In the past, the IRS allowed a basis upgrade for assets within an irrevocable trust. However, the landscape has shifted with the introduction of Rev. Rul. 2023-2. Now, unless these assets are part of the original owner's (or "grantor's") taxable estate, the basis remains unchanged. To qualify for the basis upgrade, the assets of the irrevocable trust need to be part of the taxable estate when the grantor passes away. This change is significant from an income tax perspective.  When assets are...

Generational Wealth ‘Curse’ Is Causing 90% of Families To Run Out of Money — How To Beat the Odds Generational wealth, often envisaged as a blessing, has been paradoxically termed as the ‘curse’ due to the startling statistic that up to 90% of families deplete their inherited wealth by the third generation. This phenomenon, known as “shirtsleeves to shirtsleeves in three generations” hints at the potential pitfalls accompanying inherited wealth. So, what propels this rapid dissipation, and how...

Dr. Mitchell Roth, aka Dr. Mitch, talks about his book “A Taxing Problem: The Psychologist’s Prescription for a Just Tax System.” He also talks about the possibility for running for U.S. Senate.

The widening chasm between the mega-rich and the rest of society is an increasingly polarizing issue. In the wake of escalating wealth concentration in the hands of a few, a question of profound significance emerges: Is there such a thing as too much wealth? If so, should there be a cap on the wealth one can accumulate? Now, let’s set the stage by recognizing many billionaires’ significant contributions. Their innovative spirits have driven technological breakthroughs, improved lives, and...

An insidious adversary lurks in the shadows, silently diminishing the hard-earned benefits of social security retirees. It’s elusive and surreptitious – we call it the Stealth Tax. While taxation itself is not inherently nefarious, the stealth tax, often not perceptible to the untrained eye, emerges as a force to be reckoned with in its impact on our most vulnerable citizens – retirees. What is Stealth Tax Stealth tax is an informal term for certain tax increases that take time to be...

In the land of opportunity, the American dream has traditionally been defined by a single, full-time job that provides the income and benefits necessary to sustain a comfortable lifestyle for a family. However, with shifts in economic realities and growing income inequality, many, maybe even most, Americans find that this traditional employment model is insufficient. The rise of the “gig economy” and the increasing popularity of side-hustles serves as a testament to the changing landscape of...

Nothing is more frustrating than buying groceries or completing a shopping trip and being rung up at the register only to find out your total cost is much more than anticipated. This is because of sales taxes. Many people often forget about sales taxes but get a rude awakening when making purchases, especially larger ones, because sales taxes are a fixed percent. The bigger the purchase, the bigger the sales tax.  People are already struggling in this super-inflated economy to make ends...

What is Regressive Taxation Conventionally regressive taxation has been defined as a tax policy that results in the tax burden falling disproportionately on low-income earners. In contrast, high-income earners pay a lower percentage of their income in taxes. This means that as income decreases, the percentage of income paid in taxes increases.  In his book, A Taxing Problem – The Psychologist’s Prescription for a Just Tax System, the author, Dr. Mitch, puts a finer point on the...

Do you ever feel like the United States tax system is using you? Are you paying fees to the government at every turn. Or perhaps you feel like you simply don’t understand how these things work, but in your gut, you feel like you’re missing a big part of the picture that impacts your life. Most people are not privy to just how much Americans are taxed, often by other names, and through what avenues. Motor vehicle fees are one of many types of payments to government that can be called a “hidden...

Franchise taxes are a type of tax levied on corporations by states in the United States. Corporations and similar business entities enjoy certain legal benefits.  One is the ability to exist indefinitely until terminated by the desire of the owners, or until declared insolvent and allowed to die.  This allows the business of the corporation to persist beyond the lives of those who began the business. It also allows for the accumulation of capital and ownership separate from people...