

time what's the best place for us to

find you yeah wise money tools if you

just can remember that we're on YouTube

and Facebook and Instagram and all the

rest of them

um wisemoneytools.com for the website

you can always reach me at Dan

wisemoneytools.com if you have any

questions as well amazing thanks Dan

also thank our listeners for listening

to an episode of the capital gains tax

Solutions podcast as always we believe

most high net worth individuals and

those who help them they struggle with

clarifying their capital gains tax

deferral options I have any clear plan

is the enemy using proven tax referral

strategy such as the Deferred sales

trust maybe begin with Dan to do some

equipment leasing to defer or eliminate

or um offset tax right really cool is a

great way to for you to create and

preserve more wealth throughout your

clients friends and family do the same

by the way we're also streaming on

Expert cre Secrets as well for all of

our commercial real estate entrepreneurs

out there and or investors appreciate

you listening uh we want to encourage

you to take some action right now you

can check out my brand new book building

a capital gains tax tax Exit Plan it

just got released on Amazon and you can

find that there we have Kevin Harrington

from Shark Tank in the book another

other multi-family syndicators and

operators and also some a couple

financial planners as well go to capital

gains tax solutions.com and or search on

Amazon building a capital gains tax Exit

Plan hey thanks so much for watching I

promise to do even better next time and

we uh we thank you for uh for uh