Why I Owe The IRS $1.5 Million Dollars

Graham Stephan

329 миӊ. көрүүлөр40

    Here is everything you need to know about the US Tax System, how it works, and why I owe the IRS $1.5 Million Dollars - Enjoy! Add me on Instagram: GPStephan
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    TAXES 101:
    First, you have your FEDERAL INCOME TAXES.
    When it comes to the tax brackets, you will ONLY pay the higher tax rate on whatever income is above that threshold - NOT the entire amount.
    Second, you have PAYROLL TAXES.
    This means, if you’re working a job, or maybe you’re self employed - you need to pay a separate Social Security and Medicare Tax, which could be as high as 7.65%-15.3%.
    Third, you have STATE INCOME TAX.
    his one depends on where you live…but, if you don’t live within one of the 9 states which have ZERO STATE INCOME TAX…you’ll have to pay something extra here, too.
    Fourth, you have SALES TAX.
    This is that little extra bit that’s tacky on to your receipt anytime you make a purchase.
    Fifth, you have PROPERTY TAXES
    Generally…this is anywhere from .5% of the assessed value of the property annually, to as high as 2.3% of the assessed value annually if you live in Illinois.
    Alright, so there FIRST, most straight forward “tax deduction” out there is just called “The Standard Deduction.”
    This is, BY FAR, the most common tax saving strategy out there, and it’s almost always going to be “automatically applied” by even the most basic of tax softwares. This gives people the option to reduce taxable income by $12,400 if you’re single, or $24,800 if you’re married.
    After that, you also have a VERY popular one called a Traditional 401K retirement plan.
    This is an employer-sponsored plan that allows you to invest PRE-TAX money, and then you’re taxed when you begin withdrawing the money after the age of 59.5. For example, if you invest $100 per week into a 401K, you’ll be taxed as though you make $100 per week LESS on your paycheck.
    But once we go beyond the basics….where the tax code REALLY shines is for business owners. The REALITY is that here in the United States, self employed business owners have the benefit of getting a LOT of tax deductions and write offs available to them to bring down their taxable income.
    The first, like I mentioned in my previous video, is running your business as an S-Corporation. This is a legal entity that you can set up, and then…that S-Corporation becomes your “employer,” which you just happen to own 100% of. The advantage of this is that you can designate yourself a “Salary,” which your S-Corp pays you…and then, your remaining profits are received as corporate distribution, which is not subject to the 15.3% of payroll tax.
    In addition to that, when you own a business - items spent DIRECTLY on that business are generally a “write off” against your income. If you incur any expense relating to that business generating PROFIT, it’s reduced from your gross income and you will pay less in taxes as a result.
    Alright, now…as for myself…and why I owe the IRS about $1.5 million this year: when you’re self employed, you’re responsible for paying what’s called “estimated taxes.”
    When you don’t make quarterly estimated payments to the IRS, you’re hit with an annualized penalty of 3-5% of the amount you’re supposed to pay. And for me, I found it MORE PROFITABLE to pay that penalty and have the ability invest that money upfront, instead, during a time where the markets were down.
    That’s allowed me to have more free cashflow to move around banks and negotiate a lower mortgage interest rate, I’ve put more money into the stock market, and I’ve had more overall mobility rather than paying that money to the IRS upfront.
    For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at GrahamStephanBusiness@gmail.com
    *Some of the links and other products that appear on this video are from companies which Graham Stephan will earn an affiliate commission or referral bonus. Graham Stephan is part of an affiliate network and receives compensation for sending traffic to partner sites. The content in this video is accurate as of the posting date. Some of the offers mentioned may no longer be available.

    күнү жарыяланды Ай мурун


    1. Julio Garcia

      6:13 now to you we know all those now, thank you 🙏

    2. raid_or_ die

      If you can write off stuff in your videos as a business expence couldent people just make youtube videos put litterally everything you buy in a video and it would be a write off?

    3. Go gameing

      Where I live there's no sales tax

      1. FxLifeStyle Forex

        Iñvest with my administrative Phil Hîs Àvailability îs ón whát$áp + 1 . 4 4 2. 2 9 6 6.8 7 0 fór móré îñfó .....

    4. Craig Gordon

      LOL. Thats nothing. Wait till Biden robs you.

    5. Kason Bryden

      14:03 - When he gets into why he is going to pay 1.5 mil.

    6. Merréll OBrian

      Taurus are so sexy.

    7. Renz Dirige

      The wording for the tax bracket should be income value in-between. Like they should just use an example rather than a list like a pie chart, line graph, or whatever. Say you have 100k income, well here's a pie chart of the tax bracket, so on and so forth because even some smart people misunderstood the tax bracket.

    8. Kevin Ruiz

      This hurts just thinking about it, taxes are complicated

    9. GobbleMeSwallowMe

      I owe too much money to the IRS I’m on the run and they can never catch me

    10. Aaron Powell

      That's it? Man, we need to tax rich people more

    11. Cameron Alam

      I just started working at and got my first paycheck on the 20th of December now i have to pay taxes to $200......yay...

    12. David H

      Me sitting around on my ass all day isn't going to pay for itself. Thanks.

    13. skyo280280

      why is there an income tax? we've earned that money.... sad

    14. Ryan Hunter

      Im from Canada so I'm apart of the 20 percent, only 19 percent more to go eh

    15. Star_1_Man

      Ask the IRS to produce the law that says Americans must pay income tax on their wages! The law does not exist! State income tax on your wages is also unlawful!

    16. Matt Hamilton

      You know we fought a war over taxes our government ain't nothing but criminals trying to rob the people

    17. TheOutsider Jess

      I still feel stupid trying to understand taxes

    18. Loyd Christmas

      Don't pay em. There crooks.

      1. Graham Stephan


    19. 2 Bird dogs and a Wolfdog

      Looks like a good time for a super car deduction for your "business" 🙃

    20. Marlouchiboudichou

      I can't believe the first 9k are taxed 😶 here in Quebec the first 12k are tax free !!

    21. Tynecia Wilson

      Video qualityyy

    22. Eliznah Smal

      You don't owe them anything. Tax is the biggest scam and westernized governments are the biggest thieves in our societies. We as the people need to collectively stop reaffirming their scam by just going with it and being okay. Tax needs to be eradicated. And people need to stop relying on the illusion of the government as their guardian.

    23. saiful hasan

      I have a question, I'm going into a part time job that will pay around $8500 a year, does that mean if I use the standard deduction I will have to pay no taxes?

    24. web2yt

      Because lazy people want government "free stuff".

    25. Lima Bean

      I'm 16 and taxes make me cringe like how our founding fathers went to war over a 2% raise in taxes... And people want more taxes... How... I'm flabbergasted in the people running the country like how.

    26. Charles Joseph

      Damn, this is the most important video

    27. Vaggeto

      Amazing video, great job even going into S-Corps!

      1. Graham Stephan

        Leave a message through my gmail realgrahamstephan for inside tips and guidance

    28. Elias Hernandez

      America is the most rigged country

    29. Crashsoon

      Did you convert your older investment into capital gain tax? Income tax only apply to investment within 1 year.

      1. Graham Stephan

        Leave a message through my gmail realgrahamstephan for inside tips and guidance

    30. HP Printer

      missed HSA contribution which can lower the taxes

    31. Thomas Mendoza Ray

      how many times has he said"tax"

    32. Donald Horton

      Really, you have investments that guarantee you a return greater than the 6% underpayment penalty? Please share...;-)

    33. Ron Smith

      It simple move to states with no state income tax!!!!

    34. James Smith

      When graham man tell you to like you like 👍🏻

    35. LouieGrind

      The topic of taxes is only complex in the US. All taxes in Sweden is done automatically every year. The only thing you have to do is double check if they got your capital gains vs losses right, which in my case they've always done.

    36. Smokey waffle

      trust me do not pay it its not worth it

    37. AlexMKE

      So the only way to really save as much money as possible (instead of spending them on expenses aka write-offs) is to use an s-corp?

    38. jelly beans

      damn well i’m moving.

    39. Mark Bisson

      Uh oh, all that work telling us about the complexities of taxes and you messed up "Your vs You're" @8:54. Thanks for all the good info on how much the government is taxing me. 😦

    40. F1 L0

      will you be doing the same next year, in other words was it worth it not paying the estimated tax beforehand?

    41. steve the legend

      Move to the uae 🇦🇪 NO INCOME TAX !!!

      1. Graham Stephan

        Leave a message through my gmail realgrahamstephan for inside tips and guidance

    42. Sidney

      Thank you so much Graham. Your content is amazing and I’m learning so much!!❤️

    43. Jae Bea Blessings

      But how much do you get to keep?

      1. Graham Stephan

        Leave a message through my gmail realgrahamstephan for inside tips and guidance

    44. Ghost Bandz

      Biggest scam ever

    45. Kelton Johnson

      For a small business owner, a downside of S Corp is you lose the QBI deduction- but it’s pretty complicated math and depends on if you have phased out of QBI anyways.

    46. JYT

      What's upgraham?

    47. Jacob Sheets

      Would love more tax videos!

    48. Fox Tracks Music

      Graham thank you for the video! Really informative. My heart goes out to you and the amount you owe to the IRS. We are a music production company and we can make custom music for your videos as a business write off for you. Normally we charge much more than this but for you I would be willing to work with you for.... 1.5 Million Dollars.

    49. Finance Veteran

      Graham I wish you would see this comment. My entire life has changed because of you. And truly only you. I started following you when you had around 10k subscriber and were mainly talking real-estate. I took your advice literally while watching one of your videos and called a lender about a property I seen for sale I wanted to own. I ended up buying that house. I now own 4 houses and am doing KGup full time. And have become a great day trader after the success bug bit me. I was able to get out of the Army after 10 years because of the position I’m in now thanks to you. You’re a true saint In my life. If KGup did you any good. It wasn’t money. It was the help you provided. Even my entire KGup channel is based around coffee and investing because of your reference to it 😂. I have a series called The Coffee Breakdown

    50. mcteethinator

      Your tax system is messed up... I'm a dual US/NZ national whose spent time in Australia, and out of all 3 of those countries the US has the most obtuse, opaque and outdated tax system of all 3.

    51. poormesskin

      glad to know that we get to pay endless taxes for the endless taxes....buy a few lots of dirt with a house on it and pay taxes forever and NEVER OWN it....thats a lease not ownership...dont forget, the goverment thinks THEY own all of this stolen blood soaked dirt we live on and love having the power to FORCE US TO PAY FOR THEIR LAVISH LIFESTYLES and SPENDING HABITS

    52. Dr. Nick DPT

      With the 401k, you save on taxes on the front end (now) and can invest slightly more now, potentially getting a better ROI long term.

    53. charley moua

      Your make jake Paul now

    54. Juan Francisco Duque

      In Colombia there's no income tax but there's a 19% sales tax

    55. Eric Primiano

      Iv'e learned more in these 17 min than I ever have as a student. Fantastic work, I love watching your videos Graham!

    56. iwo2024

      Land of the freedom to pay your taxes lol.

    57. Matt

      From the spare bedroom? Are you saying that space isn't used exclusively for business so you shouldn't be writing it off on your taxes? :)

    58. TrinityLinkq

      All these taxes to pay for the government but as soon as there's a pandemic they cant pay us back with a small stimulis smh

    59. TrinityLinkq

      Biden tax seems good but if i ever hit big on my options contracts im afraid I'll never make it back to my home state CA 😑

    60. John VM

      But Graham, allowing your tax bill to go past due sounds terrifying. How come that doesn’t affect one’s credit score?

    61. Chris Giuseppini

      Lol next week: Graham marry's a farm animal in vegas to save 10% on taxes

    62. Zyphera

      30% to 70% taxes? I thought that USA had low taxes!

    63. Sally Kurait

      Love your videos!

    64. N A

      So you're admitting you intentionally failed to comply with tax law, because you're treating the government's penalty and interest rates as a low-cost loan? You do realize that could land you in some pretty hot water, right?

    65. N A

      5 to 15 thousand dollars! What a steal! I just got a quote for something akin to a cost segregation analysis that starts at 75 thousand. And this is just a small side project. 5 to 15 thousand barely buys lunch in the tax world these days.

    66. N A

      Don't forget about city income taxes. In some states, like Ohio, they can be just as high (or higher) than the state income tax.

    67. N A

      What? Taxes are not taught anywhere? Tell that to the 10 or so different tax professors that took many hours of their lives to teach tax to me.

    68. mitchell olson

      Thats a good problem to have, wish I owed the IRS a 1.5 million

    69. Jonas Lind

      @graham how does not paying the estimated payment to the IRS help you get better interest rates? wouldnt you already get that due to your financial situation?

    70. Yovani H.


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    72. Dayan

      Government should get a job...

    73. ZinedineZidane

      Too much rambling for this in an nutshell: owe money if you have to pay way less for it (here 2% /year) than what you can make with it (e.g. nasdaq 10% / year)

    74. G-Dub

      Taxation is theft

    75. Mark Efreet

      "But seriously taxes go and fund good things" Then he proceeds to list all the things I hate about the world.

    76. Jason Haymond

      You're pretty much the only channel I'll hit the like button for, Graham. Thanks for the info, as always!

    77. Web Tristan

      All this goes further to show how much the government is involved in stocks. I invest in cryptocurrency now with the reputable Mrs Joyce. In august I made $26,000, my total in tax was not more than 12%.

      1. Michael Macfarren


      2. Web Tristan

        She is on telegram at "JoyceDavies" . Do mention I referrered you.

      3. Christian Fahretin

        So how do we reach Mrs Joyce?

      4. Rosabel Monroe

        Mrs Joyce Davies, CEO Fortune Academy, was on luxury magazine recently. She was tagged "badass woman in business". She is good, I read.

      5. James Strong

        Wow. I only just met her last two weeks, I have being paid twice though. It is good, I will just continue for as long as it lasts, already recovered my profit.

    78. Poker Studdd

      As a card player I have to pay wait for it... zero taxes. Ty America.! Cash is king.

    79. Snoopy gamer

      I live in florida so as soon as he showed that map i was like YEAH LETS GO BABY.

    80. Daniel

      Please do a video more in depth about tax incentives and ways to avoid paying so much

    81. Swaze Gaming

      we're all fucked

    82. Drive Digital Library - Section 1

      So is this why millionaires give themselves salaries of $1

      1. Pokemon Master


    83. Naima Ahmed

      Stephan, you’re life path 9 just like me 🤯

    84. simplicity sions

      would have been SUPER NICE if you provided sources for the info used it. I really wanted to see that tax bracket table and cant find it

    85. RaiderForTheWin

      Who else kind of understood what he was saying or is it just me

    86. New York Timelapse Channel


    87. Mark Ho- Real Estate Videos

      Some taxes can be "managed". Note: MANAGED.. which is legal. Not evaded which is NOT legal. I am talking about Federal income taxes. A mentioned, the 401K can work for that. Same with an IRA or 403B depending on your job. Self-employed people have even better alternatives (SEP-IRA for example). At least in California, the state return is based in large part on the Federal return so reducing Federal taxable income helps with the state. Property taxes are mostly NOT able to be managed (short of disputing property value). Finally.. again in California.. not everything is subject to sales tax (most food bought in grocery stores for example). Moral: With taxes.. like most thing.. knowledge is power.

    88. P Wettergreen

      $401K questions. 1. Why not explain risks to 401K - many employers have a time to vest on 401K if you leave before that you get no matching funds. Most business issue matching at year end so any time you leave a job you lose that matching for whole year. As a government contractor I have often lost jobs through no fault or own. Such as when contracts end or are not renewed. The company usually lets everyone go. 2. Stock market has gone up every year way more than my 4% average return on a 401K. My personally managed portfolio has averaged 13% over the past 9 years. 3. MY IRA investment is after tax so the income portion has been taxed. Since you say taxes will go up in future. Why not pay tax now and just pay on interest in future rather than paying tax on income and interest when I an 72 and unemployed

    89. geogerf

      Graham (and to anyone else interested): my company specializes in Cost Segregation. I'm always happy answer any questions about it and/or explore a potential opportunity!

    90. I like tools

      This is why tax evasion happens. They tax everything they can think of and a lot of the money is wasted. The government is more corrupt than the people that evade their taxes. I get the sales tax and the road tax, and maybe the income tax, but everything else is ridiculous. Also taxing people different amounts based on their income is socialism.

    91. Sabrina Tatalias

      Taxation is theft🤷‍♀️

    92. Kaeda Tiger

      I love ALL financial education. Mo boring mo betta.

    93. Lenny Ramirez

      Not even Gram is safe. You exhausted all the write offs or just lazy? maybe more marketing?

      1. Lenny Ramirez

        Please Gram this spam will kill your channel. Get loud to the higher powers👊

    94. Nico Kinner

      Hope this is not to personal of a question, but I really need this info, being self employed, what health issuance have you found to be the most preferable?

      1. Nico Kinner

        🚨^^ Fake Graham ^^ 🚨

      2. Nico Kinner

        What the, was that a real response?

    95. James Finley

      These taxes are outrageous. No tax is the only progressive tax

    96. Hope Sears

      Yo where is Beyyyn , call Cristine - the boys are talking taxes.

    97. Tamara Lucas

      Janet Yellen will most likely work and negotiate to put the US into negative interest rates. She wants to drive all sideline cash into an overpriced stock and real estate market. Then when every thing crashes in another 5-8 years, we are all the same with the exception of the 1% elitist. And don't let Bernie Sanders fool you, he is an elitist, he has three houses and his portfolio is worth over $2M. AOC wears a $14,000 outfit on the cover of Vanity Fair. She says she only borrowed it and did not buy it, WHY? Why even give credit to a single outfit worth $14,000? Why not wear what a Socialist would and should wear, and I can promise you it won't be a $14,000 outfit? The Elitist Socialist are fake, they want the masses to be the same and they want to live a life of gluttony and privilege. These fake Socialists in Washington are all about creating their own wealth and making 99% of the population the exact same ----- slaves to the Socialist Elites.

    98. Chris Hammer

      You got a new watch!! Congratulations! I was tired of looking at the same one every video! haha @GrahamStephan Is it a blue dial datejust?

    99. Shamol Brown

      I always take notes when I watch his videos 📝

    100. blud

      Imagine living in a state that pays income tax. This post as made by Florida gang.