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TIL people have no idea how taxes work. Stories that paint completely legal deductions and avoidance strategies as being improper only hurt the pub's credibility and embolden the "fake news" narrative. Massive, real debt would be a reason for concern but not legit deductions.

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The New York Times

@nytimes

· Sep 27, 2020

Exclusive: The Times has obtained tax-return data for President Trump extending over more than two decades. It shows his finances under stress, beset by losses that he aggressively employs to avoid paying taxes and hundreds of millions in debt coming due. nyti.ms/308oHAj

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Jesse Powell

@jespow

Also, of course paying your business consultant is a deductible expense. It doesn't matter if the consultant is a family relative. Your expense is their income. The taxable income just moves from one entity to another. Fake outrage from people who know better isn't helping anyone

3:27 AM · Sep 28, 2020Twitter Web App

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But the allegation isn’t that she’s family, but that they paid her as a consultant for the same tasks she was managing as an executive. This wouldn’t typically be deductible as it’s just misclassification without proper withholding, and also a potential fiduciary duty breach.

Collins Belton

@collins_belton

Sep 28, 2020

And to be clear, they can deduct for W2, but 1099ing her would’ve allowed for a reduction in tax paid by both equal to at least FICA, hence the issue.

Replying to

Most ppl have no clue about taxes. After you file if it says you owe $750. That does not mean you didn’t pay taxes as a billionaire. It means you owe more. You can pay $2 million in taxes. Then at the yr end still owe more.

Replying to

I don't believe an employee can simultaneously be a business consultant and take 2 separate sets of deductions. If you are doing that at Kraken then time to clean it up and get your books right. Hire a good accountant. Its not legal.

Can you be an Employee & Independent Contractor for the same company

It is possible to have a W-2 employee who also performs 1099 independent contractor work, but employers must follow these federal regulations.

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Thomas Rossi

@th_s4m0ht

Sep 28, 2020

Replying to

@jespow

In EU that would be at least suspicious for the local irs, you should demonstrate you are not evading inheritance tax for instance. Still I agree the issue is not being competent at not paying taxes, the perpetrated losses are more of a problem

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