Tax Time Again
A couple of weeks ago, Mittens (that's for you Creighton) was destroyed in the South Carolina primary by Newt, and one of the main reasons, in my opinion, is that he was unwilling to share his tax information when called out on it by his opponents. After losing the primary, he did come out and release his info and we all learned something that we already new...Mitt has a lot of money. We also learned that for the amount of money he has, he sure pays a pretty low tax rate, around 15%. Upon learning this, much of the media tried to turn this into a crime against the country, showing us yet another shining example of how corporate greed is destroying America. Fortunately, this was an unfounded argument and didn't stick, and in reality I was kind of proud of Mitt for astoundingly low tax rate. The way I see it, he is just like any other good American I know. We all have to pay taxes, but we try to pay as little as we possibly can. So, kudos to you Mitt for finding your way through the loopholes that litter our current tax system, I wish I knew more of them.
I have recently begun gathering all of my information for the last year to be able to file my taxes. 1098-T for school, W-2 or is that a W-4 that I used for work study this last summer. Do I file a 1040, 1040EZ, or is there some other number and letter combo that could work better for me? And what in the world do all of those numbers and acronyms mean anyways? My father in law is helping us out with our taxes again this year via his friend who is an accountant. Did you know that even though I grossed approximately negative
$90,000 last year between mine and my wife's schooling, we somehow owe taxes on part of that loan money? I don't understand it and I probably never will. Then we learned that I can deduct the cost of my computer (that I bought before I was in medical school) from my taxes this year, plus other books or "supplies" we "needed" for school. So, like we Mitt, we are slowly trying to chip away at what I can give back to the government for all they do for me.
Then, a couple of days ago, I found an article from the NY Times outlining the story of James Ross. He is a self proclaimed "1 percenter" who is a lawyer and now runs an investment firm in New York. The surprising part of his story is that last year he paid 102% of his taxable income to taxes!! Are you kidding me?? Sure, many people will say that we shouldn't fill sorry for a multi-millionaire who has to pay a lot in taxes, which I don't exactly feel sorry for him, but I do think there is a fundamental flaw in a system that even has the possibility to have people pay over 100% or even close to 100% of their taxable income. (Here's a link to the article
http://www.nytimes.com/2012/02/04/business/at-102-his-tax-rate-takes-the-cake-common-sense.html )
So let's sum this up. Basically, Romney was able to make millions and pay just little bit back in taxes because most of his money came through investments. Mr. Ross had to pay back most of his money because his was based on an "earned income", that is, he worked for his money and I will have to pay however much in taxes for taking out student loans (from the government who is also getting interest on those loans). So tell me this, why is it that we find it appropriate to tax the life out of people who are working hard for their money, doctors, lawyers or other professionals, but allow those people who just invest the money they have and let there money work for them get away without paying even half of what the rest of us pay? I feel that one of the best ways we can get our country and our economy back on track would be to just do a flip flop. Let those people who are out making jobs and working hard for their money, enjoy the money they earn. As for the investors, let's use their money to fund the many government programs that are both useful and sometimes necessary for the people lower on the economic totem pole.
I'd love to hear any ideas or any comments from all of you that are smarter than I am when it comes to this stuff.