Jewish World Review March 6, 2012/ 12 Adar, 5772
Ask the tax-prep expert
By Tom Purcell
http://www.JewishWorldReview.com | I've been self-employed for many years, which has made me an expert on tax preparation. With tax season upon us, my email queue is filling up with questions from readers.
Q: My dog is panting heavily. What could it be? -- North Dakota Norm
A: You appear to have the wrong advice column, but it could be that your dog is self-employed and has fallen behind on his quarterly IRS payments. Contact the IRS and negotiate a biscuit installment plan.
Q: My wife says we can get a big deduction by donating our underwear to charity. True? -- Fred from Philly
A: I remember news reports about the Clintons deducting boxes of underwear back in the 1990s, but don't get your hopes up. It's doubtful your deduction will be as big as the one generated by Bill's boxers.
Q: I am self-employed and earned $50,000 last year. I can make more working longer hours, but it seems like every extra dollar is taxed at 50 percent. -- Concerned in Colorado
A: I hate to break it to you, but you are correct. You are in the 25-percent federal income tax bracket. Social Security and Medicare total 15.3 percent (though there is a temporary 2 percent break). State income tax is 3.07 percent and local is 1 percent. Every dollar you earn beyond your current income is taxed at 44.37 percent.
Q: My dog stopped panting, but now my wife is panting! -- North Dakota Norm
A: Don't worry. Panting is a common affliction for Americans this time of year, as they spend precious hours complying with complex tax laws. Give your wife some bourbon.
Q: Someone told me that I am paying taxes on gasoline, utility bills, retail goods and many other things I am not even aware of. -- Perturbed in Pennsylvania
A: That is correct. If you were to calculate all the taxes you are paying, you would discover that well more than half your income is funding one tax or another. If America doesn't get its spending under control, you'd better hold tight to your wallet, because taxes are going to get worse.
Q: Didn't Franklin Delano Roosevelt say of Social Security that no damn politician will ever take it away? -- Curious in North Carolina
A: FDR did say that and, boy, was he right. Politicians have expanded the program well beyond its initial focus and now the only thing politicians are taking away is our money.
Q: This may sound dumb, but what is a tax bracket? -- Uncertain in Utah
A: A tax bracket is a heavy metal object that the government uses to hit you over the head every time you succeed in earning more money.
Q: Americans need to pay higher taxes like they do in Europe. -- Determined in Delaware
A: Do you really want America to be more like Europe? Most European countries have high government spending, high unemployment, slow growth rates, high inflation and governments on the verge of bankruptcy. Come to think of it, America is more like Europe than Europe.
Q: My wife is still panting, but we're out of scotch. What now? -- North Hills Norm
A: You'll have to go to the state-run liquor store and buy more -- and pay a big fat state tax markup in the process.
Q: If people are sick and tired of paying taxes, they should do what I did: Vote for Obama! I haven't paid a penny in taxes in more than three years! -- ut of Work in Ohio
A: Now there's a thought.
Every weekday JewishWorldReview.com publishes what many in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here.
© 2012, Tom Purcell