Greetings Taxpayers!
Here in America last September, there was a wave of flag
waving and support for the government that was almost
unprecedented in history. But patriotism, it seems, has its
limits.
Welcome to tax season.
With the economy down and billions in the former surplus
sent back to taxpayers, the government finds itself
embarrassingly short. And when politicians talk about staying
within budget, they always try to sound like they really mean it.
Just like the rest of us, the pols love to talk about staying
within the budget only so long as they don't have to actually
stop spending money on things they want.
So we complain, sometimes bitterly, about what the
government spends. It would be all so much cheaper if we didn't
also demand health services, fire and police, good roads and
other services. And while we in the US complain, some folks
around the world snicker.
The total tax bite for all taxes in industrialized countries
ranges from Japan's 37% top rate up to a wallet-emptying 60% in
Holland, Denmark and Sweden. Even Italy snatches 46%. The US
top rate for all taxes is around 39%, on average.
Only Hong Kong comes in as a cheap but relatively modern tax
haven - top taxes there are 17%. But don't get sick or lose your
job there, because there are few government social services and
practically no welfare. Which leads to the inevitable conclusion
that the place is run by Republicans.
Thanks this week to our friends and fellow taxpayers: Rosana
& Stanley Leung, Jerry Taff, Gabe Ceci, Susan Will, RJ Tully,
Caterina Sukup, Carol Becwar, Charles Beckman, Jan Michalski,
Yasmin Leischer, Tim McChain, The Peterson's Chuck Maray, Kerry
Miller, Bruce Gonzo, Mike Fagan and Nnamdi Elleh. The best tax
advice? It's one that I heard years ago from a former head of
the IRS: "The trick is to stop thinking of it as your money."
Have A Tax Free Week,
--:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)--
"Thinking is one thing no one has ever been able to
tax."
- Charles H. Kettering
--:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)--
THE ENVELOPE, PLEASE...
--------------------
One of this year's more common mistakes by taxpayers in
Wisconsin?
Throwing away their refund checks. No kidding.
The reason may be that the Wisconsin Department of Revenue
switched to new envelopes this year, replacing the old, dull
government-tan envelopes of last year with a slightly larger,
off-white envelope.
"We made the changes to reduce state government costs while
still providing better service to the taxpayer," said Revenue
Secretary Richard G. Chandler.
Apparently, many taxpayers think the new, improved return
envelope looks like junk mail to be thrown away. So they toss
it.
The new, more colorful envelope was promoted as a cost-
saving measure. It certainly will help to balance the state
budget if enough folks toss their refund checks. About 2 million
of Wisconsin's 2.9 million personal income taxpayers will receive
one billion dollars in refunds this year, so even one percent of
the trashed cash is a huge amount.
The state has said it would reissue the checks after 30 days
if a taxpayer admits tossing their refund. (Wisconsin State DOR
Press Release/NPR)
--:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)--
UNDERSTANDING TAXES...
-------------------
People do not understand taxes. That isn't so surprising,
given that the tax codes can run to many pages of law. But
apparently, the folks that pass the tax laws don't understand
them, either. The trouble with taxes is that they are the result
of political maneuvering in trying to pass multiple laws to cover
changing situations over a long period of time. That is pretty
much a blueprint for how to insure that things get really screwed
up.
Take the Pennsylvania doughnut tax. A purchase of five or
fewer doughnuts was considered a "takeout food purchase" and
therefore taxable at the six percent rate (seven in certain
counties). Six or more doughnuts was considered a retail
purchase - more like food for the family - which was not taxable.
Debates raged, and the "six-doughnut rule," as everyone
called it, was repealed in 1991. Penn crullers are now taxed
only according to where you buy them: they are now taxable if
bought at a restaurant or carnival. But the same sinkers are
nontaxable if bought at a bakery. Now the debate seems to be
whether a gas station convenience store or vending machine should
be considered a bakery for the purposes of tax law.
You see how complicated it can get.
Rules like these can produce some pretty weird results,
which are surprisingly common to other states. At Pennsylvania
supermarkets, most prepared foods are taxed, while packaged or
uncooked foods are tax-free. So a ham-and-cheese sandwich from
the foods-to-go section is taxed, but a separate purchase of
bread, ham and cheese is not.
Similarly, a bag of prewashed, ready-to-serve salad greens
isn't taxed, but the same ingredients at a supermarket salad bar
are. If a Pennsylvania store makes up a party tray, the
government wants six percent, but there's no tax on the side of
potato salad or coleslaw. And flavored mineral water is taxed
but non-flavored bottled water is not. Regular ice isn't taxed,
but dry ice is. Canned and bottled soft drinks are taxed, while
canned iced tea is not.
Even some luxury foods are tax free: there's no tax on a
bottle of 100-year-old balsamic vinegar, a pound of fresh morels,
or a tin of beluga caviar. And pate de foie gras and the finest
imported prosciutto di Parma are also untaxed.
But a cup of coffee from the neighborhood convenience store
is part of the $7 billion the state collects in sales taxes each
year.
Fortunately, the aspirin this tax headache requites is still
tax free - if bought at a drug store, but not at a supermarket.
(Philadelphia Enquirer)
--:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)--
ARKASAS EXPRESS?
---------------
American Express may have to modify their advertising in the
state of Arkansas. Instead of "don't leave home without it,"
their cards could well say "Don't leave home!"
That's the result after AMEX suspended all 6,400 state
credit cards without warning last January 30th because the state
was behind on its bills.
Holders of the cards - from staffers in the governor's
office to low-level administrators - found out about the action
at restaurants, hotels and airports. Some were stranded, and one
University of Arkansas official had to find another way to buy
lunch for someone he was trying to recruit to the faculty.
Arkansas accounting administrator Tom Smith said about 1,000
state workers were delinquent, some more than 120 days, and the
state's contract with American Express gives it the right to
suspend all cards without notice if more than 1 percent of
cardholders are more than two months past due. (AP)
--:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)--
ON TAXES AND INFLATION
----------------------
Despite the reputation as a high tax zone, Denmark is
surprisingly liberal at allowing legitimate business deductions
for maintaining or improving business properties. Two years ago,
for example, that part of law led the Danish tax appeals board to
approve a business expense for facilities enlargement - the cost
of breast implants for a worker at a massage parlor. A local tax
board had previously rejected the claim. (Reuters)
--:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)--
QUESTIONS RECEIVED BY IRS
-------------------------
This comes from Donna Patterson Wilson, who answered
thousands of IRS-directed questions from an often-confused
public. She kept a special list of the strangest of these calls.
Caller: I want to know if I should file married or single.
IRS: Are you married?
Caller: Well, sort of ...
IRS: What?
Caller: Well, we did get married, but we're not counting on
it.
------------------------
Caller: I got a letter from you guys and I want to know
what you want.
IRS: What does it say?
Caller: Just a minute, I'll open it.
------------------------
Caller: I'm a bookkeeper and I need to know if ten $100
bills make a thousand dollars or only ten hundred
dollars.
IRS: Both. It's the same amount.
Caller: So why do I get a different answer every time I
move the decimal point?
[ Arthur Anderson, maybe? ]
------------------------
Caller: What does the law say about people who are renting
to relatives and taking a loss on the property?
IRS: You are required to charge them fair market value.
Caller: It's very fair. If we rented to someone else we
could get a lot more.
------------------------
Caller: Could you please send me some of those WD-40's?
--:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)--
HOW TO GET AWAY WITH IT IN PRIVATE...
----------------------------------
It's not what you think.
There is a surprising amount of interest across the country
in "privatizing" government services, which is supposed to save
the government money. But many of these moves have been proposed
and passed with the usual amount of government care and
oversight.
That is: none that anyone can detect.
Take the interesting case from Texas, of two inmates that
escaped from a privately-run prison approved by the state as part
of their cutting-edge moves to cut costs by turning con care into
a profitable industry.
It took only eleven days to track down the escapees, who'd
headed for the deep woods of Oregon. Authorities were all set to
charge them with prison escape when one small problem was
discovered.
It's not against the law in Texas to escape from a private
prison - only state-run ones.
And the state of Oregon couldn't find anything to charge the
guys with either, since the escape had happened in Texas and
wasn't even illegal there. Last we heard, Texas was still trying
to figure out who to bill for tracking down the legal non-
escapees. (Bott 96)
--:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)--
A HUMBLE IDEA TO BALANCE THE BUDGET...
-----------------------------------
We here at SUNFUN are as concerned as anyone else about the
current budget shortfalls and possible tax increases in running
the federal government. Surprisingly, we may have found a simple
way to increase revenues.
The answer lies in Military Specification MIL-C-44072C which
you can find a number of places on the web.
That 23-page document happens to be a recipe for really
good, chocolate covered brownies (Type I) and oatmeal cookies
(Type II). In typical government fashion, it specifies all
details of the product right down to the acceptable diameter of
the shelled walnuts. A minimum of 90%, by weight, of walnut
pieces must pass through a 4/16" round hole screen, but not more
than 1%, by weight, should pass through a 2/16" round hole
screen. (I guess that means you're going to get 3/16" walnuts.)
It also includes detailed orders on how to wrap and distribute
the product, which, given the care in making it, could sell at
retail for a premium price.
That's right, the US government could have a bake sale.
Nuts? Maybe, but before you laugh too much, remember you've
already paid for this.
--:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)--
IN SCOTT WE TRUST?
-----------------
With a falling economy and a $1.3 billion budget shortfall,
the state of Wisconsin has been looking for anything it can do to
make money.
And, little known to Wisconsin taxpayers, they do. Make
money, that is.
Visitors to the state capitol in Madison have been getting a
souvenir coin bearing the picture of Wisconsin governor Scott
McCallum. This has led some to wonder if Wisconsin is now
distributing it's own money. Not true, according to the state,
it's just a promotional item given out to school kids. The fact
that Gov. McCallum has proved to be about as popular as a Chicago
Bears fan at Lambeau Field and that he's facing election in
November may also have something to do with it.
Each of the coins cost Wisconsin taxpayers 17 cents, but
they certainly aren't worth much as legal tender. The McCallum
coin wouldn't fit into any of the nine vending machines in the
Capitol, According to a reporter who tried it. (Milwaukee
Journal-Sentinel)
[ Coins, worthless. Governor? ]
--:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)-----:-)--
© 2002 by Bill Becwar. All Rights Reserved.
![[ BACK]](btn_rwdr.gif){kind=small}
![[NEXT]](btn_fwdr.gif){kind=small}