[PopAlongKid]

>you have to pay back the 401k over time

And you are also permanently out $50K of charitable contribution in just a single year. Pretty hard to justify if you have young kids who might go to college some day, or if your spouse doesn't wish to contribute to charity at that level.

And somewhere in your example you seem to forget that charitable contributions reduce taxable income, but not AGI.

Lastly, you forgot to take into account the deductions for self employed health insurance, and the deduction for half of self-employment (SUTA) tax, both of which reduce the amount available for retirement plan contributions.

[yieldcrv]

money not really out of your control if you have a donor advised fund or private foundation or both

my comment mentions MAGI specifically for someone like you, I’m aware this thread started off with being able to use the IRS’ free filing software and now is talking about not paying the government much or anything in taxes

[PopAlongKid]

>money not really out of your control if you have a donor advised fund or private foundation or both

Not sure what you mean by "control", but you are not getting it back. In one year, you have blown a $50K hole in your budget that you will never be able to spend on anything else.

[ndriscoll]

Presumably the idea is that you can use that "donated" money to buy influence, e.g. buying your kids' way into fancy schools. I don't know whether $50k/year is enough to do that though.

[yieldcrv]

now you’re talking, the other side of this is that this is just year 1

years 2 - n the tax exempt nonprofit account grows tax free, after its balance is large enough it can independently be an investor in VC/PE/Hedge Funds and have an infinite time horizon. just keep funding it until the homerun.

the same goes for the tax deferred retirement accounts, they are separate entities and can eventually become investors for higher risk higher growth things

they can be generational wealth things as well that allow for influence from your family, without the complications around ex-spouses, inheritance tax, cost basis adjustments, liability. just everything at your discretion while remaining judgement proof.

[yieldcrv]

it really depends on how you get value out of it. tax deferred and tax exempt are still ammunition. and its important to load them up with as much money as possible, and then they grow tax free from there on.

by your hyperbolic word choice, I understand its important for you to be right about your view. don't do it then.