Free Unfair Advantage -The Power of Financial Education by Robert T. Kiyosaki Page A

town. He is famous for great Italian food. He earns a lot of money. His kids work in the business, and five restaurants is as big as he wants to get.
    Another friend is a famous cancer surgeon. He has people lining up to see him. Since he can only see a few patients, he simply raises his rates. When asked if he wants to grow his business, he says, “I make a lot of money, and I am busy enough.”
    FAQ
    I am in the S quadrant. What can I do to earn more and pay less in taxes, legally?
Professional Answer from Tom Wheelwright
The most important thing to do in an S-quadrant business is to begin thinking and acting like a B-quadrant business. This includes hiring employees, increasing your investment in equipment and real estate and setting up your company as a B-quadrant entity. (An entity is simply your legal form of ownership. Most S-quadrant people are sole proprietorships or partnerships and these entities pay the most tax possible. Instead, look at B-quadrant-type entities such as limited liability companies, limited partnerships, S corporations and C corporations.)
    The B Quadrant
    “ I’m looking for the best people.”
    These are the words of a B-quadrant person. B means big—500 employees or more. A person in the B quadrant takes on tasks bigger than he or she can do alone. That means success in the B quadrant requires leadership skills and people skills, not just technical skills. This is why so many entrepreneurs, such as Bill Gates, founder of Microsoft; Walt Disney, founder of Disneyland; and Thomas Edison, founder of General Electric did not finish school. Entrepreneurs have the power and leadership skills to take an idea and turn it into a massive business—a business that creates jobs and creates wealth. For example, Silicon Valley in California is wealthy because it is a hotbed for high-tech entrepreneurs.
    Success in the B quadrant requires a team effort, because very few people can manage over 500 people on their own.
    Shining stars in the B quadrant are Steve Jobs of Apple, Richard Branson of Virgin, and Sergey Brin of Google.
    FAQ
    I am in the B quadrant. What can I do to earn more and pay less in taxes, legally?
Professional Answer from Tom Wheelwright
The opportunities to reduce taxes in the B quadrant are virtually unlimited. Almost all expenses in a B-quadrant business are deductible. B-quadrant businesses get tax credits for hiring employees, for increasing their research and development, and for investing in green technology. B-quadrant businesses also can often pay taxes at a lower rate than S-quadrant businesses, especially since the owners pay little or no self-employment taxes.
    The I Quadrant
    “ How do I raise the money to invest in my project? How do I earn more with other people’s money and pay less in taxes?”
    Earlier I stated that a key distinction of an I is that they use as much OPM as possible.
    Shining stars in this quadrant are John Bogle, founder of the Vanguard Funds, and George Soros of Quantum Funds.
    FAQ
    I am in the I quadrant. What can I do to earn more and pay less in taxes, legally?
Professional Answer from Tom Wheelwright
Using other people’s money is literally the best way to reduce your taxes in the I quadrant. That’s because you can take deductions for the purchases you make with other people’s money. Depreciation on real estate is a particularly great way to take tax benefits on someone else’s money. You get a deduction not just for the portion of the real estate you paid for with your own money, but you also get a depreciation deduction for the portion paid for with the bank’s money.
    The Quadrant in Simple Terms
E’s work for someone else.
S’s work for themselves.
B’s have others work for them.
I’s have their money or OPM (other people’s money) work for them.
    The Bigger Difference
    E’s and S’s work for money, which is why they pay more in taxes.
    E’s and S’s focus here:

    B’s and I’s work to create or acquire assets, which is why