The Power Of Zero Show Why the Middle Class Could Soon Be Paying 45% Effective Tax Rates
David sits down with certified financial planner Mark Byelich to discuss why the middle class could soon be paying 45% effective tax rates.
When asked what investors should pay attention to in 2023, David says it's now do or die for those looking to take advantage of the Trump tax cuts that are set to expire in December 2025.
According to David, the most important thing you can do to help your money last longer in retirement is to pay taxes now at historically low rates.
David believes taxes have to double by 2030, or the country might go bankrupt - gone are the days when people could get away with 10 and 12% tax rates.
Will the Trump tax cuts be extended past the 2025 deadline? David thinks they will, but there are no guarantees in life.
Mark echoes David's comments and says that the Trump tax cuts will be extended no matter who's in office.
Mark feels extending the tax cuts is a terrible economic move but a smart political move for those looking to stay or take power.
David predicts that when taxes go up, we might end up with 1960-like tax rates where the lowest marginal tax bracket was 22% and the highest was 88%.
Mark and David agree that the middle class could soon be paying 45% effective tax rates when tax rates go up.
David dissects what eight financial experts are saying about rising tax rates.
If you're an investor looking to plan for retirement, David believes your best move right now would be to have at least six streams of diversified tax-free income.
Your goal for 2023 and beyond should be to take advantage of everything in the IRS tax code and focus on getting to the zero percent tax bracket.
Mentioned in this episode:
David's books: Power of Zero, Look Before Your LIRP, The Volatility Shield, Tax-Free Income for Life and The Infinity Code
PowerOfZero.com (free video series)
@mcknightandco on Twitter
@davidcmcknight on Instagram
David McKnight on YouTube
Get David's Tax-free Tool Kit at taxfreetoolkit.com