Inheritance Tax

There are some very dark clouds hanging on the horizon. Not only is Modern Monetary Theory being pushed, we are seeing increasing calls for an inheritance tax as well. Not only are our savings going to be redirected from productive ends towards bridges, war planes and social programs, these savings will be heavily taxed when we die.

We can of course ignore the clouds. The fact that they are gathering on the horizon do not necessarily mean that there will be a storm. However, the prudent thing to do under current circumstances is to get our ships to harbor, and to nail down anything that can be swept away with the wind. In practical terms, we need to get out of risky assets and into low risk assets. We must also ensure that we transfer as much wealth as possible into the hands of the younger generation.

I have done this myself. I have transferred all my risky assets to my children, I have sold my house in Norway, and I have gotten out of all debt. The surplus has been put into cash and gold. As a result I feel like a skipper standing on shore, knowing that my ship is safe, and my possessions are safely stowed away. The storm clouds are no longer a great threat. They have a certain fascination. I will watch the storm with interest from the safety of my wife's apartment, and I will thank my lucky star that I got everything safely ashore before it hit.

If the storm does not hit, and everything is plain sailing, I have not missed out on much. My children will benefit from such a lucky outcome. Without the upsets that are sure to come with a gusty storm, the risky assets I handed over to them will give a reliable return. My only loss would be the difference in appreciation between the house I sold and the gold I got in return, and so far I have been on the winning side of this transaction. House prices in Norway have been stagnant while the price of gold has inched upwards.

I have no trouble recommending anyone with adult children to do what I have done. Transfer as much wealth as possible to the children. If this is somehow made difficult by laws related to gift giving and inheritance, sell everything, buy gold coins, and hand it over privately to the children. The exact manner in which the transfer should be done depends on the law of the tax authorities. If the laws are lenient, things can be done within the law. If the laws are oppressive and confiscatory, things need to be done illegally.

In my case, I chose to break the law. I'm on the hook for tax evasion. However, since I do not own anything, there is nothing for the tax authorities to take. All they can do is arrest me, something I doubt that they will do. They gain nothing by throwing me in jail, and there is a limit to how long they can keep me locked up. I will be inside for a few months at the most.

For anyone opting for the illegal route, it is important that things get done completely and thoroughly. Everything must be done within a year. All allocations and transfers must be be done before the annual audit. By then, all wealth must be out of our accounts. Anything left will be confiscated by the state. Don't let them get anything but a few crumbs at the most.

What must also be appreciated is that the illegal route excludes us from the system for life. Everything official must be done via proxies. I have a telephone number I need to pay for. I do this by the help of one of my children who acts as a proxy. Should I at some point decide to sell gold, this too has to be done via proxies. Investments in stocks is the same story.

However, as a middle aged man with three fully grown children and a trusting wife, I have no lack of proxies to help me out, and it's not like I need their help all the time. I need my phone bill paid, and I need some cash for myself. Apart from that, everything I need is baked into the arrangement of marriage and grown children.

I risk a few months in jail. In return, I've tucked away enough wealth to last me a lifetime, and my children are secure in having received their inheritance while the rules were still allowing for this to happen.