The Matt Chambers Show
Welcome to The Matt Chambers Show, where we explore the world of traveling, living and doing business internationally. Hosted by Matt Chambers, this podcast connects people, places, and ideas, offering inspiring stories and practical insights to help you design a life beyond borders. Whether you're seeking adventure, remote work tips, retirement ideas, or entrepreneurial guidance, each episode brings you closer to turning your global dreams into reality.
The Matt Chambers Show
Secure Your Wealth Through Trusts
Sally Gimon, a financial expert, discusses how individuals can save big on taxes and protect their assets using the powerful spendthrift trust. She specializes in showing 1099 earners and business owners how to slash their federal taxes by 70-95% using this trust. The trust helps investors legally avoid capital gains, interest, and rental income taxes. Sally shares her personal experience with real estate investing and how the trust has saved her six figures in taxes. She also explains how the trust can be used for various types of investments, including stocks, crypto, and businesses. The trust provides significant tax savings and also offers benefits such as privacy, asset protection, and avoidance of probate and inheritance taxes. In this conversation, Sally discusses the benefits of using irrevocable complex discretionary non-grantor spendthrift trusts to save on taxes and protect assets. She explains how these trusts can be used by various individuals, including real estate investors, business owners, and independent contractors. Sally shares examples of how her clients have saved thousands of dollars in taxes by utilizing these trusts. She also addresses common misconceptions and provides resources for further information.
Takeaways
- The spendthrift trust can help individuals save 70-95% on their federal taxes and avoid state income taxes in 43 states.
- The trust is applicable to various types of investments, including real estate, stocks, crypto, and businesses.
- By using the trust, individuals can legally avoid capital gains, interest income, rental income, dividend income, and royalty income taxes.
- The trust provides benefits such as privacy, asset protection, avoidance of probate and inheritance taxes, and the ability to pass on wealth to future generations.
- Working with a knowledgeable CPA and law firm is crucial to ensure compliance and maximize tax savings. Irrevocable complex discretionary non-grantor spendthrift trusts can be used to save on taxes and protect assets.
- These trusts are beneficial for various individuals, including real estate investors, business owners, and independent contractors.
- By utilizing these trusts, individuals can save thousands of dollars in taxes.
- The trusts can also provide asset protection in the event of divorce or legal disputes.
- Medicare beneficiaries can use these trusts to avoid higher Medicare costs.
- Individuals have control over who the beneficiaries of the trust are and can make changes as needed.
- There are resources available, including books and articles, for further information on these trusts.
Hello and welcome to Matt Chambers Connects, a podcast hosted by Matt Chambers. This is the podcast that transcends boundaries, empowers cross-cultural connections and fosters a more connected world. I'm your host, matt Chambers, and I invite you to join us on this quest to expand our understanding and build bridges between my two favorite places on the planet Latin America and the United States. I've been traveling, living and doing business in Latin America for nearly two decades.
Speaker 2:So how are you doing Everything? Good?
Speaker 3:Everything's great. Thank you for your patience.
Speaker 2:All right, sally Guymon, so you're a financial expert who helps Americans save big on taxes and protect their assets using the powerful spin thrift thrust the same thrust that's used by the Rockefellers and many US presidents. If I'm accurate in my study on that, you specialize in mainly showing 1099 earners and business owners how to slash their federal taxes by 70% using this trust.
Speaker 3:Actually 90% to 95%.
Speaker 2:Wow, okay. And this helps investors legally avoid capital gains interest and rental income taxes, and you've recently saved business owners hundreds of thousands in capital gains. And you are here on my show to show people how they can protect their wealth, stay private and avoid lawsuits. So, sally, welcome to the show. I really appreciate you coming.
Speaker 3:Thank you for having me, matt. I want to get this out to as many people as possible, because it's not taught in schools.
Speaker 2:Perfect, that's what we're here to do. I can't wait. You know I've been reading up on trust for quite a long time. In fact, just recently I was having a long conversation with my mother about getting her house over into a trust and some other stuff over into a trust, and we went through that for about a week and she's not really paying much attention. You know I'm her son, so she's kind of like eh, whatever, what does he know? Right, she got half those attention to me and I'm like will you just do what I'm telling you to do? So why don't you do this, sally? Why don't you take us a little bit through your background? And then, what brought you to discover this trust?
Speaker 3:I appreciate that. I started real estate investing in 2018 when my mom got sick. She got septic with blood. She was on a ventilator for 13 months in a hospital for 15 months she got better, thank God. Well, in 2019, I was still working full-time as a Medicare broker Worst job in the world. People hate you. And then I also seven properties nationwide paid off $184 in debt, completely debt free.
Speaker 2:Rock started my real estate group doing fantastic so what's your real estate group right now are you?
Speaker 3:you have a real estate investment group now correct, I was in the alliance group in phoenix and now that I'm in north carolina I'm uh with an alliance group in, uh, north carolina's too. So, uh, it's Renatus. I don't know if you know the group. It's a national real estate group, okay.
Speaker 2:So it's just a pool of investors. You pull your money together and invest in specific.
Speaker 3:It's education and you know, while I was in Phoenix, my mentor, jay Tannenbaum. He had access to notes. How much do you know about real estate?
Speaker 2:Yeah, a pretty good amount.
Speaker 3:Well, in 2008, the whole countrywide got taken over by Bank of America and things got really messed up. So his specialty was taking these notes that nobody knew who they were, so we would have to do a few steps to get the property, because the property is sitting empty for years upon years. I mean, this is 2019 and this all happened back in 2008, 2009.
Speaker 2:You're talking about all the foreclosure stuff.
Speaker 3:That happened and the banks are like this is not my property. I'm like, yes, it is. This is how we did this. So I was doing bank owned properties nationwide. I mean what I? I purposely got, uh, an auction house in north carolina because that's where my mom was in the? Uh on a ventilator in north carolina after my nephew's wedding. Uh, when it, when it, when I did my 2019 taxes, my cpa calls me to say hey, congratulations, you made so much money. Your tax rate went from 22 to 24 percent. No, matt, there's seven different tax brackets, from 10 to 37. You're, the more money you make, the more you pay. It's april 2020 and I had six notes and three of my notes did not pay me on april 1st. So all of a sudden, I'm having a money crunch and now I'm finding out I had $50,000 sitting in a bank account and I'm like what do you mean? I owe $97,000 to the federal government. It was a shock to me.
Speaker 3:My CPA had me come into the office. He had paperwork for me to pay monthly. Signed the paperwork shook his hand, got my parking validated, go down to the parking garage and literally cried for 20 minutes. I mean $50,000 was going to keep me going for a few months, but I need another $29,000 and I didn't know. Nobody knew what was going to happen with COVID, my great aunt Kitty. Have you ever heard of a book called the Power of your Subconscious Mind by Joseph Murphy?
Speaker 2:I have. I've never read it, but I've read of it.
Speaker 3:It's a little bit old. The examples in the book are a little bit old, but they're really true. My great aunt Kitty in Ireland always said sleep on it. Whenever you have a problem, sleep on it. Well, that's what I did. Next morning I wake up and I get on the computer because I had read an article on the Rockefeller Spendthrift trust. It's called the office. It's seven generations old and has almost 400 people under the same ein number, employee identification number, the tax the office is the name of their trust correct office, correct, and I spent five months, you know, researching it, calling different people.
Speaker 3:Uh, kind of a funny story. I called this law firm because I I followed, you know, followed the breadcrumbs. They said we don't, we don't deal with it. And I don't know about you, matt, but when someone calls you from a number that's on your phone, do you pick up? Usually I don't. I'm like, if they want to leave me a message, I'll get it.
Speaker 2:Well, it was a.
Speaker 3:California, the California number. I was doing some real estate in California. I pick it up and the gentleman is a representative from the law firm. He says I understand you're looking at the Spendthrift Trust. So we had a conversation. I started both my business and my beneficial Spendthrift Trust in September of 2020. And then I talked to Ron and said I would like to teach this in my real estate group because if I'm saving capital gains, other people should find out about this. So I became an affiliate of Ron's and, kind of a sad story, last november, november 2023, he died unexpectedly and the law firm's, like you're stealing so many trusts. We, we want you to become a direct affiliate of the law firm. Um, when you look?
Speaker 3:at the law firm. When you look them up, they're accident attorneys. They don't want people to know how do I say this nicely? I get to deal with everyone who's questioning it or you people's hands, and then, when they want to get the trust, they walk them through the process and do all the paperwork.
Speaker 3:Exactly. And the neat thing, you know that I work with the Benson Financial Trust. Paul Benson was a Harvard law professor. 76 years ago he wrote five different trusts to save five very specific taxes. The law firm will give you a certification saying, if you get questioned by the irs, they'll defend you free of charge. In 76 years, it's only happened once and that's what they did. I mean that. That you know. It's an amazing thing. I I filed 2020 taxes, 21, 22 and 23 taxes, no problems whatsoever, and both in 2022 and 2023, I saved 92% on my federal income taxes and didn't pay any North Carolina state income taxes. And I can't tell you how much I've saved. I've saved six figures in real estate so far. It's just been amazing.
Speaker 2:So what I'm hearing is you made your real estate investments either through your personal name or through corporations or LLCs prior to this trust and you owed taxes from that. But now that you are setting these, I assume you're setting each investment up under this trust separately, right? So each property would have a trust.
Speaker 3:Actually no, it's all under the same trust.
Speaker 2:So it's one trust. You could have 100 properties under the same trust. So it's one trust. You could have a hundred properties under the same trust.
Speaker 3:Correct. I did in January of 2024. I have my trust at Wells Fargo because I have family all over the world. In January 2024, my banker at Wells Fargo we set up different bank accounts because I knew one of my notes was not paying me on time and I had to have proof to be able to foreclose on them. I foreclosed in June of 2024 and I now have seller financing on the house. People moved into the house in Cleveland. They paid me $20,000 down payment. They're paying me $1,200 a month and in in two years they either get their own loan or they pay me another $20,000. It's an amazing thing.
Speaker 2:So you're suggesting that, basically, anyone who's buying investment properties put their investment under this Spendthrift Trust and that's all they have to do to save all these taxes. Exactly, and that's all they have to do to save all these taxes.
Speaker 3:Exactly. Just to give you an idea if you fix and flip or you wholesale a house for $50,000, at 22% you're going to save $11,000. At 24% you're going to save $12,000. I mean, I wholesaled seven properties in one year. Think of how much money I could have saved if I had, you know, $97,000 in short-term capital gains. That's a lot of money that I had to give to the government.
Speaker 2:So if it's a $100,000 house and the short-term cap gains on that right, if you buy it in January and you flip it in March, that's short-term caps because you're less than a year. What would the income taxes be on that? I guess it would depend on what that particular person made that year, right? She gets charged on based on what that person made. It's regular income, right? So let's say he's in the 25 tax bracket, he's paying 25 grand. What you're saying is, if that's under a trust, what's he going to end up paying roughly?
Speaker 2:he won't have to pay that you won't have to pay at all at all ever when, ever, even when you flip it like if you, if you, why is that like, how does it? How do you?
Speaker 3:it's in tax code 643b like bravo. So this house I'm telling you about in cleveland, ohio, uh, in june, when I got the new people in there, you'll, and they pay me twenty thousand dollars. The house is worth about two hundred thousand dollars. That's what they're going to pay me, june of 2026. All of that money is interest income taxes. That's not capital gains, it's, it's a interest income taxes. I don't pay any taxes on that when they, when they purchase the house in two years, hopefully or they move out, whatever they do, all the money I make on that house again is interest income taxes and I just don't pay the taxes and I reinvest it into more real estate. I don't want to crow, but my little empire is growing and growing and growing.
Speaker 2:Absolutely. I bet it is, I mean, if you're saying it. So now, what about the money you make on cash flow? Is that also underneath the trust and you don't pay income tax?
Speaker 3:Correct. So the entire house in cleveland. All of that is interest income taxes because we have a very, because we have what's called a seller financing contract on it. The seller financing contract says sally gimmen, doing, doing uh, business as, and it's got the name of my spendthrift trust and they're paying the spendthrift trust bank account that's where their money goes, every single month.
Speaker 2:So you're avoiding not only capital gains, but you're also avoiding ordinary income tax on the monthly cash flow, exactly Essentially, if you have an investment property. You're telling me if you have an investment property under this Spendthrift Trust, you don't pay any tax, your taxes are null and void Gone.
Speaker 3:You're going to pay property taxes I can't take those away from you but your rental income taxes. What I'm dealing with with seller financing, that's interest income taxes. All of that's taken care of. The beneficial trust. There's two separate trusts. The beneficial trust saves you five taxes Short-term and long-term capital gains, interest income taxes, dividend income taxes, rental income taxes and royalty income taxes.
Speaker 3:I you know one of my clients two clients, he and I are in the same real estate group. He was going to wholesale five houses in 2020, uh, 2023, get on a zoom with him and his wife. His wife is an artist. Um, I was telling her about one of my clients who's an nft artist who has a trust. I introduced the two of them to set uh, no, thanksgiving of 2023, the saturday of thanksgiving. She took one of her pictures. She got professionally done, made it into nft, she did one of 100 of those and because it's royalty income taxes, she got to save all that money. So they're in competition. The husband and wife are in competition. How many houses can he wholesale? How many pictures can she? How many NFTs can she do? And they're saving so much in taxes. Young family their house is paid for their two cars are paid for. The kids are in private school. They're going to leave a legacy for their children. There's no inheritance tax. I mean it goes from generation to generation. It's an amazing thing.
Speaker 2:Wow, and so what I understood in our conversation the other day is that you can also put it's not just real estate right that you can put under this.
Speaker 3:Correct, correct. So I had a conversation literally on Thursday a financial advisor. He works with his clients who are in the stock market. He tells them stocks to buy. There's a little bit of paperwork to be done. You need to get a medallion paperwork from the bank and then they have to change the stock certificate. But his clients are now going to start saving. You know, depending on what their tax brackets are, they're going to start saving all the dividend income taxes. Uh, crypto investors. The only time a crypto investor has to pay tax is when they sell the crypto at a profit. If they're holding it in a wallet or they're holding it on a site, they don't have to worry about that.
Speaker 3:One of my biggest group of people that I have are independent day traders. They're killing on TikTok. They're killing it. Some of the day traders are making so much money and then they're saving it. And then real estate agents that's that's slowed down. That has slowed down with the market. Right now I probably have about 36 real estate agents who make over a million dollars a year in 1099 income earners and now they're saving that money.
Speaker 2:Wait. So they're putting, you're saying that they, these are real estate agents that don't have an actual corporation or llc setup. They're just strictly self-employed, um under their own personal name. And then all of a sudden you put that particular business under the trust. So if Matt Chambers real estate agent paying taxes as a self-employed person, I would just come to you, put my 1099 Matt Chambers under the Spendthrift Trust and now I don't pay anything.
Speaker 3:You're not going to pay federal income taxes and in 43 states you won't pay state income taxes. Well, let me excuse me. I want to say this correctly You're not going to pay between 90 to 95%. We don't the law firm and the CPAs we work with. We introduce you to the CPA. We don't want you to get in trouble with the IRS. So in 2022 and 2023, I saved 92 percent in federal income taxes. I was happy to pay eight percent. I mean, that's, that's almost nothing.
Speaker 2:Absolutely. You'll just give them nine quarters and say here, take it Right, wrap your change and mail it in almost nothing, absolutely.
Speaker 3:You'll just give them nine quarters and say here, take it right wrap your change and mail it in exactly and you'll um, I don't know if you follow uh, suzy, or but she says when you, when you sign the check saying you're paying your taxes, you're like I'm happy to pay this money. I'm like, oh yeah, I'm I'm very happy paying eight percent so let me ask you if can this be done retroactively?
Speaker 2:so if you have an investor that owns 10 properties under his regular name or under an LLC, whatever it's under, can he go back and all of a sudden put it under a spendthrift trust and then, going forward, not pay?
Speaker 3:Go forward. Yes, so let's say you have ABC LLC and you've got two properties, one in South Carolina and one in Georgia. You will have to do a bill of sale. It's actually two bill of sales. One bill of sale says from ABC LLC, I'm moving 123 Main Street to my name or Matt Chambers' name. And then the second bill of sale would be from Matt Chambers' name to XYZ Spendthrift Trust. You will get them notarized, go to the bank. Um, you will have to do um consideration. There's no amount of consideration, that is. You know it doesn't say what consideration, but some, some form of money has to exchange hands. So when I did my first property that I did the auction house, I, I had $10. I handed it to the banker, he put it into his notary book and then he handed it back to me. On the second bill of sale, my first property, I'm in Phoenix, arizona. The property's in Nash County, north Carolina, rocky Mount, north Carolina. The two bill of sales get notarized. I go back, I scan the two bill of sales to the attorney in Raleigh.
Speaker 3:The next day the attorney in Raleigh asked me for the first page of the trust. I sent that to him, changed all the paperwork. If you're two houses, you're going to have to change the title on the house. There's a little bit of a next step on that. But change the title from the LLC's name to the trust's name and that might take a little bit of time. Another thing that might take a little bit of time. Another thing that might take a little bit of time. When I started with my um trust I had six notes. It did take two months because the servicer had to send letters to the people who were paying their more. A note is I own the paper. People pay me their mortgage. The servicer had to document what was happening. The bank account was changing. So it did take a little bit of time, but I was okay with that. I mean, I'm tax, I'm very good with that.
Speaker 2:For sure, for sure, absolutely. So this is incredible, this is absolutely incredible.
Speaker 3:It's an amazing thing. People don't believe in it and I'm like honest to God. The Rockefellers have been saving taxes forever. If they can do it, why can't we do it? That's my question absolutely.
Speaker 2:And so, yeah, no. And I happen to know that very small percentage of americans know about trusts in general a very small percentage. And you know, I I've studied this quite a lot and I know that there are many trusts out there where people can put their house in a trust and relinquish control completely. Well, no, not relinquish control. They can relinquish ownership and go ahead and give that ownership to their children or whatever they want to do, but they still maintain control, even if they only own 1% of it. And then when they die, their kids pay no estate taxes, right? Whereas in most states, or in a lot of states, if you die and that's in your personal name, your kids would end up paying a significant amount in estate tax.
Speaker 3:And these trusts I do happen to know that those trusts of you know 97% of the trusts sold in the United States are exactly what my mom and dad had and what Suzy Orman talks about on PBS television the family trust. It's usually about $1,000. It's a grand tour. So my mom and dad were both on the trust. Unfortunately, my mom passed away first, then my dad. All the assets were in there. I sold my dad's car and then the trust dissolves and all the assets are split there. I sold my dad's car you know things like this and then the trust dissolves and all the assets are split between my two brothers and I and the trust is over with that's all it does.
Speaker 3:This trust avoids uh, avoids probate, avoids inheritance tax. And then the four ways it saves you is taxes. Year after year, generation after generation keeps your information private. We ask we don't mandate it, but we ask people to shut down their LLCs and S-Corps because that's statutory law and 40% of all LLCs get sued every year. We want you to have a titanium vault for your assets where nobody can get a hold of them, but again, we're not going to follow up with you and say have you shut down that LLC? That's your decision. Old lawsuits become frivolous and go away. And then the fourth one have you heard about the 2024 Corporate Transparency Act from the Treasury Department?
Speaker 2:I haven't. No.
Speaker 3:This is ugly. People don't know about this. If you're an LLC doing business as an S Corp or corporation, you have to fill out paperwork for the Treasury Department. The department is called FinTech. If you don't do it by December 31st 2024, you could be fined $10,000 and or two years in jail. And people aren't even talking about it. It's scary. It's not hard to do, but one of my clients in California had 44 properties and 44 LLCs. He'd have to do that paperwork 44 times one for each one of his LLCs. He's like that was a headache. You just saved me. I'm like no, it's a total nightmare.
Speaker 2:And the beauty is you set this thing up one time and you put all 44 houses underneath the one trust and you pay no taxes on either any of the 44 exactly.
Speaker 3:So he's got renters in there, uh, he's gonna save rent the. He can do depreciation, he can do cost, uh, cost averaging whatever he's doing.
Speaker 2:But so you still get all your typical write-offs anyway, depreciation, all that exactly, or or if you don't, you'll cost averaging.
Speaker 3:I I know somebody who does cost averaging. He charges twelve thousand dollars, twelve hundred dollars, to do the report. Save it, don't, don't even bother doing cost averaging. You'll pay that twelve hundred dollars. Just save it because your, your rental, rental income taxes are going through that. So one of my clients came from a financial advisor she she was. She was going to sell her apartment building. She had depreciated it for 27 and a half years. That's how you normally depreciate something.
Speaker 3:And she's like I've got to sell this. I want to save the capital gains. I'm like why sell the apartment building? Just have all the rental income. Go through the trust and say I'm going to be honest. She's at 37% tax rate because she's a big investor. She's like that's amazing, I don't have to sell now. I can continue making this income off her apartment building and she's just like she loves it. Her financial advisor is like I have a JV agreement and he made a commission on selling her the trust.
Speaker 2:Incredible. So I think I already know the answer to this. I just want to confirm If I own an LLC. I just want anyone who's listening and for myself to confirm If I own an LLC with, let's say, I have one property under one LLC, that's a business. Anything I do for that business. If I go take a client, take the renter to lunch, that's a write-off, right? The gas that I spent to get there or the mileage that I spent to get there and take him to lunch is a write-off. There's all these write-offs that a business owner has that a regular W-2 employee wouldn't have, right? You're saying I still get all those write-offs. So basically nothing changes except for the fact that I end up saving 90% more on taxes.
Speaker 3:Exactly so. Just to give you an idea, there's two different trusts. There's the business trust for business owners, franchisee owners, entrepreneurs and 1099 income earners. They're going to save at least 90% on their federal income taxes and 43 states no longer pay state income taxes. The beneficial trust is going to save you capital gains, interest income, dividend income, rental income and royalty income taxes.
Speaker 2:So the business owner, the guy that owns a retail store John's Furniture, mart right, that's paying. You know, whatever he's paying in taxes, 20%. Let's say, if he puts his business under this, trust's not, he's going to save 90, correct?
Speaker 3:I'll give you an example. Two story my favorite, my favorite new york style pizzeria here. That uh, february 2023. I took my friend ingrid door knocking in her neighborhood. They have the best white pizza. I don't know if you like new york style pizza we show up about I do, but it makes me really fat and I try to avoid it.
Speaker 3:You'll love this story. So we get there about two o'clock, we order the pizza. It's very quiet, it's between lunch and dinner, we're talking, mario the owner is listening to us and as we get up to leave, he's like Sally, can I have your business card? A week later, he and his wife. I met them at the pizzeria two locations in the Charlotte area. They're making about $15,000 gross per month. Before any deductibles or anything else. They are just doing their 2022 taxes $15,000 gross with the Spendthrift Trust. They're going to save $34,935 with the two locations, based on $15,000 a month. $180,000 a year, yeah, $180,935 with the two locations.
Speaker 2:Based on $15,000 a month $180,000 a year. Yeah, $180,000,. Yeah, they're going to save $34,000.
Speaker 3:Not working harder, not working longer, not working smarter, just with what they're doing right now.
Speaker 2:That's insane With $34,000, you can literally put 20% down on a $150,000, $200,000 house.
Speaker 3:Exactly Well. You can pay off your mortgage, buy a new car, take the family on vacation.
Speaker 2:Reinvest it.
Speaker 3:Reinvest it. So what Mario and Marianne are doing they opened a third location closer to my house. I can't go in there. They give me cookies, they give me pizza. I mean, talk about getting fat. So they use that money to open a third location. So they're making more than $180,000 now, 2025, they're going to open a fourth location when they retire in 3036, they leave two pizzerias to one grown child, two pizzerias to another grown child, no inheritance tax, and then they continue to save 1099 income. I mean it's an amazing thing. It just goes on and on and on. And you know I'm not anti-american, this is in the irs tax code.
Speaker 2:I mean they write it in there on purpose, right? I mean it's there. It's there for the elites to, because they know that you know only one percent of people are going to dig in there and figure out this tax stuff anyway. Yes, even even a basic level. Forget the trust. Even on a basic level, people, even successful entrepreneurs, don't typically do anything other than send all their bank statements to their accountant and let their accountant write off what they will and then tell them what they owe, without that entrepreneur ever really digging in and figuring out where he can save more. I think it's because we just have this attitude that if you have a CPA degree, a CPA is a CPA. That's kind of the mindset and it's absolutely not true, right? I mean, that's why big entrepreneurs pay tens of thousands of dollars every year and much more for their accountants, because there's levels of this thing, right. There's the CPA that just does mom and pops in small towns and there's CPAs that are covering real estate developers in New York City.
Speaker 3:Correct.
Speaker 2:There's a different level there.
Speaker 3:And the sad thing, I'm not making fun of CPAs, but CPAs aren't trust attorneys. They go to graduate school. Get their CPA A textbook. There are a million attorneys in the United States. Only 4% are trust attorneys. A textbook that trust attorneys study is called Scott and Asher on Trust, 5th Edition.
Speaker 3:And you know I'm not making fun fun of cpas. But in my real estate group we have a cpa who taught who's in education. He has an office in phoenix the gentleman who ran the phoenix uh real estate group. I was in he and I made a presentation to this cpa. He sat there. We gave him examples, everything else he's like thank for coming. I'm not interested because he makes money on selling the LLC, the S-Corp, filing the K-1s. You know, and you know true story.
Speaker 3:In April 2023 here in Charlotte area, it was multifamily association and I bought a ticket. I went to lunch with a bunch of with. There were six of us at lunch. You know we we discussed things. One of of the gentlemen from lunch he went back up to long island. He was supposed. He got on my calendar. We get on the zoom because my cpa says you're lying, I don't want to talk to you, and he just got off the zoom, the other five people at lunch. All we all are working together and their clients are saving thousands of dollars. I mean, it's you know.
Speaker 2:Well, so let me, let me ask you this to that point, because there's obviously going to be a lot of people, kind of like the ones we just talked about, that are never going to look into this stuff deeply. They're just going to say this lady's crazy, there's no way Right, there's no for sure. So for those people that hear this and say, well, I think she's wrong or I think she's lying, but I'd like to at least confirm it, who do they go to to confirm that what you and your law firm are saying is true?
Speaker 3:Black's Law Dictionary which most attorneys have. You can look up the Spendthrift Trust there Some famous people who've had the Spendthrift Trust. I hate to tell this story but you remember OJ Simpson right? I did for sure okay, he was acquitted, killing his wife and ron goldman. Yeah, the goldman family sued oj simpson the man for 135 million dollars. He had the trust that lawsuit frivolous, and not a penny was paid.
Speaker 2:Oj because they just can't pierce that trust.
Speaker 3:Huh correct because he doesn that trust because he doesn't own it he doesn't own it.
Speaker 3:His football career, his commercials, his movies, everything else everything gets paid to the trust exactly several years later, the man, oj, breaks into a Las Vegas hotel room and he goes to jail. Not his trust, none of his assets are touched. He serves his time. He gets out. Trust None of his assets are touched, he serves his time. He gets out of jail and all his assets are still there and he can do whatever he wants. Exactly, I mean, it's a bad example because he's a I don't want to say he's a murderer, he was acquitted, but you know, this is how the trust saves people money.
Speaker 2:Another example what about divorce? I kind of sad divorce, what about?
Speaker 3:divorce. I kind of want to know about that. Sorry I interrupted. You. Go ahead, go ahead through your thought there and then let's go back to divorce. When you're finished we'll circle back. I'll do the divorce. My real estate group, um, my friend katrina. She has four airbnbs. They have two grown, two adult sons who are artistic. Her and her husband met in the air force. She caught her husband cheating bad thing to do. So katrina goes I want, I want to set this up. She puts her four airbnbs into the trust and half of the house she owns and her vehicle into the trust. Her husband's like well, I want part, I want a half of everything you own. She's like no, no, no, you get half of the house, you get your car and then both of us pay for our grown sons.
Speaker 2:I mean, I'm not saying this is the way you should do divorce so she did this right before she left, like that's when she knew she was leaving.
Speaker 3:She put it, moved it over exactly and then he couldn't get her in court sally, I need to do this and I'm not saying people should do that, but I have some clients doing doing that because one of my clients that I'm working with, um, now I'm working with the uh, the sports agent. Her son is a triple a baseball uh pitcher. He's getting a signing bonus from one of the big teams and she's just like not that I don't want to say this, but baby, baby mommies are going to come after him. I want his signing bonus in this trust. Well, when his sports agent found out about this, he's just like my other. My other athletes need to have this too, and if anything should happen that instead of you know right now I'm not married and I don't have any kids.
Speaker 3:I have seven nieces and nephews. If I decide, I'm leaving all my money to one nephew and only 10 to the other. Um, six nieces and nephews. They can't contest the will, they can't do any infighting, even from the grave. I can tell people how to do that You're controlling them.
Speaker 3:Yeah, exactly, exactly.
Speaker 2:Incredible. So do you have any other literature? You named the book. Any other literature, anything on this? If someone wanted it, I mean, I'm sure it's buried deeply because the IRS obviously doesn't want people to know that this stuff's out there.
Speaker 3:The true story. If you Google IRS Tax Code 643B, you will find an opinion letter from the IRS dated September 11, 2018. It's an opinion letter because the IRS cannot change the tax code. Only Congress can change the tax code. So another book it's now called what the billionaires do by garrett gunderson. It's about rockefeller's trust and they also use insurance and everything else to do uh, how they do things there. There's that book for infinite banking. I would be be um, be your own banker by um nelson nash. It's it, nash. I hate to say it. It's the best kept secret of the rich.
Speaker 2:And the reality is like Congress isn't changing any of that, right? I mean, because it's all their buddies that are using it. That's why it's set up that way, and they don't want regular Joe to know about that. So unless this gets out there and you know out there on a big, big scale, where it starts affecting their wallets more and they're forced to rewrite it or something, it is contract law. Yeah, they're not going to change that right.
Speaker 3:So if they change the law, my contract is between me and the law firm, so Congress can't break my trust with the law firm. Maybe I won't be able to say save taxes afterwards, but at least I'm saving taxes. Now I just wholesale the house, you know, I mean I, I made I say because I do everything at 24 I saved 20, 24 000 dollars in short-term capital gains on the house. I just wholesaled in August.
Speaker 2:That was in July, that $24,000, you buy a brand new house.
Speaker 3:The $24,000 goes into another real estate deal, or now it's into two different tax lanes and I'll make money off those tax lanes when I wholesale them.
Speaker 2:So here's can I buy using leverage underneath this trust? So if I pay $100,000 grand down by a half a million dollar house and 400 of that's on leverage, can I put it under the trust while it's under leverage?
Speaker 3:Yes, so there is a due on clause thing in a mortgage contract. I can't control that, but, being a real estate investor since 2018, I've only heard once that ever came due. The person was late, so there was a reason behind it. So my beneficial trust I make more money in my beneficial trust than I do in my business trust. My beneficial trust pays for my homeowner's insurance, pays for my electricity, pays for my water, pays for my garbage pickup. Pays for my homeowner's insurance. Pays for my auto insurance I did have to get the title go to the DMV, change the title over on my car. Pays for my gasoline. Pays for I had to get my windshield replaced because a rock shattered the windshield. The trust pays for that. The only thing I'm going to get into the weeds on this, so I have to apologize the only thing that a trust doesn't pay for is your personal food, fun and fashion.
Speaker 3:Well, I'm with Wells Fargo. I have a red debit card for the Beneficial Trust, a blue debit card for the Business Trust. So when I go get an oil change, I'll be honest, I go to Walmart so I pay for the oil change with the red debit card and I pay for my food with the blue debit card. The kid at the counter not making fun of him, but if he's 20, he was old he's like you're Nemo. I'm like okay, I'm Nemo, red pill, blue pill, but I'm saving so much money doing that.
Speaker 2:So how do you manage those bank accounts? If you have all this money coming to the trust but you also need some of it personally, do you have to transfer from the trust to the other bank account? I assume so and keep those accounts completely separate? Actually, that sounds like that's what you're doing, right.
Speaker 3:Correct. Here's a funny story September of 2023. This is my 2020, 23 taxes. I do a thing called upset bids here in North Carolina. It's a weird thing in North Carolina, but I go to five different counties. I stop at QT, get gas run in to use the bathroom, come out in my favorite cake donut with chocolate icing and jimmies on top of it. I don't need a damn donut. I don't have the right debit card with me. Because I'm doing real estate, I pay for this stupid $2 donut and I put it into my. I use an Excel spreadsheet. I send this all to my CPA. He's like you're really claiming $2 off of your 2015 car. I'm like, yes, I'm claiming because I'm doing a demand letter for $2. He's just like I've never seen someone do that before. I'm like I'm cheap.
Speaker 2:I want to get paid back for eating a donut.
Speaker 3:So you wanted to save the 48 cents. 24 exactly exactly. And my cpa, who's in california, he's just like I can't believe you're doing that.
Speaker 2:I'm like, if I can do it, I'll do it so, with all these different trusts, let's say I'm a 1099 sales person um, right. And then let's say I also have, separately, real estate investments Right, those are all under separate corporations or or just completely separate. Would I need two different trusts? Do I need the 1099 trust and then the Unfortunately, yes, yes. So you need two different.
Speaker 3:Correct. So there's a I don't want to say a line in the sand, but there's a hard line. The business trust saves federal income taxes and state income taxes. The beneficial trust saves the capital gains, interest income, dividend income, rental income and royalty income taxes. The senior trust is for someone who's over 65 and making too much money. I used to be a Medicare broker so I know a little bit about this. If you make more than $91,000, you have to pay completely for Part B of your Medicare. I usually, if the person's how do I say this? I only have sold two senior trusts because it's a blind trust. So if someone's older than 65 but have their facilities, I suggest not to have it Every October. The IRS. If you're on Medicare every October, the IRS goes back two years. So October 2023, you went back to 2021 to see if someone made more than $91,000 and then they would back tax how much you owe for your Medicare. With the trust any trust you get you're going to file a 1041 tax return so it won't affect what's happening with medicare.
Speaker 3:One one of my real estate buddies this is a sad story, true story. He went to a church picnic. I don't know if someone didn't wash their hands or if it got too hot. He ate three double eggs and he got kidney disease. He's got he's, he's on dialysis, uh, three or four times a week. He, he, you know, he's 34 years old, he's got dial, he's got kidney problems. They're looking at his social security number to do the dialysis, all his real estates in the trust, and they don't know he's got all this real estate he's doing and he's like it's fourteen hundred dollars, fourteen hundred dollars a month for his dialysis and he's just like like I'll let Medicare pay for it and people are saving thousands of dollars doing things like that.
Speaker 2:Wow. And so going back to divorce and I'm interested in this because I assume someday there might be a chance I mean, this will certainly open people like me up who are a little bit scared of getting married right For this reason. So if I wanted to go ahead now and put all my assets, everything I own, in these trusts, I think I already know the answer to this. I think it's a rhetorical question, but anyway, if I go ahead and put all my assets in now, this girl is not even going to know that they're under the trust. She's just going to think well, matt Chambers owns all these things. And then, if we were to get divorced two years from now and she tries to take him, well, matt doesn't own those things, he's trustless.
Speaker 2:This is great.
Speaker 3:And then you can decide. You know this is a true question we had. One of my clients has four apartment buildings. One of his children married we call her suzy the floozy. They had two kids. They got divorced. Well, suzy the floozy's not a beneficiary, but the two grandchildren, who are like seven and eleven, are, uh, beneficiaries of the trust. So even their mom can't get the money. But the money if something happens to their dad, the, the son of the people in have the apartment buildings. They have something worked out because they don't want the ex-wife to get hold of the assets, if that makes sense.
Speaker 2:This is incredible stuff, incredible stuff. You just made me much more relaxed with possibly getting married. Just saved my life, susie, thank you.
Speaker 3:You can decide who is a beneficiary and then you can also decide hey, this person's a beneficiary, it's September 5th 2024. They're no longer a beneficiary, so they can't get money after that date.
Speaker 2:Just change it whenever you want.
Speaker 3:Exactly, you're in charge of that.
Speaker 2:So how long has this thing been around? A long time, if it's in the tax code right could right.
Speaker 3:Here's true story. It started way back when king henry the eighth, the famous king who chopped off his wife's heads. He started the church of england. He went to go tax the lords and ladies of england and they went back to the magna carta in the 13th century. They said no, no, no, king henry the eighth, you can't do this. It's contract law that came to the colonies while we were still part of england. The law firm I work on behalf of the benson financial trust inherited trust that in 2023, turned 350 years old. They weren't saving federal taxes because it wasn't then at that time, but they're keeping all the assets in the trust so it doesn't have to get broken up. I mean, it's, it's contract law. It's an amazing thing. Our tax code went into effect February of 1913. It was only supposed to be around for a few years. It's 111 years old. I mean, a few years is not a few years.
Speaker 2:And save 90% on taxes Absolutely insane. So if I started a 10, I mean, I know the answer to this, but I'm just rehashing it so if I started a new 1099 business today, right, and I didn't, you know, there's quite an investment to get this trust started. So if I'm making zero, I probably wouldn't want to invest in that trust because at this point I'm making zero. But let's say, well, let's say I start at January 1, 2020, just to make it easy. But if I start at January 1 of 2025 and I'm making zero, but by November I realize, oh man, I'm going to make like $100,000 this year, first year.
Speaker 2:Pretty decent for a brand new business. We'll make $100,000. I file my taxes like I normally would. I'm going to pay 20, let's say 25, 35%, whatever that number is. So 35%, right. I'm going to pay 35 grand. If I decide in October that, okay, I'm going to make this 100 grand, I want to buy this trust. So it would be worth it for me to go ahead and spend the money investing in the trust and I'm going to save 90% of that $35,000 in that same year, right?
Speaker 2:Unfortunately no Okay so it's going to be going forward.
Speaker 3:The day you start the trust. Let's say, you start the trust October 14, 2024.
Speaker 3:You will save taxes from October 14, 2024 forward. I'm trying to go back. I'm trying to quietly go back through my notes story husband, wife. In texas she's a stay-at-home mom. Two young actually three young kids. One kids in school. Two kids are still at home. Husband's making 75 000 a year. They're at 12 tax bracket. She started digital marketing and in the first five months of 2020, uh 2024, she made over a hundred thousand dollars. She raised her taxes from 12 to 22 and I can't help her with this. But they start the trust because if she continues doing what she's doing, you know I I wish her well, but she makes another hundred thousand dollars you know exactly, you know and things.
Speaker 3:And she's just like if I save all this money, can I have my, my husband, quit work and I'm like you can do whatever you want with the money. This is your money to do with what you want and no one's gonna tell you and what we figured out.
Speaker 3:You know, going forward for the next six months, if she makes another hundred thousand dollars, she's gonna save about ten thousand three hundred and eighty five dollars. You know because she going to have to pay the taxes which she already has. But it's an amazing thing. Another client I'm working with. She's in Georgia, an insurance agent. Husband's working W-2 income. She's at 1099 income. We're taking her $100,000 business out of the personal taxes. They're still going to be at 24% because the husband's making so much money. But we're gonna save them over $22,000 a year because their their personal taxes drop down. Then she's gonna save about $90,000 on her 1099 income.
Speaker 3:And you know the husband's looking at this. He's like why am I still working? I'll help you with your insurance company. I'm like that's your decision. You know the husband's looking at this. He's like why am I still working? I'll help you with your insurance company. I'm like that's your decision, you know, but exactly, people are finding out and you know she's been an insurance agent for three years so she's getting residuals and she's selling more things and, you know, saving thousands of dollars. I mean one of my clients, the real estate agent down texas. They're doing the birth strategy. I don't know if you know the buy, rehab, resell, everything else. His wife is a um, a vietnam, vietnamese vote person who came over with you know, when she was six years old. They have a charity started to help people who are immigrants with nothing on them, get them into the houses, get them into a job and just doing charities. I mean my clients are making some incredible charity work because they're saving so much money.
Speaker 2:Wow, that's insane. So you've got my mind blown. I mean, and I happen to know quite a bit about these trusts prior to talking to you, but I didn't know every single detail, correct. It's incredible, incredible stuff.
Speaker 3:That's why I have a free class, if you don't mind me plugging myself.
Speaker 2:Yeah, yeah, no please.
Speaker 3:My free class is my name wwwsallygimmoncom. It's on the Great Discovery. It's a 23-minute presentation. There's three articles from Forbes magazine. You were talking about books and things. These three articles were written by the same gentleman in Forbes talking about the Spendthrift Trust. One's about capital gains, one's about saving 1099 income and one's about saving your assets. There's two pages of case law. So if you are curious and want to go, if you're near a law library, you can research it. There's a chart showing there's four ways to file your taxes single, head of household, married jointly, married separately. Single is the most expensive way. So if you're making eighty thousand dollars gross in any state in the united states, how much you would save per state? You know seven states don't have state income taxes but you're still saving over eleven thousand seven hundred dollars a year. In Tennessee, Nevada, Texas and Florida you make more than $80,000,. You're going to save more than that and you know, year after year, generation after generation.
Speaker 3:And one of the things, matt, someone said to me like oh, I don't pay my taxes until April. I'm like, you're paying taxes every single week, every single month. I mean it's just hey, you're at 2023 taxes, but you start saving taxes today.
Speaker 2:And I think you already answered this but there's no limit on this right. So if you set this up one time, you're not renewing it every year or every 10 years, it's just there. No nothing to pay. After you pay and send it, you get it all set up one time. You don't pay anything.
Speaker 3:Exactly there and you get it all set up one time. You don't pay anything. Exactly, there's a whole Anna Maria has a team that is there to answer your questions, walk you through things.
Speaker 2:Anna Maria is the accountant right in CPA.
Speaker 3:She's not the CPA, she's actually a trust holder. But there's a whole team that walks you through things, answer your questions. Supposedly she works with you for a year. Most of my clients clients after two months, like my questions are answered you'll and you'll just send a message. I'm in the I I just ordered my car but uh, the car I had when I registered in uh in uh, north carolina. I changed the title and then when I went to the car dealership I I paid cash. You know like I took money from my trust. I'm paying cash for it. It's in the trust name I I don't have to go to the DMV or anything like that. And I mean the guy's like, why are you doing this? I'm like because I can. And I didn't realize a lot of car salesmen are no longer 1099 income earners.
Speaker 2:He's the son of the owner of the dealership and he's just like they're looking at starting the trust for themselves. This is amazing information. I really really appreciate you coming on before we go. Is there anything at all that I missed that we should cover?
Speaker 3:it's in the IRS tax code. I'll just give you the full name for it it's Irrevocable, complex, discretionary, non-grantor Spendthrift Trust the two main ways it's different from what the family trust is. The family trust is a grantor trust. My mom and dad granted it or started the trust, and it's revocable, so that's why it canceled out when my father passed away. And then you know, it's just. I want to teach this to people. If people don't believe it, fine, but if people, if people want to find out more information, I'm here to answer that answer that information.
Speaker 2:Your email is on your website, I assume, where they can reach out about your course and all this other stuff that you're doing okay and again sally on the great discovery.
Speaker 3:I I just you know you can watch the 23 minute presentation. I have two different um ones, real estate and one's uh examples anywhere from a pizzeria to uh, an affiliate marketer, to a chiropractor, a dentist, you know people who are saving actual money that you know these are. I just say where the state they are.
Speaker 3:I don't say what their name is or anything like that sure so people can see examples, because a truck drive that I had if you don't mind, I'm going to tell the story I get a message saying can you call this number at two o'clock tomorrow? I'm like okay, kind of a weird thing to do, so I call the number two o'clock my time, east coast time. This guy, interested like who's who, is this? I'm like my name's sally. I was told to call you from tiktok. He's like my crazy wife. Why are you calling me? I'm'm like I help people save taxes. Independent truck driver making over $253,000 a year living in Nevada. We're going to save him $56,000 a year only state income taxes and he's on his mandatory break and he's like I'm sitting here in the truck stop. I know at least six other independent truck drivers right now and I'm like you tell them.
Speaker 2:Sign them up.
Speaker 3:Yeah, I got six. My biggest group of people are day traders, and now I'm getting independent semi-truck drivers and affiliate marketers. I mean, those are the people I'm working with, so are you paying out affiliates?
Speaker 2:So if that guy brought you his other five or six people, are you just giving him a discount to help you out getting those?
Speaker 3:five or six. I have an affiliate program.
Speaker 2:Oh, you do. Oh, I didn't know that Okay.
Speaker 3:So how's that work? Yeah, so, one of the truck drivers true story. One of the truck drivers is going to pay for the trust Tuesday. What is that? September 3rd, you know? And I, you know, I contacted his name's ray. I'm like, hey, ray, uh, do you want to buy paypal again? Or and he's like, no, I don't want to buy paypal, they're taking too much. Can you send me a check? I'm like I'll send you a check, but yeah, it's, let me, let me get. I.
Speaker 2:I shut down my computer so to read just about the spendthrift. So where would we send people as an affiliate? Where would you send people to the spendthrifttrustcom or just to your website?
Speaker 3:correct. You're going to get an affiliate, a situation and you give them their link and they'll be able. It's kind of funny. I actually contacted a business broker in july saying so and so's applying and selling his business at the end of july he's like I didn't know that.
Speaker 2:And what's the affiliate commission you pay out?
Speaker 3:$1,000. Oh, wow, Okay, one of my people I'm going to be honest. He's a CPA and I do a free live every Monday on LinkedIn. One of my people who came on the live a grown adult. His mom and dad have five apartment buildings in Long Island. The kids are all over the country, they're not interested in this. He gets out. He gets out on Zoom with me, he's talking to me. Then he sends me a message saying my CPA doesn't believe in this. I said, well, here's a textbook. It's got Nashron Trust. Tell your CPA this is legal. Two weeks later, somebody makes an appointment on my calendar. I didn't realize it was a CPA. He and I are now working together and all his clients on Long Island are selling these apartment buildings and he's making money. They're saving money. I mean, it's an amazing thing.
Speaker 1:Thank you so much for joining me on this episode of Matt Chambers Connects. Stay tuned for upcoming episodes where we'll dive deeper into these two fascinating worlds. If you enjoyed today's episode, please subscribe to our YouTube channel, matt Chambers Connects. You can also find us on Spotify, apple Podcasts, youtube Music and many other major podcast platforms, so you don't miss a show. Also, please join us on our social media channels so you can connect with other listeners and ask your most pressing questions and also tell us what types of guests you'd like to see on the show. Thanks again, and I'll see you next time.