By understanding the tax code and the legal system, the rich stay one step ahead of the systems designed to rein them in.

When Robert was back in school, one of his favorite stories was the tale of Robin Hood and his band of Merry Men – the pack of traveling vagabonds who stole from the rich to give to the poor. It was a thrilling story, he thought – but his rich dad disagreed. To him, Robin Hood seemed like a crook. You see, rich dad blamed the Robin Hood fantasy for inspiring the tax system he despised. Just as Robin Hood took money from the rich and gave it to the poor, so too did the government try to take from the rich to give to the needy. But, as rich dad explained, they didn’t actually succeed. The way rich dad saw it, it was the middle class that ended up shouldering the burden of taxation, not the rich. The rich were far too clever and well-equipped for that, and deflected tax with sophisticated tools. One of the tools that the rich use to shelter themselves from tax is the corporation. A corporation is allowed to spend pre-tax dollars, after all, and is only taxed on what remai...