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Thanks for that. Had a good read through. I’m starting to get some more ideas together and am close to making a plan.
I don’t have any financial qualifications so please ask your tax advisor to clarify. My understanding is that the $100k transfer from your personal account to the trust would be identified as a directors loan in the accounting software. In your accounting software, it then ‘sits’ in an account (not a bank account,.. an account set up within your software) which registers a liability (=-$100,000). When this is paid back, the journal entry should specify that the directors loan has been repaid.
Should you get audited, you will be able to demonstrate the money that went in to the trust from the director and back out again to the director.
It needs to be paid back to the director when this is due. This is, of course if your trust is set up with a corporate trustee and you were the director of that entity.
It all gets a bit complicated, so it really is worth sitting down with your accountant and asking them to explain it to you. I am not a financial advisor and the above may well be wrong.
