Archive for the ‘Social Security’ Category

A Century Of Tax Mischief

May 5, 2008

My Dad forwarded to me an e-mail that included this gem about all of the taxes conceived in the minds of politicians over the past century (the impact of several of them on just our family has been chronicled on this blog):

Accounts receivable tax
Building permit tax
CDL license tax
Cigarette tax
Corporate income tax
Dog license tax
Federal income tax
Federal unemployment tax
Fishing license tax
Food license tax
Fuel permit tax
Gasoline tax
Hunting license tax
Inheritance tax
Inventory tax
IRS interest charges (tax on top of tax)
IRS penalties (tax on top of tax)
Liquor tax
Luxury tax
Marriage license tax
Medicare tax
Property tax
Real-estate tax
Service charge taxes
Social Security tax
Road usage tax (truckers)
Sales taxes
Recreational vehicle tax
School tax
State income tax
State unemployment tax
Telephone taxes
— Federal excise
— Universal service fee
— Federal, state and local surcharges
— Minimum-usage surcharge
— Taxes on recurring and non-recurring phone charges
— State and local phone taxes
— Telephone-usage charge tax
Utility tax
Vehicle registration tax
Vehicle sales tax
Watercraft registration tax
Well permit tax
Workers compensation tax

The kicker to the e-mail: “Not one of these taxes existed 100 years ago, and our nation was the most prosperous in the world. We had absolutely no national debt, had the largest middle class in the world, and Mom stayed home to raise the kids. What happened? Can you spell ‘politicians?'”

Lay Off The Layoff Taxes

February 6, 2008

There’s a good reason that I have a new job: I lost my old one as the editor of National Journal’s Technology Daily in a layoff. My last day was Jan. 31.

I was blessed enough to find gainful employment quickly, but not everyone is so fortunate. Sadly, our tax system can make life much harder for people who lose jobs.

The severance check I received to day drove that point home for me. The deductions from it for federal income taxes, state income taxes, and Social Security and Medicare would have been enough to pay the mortgage for two extra months had our family been forced to live on the generous severance.

I’m not exaggerating — and the tax bite on us was much smaller than it could have been. The federal government forces companies to treat such lump-sum severance payments like bonuses, which means the tax rate is 25 percent. The rate was significantly less for me because we have so many itemized deductions.

Governments should not be allowed to tax severance. It makes absolutely no sense to rob families of money that would help them buy food, pay the rent and live day to day while seeking new employment, and then turn around and give them food stamps and unemployment benefits that aren’t enough to pay the bills.

That’s bureaucratic logic for you. Lay off the layoff taxes, Uncle Sam and Aunt Virginia.

The W-2 Stomach Flu

January 24, 2008

My annual W-2 form arrived today, an ugly reminder of how much of my income went straight from my employer to various governments without me seeing a penny of it.

Because of our latest adoption in 2005 and the resulting adoption and child tax credits, the federal government hasn’t been getting much from me in the form of income taxes. But thousands of dollars this year went toward Social Security and Medicare. The Commonwealth of Virginia got a similar chunk.

I’m not sure we’ll get a refund this year because we will exhaust the adoption credit. We may even owe money to either Uncle Sam or Aunt Virginia for the first time in years. So much for that tax rebate.

It’s enough to make a man sick.