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Tangential, but a pet project I've been working on has been doing exactly that! Looking at US federal tax laws and using constraints solves to find optimal paths to the lowest taxes.

I don't really do anything besides play with it, my taxes are very simple and boring, but it's been a fun project to play around with.



Yeah, that is tax minimization, not tax avoidance. There's a big difference.


Very big! Minimization is when I do it, avoidance is when Apple does it.


According to this article, it’s actually evasion when Apple does it!


The great thing is nobody knows the difference between minimization and avoidance unit after years of very expensive litigation.


Those two concepts are very much the same thing. There is no literally distinction between legally minimising the taxes you have to pay, and legally avoiding a tax that you would otherwise have to pay. You just want to have a different word to use to criticise people/groups/companies you don’t like doing something you seem to otherwise approve of, so you don’t look like a hypocrite.


My accountant defined it this way… minimization is legal, avoidance is not.

Minimization is just taking advantage of the tax loopholes and strategies that are within bounds. Avoidance is lying or ignoring.

Yes it’s possible to minimize your taxes down to zero legally in many cases, but you’ll pay a good percentage of that savings to accounts and lawyers for managing that structure.


I’m struggling to believe that a qualified accountant said that. Tax avoidance is completely legal, if it becomes illegal, then that’s called tax evasion.

Avoidance and “minimisation” are the same thing, evasion is a crime.


Isn't it tax avoidance (legal) vs tax evasion (illegal)?


That is correct


How? There's a big difference between avoidance and evasion, but avoidance and minimization mean pretty much the same thing in this context.


I think of minimization as doing things like taking deductions, and avoidance as creating confusing structures of new entities in order to take advantage of gray areas and deciding that the cost of getting caught is not material.


Yeah, that's fair enough; outside of keeping as much money as I can in ETFs and index funds, my tax strategies are pretty much non-existent since I don't have enough money for it make a huge difference.


If there are any novel or situation-specific conclusions drawn, that sounds like an easy sell to CPAs and independent tax preparers. Maybe even individual tax optimizers.

My naive assumption is that sophisticated analysis will return the same few well-known recommendations almost all the time -- the taxation variant of eating properly, sleeping regularly, and getting appropriate exercise.


Certainly for anything I actually do, I've not found anything that is better than something like TurboTax gives me.

The scope of what I'm working on is trying to build strategies for holding and selling stock as well in order to minimize taxes. I've only ever used it on paper trades.




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