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From what I understand, he would take all profits he makes, invest it all into new businesses expecting them to take years to generate a profit. At this point, he would use his assets for loans. (Personal loans are not taxed) and use that as his income. He avoided taxes because his net revenue was technically negative because all of his business ventures were set up to succeed slowly. This allowed him to pay $0 in federal tax for 10 years based on the tax code. Then once they turn a profit, he sells them and does it again, or, if it never turned a profit he declares bankruptcy on the asset. 

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