Ryan VaughnCOO of Incite Tax & Accounting. Ask me anything about your taxes.

Reacting to Bad Tax Advice Part 2

19 Mar 2026 · 1 min

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0:49

In this segment of the YouTube video “Reacting to Bad Tax Advice Part 2,” Speaker B promotes a dubious method for avoiding federal tax withholding: completing a new W‑4 form marked “exempt,” then investing the withheld amount in a high‑yield savings account. Speaker A counters by calculating that the IRS imposes a daily‑compounded penalty interest of roughly 7%, which outpaces the 4‑5% return typical of high‑yield accounts, meaning the strategy results in a net loss rather than an arbitrage. The dialogue concludes with a warning to avoid tax advice from influencers who lack professional credentials and to instead rely on qualified tax professionals for legitimate tax‑saving strategies.

You're not arbitraging the system, you're just losing money every day.
I'm not paying federal taxes, and there's a lot of people just like me. And every single day I get the same question: how do I do it? You're gonna need to fill out a new W-4. You're gonna write exempt, sign and date here, and you'll turn that into payroll or HR. Then I would take the money you save in taxes and put it into a high-yield savings account.
Okay, let's do the math. IRS penalties currently accrue at about a 7% interest rate compounding daily. But even a great high-yield savings account only pays between 4% and 5%. So you're not arbitraging the system, you're just losing money every day. Stop taking tax advice from influencers who have never signed a tax return. Instead, trust the professionals who actually share the liability with you and follow for more real tax-saving strategies.