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Discussion in 'Roadster 2022' started by tstafford, Dec 19, 2017.

  1. HankLloydRight

    HankLloydRight No Roads

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    #61 HankLloydRight, Jan 19, 2019
    Last edited: Jan 19, 2019
    I'm not advocating for transparency and truth? News to me.

    I'm just trying to educate you on how the system actually works. But you continue to ignore and reject all assistance and spout out vague accusations without any proof or backup. #alternativefacts

    But I'm going to stop now and just let you continue to make yourself look like a fool.

    I'm out.
     
  2. Barnes

    Barnes Member

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    Thanks for your assistance on telling me how the system works by saying "you should just stop posting." I think a lot understand how the system works and if you cared about the company you would encourage transparency.
     
  3. Roys3

    Roys3 Member

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    Zac gets 2, Jesse gets 2 - referral program over. :)
     
  4. Roys3

    Roys3 Member

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    Ah, that would explain it - if Elon and "official Tesla" drove traffic to Slye's vids then of course the numbers would go crazy...
     
  5. Roys3

    Roys3 Member

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    No worries, there are a number of Tesla-can-do-no-wrong bullies on here. :mad:
    Just stick to your guns and don't worry about it...
    But also give Tesla its due if it fixes things...
    The referral program cancellation was a good move.
     
    • Like x 1
  6. HankLloydRight

    HankLloydRight No Roads

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    If you are referring to me, I am highly critical of Tesla in many, many areas. In fact I'm probably more critical of Tesla than I am a fan. They can do better.
     
    • Like x 1
  7. Roys3

    Roys3 Member

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    #67 Roys3, Jan 20, 2019
    Last edited: Jan 20, 2019
    No, I haven't seen enough of your posts to form any valid opinion. I do know that diehard Tesla sycophants are around though (I guess I'd be surprised if they weren't), but my experience comes mainly from other Tesla forums, and the Model 3 forum here.

    Definitely - Tesla can do better! Much.

    It's like if corporate Tesla bullies or screws up, all the little bullies come out and defend it (a bit like Trump's sycophants in that regard.)
     
    • Like x 1
  8. aikisteve

    aikisteve Member

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    It all depends on how exactly Tesla does the paperwork on those free cars. If fully taxable as personal income, then in Belgium that means ending up in the 52% tak bracket and a free Roadster will set me back €150k (as that's what it's likely going to cost over here). I hope there is some legal way around this to make it cheaper... Otherwise you're better off buying one at 98%, because then it's not a gift, since you still bought the car.
     
  9. HankLloydRight

    HankLloydRight No Roads

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    Not really. My quoted comment above was for US residents or taxable entities. It really doesn't matter how Tesla "does the paperwork." Receiving a 2% discount or 100% discount off the car, the discount is still fully taxable as 1099 income (again, US tax rules). In the US, there's no distinction of a "gift" or "award", etc to be taxed differently. It's all income as far as the I.R.S. is concerned, and they're going to want their cut (and hopefully not right away!) And even if Tesla doesn't send out 1099 forms to report the income to you, you are still legally obligated to report it. Another kick in the pants is that for most 1099-misc income, you'll have to pay the self employment tax (social security, medicare) which is currently 15.3%, which if you're a W-2 employee, your employer pays half. So you'll be paying 7.6% more in SE tax for the award amount.

    The only possible "legal" way I see to avoid paying the income taxes on the award is to have a business that also has $250k of net expenses (or whatever your award amount is) to offset the income. But you'd still have to have a business spending $250k as real expenses.. and realize that the people/entities you've spent that $250k on for your expenses, you'll have to document that and send them 1099s, so they'll have to pay tax on that, too. So really, in the end, someone is going to pay the taxes. Unless you just happen to have a real business with net $250k of extra expenses anyway, then you're lucky and might be able to pull something off along those lines and pay no taxes.

    Just thought of another idea -- (don't know if this is valid), but if you sell some stock at a $250k loss, maybe you can offset the income? But you'd still have a $250k realized loss. Is that better than paying the taxes?

    Besides that I don't know of any other legal way to avoid income taxes (but I am not a CPA, so there always could be), other than Tesla offering a "gross-up" to also give you cash to pay the tax on the award (and the taxes on the gross-up, etc, etc). Years ago I won a large award from AMEX and they grossed up the award to pay the taxes, which was really great. I don't think Tesla is going to gross-up 80 NGR awards.

    I have no idea how they'll handle other countries, though.
     
    • Like x 1
  10. HankLloydRight

    HankLloydRight No Roads

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    Ok, I just had another idea. I don't know how feasible this is to pay less tax.

    Steps:

    1. You form a company/LLC to buy and sell widgets. Widgets that are a commodity and won't expire or get obsoleted over a few years, say five years. And small stuff that doesn't take a lot of warehouse space. Maybe batteries or cables.
    2. The LLC borrows $250k (or you fund it yourself for opportunity cost) and buy $250k worth of widgets at a big volume discount. Put them in the warehouse.
    3. Accept the NGR award as taxable income to the company/LLC. Declare that as LLC income.
    4. File your taxes. The $250k income is offset by the $250k expenses for widgets. Pay $0 tax.
    5. Over the next 5 years, each year sell approximately 20% of the inventory for $50k.
    6. Each year declare $50k of additional income (less expenses for storage, interest on the loan, etc) for the LLC. Use the $50k cash to pay down the loan in step 1.

    That will keep you out of the higher tax brackets and not having to pay 100% of the tax in one year in the highest tax bracket. If your effective tax rate is 25%, that's just $12,500 of income tax per year.

    Now there is the cost to borrow or tie up $250k cash for 5 years. Say you get it at a 3% interest rate - that ends up being about $23k in interest over five years (and also deductible as an expense).

    The risk is you can't sell the widgets and/or the market for widgets doesn't go down.
     
  11. BoerumHill

    BoerumHill not great not terrible

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    Would not be allowed.

    INCOME - The car is not business income, so you cannot match it against business expenses. The NGR is other income, regardless if the 1099-Misc is in your name or an LLC. The income will flow through the LLC to your personal return; remember, S-corps & Partnerships don’t pay tax. They’re just hybrid flow through entities.

    EXPENSE - this would not be a deductible business expense. You have to match business expenses to business income. The inventory is a COGS which is unrelated to the personal ordinary income. Expenses come in four basic flavors: business expense (say office supplies), COGS (Cost of Goods Sold), Capital (long term assets like a boiler or a roof or equipment), and Personal.

    You’re trying to mix Cost of Goods Sold with Personal Income. Hope that made sense.
     
    • Informative x 1
    • Like x 1
  12. HankLloydRight

    HankLloydRight No Roads

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    Yup. It was just a brainstorm.

    Nevermind.
     
  13. HankLloydRight

    HankLloydRight No Roads

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    Can you think of some other way to offset the income with a loss(or expense) and then recognize the income over subsequent years instead of all at once?
     
  14. aikisteve

    aikisteve Member

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    How about Tesla selling the Roadster for a symbolic Euro or Dollar? Technically, you still bought the car then and did not get it for free :p
     
  15. Barnes

    Barnes Member

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    Divest an entity and continue to run-up massive losses over the next few years, once the car is available receipt the asset into the entity. It's really trump 101
     
    • Funny x 1

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