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Tax Pro Reveals How Kardashians Write Off Their Entire Life | Grant Newell DSH #1053
00:36:10
Tax Pro Reveals How Kardashians Write Off Their Entire Life 🤯 Mind-blowing tax strategies from a former football player turned finance expert! 🏈💼 Grant, a Dallas-based tax pro, shares insider secrets on how celebs like the Kardashians...
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- [00:00]
Grant Newell
Pulled me out of that dark hole that I was in.
- [00:03]
Sean
Wow. Shout out to her. Yeah. I went through a similar journey. I was at a super low point and my fiance got me out.
- [00:08]
Grant Newell
Yeah. I mean, they say that behind every successful man is a woman that pushed him.
- [00:14]
Sean
Yeah.
- [00:14]
Grant Newell
And I firmly believe that. I've, you know, been a testament of that because of my wife pushing me to levels that I don't think I would have gone myself.
- [00:26]
Sean
All right, guys, got Grant here today from Dallas. Flew in. Luckily you brought the suit because it's cold out today.
- [00:31]
Grant Newell
Yeah, it is A lot colder than I was expecting.
- [00:34]
Sean
Yeah. You think of Vegas, you think of desert heat?
- [00:36]
Grant Newell
Exactly. I was thinking 100 degree heat, you know, similar to Texas, but luckily I brought a jacket.
- [00:41]
Sean
For real, what you've been doing out there in Dallas lately?
- [00:45]
Grant Newell
So we're. We're actually in the process of moving. I just had a kid, seven months old now.
- [00:51]
Sean
Congrats.
- [00:52]
Grant Newell
Yeah, it's. It's been busy. Between a kid and moving, it's a lot.
- [00:56]
Sean
Where are you moving to?
- [00:57]
Grant Newell
Out to the suburbs. A little bit more rural area. The north lake. It's out by the racetrack. So.
- [01:03]
Sean
Okay.
- [01:04]
Grant Newell
We're finally, finally moving out of the city. City's just getting too crowded for us and we're just want some peace and quiet.
- [01:10]
Sean
Yeah. I feel like. Yeah. In your younger years, city life is appealing. And then as you have a family and kids, it's like, let me move out to the farms.
- [01:16]
Grant Newell
Right. You know, Exactly. So it's, you know, and plus, like, I have a son, so he, you know, just wants to run around, and giving him more space to run around is, you know, what I want to give him.
- [01:29]
Sean
I love that you've been in Dallas for a while.
- [01:32]
Grant Newell
That's where I grew up. I went to California for a little bit in college, and then Oklahoma and then moved back to Dallas. Gosh, that was almost eight years ago now.
- [01:43]
Sean
Okay, so.
- [01:44]
Grant Newell
Been in Dallas a while.
- [01:45]
Sean
Why'd you choose Cali for college?
- [01:47]
Grant Newell
It was. It was forced. I. I was playing college football and I went to junior college out there in California and then transferred from junior college to Oklahoma State. Finished out my career there and then moved back to Dallas from there.
- [02:03]
Sean
Got it. You wanted to make it to the NFL. That was your goal.
- [02:05]
Grant Newell
Yeah, that was the. That was the plan, but it didn't work out. Tore my shoulder up and at. Actually went back to be a lifeguard.
- [02:13]
Sean
Whoa.
- [02:15]
Grant Newell
I, you know, my only plan was to go play NFL and it didn't work out. And so then I Went to go be a lifeguard, ended up having shoulder surgery, so couldn't save anybody's life if they were drowning. So I lost that job and then got into finance through a church pastor. He said, you know, hey, you were good at math. Do you want. Do you want to come do this job interview? And I did it. The owner at the time was a Harvard mba, Taught me everything he knew. And then, you know, it brought me to where I am now, which is running a tax and accounting firm.
- [02:55]
Sean
I love it, man. I want to go back to that story of the shoulder tear. Was that the lowest you've been mentally in that moment?
- [03:03]
Grant Newell
Probably when I had my shoulder surgery and I even lost my lifeguarding job.
- [03:08]
Sean
Oh, that was. That was the moment. Okay.
- [03:10]
Grant Newell
When I couldn't even hold a job as a lifeguard after being a college graduate, you know, to me, I felt pretty low, you know, was living with my parents, and, you know, between living at your parents and losing a job as a lifeguard, you know, you feel pretty low at that point.
- [03:25]
Sean
Absolutely.
- [03:26]
Grant Newell
But, you know, my wife, she was my girlfriend at the time, you know, helped me get out of that hole, encouraged me to go take that job interview, which pulled me out of that dark hole that I was in.
- [03:38]
Sean
Wow. Shout out to her. Yeah. I went through a similar journey. I was at a super low point, and my fiance got me out.
- [03:43]
Grant Newell
Yeah. I mean, they say that behind every successful man is a woman that pushed him.
- [03:50]
Sean
Yeah.
- [03:50]
Grant Newell
And I firmly believe that. I've, you know, been a testament of that because of my wife pushing me to levels that I don't think I would have gone myself, you know, because sometimes we get in these comfort zones that. That were like, man, this feels good. You know, I'm good. But whenever somebody is behind you pushing you, like, I believe in you. You can do more, you can do better. Like, there's something inside of us that's like, man, I don't want to let him down 100%.
- [04:17]
Sean
So, you know, especially when kids get in the mix, too.
- [04:20]
Grant Newell
Oh, yeah. I sit down and I look at my son, and I'm like, okay, I got to go even harder for him. My wife was one level, and then my son is an extra level. Because, you know, my wife, if she was to be on her own, she could provide for herself. My son, if he's on his own, he can't provide for himself.
- [04:36]
Sean
Facts.
- [04:37]
Grant Newell
You're the. You're the only source there. So it's like this internal burning of, like, I've got to go. Yeah, I'VE got to get it going.
- [04:45]
Sean
And I'm seeing a lot of my friends now and people I know just have trouble raising kids because of finances.
- [04:50]
Grant Newell
Yeah.
- [04:50]
Sean
And it's. It's sad to see.
- [04:52]
Grant Newell
Yeah. And that's my book that I'm finishing up writing, genetics of wealth. 78% of Americans are living paycheck to paycheck.
- [05:02]
Sean
Geez.
- [05:02]
Grant Newell
And don't even have $1,000 in their savings account. I mean, that's an insane amount. When I did that research, I was shocked.
- [05:10]
Sean
Crazy.
- [05:10]
Grant Newell
I mean, I knew that people's finances weren't in great spots, but I was shocked that it was that high. I mean, you walk around and eight out of every ten people you see don't even have $1,000 in their bank. Bank account.
- [05:22]
Sean
That's nuts.
- [05:23]
Grant Newell
Which means, you know, one month's rent and you're done. You know, one hard month and you're done.
- [05:28]
Sean
Yeah.
- [05:29]
Grant Newell
Which is scary, you know, especially when you have wife and kids. It gets even scarier.
- [05:34]
Sean
Oh, yeah. Yeah. That's why you need a safety net these days, because you don't know what's going to pop up. I've had random. I'm a homeowner now, and I've just had random stuff popping up. It's like, damn.
- [05:43]
Grant Newell
Yeah.
- [05:44]
Sean
Average person wouldn't be able to afford this.
- [05:46]
Grant Newell
No. And I mean, I. I've. I have a lot of clients that, you know, $40,000 here, $20,000 here by owning a home. And it's like, whoa. And you're like, dude, I put all my money on the down payment. What is all this?
- [05:58]
Sean
Yeah, that happened to me. I had to dip into my savings because I wasn't prepared for all these additional expenses. We just had to replace the fridge yesterday. That's 2,000 bucks. So the stuff like that's pretty normal as a homeowner, Right?
- [06:09]
Grant Newell
Right. Yeah. And that's. For me, I'm a. I'm a big proponent of renting.
- [06:14]
Sean
Oh. Yeah.
- [06:15]
Grant Newell
Because for me, it's. Especially during these times, it's like, you know, if you do the cost that it would be to own the home versus what it is to rent the home. I mean, it's astronomical. Like the home that we're moving into. If I was to own that home, I'd pay an extra $3,000 a month in mortgage. That's just the mortgage. So I'm saving $36,000 before, you know, before any other expenses. And, you know, if anything pops up, I call the landlord, he comes and fixes it.
- [06:51]
Sean
Yeah.
- [06:52]
Grant Newell
You know, And I it, if you do the math, it's like, wow. And because the banks really own the home, you're either paying your rent to a landlord or you're paying your rent to the bank. Because the bank, as soon as you miss a payment, the bank's going to come take that home. Just like if I rent and I miss a payment, the landlord's going to come take the home. The difference is, is when something breaks, I call the landlord, they come fix it. If you try and call the bank and say, hey, this broke, and you all can fix it, they're going to be like, no way, I'm not fixing that for you. And so to, like, especially in this country, the banks have been protected for everything.
- [07:33]
Sean
They'll get bailed out.
- [07:34]
Grant Newell
Yeah, I mean, they're going to get bailed out. They, you know, homes were built for the banks to make money 100%. And, you know, if you look at a mortgage, you pay all your interest up front, and then you start building equity on the back end. Because they don't even trust us to pay the mortgage long term. And so they're like, hey, I'm going to put all of our interest up front rather than, hey, we'll space it out. Because they don't even trust us to do that. And to me, it's crazy that because I was raised, hey, you make a family, you buy a home. That's the American dream. And I'm like, Because I was going to buy a home, and I was like, once I started doing the numbers, I was like, I can't buy a home. It just doesn't make financial sense to me. You know, you put $200,000 down on a down payment, and then, you know, you have to do all the repairs. And you're like, I just dumped all my savings to buy this home.
- [08:27]
Sean
Yep.
- [08:28]
Grant Newell
Which is what a lot of people do. And then they're like, you know, I think it's about 1% a year is what you have to pay in repairs. People don't have that. They furnish the home, and they're like, I'm good to go. And it's a scary reality. It's a scary thing that, you know, my wife and I, I said, if we're going to buy a house, it'll be in cash. I don't have that cash. So I'm not buying a house. And because it just doesn't make financial sense.
- [08:56]
Sean
Yeah. With the interest rates, it doesn't make sense for most people. I'd say, yeah, if it goes back down to 2, 3. Maybe it makes more sense for some families, but right now it's like 7, 8%. So.
- [09:06]
Grant Newell
And, you know, the hard part is, is when it was down that low, the housing prices were inflated so high that it's like you're overpaying for a house and that. Like, at least it was in Dallas. In Dallas, I would look at homes and, you know, they were $600,000 homes. Now going for 1.2 million, and you're like, this is six, $600,000 house, and people are paying 1.2 million. Even with the low interest rate. That still doesn't make sense.
- [09:32]
Sean
That's true. Yeah. They were inflated because everyone from Cali moved over.
- [09:36]
Grant Newell
Yeah. So it's. It's. You know, the housing market is one of those things. Real estate is a big thing, especially in tax as well. Like, it's. It's a big thing. A lot of people want to go into it, but I mean, really what it is, is the government's trying to protect the banks. That's why the tax code has so many advantages for real estate. Because they want you to do business with the bank. Banks. They want you to make money for the banks.
- [10:02]
Sean
Yeah. Because their incentives are aligned, Right?
- [10:04]
Grant Newell
Exactly.
- [10:05]
Sean
Like, if the banks make money, the government makes money.
- [10:07]
Grant Newell
Exactly.
- [10:08]
Sean
So they want the banks to succeed.
- [10:09]
Grant Newell
Yep. Because the way the banks make money is off of the interest rates, federal interest rates. So they're like, hey, we're going to get our money from them. And so they. They want to keep that wheel churning, Right. They don't want that wheel to stop.
- [10:21]
Sean
Yeah. The interest rates on credit cards are pretty insane, too. Like 40%, right?
- [10:26]
Grant Newell
Yeah. I mean, some. You know, depending on your credit score, they can get up to, like, 40%.
- [10:32]
Sean
Crazy.
- [10:32]
Grant Newell
I mean, it's. And, you know, people will run them up because they like, hey, I have a $20,000 limit. That's how much I have to spend. And it's like, no, that's. I always tell people, if you treat a credit card like a debit card, you'll be fine. Pay it off every single month. If you have it in your bank account, spend it. If you don't, don't spend it.
- [10:51]
Sean
Yeah.
- [10:51]
Grant Newell
Because that's. Credit. Credit card is the worst one. I think it's Mark Cuban that says. He said, people ask him what the best investment is, and he said, paying off your credit cards because nowhere else are you going to find a 40% return on your money.
- [11:05]
Sean
I saw that. Yeah. Dave Ramsey's against credit cards, too.
- [11:08]
Grant Newell
Yeah. And I'M not against credit cards. I think credit cards are great. You can, I mean, you're losing out on money if you don't use them, but it's incorrectly using them.
- [11:17]
Sean
Right.
- [11:17]
Grant Newell
You know, that gets people into trouble.
- [11:19]
Sean
Yeah, I feel that. So you agree with Grant Cardone then about renting. That's interesting.
- [11:23]
Grant Newell
Yeah, yeah. And I actually am an investor with Cardone Capital.
- [11:29]
Sean
Oh, nice.
- [11:30]
Grant Newell
So the money that I was going to pay on a down payment on a home, I actually put it into there. I get the tax deduction each year for owning the real estate and I get the cash flow that he pays out every single month.
- [11:42]
Sean
Oh, nice.
- [11:43]
Grant Newell
So, you know, to me, I was like, wow. I mean, that, that cash flow pays my rent. So now like, I'm not even, I don't even have to cover that because it's paid for by the rental properties.
- [11:57]
Sean
And that's a great feeling. When you could live off your passive income. That should be everyone's first goal, right?
- [12:02]
Grant Newell
Yeah, yeah.
- [12:03]
Sean
So get to that level.
- [12:04]
Grant Newell
I mean, and like it didn't make sense to me at first until the check started flowing in and then you're like, wow, this makes sense. If, you know, if this can eventually cover what I'm paying in rent, then I, then I don't pay anything.
- [12:17]
Sean
Right.
- [12:17]
Grant Newell
And you know, if any repairs happen, they're not on me. So I can sit there and I can go out and go on a vacation and not have to worry about, man, am I going to need that couple thousand dollars I just spent on vacation. I don't, I don't need it because if a repair goes off, it's not my responsibility.
- [12:34]
Sean
Yeah.
- [12:34]
Grant Newell
And so to me, it's a nice financial freedom. Is being able to live stress free.
- [12:40]
Sean
That to me, absolutely. Trump just won a couple of days ago. Is that going to be good for taxes, you think?
- [12:46]
Grant Newell
Yeah. Well, I mean, if he gets things passed through. Yeah. You know, he'd propose 15% corporate tax, which as a tax professional, that changes things a lot because currently S corporations is what a lot of people talk about, what's good for people. But now at capped at a 15 tax rate, if you do us business is, I mean, that's a game changer.
- [13:14]
Sean
Yeah.
- [13:14]
Grant Newell
Because if you're, you know, once you reach a certain threshold, you know, the S Corporation doesn't really make sense because you're passing it through to yourself. You're paying too much in taxes, you're pass. You're taxed at the income rate, active income rate, rather than if you're capped at 15%. You can make $100 million and all you're gonna have to pay is 15 million taxes.
- [13:38]
Sean
Because right now it's what, like 30 something percent?
- [13:41]
Grant Newell
No, right now it's at 21. 21, because Trump put that in place. But he's even proposing making it even lower.
- [13:48]
Sean
Wow.
- [13:49]
Grant Newell
And so, you know, that becomes a huge incentive, especially if for people that want to keep a lot of cash in the business. Some people are like, hey, I'll move it around, put it in different things. It won't make that big of a difference to those people. But those that are like, hey, I want to keep a cash reserve. Like, you know, if Apple decides to move all of their stuff, you know, domestic, that's a huge gain for them because they keep a lot of cash. But, you know, if you do work overseas, he said he's going to keep you at 20, but if you bring everything domestic. So he's trying to bring the jobs back into America, which is important. And, you know, a lot of people are upset that he would lower the tax rate, but he's saying, hey, look, I'm trying to bring more jobs, which will then be taxed at W2 taxes. You know, people pay W2 taxes on those jobs that they're bringing in. So the government's going to get their money still.
- [14:44]
Sean
Yeah, yeah.
- [14:45]
Grant Newell
It's just a different way of doing it. He's trying to move people, incentivize people to move, like, get people back in the workforce.
- [14:52]
Sean
Makes sense. So that's the side of the argument you don't hear, because you see these liberals talking about tax the rich and Trump wants to lower them, but they don't hear the other side of why he wants to lower them. He's going to make money with the way you just said, too.
- [15:05]
Grant Newell
Exactly. And I've never been a proponent of taxing the rich because if you think about it, you're middle class, lower class, and you find something that you finally get your big break and you make a large year. Let's say you make a million dollars and you're like, hey, I've finally gotten my break. Well, if you're taxing the rich now, you're going to undercut that. And now you're back into the middle class because you got taxed so hard that your great year turned into just an average year. And to me, that's not fair. You know, I'm like, hey, look, if you have your great year, go out and continue to build and grow that business, like what you've done here you know, you got your own studio, you. You're expanding your business, you're hiring people. You have people. Yeah, that's what it should be about. It's about. It shouldn't be, hey, let's try and undercut Sean. As soon as he starts to reach that level, let's start taxing him harder so he stays down. To me, that doesn't make sense. I'm like, we should be encouraging those people who are growing and incentivize them to keep growing. You know, hire people, continue to make success in what you're doing and not say, hey, we're going to, you know, take 37% of what you make. I mean, if you live in New York or one of these states that has state income, it's even higher than that. Yeah. I mean, that's why a lot of people move. That's why Musk move Tesla out of California. He's like, I'm paying a ridiculous 50%. You know, you moved to Texas. You got. You don't have any of that.
- [16:40]
Sean
Yeah.
- [16:41]
Grant Newell
So to me, it's. It's about the people who are generating jobs are going to help because, I mean, a lot of people don't realize the cause and effect. You know, if you start taxing Amazon higher, they're not going to just say, okay, we're going to just take this tax hit. No, they pass it through to us, pass it through to the average American, and they are going to raise the prices. Now, your, you know, toilet paper that you bought on there for $10 is now $20, because they're getting taxed harder. So they're like, all right, well, we got to raise the prices.
- [17:18]
Sean
Right.
- [17:18]
Grant Newell
They don't just say, all right, we're going to take this tax.
- [17:20]
Sean
Nah, not at that level exactly, because their margins are already thin at that level. So if they get another tax, they're going to charge more for sure.
- [17:27]
Grant Newell
Exactly. And so that's what, you know, people don't think about those sort of things. They just, you know, want to tax the rich because they make money.
- [17:35]
Sean
Yeah.
- [17:36]
Grant Newell
I'm like, you don't realize they're not going to just take that tax hit. They're paying. They're paying people like myself to find all the tax loopholes to make sure that they don't have to pay that.
- [17:47]
Sean
Right. Yeah. The super wealthy don't even pay to begin with, so it wouldn't work.
- [17:51]
Grant Newell
Exactly.
- [17:52]
Sean
Yeah. There's so many loopholes.
- [17:53]
Grant Newell
Yeah. And the tax code is longer than an encyclopedia.
- [17:58]
Sean
That's crazy.
- [17:59]
Grant Newell
There's. There's so many things that you can do when it comes to the tax code that I'm like, they're gonna, they're gonna find a way.
- [18:07]
Sean
Yeah.
- [18:07]
Grant Newell
They're not just going to take it.
- [18:09]
Sean
Yeah. I'm pumped for Trump to bring back the 100% write offs for vehicles and airplanes and stuff.
- [18:14]
Grant Newell
Yeah, yeah. And that I've actually, I saw something the other day. I had a client send me something about. I think his name was the Stradman.
- [18:26]
Sean
Heard of him.
- [18:27]
Grant Newell
The car guy on you.
- [18:28]
Sean
Yeah, yeah.
- [18:29]
Grant Newell
And he had posted this thing about he got hit with a half a million dollar tax.
- [18:35]
Sean
Whoa.
- [18:35]
Grant Newell
He got audited and they fined him half a million dollars because of the car. So he, in the video, he talked about how he had one of those big jeeps with like six wheels. And he's like, this one's over £6,000. And then the Aventador was under £6,000. But his tax person had told him, hey, you can take the full 100% deduction for this car because you're using it for business purposes. You know, you need it to generate money. And with those things, you have to be careful with the special exemptions. And where they got it wrong was he was told that, but in order to be able to do that, you have to have no other ways to make money. So, you know, he talked about a hearse driver. Well, the difference between him and a hearse driver is they have that hearse and they have to drive that hearse to, you know, be able to do their job or else they don't have a job. But in the video, he proved the IRS's point. He showed, you know, I made $10,000 off of the Jeep, I made $20,000 off of the Aventador. But what he showed was he was making money off of the other one. So the Aventador wasn't needed, necessary for him to run that business. So he should have taken the regular deduction.
- [20:00]
Sean
Wow.
- [20:01]
Grant Newell
Which is what they ended up finding him for. And, you know, you have the fines and the interest and all that. So he had to pay half a million dollars that if he had just done it correctly, he probably would have paid half of that. Maybe.
- [20:12]
Sean
And that sucks. Because you put your trust in these accountants.
- [20:15]
Grant Newell
Exactly.
- [20:15]
Sean
Because you don't have the time to study all those tax codes yourself.
- [20:18]
Grant Newell
No, no. And that's. And like, for me, I try, I try to tell all my clients, I say, you know, I'm not going to tell you. No. I'm going to tell you what you need to make it a yes. And then you can decide whether or not you want to make it a yes or not. And if you can't answer, you know, if you can't do abcd, then you shouldn't do it.
- [20:37]
Sean
Yeah.
- [20:38]
Grant Newell
And, you know, I think too many people in my industry just want to make the people happy. And in reality, you're their bodyguard. You're their financial bodyguard. Because his person did not protect him. And his accountant sure didn't pull out his wallet when that half a million dollars, definitely not. He didn't say, oh, that's my bad, I told you wrong. Here, let me cut the check. They don't. And so, like, to me, I was telling my client last night at dinner, I said, I am your financial bodyguard. I'll tell you, hey, stay away from this. Go over here. But if you venture into that, I warned you, you know, and a good bodyguard tells them, hey, don't go here, go here type of thing. And so I always tell my clients, I'm like, hey, you know, if you want to do this, you need to do xyz.
- [21:32]
Sean
Yeah.
- [21:32]
Grant Newell
You know, and like on the car one, I had a client that loves cars. He's a big car guy and he's like, I want to buy cars, but I don't want to rent them out on Turo. All this stuff that people will tell you, okay, if you want cars, you can do this. So he runs a. He has a podcast where, you know, he wants high net worth people to come. And so I said, okay, in order to do that, you're going to have to, you know, you can't just be like, hey, Mark, mark Cuban, here's $100Amazon card. Will you come on my show? He's gonna be like, I don't need that. But if you're like, hey, Mark, I've got a suite at the Mavs game for you. I've got a Rolls Royce whenever you get here that you can use up until the podcast. He might be like, wow, okay, this is rolling out the red carpet. That might be incentivizing.
- [22:22]
Sean
Smart.
- [22:22]
Grant Newell
So we had him, he bought five cars. And whenever he invites a guest, he invites him to come out to a Rangers game. He has a suite, they'll go to the game. He says, hey, here's our list of cars. So he lists them out. Wow. Now there's proof, there's written proof that these are business cars. He says, hey, here's the cars that we have. Let us know which car you want to be dropped off at the airport. So they choose the car, it gets dropped off at the airport, they take it, they drive to the game, then they'll drive to the podcast the next day with it. They get it while they're there. They drop it off whenever they get to the podcast. But now all those cars can be written off because they're business use.
- [23:02]
Sean
Wow.
- [23:02]
Grant Newell
And so that, I tell people, is, you know, getting creative with the tax code.
- [23:07]
Sean
Yeah.
- [23:07]
Grant Newell
Because now we're able to write off Ranger suite at the, at the Rangers game. So he pays, you know, whatever the.
- [23:14]
Sean
Fee is for the year that ain't cheap.
- [23:16]
Grant Newell
Gets to write off because it's marketing, it's lure, it's, you know, trying to get people in. You know, you gotta, in order to get, you know, high net worth people. You can't, like I said, you can't just toss something light at them.
- [23:27]
Sean
Yeah. Dinner's not enough for those people.
- [23:29]
Grant Newell
Exactly. You have to, you have to roll out the red carpet for them. And, you know, and then still, you may still get turned down even at that point, but, you know, at least you're giving yourself a chance. It's now, you know, ordinary and necessary, which is what the IRS says you need in order to write stuff off. And all those cars now get to get written off.
- [23:48]
Sean
Brilliant business use. So they don't even have to be £6,000?
- [23:51]
Grant Newell
Nope.
- [23:52]
Sean
Wow, that's awesome.
- [23:53]
Grant Newell
Yeah, so that's, you know, that's one of those things where you have to be. And it's documented. And that's the big thing is, you know, it's documented who goes to those games. It's documented who uses the cars. All documentation will get you out of a lot.
- [24:10]
Sean
Yeah. Because if you get audited, they're going to be asking for that first.
- [24:13]
Grant Newell
Exactly, exactly. That's. In a lot of times, they won't even go through long audits. If you have good paper trails.
- [24:20]
Sean
Oh, yeah.
- [24:21]
Grant Newell
If you have good accounting, if you have good receipts, if you have good contracts, they're like, all right, we're not going to waste our time here.
- [24:27]
Sean
Smart.
- [24:28]
Grant Newell
But if, but if you're like, if they're like, hey, let us see your operating agreement. You're like, oh, I, I don't got one. Then they're gonna be like, okay, our time will be. We'll. We'll get our money's worth here, you know, but if you're like, here's our operating agreement. Here's all our receipts. Here's our accounting. It's clean, it's easy to find. Then they're like, all Right. We're not gonna waste our time.
- [24:50]
Sean
Yeah.
- [24:50]
Grant Newell
You know, we'll go find somebody that is not organized, which, I mean, there's a lot of people who are unorganized and they get a lot of money from them.
- [24:57]
Sean
Oh, I bet.
- [24:58]
Grant Newell
And so I always tell people, I'm like, if you can, if you have good contracts and you have good receipts and you have good accounting, a lot of times you'll be done in a couple days.
- [25:08]
Sean
That's why I don't cheap out on it. It's one of those things as entrepreneurs, like, you want to get the best deal on. But I'd rather have peace of mind.
- [25:15]
Grant Newell
Exactly. Because you don't want them to knock on your door and half a million dollars go out the window. Because it was, you know, that would.
- [25:23]
Sean
Ruin the business, honestly.
- [25:24]
Grant Newell
Exactly. And that's, you know, I mean, lucky for him he had the money and it didn't ruin his business. But to a lot of people, half a million dollars in back taxes ruin them.
- [25:34]
Sean
Oh, yeah. Then they could take liens out and who knows what else they could do.
- [25:37]
Grant Newell
Exactly.
- [25:37]
Sean
They got a lot of power.
- [25:38]
Grant Newell
Yeah. I mean, they can have access to your bank accounts.
- [25:41]
Sean
Really?
- [25:42]
Grant Newell
Yeah. If. If it gets that bad, they can have access to your bank accounts. They'll garnish your wages, all that.
- [25:47]
Sean
Damn. That's crazy.
- [25:48]
Grant Newell
Yeah.
- [25:49]
Sean
Are you dealing with a lot of athletes since you got a football background?
- [25:53]
Grant Newell
Not as many. Because it's, you know, it's hard. They get paid W2.
- [25:57]
Sean
Yeah.
- [25:58]
Grant Newell
And so, you know, the majority of the incentives that you can do is, you know, through stock market and real estate. For us, we work a lot with personal brands and being able to have serial entrepreneurs, have multiple ventures, and we can spread out what we need through those.
- [26:15]
Sean
Yeah.
- [26:16]
Grant Newell
So, you know, influencers and things like that. We get a lot of those. Because, you know, I say the Kardashians, they laid out the greatest tax strategy of all time. And people didn't realize it, but whenever you. Whenever you look at it, all their trips to Gucci, Louis Vuitton, their house, everything that they ever did was a tax write off.
- [26:45]
Sean
Wow.
- [26:45]
Grant Newell
Because they were on the show.
- [26:48]
Sean
Crazy.
- [26:48]
Grant Newell
In order to do the show, in order to get people to watch the show, they had to go shopping, you know, on Rodeo Drive. You know, people wouldn't watch if they went, you know, just up the street to the gas station. But everything they did, the house, the cars, the purses, the clothing, all of it, 100% written off.
- [27:07]
Sean
Wow.
- [27:07]
Grant Newell
Because. Because they made their lifestyle, the business, and that's and that's where I kind of had that unlock was, wow, people can live their lives and write off on the taxes. That's better than, you know, any real estate deal you can do because you're just living your life and all of it becomes a tax write off. I mean, Gary Vee was another one. He didn't realize he was doing a tax strategy either. But, you know, he said, document your whole life, you know, and let that become your business. Because then you can say, like, the rock. I think he's the biggest personal brand. I think there probably is. He started so many different businesses. He started a energy drink and then he did alcohol. Yeah. I mean, like, he does everything because he has a personal brand. He can do something random off the wall, and people are gonna buy it.
- [27:58]
Sean
Yeah.
- [27:59]
Grant Newell
Because he built that personal brand, but he can now write off his whole lifestyle. He's like, I like to drink tequila. Let me start a Tequila brand. So now anytime he goes and drinks tequila, it can be used as research, you know.
- [28:11]
Sean
Awesome.
- [28:11]
Grant Newell
So it's crazy that, you know, I tell people, figure out what you like to do, and let's figure out how to make it a business.
- [28:18]
Sean
Yeah.
- [28:19]
Grant Newell
Because then you can keep doing that and you don't have to pay taxes on.
- [28:22]
Sean
So building a personal brand is one of the biggest tax write offs you can have done.
- [28:26]
Grant Newell
Yeah.
- [28:26]
Sean
For people watching this, to me, it is.
- [28:28]
Grant Newell
It is the greatest tax strategy of all time. Better in real estate. Better than anything you can do, because you're just living your life.
- [28:34]
Sean
Right.
- [28:35]
Grant Newell
And that's what you want. You want to just be able to live your life and not have to pay taxes.
- [28:39]
Sean
Great. Imagine going on a cruise or a vacation and you could write off some of it.
- [28:43]
Grant Newell
You could write off all of it if you're documenting it.
- [28:46]
Sean
Really. So if you're just posting content on social media about it.
- [28:49]
Grant Newell
Yeah.
- [28:49]
Sean
Wow.
- [28:50]
Grant Newell
That trip, if you're posting about, you know, hey, I'm. I'm on this, you know, Royal Caribbean cruise, and, you know, you're posting, hey, look at this room. You know, all this, that's. That's a tax write off.
- [29:03]
Sean
I need to start doing that.
- [29:04]
Grant Newell
Yeah. Because you're there and, you know, like, let's say you decide you want to rent out one of the rooms and film podcasts on the cruise. Now that trip is you film one podcast a day. The whole thing's. The whole thing's a write off now.
- [29:17]
Sean
Wow.
- [29:18]
Grant Newell
You know, you just have to do business each day that you're there. And the whole thing can be written off.
- [29:25]
Sean
Crazy. What if it's just a business call or like a meeting?
- [29:28]
Grant Newell
Those ones are a little bit tricky. As long as you take like meeting minutes or things like that. But in order for those ones to be there, the government might say, hey, you know, did you really have to be on a cruise ship to have that? You know, but if you do the podcast.
- [29:46]
Sean
Yeah.
- [29:46]
Grant Newell
If you, you know, bring some equipment, just do like a light podcast there, then they're like, well, yeah, you had to be there because, you know, because you're filming it. And those, those ones I tell people, I'm like, if they can't knock that you had to be there, you're solid, you know, because you post this on YouTube that, hey, we filmed this on the cruise ship. They can't argue with it. You documented it. It's out there.
- [30:11]
Sean
That actually be a cool idea, just bringing a pod studio to a cruise and like interviewing random people I meet there.
- [30:17]
Grant Newell
Exactly.
- [30:17]
Sean
I'd be funny.
- [30:18]
Grant Newell
Yeah. I think it's what the hard knocks guy, where he just. Oh, yeah, all of his stuff. School of hard knocks. Yeah. He gets to write off all those trips because all he does is he just goes, walks out, finds people. Now the whole trip completely write off.
- [30:35]
Sean
Yeah. Daniel Mack does that too.
- [30:36]
Grant Newell
Yeah.
- [30:36]
Sean
What would you do for a living?
- [30:38]
Grant Newell
Exactly.
- [30:38]
Sean
Yeah. Interesting.
- [30:40]
Grant Newell
And I mean, the thing is, is a lot of people don't even realize they're laying out these great tax strategies for people. They're just doing.
- [30:47]
Sean
Right.
- [30:48]
Grant Newell
And I'm like, oh, wow, that is a really great strategy if you just put the pieces together.
- [30:54]
Sean
Well, not a lot of people are on top of it like you, because a lot of these accounts are on the older side. They don't know about this social media game, these personal brand write offs. That's not like a common thing, you know.
- [31:04]
Grant Newell
No. And I mean, a lot of times, I mean, the thing is, is people will just go off of real estate. That's a lot of people. They'll be like, oh, we work with real estate investors because it's an easier one. You know, you get the depreciation and all that stuff. And then it's like, hey, this is an easy one. But it's harder to dig in the tax code to find, you know, like, I laid out with the cars and the, you know, the suite. That one takes a lot more time. I have to do some digging. I have to find what sort of documentation we need rather than like, all right, I just appreciate this real estate asset.
- [31:35]
Sean
Right.
- [31:35]
Grant Newell
It's a lot easier you can run through a lot of people with that, but it takes a lot more time to figure out, hey, let me do this, you know, let me research, figure out how we can do this.
- [31:45]
Sean
Yeah. How does the real estate one work?
- [31:47]
Grant Newell
So, I mean, real estate, you buy a piece of real estate and what a lot of people do is they'll do cost segregation studies, which is where you break down the asset into its individual parts, like the plumbing, the electrical, those sort of things. And you say, okay, I can depreciate the electrical in five years rather than 30 years. So that amount gets depreciated faster and it becomes a bigger one. So, you know, it's typically around 30% of the assets. So, you know, just for easy math purposes, if it was $100,000 real estate, you could write off about 30% in.
- [32:25]
Sean
Your first year just for owning the real estate.
- [32:28]
Grant Newell
Right.
- [32:28]
Sean
Oh, wow.
- [32:29]
Grant Newell
But you have to do that cost segregation study, which, you know, sometimes it'll run you about between 5 and 15,000. You have to, you know, it has to be a decent piece of real estate in order to be like, I mean, a lot of people do it on big ones, like over a million dollars. Because it's like you're going to pay 15 grand to have that done. You better get a lot more than 15 grand in a tax write off.
- [32:51]
Sean
Wow. I might have to look into that one then.
- [32:53]
Grant Newell
Yeah.
- [32:53]
Sean
Because my house is 2 million, so. But I only put down 20%, so I don't have the full equity.
- [32:59]
Grant Newell
Right. But if you're using that house for business purposes and it's a business asset.
- [33:04]
Sean
Yeah.
- [33:04]
Grant Newell
That cost segregation study can be done breaking off the individual pieces.
- [33:08]
Sean
Got it.
- [33:09]
Grant Newell
So, you know, like if, like I said, the plumbing, let's say the plumbing is $2200,000 in the house throughout the whole house. And it, you know, it's going to depreciate faster than the electrical. Let's say it goes five years now, that 200,000 is now broken up into 40,000 pieces over the next five years. So that's, that's where you can get those breaks. If, you know. And a lot of people use it on W2 people because they don't have any business expenses. And they'll say, okay, go out and buy this rental property and we'll do a cost segregation study on. Yeah, so that's, you know, that's the big one for a lot of real estate professionals is the cost segregation study. And if they didn't do it in the past, you can do what's called A look back study as well, where they'll take, you know, ones. I think it's like 1987, you can go back far and do them from there. And a lot of people, you know, say, hey, let me get this for you. And so they'll get big tax deductions in that first year because they went back. You know, if you had 1987, you got like, you know, you got like 30 years right there in. Or even longer than that.
- [34:25]
Sean
Like 35.
- [34:27]
Grant Newell
Yeah. You got a lot of years of depreciation that you can write off for that in that first year. And so that's where, you know, people, you know, win you over in the first year.
- [34:38]
Sean
That makes sense. Have you had clients try to move to Puerto Rico?
- [34:43]
Grant Newell
I know that tax strategy, but I haven't had any clients that have actually wanted to do it. Yeah, what does it look like? And I'm like, you got to live there for, what is it, six months in one day or something? More than half the year. Just barely more than half the year. And a lot of people are like, I'm dying to come back to the U.S. yeah.
- [35:03]
Sean
I haven't heard many positive stories.
- [35:05]
Grant Newell
Exactly. So, you know, to me, I always look, it's like, is it a bigger hassle than, you know, what you're going to get out of it? And do you really want to be tax free and have to live in puerto Rico for 50% of the year? I don't know, maybe you do. But for most people, they're like, I want to. I want to live in the U.S. yeah.
- [35:25]
Sean
I could see moving states. I've done that. I've moved from Cali to Vegas.
- [35:30]
Grant Newell
Yeah, but moving.
- [35:31]
Sean
Yeah. Moving countries is. Yeah, that's a whole nother level.
- [35:34]
Grant Newell
Yeah. Because I mean, it's totally different living, you know, moving from state to state. It's like, it's still America, but you move to a different country and it's totally different.
- [35:43]
Sean
Yeah, absolutely. Well, Grant, what's next for you, man? Where can people watching this get your services and learn more about you?
- [35:49]
Grant Newell
Yeah, so they can find us at abundantex.com, which is my tax and accounting firm. They can also find me on Instagram, YouTube, Twitter @Grant G. Newell.
- [36:01]
Sean
Perfect. We'll link it below. Thanks for coming on, man. That was awesome. Yeah, thanks for watching, guys. Check out the links. See you next time.