Tuesday, June 16, 2009

Gold Coin Tax Scheme – Brilliant Idiocy

First of all, I believe it is every American's right to pay the least amount of taxes they legally can. Note, I said LEGALLY. By legally, I mean the law as determined by our court system.

Do not take legal advice from some guy on the radio advocating a crackpot scheme to "legally" avoid paying income tax. Recently, I read a story about a guy on trial for concocting a brilliant scheme to avoid taxes. As I understand it, he paid contractors in US Gold Coins for their work. By doing so, the contractors only had to pay income taxes on the face amount of the payment.

Of course, this brilliant plan had a serious problem. Because it is probably illegal, the federal government put him on trial and he faces 57 counts of tax evasion. Even if he manages to win an acquittal, he will spend more than he saved defending himself.

UNLESS you are willing to go to jail and waste all your money on defense attorneys, do not try any of these schemes. A simple rule of thumb, if the deduction is not allowed in TaxCut/TurboTax, it probably is illegal and should be avoided.


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