I didn't invent the Two-Company Architecture — I scaled down what family offices and investment businesses already do. And here's the part most people get wrong about why it matters.
How do you interpret Higgins, §212, or Lender Management? My understanding was that managing your own investments is not a trade or business (Higgins), so the fees your holding side pays your management side are nondeductible to the payer while remaining income to the recipient — you create taxable income without creating a deduction. Lender Management is the only sanctioned path, and it requires multiple genuinely separate taxpayers, a profits interest, and real services — unreachable for one household. but i am not a tax professional or lawyer so I might be wrong. How do you view this? NFA
How do you interpret Higgins, §212, or Lender Management? My understanding was that managing your own investments is not a trade or business (Higgins), so the fees your holding side pays your management side are nondeductible to the payer while remaining income to the recipient — you create taxable income without creating a deduction. Lender Management is the only sanctioned path, and it requires multiple genuinely separate taxpayers, a profits interest, and real services — unreachable for one household. but i am not a tax professional or lawyer so I might be wrong. How do you view this? NFA