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Buy, Borrow, Die – Explained
41–50 of 504 posts
Re: Buy, Borrow, Die – Explained
#42If this is accurate, it finally explains something I've been asking about for years: The loan is paid back after the step-up in basis. That's the loophole. If the loan was paid back before step-up, the estate would still have to pay capital gains tax.
Re: Buy, Borrow, Die – Explained
#43Earlier quoted context omitted.
Why would anyone take anything at face value posted on reddit? So this one random lawyer on reddit has hundreds of clients with a net worth of $300M+? Or, they're LARPing. I wonder which is more likely.
> So this one random lawyer on reddit has hundreds of clients with a net worth of $300M+? Or, they're LARPing. Those are not the only options. That's a pretty bad strawman.
What are the other options?
Re: Buy, Borrow, Die – Explained
#44I can't read reddit anymore because I always get "Your request has been blocked due to a network policy. Try logging in or creating an account here to get back to browsing."
Any way to bypass this?
Re: Buy, Borrow, Die – Explained
#45Is there any indication the ultra rich structure loans like this to avoid taxes? Or is this just a meme that, for the most part, financially illiterate redditors like to throw around?
My understanding is that this is possible with whole life insurance policies without having to be ultra rich. After a certain period, there is no longer any premium penalty, so while the insurance premium principle doesn’t grow, it doesn’t cost anything to own. At some point the owner can take loans against that the value of the policy that are ultimately paid back when the policy pays out. There’s some details that a financial advisor can fill in, but it’s doable for the average HN reader who doesn’t mind offsetting income for far in the future returns.
Re: Buy, Borrow, Die – Explained
#46Earlier quoted context omitted.
> So this one random lawyer on reddit has hundreds of clients with a net worth of $300M+? Or, they're LARPing. Those are not the only options. That's a pretty bad strawman.
What are the other options?
You want me to enumerate the potential experiences a tax lawyer may have, outside of having hundreds of clients with a net worth of 300M dollars, over a 20+ year career, that would allow them to do the math outlined in the post?
I don't think that's necessary.
Re: Buy, Borrow, Die – Explained
#47[Meta] is it common to open a subreddit just for a single post like this one?
Re: Buy, Borrow, Die – Explained
#48Re: Buy, Borrow, Die – Explained
#49I can't read reddit anymore because I always get "Your request has been blocked due to a network policy. Try logging in or creating an account here to get back to browsing." Any way to bypass this?
You can access via tor (they have an onion address as well) — or run individual links through an archive service
Re: Buy, Borrow, Die – Explained
#50I gather the reason for the step-up basis is to avoid taxing an asset that's already subject to estate tax, but that seems like an awkward solution. Especially since there have been attempts to reduce or eliminate the estate tax not to mention various dodges that exist. I think it would make more sense to eliminate the step-up basis (which is proposed by Kamala Harris) and just limit the scope of the estate tax to exclude capital assets. Tax is paid on gains as per normal with no exceptions.