Tax Time Blues

Dateline: 18 March 2014

Herrick's Spring Vacation 2014

The only good thing about my wife going to Florida for a week is that I can have the entire kitchen table to myself and work on my income tax records, and that's what I've been doing for a good portion of her vacation.

I think I've griped here about income taxes every year since 2005 (when I started this blog). Each year since then I have made more money with my Planet Whizbang business and I have paid more money to the government. 

It boggles my mind when I consider how much money the government takes from me. I work hard for it, send a large portion of it to them quarterly, and they squander it in ways that make me angry. Worse yet, they don't just squander the money that hard-working, productive people like myself send them, they also borrow and squander the money of future generations. It is an immoral system, for sure.

When I was elected to the town board of my small, rural township 14 years ago, I was shocked to find out that the annual budget contained two thousand dollars for senior citizen bus trips. The taxpayers were paying to charter a bus for older folks in the town to take day trips to museums and plays. I asked how long the town had been paying for that. They told me, "forever." I said that's not right, and another board member quipped, "Well, you can tell them that!" 

In time, we eventually cut that item out of the budget. We also, with my encouragement, cut out the annual payment to send town kids to a summer recreation program in a neighboring town. This has met with some resistance from a few people in the community, but my argument is that using tax dollars to send kids to summer camp isn't right. If I were to ask the taxpayers of our town if they want their tax dollars going to pay for other parents to send their kids to camp, I'm sure that the majority would say no. If parents want their kids to go to camp, they can pay the cost themselves. Another board member likened it to the town paying for some parents to send their kids to a baby sitter.

Like most every small rural town in America, ours is fiscally conservative. We are very careful with how we spend taxpayer dollars. And we do not have any fiscal problems. Taxes in our town have not gone up in several years. 

If that same small-town rural fiscal responsibility could be applied to our states and the federal government, this country would not be in the sorry financial mess we're in today.

The American dollar, once "good as gold" will one day be obsolete. The nations and the people of the world are realizing more and more that the dollar, and dollar-denominated assets are not a safe investment. They are not buying our debt like they once did. Now our government creates money out of thin air and uses it to buy our own debt. It is so bizarre that it seems unbelievable. But that is what is happening. It is a desperate non-solution. 

The American dollar will one day no longer be the world's reserve currency. When that happens, life in this country will change. Things will get very expensive. Life will get much harder. This will happen. It is just a matter of time. Most Americans are blind to the coming reality.

I hate tax time.







8 comments:

ukageng said...

I agree about not liking tax time. Mine got finished up today and it is crazy what percentage is taken from our small business.

timfromohio said...

I started a new job just over a month ago. They gave me a nice raise. It's only a raise on paper - must have bumped us to the next tax bracket or something b/c there was a only a marginal change in takehome pay. That or the local income tax I get to pay is more in my current location - that is, the tax b/c I happen to work in a certain location. Seems to me I remember we fought a revolution about taxation without representation, but I digress. So, I get to pay Federal, state, and 2 local income taxes (you're supposed to get credited from the work location to the living location local, but it's never dollar for dollar). Add to that property tax 80% of which goes to a service we don't use (we homeschool). Then there are vehicle registration fees, sales tax, gas tax, tax on utilities and even tax on access to utilities, ... I'm sure there are a host I'm missing. What is the end result? Ballpark calculations tell me I wind up working over 5 months out of the year BEFORE I get to bring any money home for my family. That's almost half. That's messed up. That's also not sustainable.

Herrick Kimball said...

Tim,

It's more messed up if you are self employed. Then you pay pay twice as much FICA (social security) tax as you do when you are an employee.

But I think they call it a FICA "contribution." so it's not quite so bad.

;-)

I agree that it is unsustainable. Unfortunately, they will extract even more from the working class before the system finally breaks.

timfromohio said...

You're right - it does seem worse if one is self-employed. What an incentive, eh? One plus is that I get the benefit of a 401k!!! (somewhat tongue in cheek here). While I do get to put pre-tax dollars into an account that I can't touch until I'm at least 59.5 (without extra tax penalties), my "investment" choices are increasingly limited. One used to be able to put these dollars into a true money market fund. Now, the so-called "safe investment option" in most plans is a "stable value fund". Guess what it invests in? That's right folks, government bonds. Methinks that instead of outright taxing of retirement plans (which will happen eventually anyway, but in the form of the government "helping" us by requiring a portion of such accounts be invested in "investment vehicles" with promised "rates of return") they are being a bit more sly by "suggesting" to big investment houses that they limit such "safe" options to ones featuring government debt. They can't print forever, the Fed can't buy ALL of the unwanted debt issued each week that nobody else wants, why not funnel retirement money into such debt to buy some more time. Maybe I'm too cynical, but that's my take.

Mr. Kimball, you're right. They will keep taking from the present generation while they issue debt to future ones. The more dollars there are, the less each one is worth.

What to do? This is the segway to a link about an Agrarian Economic Defense plan - one of your entries dealing with getting out of debt, getting some land (and you probably don't need as much as you think you do - read "The Market Gardener" - the guy lives in Quebec, not exactly the longest growing season, and makes a living off of a couple of acres!), and learning how to provide at least some of the necessities of life yourself. Perhaps I'm a bit testy due to tax season as well ...

Gorges Smythe said...

These conditions are what "they" wanted, that's why their ancestors took us off the gold standard.

Survival Gardener, AKA David the Good said...

My S Corp. status shields me from most taxes... and there's no state income tax in Florida. Praise God.

My biggest concern is keeping everything above-board and legal. There are so many potential mistakes you can make... I just don't trust myself to file taxes anymore so I hire a professional accountant and she makes sense of all my receipts and invoices.

Don't worry. Everything is going to collapse soon.

Sheila G said...

My final goal in life, is to finish becoming self sufficient, and living without any income, other than what I can make from my home. Just enough to pay property taxes.
I own my own property, have a small, fully finished, garage on it, and am working on being able to make enough for the taxes if we crash. It's still a work in progress, but it is improving each year.
I do have to say, that the one thing the Lord requires of us that I don't care for, is,
Render to Caesar what is Caesar's and to God, what is God's.

I do have cash stashed for property taxes, and since they are very low, it will last many years, but only God's grace will get us through what I think is ahead of us, so I would much prefer to give to those that need it, not to Caesar. Thy will be done Lord, and I do hope to mean that some day too.



TimfromOhio said...

Ms. G - I understand your feelings. Remember, God also commands us to be good stewards. It sure would be easier to pay some reasonable tax if there was evidence that our government was doing its level best to be a good steward of the tax revenue!