The Truth About the Inflation Reduction Act – Kim Kiyosaki, @TomWheelwrightCPA

(upbeat music) – [Announcer] This is
"The Rich Dad Radio Show," The good news and bad news about money. Here's Robert Kiyosaki. – Hello and welcome to
"The Rich Dad Radio Show," The good news and bad news about money. I'm Kim Kiyosaki sitting
in for Robert today And we have a very, very
important show today Because getting close to that time of year And there's a lot of
funny stuff going on in The economy and inflation is
on a lot of people's mind. And of course going with inflation, Taxes are also on people's mind. So, we're gonna talk about the bad news And we're gonna talk about the good news Because there is both
going on here in the world And our very, very special
guest today is Tom Wheelwright. He's our Rich Dad advisor, Author of the book, "Tax-Free Wealth," And his new book is called
"Win-Win Wealth Strategy: Seven Investments the Government
Will Pay You to Make." So, welcome to our show, Tom. – It is always good to be with you, Kim. Love being here.
– Thanks. Well, today's show get is
gonna be a little bit different 'cause we're really gonna get into some Of the practical things that are happening And specifically around taxes,
how that might affect you, The viewer, how that might
affect your tax situation And what you can do about
it and it's actually, I think, and Tom, you can
talk to this, it's more, It's bigger than just taxes. It's really preparing
for your financial life And taxes are one piece of it.

Unfortunately, they're a very big piece And the way things are going are Not necessarily in everybody's favor. So, if we could start,
Tom, with you giving From your perspective as a
tax strategist, accountant, What you see is really, really
happening in the economy. They keep talking about,
we're not in a recession. Sure seems like we're in a recession. They say the job markets are good, But I'll talk to a lot of
people who have not worked For a long time and they're
struggling day-to-day. So, tell me from your perspective, What do you see going on
in the US and globally? – Yeah, it's actually a
very interesting time. We have high inflation. We have, at the same time
we have high employment. We have a lot of people
who've taken themselves out Of the job market, which
I think is part of why The numbers are like they
are, you know, they say, Well, there's such a
low unemployment rate. Well, there's so many people That aren't even looking for a job. So, they aren't even
included in those numbers. So, I think-
– Why is that? Why are they not looking
for, how are they surviving? – You know, that's a really good question. There is a very high
percentage of young people Who are living at home with their parents. That's one way that they're surviving. There's still money leftover. Remember for two years
during the pandemic, People didn't spend any
money and people got, Were given a whole lot of
money from the government. So, between those, they were
still getting paid, right?

Or if they had unemployment benefits, They got high unemployment benefits. The unemployment benefits were The highest ever in history.
– Wow. – So, I think they had a
lot of time to save money. I think they're still going through that. And now what we're seeing
is that people are now Going back into maxing
out their credit cards 'cause they're going,
oh, the economy's good. So, when the economy's good, We can max out our credit cards. Of course, home prices are
way up and so that means That they can get more
of a home equity loan. So, I think what we're
seeing is there's just been Such an expansion of the
money supply that people Are tapping into that
expansion of the money supply. On top of that, the stock market went up. So, anybody who had money
in the stock market, It's been artificially inflated
over the last several years. You know, prices have gone way up. And so they feel like, wow, I have money so I can spend
money and it's really, You know, I think the
confidence is still pretty high. I think that's why people think There isn't a recession going on. But certainly all the
indicators of a recession either Going on or coming are
pretty strong right now, And of course the other
part is that taxes are, You know, they're such a
major part of everything we do And people are, you know,
people are gonna get, I think people are gonna, actually, I think a lot of people are
gonna get hit hard come April. They think that they're gonna
get this big tax refund. I think a lot of people
are gonna owe taxes.

– Interesting, so, you know
what else I heard is a lot Of people who bet on crypto
and invested in crypto, As the crypto prices were
going up and up and up, Okay, let's say I'm,
you know, a 25 year old And I bought some crypto and
all of a sudden it went from, You know, 10,000 to 50,000 to 60,000, Well, I'm rich-
– Right. – You know, I don't have to work. So, a lot of people I
think left the workforce Because they felt that they
had all this money in the bank And now have come to
find out that's not so. So, do you think people are
gonna start going back to work? – That is the, I think
that's the multimillion Or multi-trillion dollar question, Kim. Because if they don't, You're gonna see inflation
continue to go up Because what what'll happen is is that You're gonna have to have wage inflation And wage inflation creates price inflation And it's just, it's a
nasty circle of things. So, I don't see how they not
go back to work, but, you know, My kids are working, so I'm
not, I don't have kids at home. They are, they're fully employed. – Yeah. You know, it's hard to imagine. I mean, you and I, we grew up, you know, With this work ethic,
but work also gives us Such a great confidence
and so much responsibility And the values associated with working And accomplishing and all of that. I think a lot of people are
missing out on that, it's- – Well, and I think that shows up In your mental health levels That there's a lot of depression going on. There's a lot of mental health

And there's a lot of drug abuse. You know, a lot of not just drug use, But drug abuse and then, you know, That all is self-medicating,
right, for those, Because they're not
getting it somewhere else. Well, you know, the normal place to get it Would be work, family,
you know, relationships. But people, if you're sitting
at home playing video games Or you know, you're kind
of withdrawn from the world And not productive, you
don't feel worthwhile When you're not productive. So, I agree with you. I think that not working is
actually a very serious issue. – Good. Okay. So, you know, we've
talked before on the show And we're gonna get into this Inflation reduction act
here in just a moment. But we've talked a lot too About where this economy is going. Are we in this giant bubble? Are we in like, the
biggest bubble in history? And what happens if and
when that bubble bursts? So, from your point of
view, do you think we are In a major bubble here financially? – Well, I think by definition, Because money's no longer money right, Now it's credit as our friend
Richard Duncan explains. It's now credit. So, by
definition it's a bubble. The question, to me, the question isn't Whether this is the
biggest bubble in history. The question is, can this bubble Get bigger and can it keep going? And I honestly, I don't know The answer to that question, Kim.

I know that a lot of
people, including Robert, Think it's gonna, it's just gonna burst And everything's gonna come crashing down. It's, but it's interesting. We've never had a world economy
in the history of the world, We've never had a world economy
that was based on credit. And so we're not based on gold,
we're not based on crypto. We're not based on anything
that we can put our hats on. We're just based on confidence
and so the question is, I think the difficulty is, is that when, If you're based on confidence, You have to keep that confidence going. So, if you can't keep
that confidence going, Then, and the confidence crashes, Then the whole thing comes tumbling down And I think that's where
it's really challenging In the economy right now is
because we don't have anything To fall back on that is,
you know, is really solid. Like, oh, well I can fall
back because I know that my, You know, my dollars are
limited by the amount of gold. I mean, that's something fall back on. If I have 10 million, if we have 10 million foreclosures
like we did in 2008, '09, and '10, well, all
that, that's money coming out Of the marketplace when
those foreclosures happen, That's all money coming
out of the marketplace. And you need money to continue
going into the marketplace, Which is why the government
incentivizes debt so much. That's why debts
incentivized through taxes, Because the government needs more debt 'cause that inflates that balloon. – So, we're, in the
past, we were a country That was built on production
and producing things. Now we are a country that
is just basically borrowers.

It's a bunch of borrowers and it's debt, That's what our country's built on now. – Yeah. It's not just the
country, it's the whole world. Right? The whole the whole
world is based on credit. It's not based on anything tangible. And so that credit is
good as long as there's, As long as there's supply
behind it and there's, You know, people want it
and people can produce it. As long as that keeps
going, it's fine, and- – Which actually is a big issue
today with the supply chain. I mean, we're experiencing it ourselves. We've had to, because
we're in books and games, We're paper, we're about paper And paper shortages
are all over the world. And we have, thank God for our team, They saw this coming and
we were able to basically Get stock for the next,
it'll take us to 2023, But a lot of people are
not, the book industry's Down 32% right now
because of the shortage. So, to your point, if there's shortage, That's gonna build on
that lack of confidence. – Well, and on top of
that, that's what causes, That's a lot of inflationary
pressure, right? I mean, inflation's pretty simple. It's just too much money
chasing too few goods. So, the fed's working on
not having too much money, That's the whole point of
their interest rate increases, To reduce the money supply. But you also have the too few goods issue. And if you have this big
supply chain interruption And it continues to be
interrupted, 'cause I mean, A lot of people thought, including me, I thought, well, geez, by the end of 2022, Surely all the interrupted supply chain

From the pandemic will be back to normal, But it's not anywhere near back to normal. And that's that supply chain. And you can see it on the
grocery shelves, right? Or in the drug store shelves
where half the shelves Are empty right now and
it's, you know, who knows What you're gonna get
when you go to the store? When you have that kind of
supply chain interruption, Then that means that you're gonna continue To have price pressure
pushing upward on that. – Right, and, you know, I don't, I still don't understand
this whole thing about, Okay, if we have, if we
raise interest rates, That's gonna reduce inflation. But if you raise interest rates, The producers and the manufacturers are, They're gonna be paying
more for their supplies. So, they're gonna pass
that on to consumers. So, I don't I really don't understand how That is a inflation
reduction strategy at all. Never did, never did. Okay. Inflation. All right.
– Yes. – Inflation. The Inflation Reduction Act. Okay, Tom, you are one of
the smartest guys I know When it comes to taxes,
you study the code, You are ahead of the game. This Inflation Reduction Act that the IRS And the government is putting into play. What the hell is it and how
does it impact you and me? – Well, first of all,
there's nothing in there. Not anything that reduces inflation. I always refer to it as the
"Inflation Enhancement Act" Because there are some
things that actually Put pressures, upward pressures on prices,

And significant upward
pressures on prices. For example, we have the, you know, On it's good news, bad news, right? Bad news is we have $80 billion more Going to the IRS over the next 10 years, Which is basically double their budget, Which will add a large number,
not 87,000 like they said. I mean, it's 87,000 new employees, But that's not 87,000 new auditors. Let's be clear about that. So, it's not as bad as that, But they will easily be
doubling their audit force And probably more than
doubling their audit force. So, that's the bad news. The good news is there's tax credits And tax benefits in this bill. But for example, let's, you
know, talking about inflation, The day they announced that
this new act would allow That $7,500 electric car
credit to go towards Tesla, GM, Et cetera, the car manufacturers
all raised their price By shockingly enough,
between seven and $8,000. So, nobody's, you know, Nobody's getting a reduction out of this. They had the $7,500 credit
before, now they say, Well, now we're gonna
apply it to more people. So, now what all the car manufacturers Have done have raised the prices. So, that's a little troubling when you see That immediate effect. I mean, literally it was in, It was within days of the announcement. – Wow. Wow. So, you've got billions
going to boost IRS auditors? – Yes.

– You've got some going
to customer service? – Correct.
– A little bit. Who, okay, so these IRS audits, So they're obviously gonna have A whole lot more audits going on. – Correct. – Who are they going after? – All right, so that's something That most people are not understanding Because those who enact-
– Say the rich. Say the rich. – Those who enacted this say, well, It's the rich that they're gonna go after. Well, so here's the reality. The reality is 90% of audits
are for people who make Under 400,000, actually close To 90% are under 200,000, okay? What Janet Yellen said, our treasury, Beloved treasury secretary, she said They won't increase the
proportion of audits On people who make under
400,000, all right? So, let's do the math here. If the proportion right now is 90%, Then the chances are that
90% of those new audits Are gonna be for people
making under 400,000. And the question is, well, why? Well, because that's
where all the money is. First of all, there's a lot more money Under 400,000 than over 400,000. Second of all-
– Why is that? Why is that? – Well, because that's just, I mean, You're in the top 1%, right? If you're over 400,000. So, most of the money in
this country is, it's not, I mean, yeah, the billionaires
from a wealth standpoint,

It's very highly skewed
towards the wealthy, But from an income standpoint, it isn't. So, you've got, and plus on top of that, They say the wealthy cheat,
I have not experienced that. And I've been doing this, what, 40 years, 40 plus years, Kim, and
that is not my experience. My experience is that the cheaters are in That hundred to $200,000
range, or $300,000 range. That's where most of the cheating is done. In fact, if you look back
at the IRS statistics Over the last 10 years,
that's what the IRS statistics Say is where most of the cheating is done. Because here's what happens.
I mean, think about this. So, you have a contractor
come to your house And they say, well, I'll
do this job for $120, But if you pay me cash, it's a hundred. – Yeah.
– Well, why? What are they saying? They're just saying, well, I'm not gonna report
that cash on my taxes. So, I'm gonna take a smaller amount. Otherwise, why wouldn't
they rather have the 120? Because they don't wanna deposit a check? No, because they don't wanna
report it on their taxes. So, that's where the cheating
goes on, on a regular basis. Are there wealthy people who cheat? Yeah, clearly there are
wealthy people who cheat. But more often what happens
is the wealthy understand How the tax laws work,
they understand where The incentives are, and
they have very sophisticated Tax advisors like myself
who help them find Those incentives and take care
of that, you know, for them. So, the average person doesn't have that. They don't have the
education and so they end up,

They go, well, I don't want, you know, The rich don't have to pay tax. I shouldn't have to pay tax. But the rich, they're not paying tax. It's not that they're cheating. It's that, that's how
the tax law works, right? – They take advantage of the tax law. – Yeah, they're just saying, well, look, If the tax laws, as I
said, in "Tax-Free Wealth," If the tax laws is a series
of incentives, right? And the rich just say, well, I'm just gonna invest
where those incentives are, Then of course they're not gonna pay tax. But the average person,
they don't know that. And so therefore, what do they do? Well, I'm not, if the rich
don't have to pay tax, I don't wanna have to pay
tax and they have to cheat, Or they feel like they have
to cheat and so, you know, The proportion of the
audits, are they gonna go, Are they gonna have more
audits after rich people? Absolutely, there's actually
a, one of the things They're working on right now is if you Have total positive
income on your tax return, That means take all the
negative numbers off Your tax return and only
the positive numbers on, And if that's more than 10 million, You're likely to get audited, okay? So, that means you can have a loss from Your real estate, but
income from your business, And while they may offset for tax, Your tax computation purposes
from a audit standpoint, They're going to ignore
the negative amount And look at just the positive
amount and say, well, If you're over $10 million of positive in,

Of positive numbers on your tax return, We're gonna come after you. – That's crazy. That's crazy. What else? We just have a
couple minutes before the break. What else is in this bill? – Well, so in addition, well of course, There is some money for technology For the IRS in this bill, which they need. They should probably spend $45 billion On technology and $5 billion on auditors. But it seems to be the opposite. And they have already hired
customer service people, And that is in the bill,
and they're desperately In need of customer service people And people to process tax returns. But on top of that, There are some very
positives in this bill. There are tax credits. Again, the electric vehicle
tax credits have been extended. The solar tax credits are, They've been extended and enhanced. And we'll have to talk about that because That's where actually
they encourage inflation. There's gonna be high
labor costs for a lot Of those solar initiatives,
and there's one Little bit that people should know about. And that's this, the business
loss limitation rule, Which we can talk about when we come back. But that business loss limitation rule Is actually very significant. It was originally act in
2017 under the Trump bill. It was delayed for several years, And this act basically makes it permanent. – Okay. Okay.

Well, we'll be right back. When we come back, Tom, I wanna talk, There's a few other items
that are in this tax bill That I wanna talk about,
but then more importantly, I wanna talk about what
can the individual do To prepare for this, and what should they, Where should they be focusing on? Where can they take advantage, Maybe of this tax bill and
the negative piece of it? How can they mitigate
the negative side of it? So, when we come back
more with Tom Wheelwright, More about the Inflation Enhancement Act, We'll be right back.
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That's richdadfree.com. – Hello, hi, this is Kim Kiyosaki With "The Rich Dad Radio Show." I'm sitting in for Robert today. We're discussing a really
important subject right now, And it's very much the
practical hands on thing Called taxes and inflation,
and how the government Is basically putting forth this bill, The Inflation Reduction Act,
and as Thomas said before,

It's actually opposite
what, and I like this too. Whatever the government says, Whenever there's a new bill out, You know the Clean Energy Bill, You'll know it's not about clean energy. So, you know that Inflation Reduction Act Is not about reducing inflation. Anytime they say this
is what we're gonna do, Just know that they're doing the opposite. I think that's a key point. So, our guest today is Tom
Wheelwright, CPA tax strategist. He is the author of "Tax-Free
Wealth" and he is also The author of the new book,
"Win-Win Wealth Strategy: Seven Investments the Government
Will Pay You to Make." So, welcome back, Tom.
– Thanks, Kim. – So, we were talking about
some of the other things That are in this bill and how
they affect small business, How they affect the individual. So, do you wanna just touch on those And then we're gonna talk
about what people can do To protect themselves
and enhance themselves. – Yeah, absolutely. So, I like that. So, one of the things that
is very little known is This business loss limitation
rule, which everybody, Everybody who makes any
significant amount of income should Be paying attention to, and
here's how the rule works. It used to be that if you
had losses from businesses, Including rental real
estate, you could offset A hundred percent of your
other income, not so anymore. The 2017 act, this was the Trump tax bill, Put this into place, but it was postponed All through the pandemic and it isn't Until 2022 that it comes into play. And what this new bill
does is actually pushes it,

Actually lengthens the term of it, It goes until 2028 now. Now, here's what it means. If you have over $500,000 of wage income, Income from interest,
income from dividends, Income from your retirement plans, If you have over $500,000 of that, You can only offset up
to $500,000 of that type Of income total with your
losses from real estate, Solar, other tax benefits
that you would have. Otherwise, you can only
offset $500,000 of WASA. So, if you're a doctor, for example, Making $800,000 a year,
and let's say your spouse Decides to do real estate full-time, So they're a real estate professional And you have $2 million
of losses during the year, You're still gonna pay tax on
$300,000 because you only get To offset $500,000 for
that wage income, so it's- – Are they basically taking away The incentive, the tax incentives? – No, what they're doing
is, is they're, once again, They are going after the employees. So, if you have business income, So let's take you and you and me, Kim, All of our income is business income. We don't have wage income, right? So, all of our income is business income. Well, our losses from our
investing can 100% offset That business income because business is- – Not the personal income. – It's the individuals who earn
their money as wage earners And those who got money
as dividends, interest, And retirement income, all
of those, they're, so you Can only offset a limited
amount of that type of income.

– Wow. So, again, the
middle class gets screwed. – Once again. That's right. It's, you know, there's been
an assault on employees. Remember until 1944 employees Didn't pay tax at all
in the United States. There was no income tax
on employees before 1944. It wasn't until after that. And even after that for many years, The standard deduction and
the dependent deductions, They were enough to offset
the average person's income. It's only really been
in the last 30, 40 years Where it's all shifted away
from focusing on basically Taxing the rich to
taxing the middle class. And that's where all the taxes are now. They're all on the middle class. – So, the business loss limitation, Does that include like 401ks? – It does.
– Wow. – Yep. 401ks, pension plans. I mean, let's say that you, Let's say you were a business
owner and you socked away. So, business owners say, a
lot of 'em like to sock away A lot of money into their pension plans, The last, you know, 10 years of being In business so that they
pay less taxes then. But then what happens is, okay, Well if they didn't sock
that away in a pension plan And instead had followed
years in Robert's advice, Which was invest outside
of the stock market, Invest outside of a
pension plan, IRA, 401k, Then what happens is if they pull too much Of that money out in one year, They can't offset that money at all. They're just gonna pay tax on it.

– Wow, wow, on top of, as
our friend Ed Seidel talks About in the book, "Who Stole My Pension?" Not only are they getting taxed more, But now also their pensions being reduced On top of it because of
bad management, okay. All right. You talk about solar credits. – So, this is where the Inflation
Enhancement Act comes in. Enhancement part of the
inflation act comes into play. So, the solar tax benefits are amazing. And it's not just solar by the
way. It applies to hydrogen. There's actually nuclear
tax benefits in here for- – And is that for the business
or for the investor or both? – For solar it is for the
business or the homeowner. However, businesses are better, as always, Businesses get better tax
benefits than homeowners do. So, here's the first thing. First thing is, you
put solar on your house Or on your real estate,
you put it on your home, Your personal real estate, Or you put it on your
investment real estate, You're gonna get a credit now of 30% Of the cost of that solar. Which means you put a
hundred thousand dollars, Like I'm putting on my
building right now in Tempe, I'm putting a hundred
thousand dollars of solar on. I will get a tax credit
immediately of $30,000, For a homeowner, that's where it ends. – Okay.
– For a business owner, It gets better because not only do you get The $30,000 credit, but
you get to deduct 85%, Or in $100,000, you get
an $85,000 deduction. So, that means that if
you're in a 40% tax bracket, That's basically $34,000
on top of the 30,000. So, think about it, you
paid a hundred thousand,

You get 30,000 back as a credit, $34,000 back through deductions. So, you're only paying
roughly a third of the cost Of that solar energy and if
you're in a place like Arizona, Texas, California, to
not put solar is just, It's just silly to not
put it on your building Because there's so, the
government's paying for it. I've got a buddy in Texas,
Kim, who put $185,000, Is putting $185,000 solar
panels on his business. And he's taking out a loan of 120,000 And because of that, he
actually ends up net ahead. So, he ends up with more
money than he started with. – Yeah. – By putting solar on his house And then the solar will pay for the loan. So, he just gets the money
right away. It's immediate. It's like immediately
putting cash in your pocket. – All right, well, we
gotta talk about that 'cause we don't have solar
on our building yet, yet. Yes.
– Yes, We do need to talk about that. – We're gonna talk about that. Okay. One other thing, this is
how they've been selling, One of the ways they've
been selling this bill is, Oh, everybody's gonna
get a $7,500 tax credit. Yay, everybody. Is it everybody? – Well, it's not everybody, by the way, Can I just add one more
thing on the solar? – Please, please.
– So, the whole idea behind it Is that people, that investors go out And put out big massive
solar projects, right? Not just on your home
and on your business, But massive solar projects. There's a little known
factoid in that bill though.

If you use less expensive labor, You only get a 6% credit. But if you use union labor rates, You get a 30% credit.
– Whoa. – So, five times the amount of credit, If you use union labor rates, Then if you use market labor rates. – Oh my goodness. – So, when I talk about,
you know, you're putting Upward pressure-
– So, it benefits the union, The unions have been pushing
for this big time then. – Oh, for sure. Well, you know, President
Biden has said from day one, He's a union guy and he's
proven it in this bill That this is all, this is a
huge handout to union labor. It's a huge handout. Now, you don't have to be
unions 'cause that would Be unconstitutional, but you
do have to pay union rate. So, some people are not unions And they'll still get the union rates. They'll be happy, too. So, that is the enhancement part. That's part of the enhancement Of the Inflation Enhancement Act. – Got it, got it. Okay. So, tax credit, $7,500. Yay, worth my check.
– EV credits, EV credits. Okay, so here's the deal. First of all, the cars have To be made in North America, in 2022, Just the production has to
be finished in North America, Which includes Canada and Mexico, right? Because we have a lot of
Mexican car, you know, Manufacturing done with
US car manufacturers.

But then more and more of the
raw materials have to be made In the US, they have
to be mined in the US, Which I don't even know if we have them. So, it's gonna be, I think that, So I read the other day that
very few cars next year, EV, electric cars will
actually qualify for the credit Under the rules that are
in this bill next year. On top of that, you have
to make less than $150,000 If you're an individual
or less than $300,000 If you're married, and if
you make more than that, It's a drop off, you
just don't get it at all. Okay? It's just gone. And only a car that costs
less than $55,000 or a truck That costs less than 80,000
qualified for the credit. Now interestingly enough,
Ford, I believe it was When they announced this law,
they pushed their price up To I think $78,000 on to their trucks. They go, oh well, we just
have to be under 80,000. We can charge as much as we want, As long as it's under $80,000. And that's what they did. So, that means that your, you know, Your Tesla Model S isn't gonna qualify. Your Porsche isn't gonna qualify for sure. – It makes no sense because
they're pushing electric cars. But now they're penalizing
you if you buy electric cars. – They're, exactly, they're
pushing electric cars, But they only pushing them for people Who don't make a lot of money. They're pushing electric cars,
but they're only pushing, If they're electric cars, if
they're made in North America. So, they are, you know, it's-
– Limited. – There's a lot of different
policies going on here. And they're, I think they tried

To do too much frankly with this. I think they did expand it because it was That Tesla, GM, and I think Nissan did not Qualify anymore 'cause
they already maxed out Their credits and so they
expanded to everybody. So, any car manufacturer can
get it so long as they meet The other requirements of
being finished in North America And that the income's right
and the price is right. – Wow, okay, so let's start
with, on the good news, What can the individual invest in before We get into how they protect themselves? What can they do with their money? What's the most beneficial, Advantageous thing that
they could be doing? – Well, whatever the
government wants them to do. So, really, there's five things That really the government
wants them to do most, There's two others, but
there's five primary things. So, the first is business. Business has the best tax benefits. I actually gave an example in my new book That if you're starting
a business in your house, The government will literally
give you more tax benefits Then the cost of starting the business. So, it literally, the government will Literally pay you to start a business. – Even a part-time business? – Even, especially a part-time business. They'll just pay you right
up front just, you know, Reduce your withholding,
reduce your estimated payments And you get paid right up
front and you can actually Have the money from the
government to start your business. So, that is a nod to the side hustle, If you will, the nod
to the small business.

'Cause now you get to
deduct your home office. Now you get to deduct the
furniture in your home office. Now you get to deduct more of your car. So, there are a lot of deductions, Meals that you can deduct. There's travel that you can deduct. There's all sorts of
deductions you don't get as an Individual employee that you
do get as a business owner. And so there's huge tax
benefits in business. Of course, the government
wants technology produced, So they're huge technology tax benefits. The government wants housing. So, there's big benefits as you know, You do a lot of housing
investing and for investing In housing or other investment
real estate properties. So, huge investment. There's huge tax benefits there, mostly- – And for housing, could be anything from A single family house to
a multi-family building? – Exactly, exactly. As long as you're renting it out, It could e even be a VRBO or an Airbnb. So, it doesn't have to
be long-term rental. It could be, you know, it could be A short-term business rental.
– Okay. – And then on top of that, then you add, Of course, the government
wants to produce food. So, agriculture has
always had, they've always Been really the number
one preferred taxpayer. Very few farmers, ranchers
pay tax. They just don't. – How would an individual, How would an individual invest in food? – Well, for example, you
could invest in a ranch. You could invest in a, well for you,

You could invest in a vineyard. – Oh, that would be nice. I like it.
– Right? There you go. – I could actually invest in
some beef and cows and bulls. – Yep, right?
– Yep. – And that all qualifies. So, you can, I mean you can Absolutely invest in agriculture. It's, you know, it's a little harder. You have to do a little
more research for it And it's a little riskier. So, you have to pay attention to that. But then of course energy,
energy is the big one right now, Curiously enough, they
didn't do anything to dampen The incentives for oil
and gas in this bill. The oil and gas incentives
are just the same As they've been for many, many years Where you get to deduct
basically 100% of the money That you put into the oil
and gas drilling program. And, on top of that, it
doesn't matter if you're A passive investor, unlike
real estate where you, If you're a passive
investor, you're limited on How you can write off your deductions. In oil and gas, you're not limited. It's an unlimited amount. Even if you're an employee,
that's the one place, Now you're still limited on 500,000, But it is the one place
where you don't have To be actively involved
to get full tax benefits Is oil and gas and solar tax credits. Those also, you don't have
to be involved at all. But really the energy is a
really big one right now. These are just things the
government wants done. I mean, they're things
that, you know, they're,

You and Robert have been talking About 'em for years and years and years. The idea of investing,
energy, housing, business, Those types things is those, That's what the government wants it done. So, that's where they put the incentives. They know that if they
put the incentives there, People will more likely
take those projects on. – You know, last time I
was in Germany years ago, There was a couple I
was talking to and they, I don't know if you can do that here, But they were putting just three
windmills on their property And selling the energy back
to the energy companies And they had huge tax
benefits because of that. – Yeah, exactly. So, the point is that this- – Doesn't have to be big, right? – And it doesn't have
to be in the US, I mean, You don't have to be a US
taxpayer to get these benefits. What, I've actually looked
at 15 different countries And done a lot of research
on 15 different countries In Asia, in North American
and South America, In Europe and what I,
and even in South Africa. And what I found is, is that The tax benefits are very similar. I mean, even Australia, the tax benefits Are very similar from country to country. So, the details, you gotta
understand the details. That's where your tax advisor Comes into play,
– Okay. – But understanding the
concepts is something That is pretty much applicable
throughout the world. – Okay, so where your
tax advisor comes in, Your tax expert comes in,

So you're gonna have
the more audits, right? – Right.
– You're gonna have More taxes to pay and all of this. How does an individual
protect themselves from that? – Well-
– I mean, if somebody, If the IRS comes knocking
and says, oh sorry, You just got audited
and you don't maybe have A tax strategist or a CPA,
what the heck do you do? – Yeah, you're in trouble. You really need to look now at preparing, The audits aren't gonna start
happening for another couple Of years 'cause they need
to hire all the auditors And then give them some training. So, we're probably two years away from it. But remember, that gives
you two years and beginning With the 2022 tax return,
that's gonna be the first year That gets these heavy
audits is 2022, okay? So, that 2022 tax return, you better have A better tax preparer
and you better make sure That you got a tax advisor, tax preparer, Your CPA that actually knows
how to handle an audit. I've had a number of CPAs come to me since This bill was in enacted and said, "I've never handled an
audit, what do I do?" And I'm going, well, figure it out. I mean, you gotta be able
to handle that audit. You know, I mean, I've
handled audits for 40 years. So, it's not that hard, but it does take A skillset that is a pretty
specialized skillset. So, you better make sure
that you're prepared for it. – But aren't a lot of CPAs
scared to death or have put The fear of death into their
clients about getting audited? – Oh, scared to death. Now, just because, by the way,

Just because they've done that And you've paid higher taxes
because you've done that, Doesn't mean you're not gonna be audited. So, your chances of being audited, I think you're gonna go way
up, especially if you're A business owner or you're
an investor, your chances Of being audited are gonna go
way up in the next few years. And so it's really right
now would be the time To upgrade your tax advisor
and your tax preparer. – And here's where I wanna
give you a plug, Tom, Your company is called
Wealth Ability, correct? – Correct.
– Let me say that again. Your company is called Wealth
Ability and I thought it Was brilliant what you've
done because you can't handle, You yourself cannot handle
thousands and thousands Of clients, but you've put
together a network of people That have been trained
by you and your team To handle these types of situations. Personally speaking, you
know, we've been audited And you've handled our audits
and we've always come out Way ahead because you
actually end up educating The IRS auditor because
you know more than they do. And that's what you want in A tax strategist and a tax accountant. Because if they're telling you don't take The home deduction because
you might get audited, Then that's the wrong CPA, right? – Oh, oh yeah. Anytime you're told don't
take this tax benefit Because you may be audited,
it is time to call us. By the way, chapter 23
of "Tax-Free Wealth" Tells you how to find a good tax advisor, Or you can just call Wealth Ability. We have about 65 CPA
firms around the country

That are now part of our
network, and I, you're right, I mean, I train them, I
train them every month. Our team is constantly working with them. And that's what you're gonna need. You're gonna need a better CPA, You're gonna need better tax preparation, You're gonna need to be
ready for these audits And then you're gonna
need to have somebody On your side once the audit comes. – And let me ask you this
'cause most people think That they're tax strategists
and their tax expert And their CPA has to be in
the city where they live. Is that true or not true? Because when somebody
comes to Wealth Ability And says, "Here's my situation,
here's where I'm located." Is it based on location or what's it, What are you gonna?
– We, location is The last thing we look
at because we're on, I mean we're on Zoom right now, right? I mean, we're on video.
You're gonna be on video. You're not, who wants to spend time In the office with your CPA? I mean, seriously, we're not The most exciting people in the world. So, instead why not have somebody Who's more suited to your situation? And what we're gonna do
is we're gonna look at Your situation, we're
gonna look at the CPA, The tax advisor that fits your situation And we're gonna match you up that way. We're really not gonna
focus on your location 'cause I actually think location
these days is irrelevant. – Yeah, and so for example, for me, I like real estate and
business, so you're gonna

Pair me with somebody
in who's an expert in That field versus somebody who's an expert In the stock world or commodities world. – Right, versus somebody
who's just starting out And they don't need the same
level of expertise you need. So, they don't wanna pay as much as You would want to pay for your expertise. They wanna pay less money. They wanna, they don't need as high level Of tax advice and high
level quality of everything. So, they wanna, you know, Keep their expenses down, that's fine. We'll match you with somebody
who can help you with that. – Excellent. Excellent. Well, thank you Tom. Final words for our
wonderful audience here? – Well, just remember that taxes are Your single biggest expense and there are More opportunities than
you can shake a stick at In the tax law and particularly this new, It is, I like call it
this Tax Reduction Act. It actually, there are
so many opportunities To reduce your taxes in the
Inflation Reduction Act. And I think that doing what
the government wants done, There's, you know, that's, it's safe. The IRS isn't gonna come
after you for doing it. And at the same time, you're
gonna get massive tax benefits, Pay way little tax and
build a lot of wealth. – Great, so the key is to
get smarter with your money And find smart, smart, smart
tax advisors who read the code, The tax code for entertainment
as Tom Wheelwright does. – Exactly.
– Thank you Tom, This has been great,
wealth of information. Really appreciate it and
everybody pay attention

And pay attention to what's
happening and get yourself In a position so that
you're taking advantage Of these tax tax incentives instead Of being at the effect of the tax laws. So, thank you Tom.
Appreciate it very much. – Thank you.
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