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“The Taxman’s Taken All My Dough…” The Kinks

April 14, 2014

It’s that time of year again. No, I am not talking about Spring (finally!) or baseball season, but rather it’s time to finish filing income taxes. Rather than bore you any more with my perennial pleas for tax reform and tax code evisceration, I will simply refer you to “Should 5% appear to small…” from March 2012 for a complete description of why we need tax reform. (I also mentioned tax reform earlier this year in “Taking care of business” with regard to job creation.)  These posts outline how we can massively simplify and improve our tax code and improve the economy substantially thru the “Fair Tax” (see FairTax.org) or at least something like it.   

However, when I think of taxes, I start to get a bit selfish and think of the ungodly chore that doing my taxes has become and how it somehow manages to get worse every year. But, I don’t want to talk about that in this post. No, I do not plan to vent my frustration with a tax code that is so miserably complex that you MUST purchase Turbo Tax to do your taxes yourself. (OR hire a tax accountant). But even so, you must become an expert on the tax code to do an Individual Tax Return if ,”god help you!”, you decide to take capital gains or losses in a given year, or just own an ETN ( in which case you must pay your fractional share of the ETN income or losses as well as a host of other things on a Form K-1 that I can barely understand). And don’t get me started on owning a put or call option and the requirement that it be marked-to-market in a given tax year so that you must pay capital gains even if you didn’t sell anything or realize a single penny in gains!

 And this is just the tip of the 1040 iceberg, because if you itemize deductions like many of us and for example, did something nice like donate old clothes to charity, you must figure out the “thrift shop value” of those clothes to deduct them. ( I don’t know about thrift shops, but I really “valued” some of my old paisley ties, or my ” you can only wear on St. Patrick’s Day or if you win the Masters” green jacket. ). Then, if you are crazy enough to try to deduct “out-of-pocket” medical expenses, you must literally save every scrap of medical records that you have , decipher what the insurance company actually paid for and after all this work, can only deduct what exceeds 7.5% of your AGI. That’s Adjusted Gross Income , naturally not something simple like your total compensation or salary. ( For this reason, I like to refer to AGI as “Absolute Goddamn Insanity”) .

 To add to all of this, you are STILL not done once you have in a state of wild-eyed exhaustion, with reams of paper receipts scattered about your desk (and sometimes your floor), finished your federal 1040 and your dozen other schedules and worksheets that must be attached. Now, you must complete your state and local taxes. Fortunately, the state tax form in Ohio is relatively simple once you have finished the Federal. But then there is RITA!

This is no “lovely RITA, meter maid” I am afraid. RITA (which stands for Regional Income Tax Authority) is the purveyor of all local taxes in Ohio and has managed to put all of its budget into Gestapo enforcement techniques, and none of its budget in explaining what should be a very simple tax. However, over time , I have learned  (the hard way, after being threatened with going to Upper Arlington jail) that though federal and state income taxes do not require a dependent that earns only a few hundred dollars to file or pay taxes, RITA does. Even worse, RITA apparently believes that if your child is going to school and living in Rhode Island at Brown University and earns a few hundred bucks while at college, that they must file local RITA taxes in Ohio. I learned this the hard way when RITA in one of several nasty letters informed me that we had not filed for Kathleen in 2011 and had failed to pay the, “I’m not kidding you”, FIFTEEN dollars that we owed RITA. As a result there was a $50 fine and a summons to appear in Court. (Apparently, the RITA court is a black ops site where waterboarding is permitted). In other words, RITA really stands for Regional Interrogation and Torture Agency.

And I haven’t even mentioned that the considerable sum of taxes that our family willingly donates to the federal, state and local governments and which keeps me working into May, just to pay our taxes. Where does it all go? I realize we need a national defense but $600 billion worth! (Can’t we just hire Captain America and the entire Legion of Super Heroes and be done with it?). And of course we need Medicare for retirees and those who must go on Medicaid or other government medical assistance, but does it really have to cost almost $1 trillion a year! Then there is Social Security and my favorite misnomer in the government the Social Security Trust Fund. (No doubt this “trust’ fund was managed by Bernie Madoff as it is currently nearly bankrupt, as Social Security is NOW costing us $850 billion per year and rising rapidly). Finally, let’s not forget that one-quarter of a trillion $ is being spent on federal interest on the debt alone and this number will be increasing to at least $0.5 trillion in just a few years (optimistically), but more likely closer to $1 trillion once the effects of our insane monetary policy of the past few years fully kicks in.  

So where was I? Oh yes, as I sit here in my back yard on a beautiful sunny Sunday April 13th, all I can think is  “The taxman’s taken all my dough…and all I’ve got this sunny afternoon!”

From → Humor, Public Policy

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