On today's episode, Cody and Justin are joined by Kieth aka The Wealthy Accountant who went from a small town farmer to a multi-millionaire tax professional. Want to know how good he is? Well he's good enough to have been selected by Mr. Money Mustache to do his taxes. That's a heck of an endorsement.

Keith's story is truly amazing. The way he self educated himself is as relevant today as ever with the access to training and the changing job landscape.

Hear how he started his business and became financially independent way before that was even a common phrase.

Episode Summary

Keith grew up in a farming family in small town Wisconsin

They didn’t really have anything to spend money on so they lived frugally

The family farm ended up going into bankruptcy when he was 18

In high school he started studying the stock market crash of 1929 and became really passionate about investing and he started investing at 18

He also started doing the books on his dad’s agricultural repair business

That eventually turned into fellow employees asking him to do their taxes

Before long he had 50 clients with no overhead

We talk about how different the interest landscape was in the 80’s

He talks about how excited he was to get a 10% mortgage

In totality he’s only ever worked for someone 14 months

At about 32 he realized he had accumulated $1M and he was married at this time

This being the late 80’s he had a $540/mo house payment and they lived on less than $10k

He spent all day outside of tax season just sitting around reading books and learning

In reality he never got a college degree but didn’t need one

Even though he didn’t have a degree he spent a decade just pouring over books

He was a financial independence guru before FIRE was even a term

The first blogger he really ran across was Mr. Money Mustache

In fact he even did Mr. Money Mustache’s taxes!

He points out that before you get to stressed out over tax loop holes and maximizing everything, to stop and realize you’re probably always going to make some kind of income and if you’re serious about this path you’ll likely end up with more money than you’ll ever need

We then swap this discussion to the tax specific tips

He talks through standard 401ks, backdoor roth 401ks and mega backdoor roths

We also get into things like Cash Balance accounts available to self-employed members

Keith also mentions that standard brokerage accounts get a bad rap and shouldn’t be overlooked but still recommends filling up your 401k and IRA

When coming up with a tax strategy for someone he talks about how important it is to look at a person’s scenario on a long term view and not just year to year

You won’t want to miss the deep dives into the mechanisms behind the different IRA contributions, cash balances, and profit sharing which can take you to many times the $19k 401k and $6k IRA limits

Then we get into the discussion of tax moves you can make with non-qualified accounts like your standard stock market account that’s not a 401k or a IRA

One thing Keith points out is that these non-qualified accounts are tax advantage in a way because when you die, you’re beneficiaries won’t have to pay capital gains tax on all those earnings. Your kids get to take over those shares at the price listed on date of death and all those gains are forgiven from any tax burden

From Keith’s standpoint most tax loss harvesting is ok but not worth paying for

On the flipside, he’s a huge fan of harvesting gains

Harvesting gains is when you’re in the 0% tax bracket and have some room to give so you purposefully sell some shares for a profit and capture those gains without paying taxes on the gains

(STOP AND READ THAT LAST BULLET AGAIN…SO POWERFUL)

Keith also urges you to consider what your retired minimum distributions can climb up to be if you just let them sit in the traditional accounts until 70

Stay out of debt, invest,