Tom Wheelwright on How to Permanently Reduce Your Taxes and Build Wealth Faster

Taxes are looked at so negatively by most people, but taxation is actually one of the most powerful tools for wealth creation—and today, you’ll learn why!

I’m speaking with Tom Wheelwright. Tom is an entrepreneur, best selling author, Rich Dad Advisor® and international authority on tax, whose goal in life is to make taxes fun, easy & understandable. He’s dedicated his life to learning and studying the tax law and has taught thousands of investors around the world how to permanently reduce their taxes.

He has been a keynote speaker at Rich Dad conferences worldwide with Robert Kiyosaki and his work has been featured in hundreds of media outlets, including Forbes, The Huffington Post, Accounting Today, CFO Magazine, ABC News Radio, and Entrepreneur Magazine.

In today’s discussion, you’ll hear the real truth about taxes. If you want to follow the rules of the rich, gain more control over your money, and permanently pay less taxes so you can build wealth faster, don’t miss this episode with Tom Wheelwright!

Featured on This Episode: Tom Wheelwright

✅ What he does: Tom Wheelwright, CPA is the visionary and best selling author behind multiple companies that specialize in wealth and tax strategy. Tom is also a leading expert and published author on partnerships and corporation tax strategies, a well-known platform speaker and a wealth education innovator.

In his best selling book Tax-Free Wealth, Tom shows entrepreneurs and investors how to build massive amounts of wealth through practical and strategic ways to permanently reduce taxes.

💬 Words of wisdom: The tax law is a roadmap to financial freedom, filled with incentives for entrepreneurs and investors. You just have to follow the rules of the rich!

🔎 Where to find Tom Wheelwright: Website | Facebook | Twitter | Instagram | LinkedIn

Key Takeaways

  • How the infrastructure bill will affect your taxes
  • The blueprint for paying less taxes—legally!
  • Understanding tax deductions and credits—and why your retirement plan is working against you!
  • Leveraging private equity to receive more tax benefits.
  • How to follow the smart money and avoid government controlled plans.
  • How to lower risk and gain more control over your money.
  • Why you don’t have to break the law to reduce your taxes!
  • What it’s like to work with Robert Kiyosaki.
  • Why the government will pay you to make certain investments.
  • Connect with Tom Wheelwright

Tom Wheelwright Shares The Blueprint For Paying Less Taxes

Tom Wheelwright Tweetables

“The tax law is a roadmap to financial freedom, filled with incentives for entrepreneurs and investors. You just have to follow the rules of the rich” -Tom WheelwrightCLICK TO TWEET“There’s much better ways to deal with your taxes than a retirement plan.” – Tom WheelwrightCLICK TO TWEET

“These strategies are not tax dodges. These are things the government wants you to do, they pay you to do it, and they get a huge benefit as a result.” -Tom WheelwrightCLICK TO TWEET


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Read the Full Transcript with Tom Wheelwright

Justin Donald: Well, Tom, I’m so glad to have you on the show. In fact, this is really special for me because I have learned so much from you over the years, from books and speeches and messages, and we run in similar circles and have a lot of mutual friends. And so, I’m just thrilled to be able to get a chance to share all this wisdom that you have with The Lifestyle Investor audience. So, thanks for being here.


Tom Wheelwright: Oh, Justin, it’s always good to be with you. I’m always learning from you, too. So, I do love the circles we run in because I think they’re very interesting people who have very interesting perspectives.


Justin Donald: Yeah. There’s no doubt about that. And in fact, a nice shoutout for anyone who’s actually watching this, if you’re listening, this is going to be important but, Tom, you are stylish. You’ve got quite the outfit on, your glasses are super cool, super chic, and I just want to pay you that. That’s pretty awesome.


Tom Wheelwright: I’ll take it.


Justin Donald: I like it. So, recently, you and I had a chance to speak together on a panel with Mike Dillard, and what a great lineup of guests he had and some cool people that we got a chance to also interact with and learn from. But I just feel like you’re always on the cutting edge of what’s happening, what’s new, what’s coming down the pipeline in terms of tax reform and business ramifications. And so, I love your knowledge and I’d love to know anything as you see it here today. And then I’d like to journey back and maybe figure out how you became the guy that you are today, probably the most well-known CPA that exists. From an entrepreneurial standpoint, you’ve built just a mega business. This may just be my paradigm but, to me, I felt like you had a nice launching pad with the Rich Dad Poor Dad book and series. And that’s really where I learned about you. So, I’d love to hear kind of what’s new now, and then let’s take a step back and hear how you became who you are today.


Tom Wheelwright: No, sure. Thank you. Lots of nice compliments in there and I love compliments, so it’s great. So, what’s going on, right? Now, of course, we got really two major bills but it really has seemed to be morphed into a single bill because one’s not going to pass without the other. And that’s the infrastructure bill, which is being held hostage by the progressive Democrats that they’re not going to pass that until they get their $2 trillion to $3 trillion social extravaganza put in place. So, we’ll see what happens but the reason, actually, you mentioned predicting the future, it’s really easy to predict the future when you have an understanding of how the government actually works. And I was fortunate to spend three years in the National Tax Office of Ernst & Young back when Ronald Reagan passed the ’86 Tax Act. So, that dates me a little bit but it tells you that there are certain things that happen and you really can predict. So, for example, when the state and local tax deduction went away in 2017, that was not a surprise to anybody. That had been on the chopping blocks for literally 30 or 40 years. So, what we see in this legislation is there’s nothing really astounding that’s going to end up in this legislation. There were some proposals, and I think they’re just trying to get them on the list. So, understand that there’s a list of proposals and things move up and down that list. And so, if you want to predict what the government’s going to do, you just have to understand what’s on that list.


And so, for example, this idea of capital gains at death, right, that’s something, by the way, that Canada already does. Now, they don’t have an estate tax. They just have capital gains at death, which you can get away with capital gains at death if you don’t also have an estate tax. But if you add an estate tax, you end up with it like a 92% tax rate on people who have been very successful. So, that’s been pulled off the table. The 1031 exchanges, they were put on the table. That’s been pulled off the table but it’s interesting they were put on the table. These massive increases in capital gains, which is a terrible idea, by the way. I think the Tax Foundation and several other of the think tanks say that your capital gains rate can’t go above 31% else you start losing money. And that’s where I end up, by the way. You hear it’s going from 20 to 25. Well, it’s not. It’s going from 23.8, okay, because we have the net investment income tax, which is just another tax, right? Just because it’s Medicare taxes, I mean, it’s not tax and it’s a tax on net income so it’s still an income tax. So, your really top rate right now is 23.8. It’s going to go to 28.8% but when you add in the 3% surtax on people over $5 million, you end up at 31.8%. Okay. That is a magic number so you look, what are the magic numbers? Well, in regular income tax, the magic number is 40%. And the reason is that once you get much over 40%, people start, really, it starts impacting how much will people work, how much effort will they put in. You lose productivity once you get over 40% because what happens is instead of putting money into incentives as you’ve heard me say a hundred times and I do in Tax-Free Wealth, the tax law is a series of incentives, right? Instead of putting into incentivized investments, what you do is you end up looking for tax shelters.


So, what you trying to do if you have any sense at all on the government is you don’t want money going towards tax shelters. You want them going towards true incentives that you want. So, for example, in this new legislation, there are big incentives for solar. Well, that’s a tax incentive. If you want more solar and more charging stations, those are the two big tax incentives in this bill then you give incentives for that. The Democrats also want population growth. That’s actually a big part of their agenda. That’s what’s happening at the border. That’s what’s happening with the child tax credits and the pre-K and all of that kind of stuff. These are all population incentives for, remember, the higher your income, the lower your birth rate. And that is true around the world. The higher your income, the lower the birth rate. Well, so if you give incentives to the people who would have a higher birth rate, which are the lower-income, then you get a higher birth rate. And actually, nobody’s talking about that but that is part of the incentive behind all of you see child tax credit, you see the prekindergarten, you see the child care credit. All of those things are related to, okay, well, that’s an incentive to have more children. So, we can’t ignore what the incentives are and also, we can’t ignore what makes sense. So, what we’ve seen in this current iteration of this bill, which is going to go through a number of iterations still to come but what we’re seeing is we’re seeing that capital gains rate 31% target. We’re seeing the ordinary income rate target, 40%. So, you can just watch these and you go, “Okay. Well, they’re just hitting the top.”


And what they did was, I call this the Costco bill because when you walk into Costco, what do you see? You see the big-screen TVs. You see the expensive jewelry. So, that when you get back to that $15 bottle of mayonnaise, that’s a good deal. Well, that’s what’s going on right now with this. Remember, in the original proposal, there’s this 92% estate tax and now they’re looking at just reducing the exclusion from 12 to 6 and everybody’s going, “That’s not so bad, right? They’ve actually managed it pretty well.” So, I think it’s interesting to watch and kind of watch how they’re thinking. They’re just trying to get a bill through. That’s all they’re trying to do. They’re trying to get their social programs in place. And the reality is, I mean, this is my own perspective but the reality is I think there’s a good portion of our population that does need help. And so, I like Joe Manchin’s idea. Well, let’s make it work-related. Let’s make sure that it’s means-based and all that kind of stuff. People that make $400,000 a year probably don’t need additional child credits.


Justin Donald: You know, it’s interesting. There are a few things that I want to highlight from what you just said. I mean, one of them is that it’s very obvious that one of your most simple sales strategies as you start with the highest price you can and then you drop down and you eventually meet somewhere in the middle and then both parties feel like they won because they got some movement and there were some negotiating and there were some people kind of like just giving on some points and then you make a deal in the middle. But one of the big things that you said that you just kind of skimmed over that I don’t know if people realize is like as important as it is and it’s the whole idea of tax incentives. So, I learned this from your books. You wrote a book, Tax-Free Wealth. By the way, I think that this book is the best book on the market about anything and everything tax. And in fact, I liked it so much that I included it in my list of recommended books for my book because I just thought it was such a great start-to-finish overview plus the details of anything and everything tax code. And the whole idea of the government’s not saying, “Don’t do all these things. We’re going to tax you,” but really, they’re saying, “Do all of these specific things because we’re going to give you a credit,” or some sort of a discount or a break because they’re looking for certain things to happen: affordable housing, renewable energy, agriculture, the list goes on and on. And so, I’d love to have you touch on that because that might be one of the greatest takeaways that I’ve had is the whole idea of this is a blueprint to figure out how to pay less in taxes. Just do what the government wants you to do and you’re going to pay less.


Tom Wheelwright: I love that. Actually, I was at a seminar I was speaking at this weekend and people were quoting me on that. I’m going, “Alright. We’re doing our job when people start quoting us.” Because it really is a series of incentives and I know that it seems like apparently, I coined that but, to me, it’s obvious because when you look at it. So, anybody who’s ever gotten a paycheck knows that we’re all partners with the government. When you look at, you look at withholding in that FICA and you go, “Why are they taking all this money on my check?” Well, that’s your partner that’s taking the money out of your check. Now, it’s not a really fair partnership because, in that case, you’re a silent partner. You don’t get any say except in who you elect.