So today is the day you pay your taxes. Today you see and feel the pain of your hard earned money leaving your hand…
So, how much did you really pay? Now many will answer, I didn't pay anything, I got $200 back. Nope, that just means you overpaid. Before filing away your forms look at the real amount you paid in… if you're like most you filed online or with the $30 tax software. Both will let you view/printout a PDF version of your 1040 form. If you filed old school you already have your 1040 in your hot little hand…
Ignore the bottom most line (73a if you got a refund or 75 if you still owed money) and look at line 63. This is after all the additions and deductions is your TOTAL TAX. That is how much you paid the government – not the two hundred or two thousand dollar check you wrote this weekend. A lot bigger isn't it? Kinda makes you want to find out where it all goes doesn't it?
Here are a few other tax tid bits that will make you think:
- Corporations spent over 2,900,000,000 man hours complying with the tax code (which is the single longest document in existence) at a cost of approximately $100,000,000,000 in wasted productivity in 2002. And that cost doesn't include actual taxes – that is just the cost of legally following the code.
- Corporations don't actually pay taxes. Sure, they file the forms and send the checks but the customers actually pay for the taxes. Think about it. Double the taxes a company owes and it will do one of two things:
- Raise price on it's products until it can pay the taxes and still be profitable (if customers refuse to pay higher prices see #2)
- Go out of business (you can't stay in business forever losing money every year)
- Who is paying for the extra agents – that's right all tax payers. Expect the $10 billion budget from 2002 to be bigger this year.
- 98.4% (62 out of 63) of the $100K+ bracket could still be cheating and the IRS would NOT KNOW.
It sounds like our entire approach to taxation simply needs to be revamped into something where it's easier to comply with and harder cheat. That would mean less wasted productivity for businesses and individuals – more time to make something of value for the economy. If you couldn't evade taxes, everyone's taxes would go down since everyone would be paying their share instead of just the honest 80%. This can all be done with a national sales tax. Check out FairTax.org for more info.