SO, HOW CAN WE ACCOMPLISH THIS KIND OF LEVERAGE DEDUCTION?
THE TIME TO MOVE ON THESE TYPES OF STRATEGIES IS NOW.
A Minerals-oriented LLC will seek out commercialization companies that are looking for an infusion of cash. The LLC will purchase a significant amount of minerals such as gypsum, magnesium, volcanic ash, etc. at a significant bulk discount with the intent to donate those minerals. The LLC then holds the minerals for a year and a day so that the donation can be made at the current market value as opposed to the original purchase value. The prospective client joins the LLC with a cash contribution. Let's say that the contribution is $50K. Before the end of the year, they will receive LLC docs for them to sign and they will elect to donate their portion of the minerals to a charity already designated by a minerals-oriented LLC. The client's portion of the minerals will be donated based on a gallon value instead of the bulk discount (maybe tonnage) value. It will be calibrated to be exactly 4x the cash contribution. In this case, a $200K deduction. The following year, the client will receive a K-1 by March 15th and will receive a legitimate 3rd party appraisal to be submitted with the tax filing. The appraisal will provide the legitimacy of the 4 times deduction. If your adjusted gross income is $500K, then at 30%, only $150K of the $200K donation can be counted for this year's deduction. The balance of $50K can be carried forward for up to 5 years.
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