Good day all. I sit here, finalizing my taxes and accepting that the mantra of the day will be, “I owe, I owe, it’s off to the IRS I go!” Yes, I will not be getting a refund. However, I’m not screaming, crying and whining about it.
While not having to blast open the Anger Central piggy bank, I wasn’t surprised that I wasn’t getting a refund. Why? Because I have set my withholding to the minimum I can, that’s why. I’ve been watching the stories about people who are suddenly finding out that they aren’t getting a refund, or are getting one that is smaller than they anticipated. The them I say, “What are you, morons?”
There is a reason why I prefer to owe money. When you get a refund, it means that you overpaid your taxes, and that basically, you have given the United States Government a nice interest free loan. Yes, that is what I said. You have generously supplied the treasury with a loan and they are repaying it with no interest to you.
In my case, and in the case of many others with half a brain, we don’t really want to loan the Congress any of our money. Instead, we would rather put it into interest bearing accounts and actually increase our assets. This means we will set the withholding to zero on the W2’s we fill out.
Also, I have investments that earned dividends and those are also taxable. What hurts there is my reinvestment system. I use something called a “DRIP” through my broker. This is short for Dividend Reinvestment Program. When the dividend is posted to my account, more shares are bought of the stock that just paid me a dividend. This means a bigger dividend the next cycle. Wash, rinse, repeat.
The down side is that the cash isn’t available to handle the taxes I know I will be paying. I have to pull that from my savings. Still, the dividends earn me far more then I would get with just a bank account and 100% more then if I handed the money to Uncle Sam in the hopes of a refund a year later. Also, the new tax law is fully kicking in now. I’ve already seen a nice cut in my taxes and that money is going into my stock portfolio and my IRA accounts.
Speaking of the new tax laws, many people forgot that besides cutting rates, the new law also cut a lot of deductions, and increased the standard deduction. One of the places that people are getting hit is the now missing deductions for state income taxes and property taxes above a certain level. In the past, these deductions have allowed high tax states to hide what they are stealing from people. Now people are seeing just how badly they’re getting screwed by their state and local governments.
Will the voters actually start putting people into office who don’t treat the taxpayers as money trees to pick cash from? Considering most of the high tax states are run by Democrats, (Generally into the ground), I would say no. Instead, you are seeing the richer taxpayers moving out and heading to states with lower levels of taxation. This drives the progressives nuts, since all they see is “The Rich” stealing all the money that rightfully belongs to the government, in other words, to the Progressive Liberal Democrats.
It sucks to be them, doesn’t it? In closing, all I will say is “Stop your sniveling and do a better job of figuring out how to legally shaft the tax collectors!” If you want to provide no interest loans to the government, then increase your withholding to the maximum allowed. You might even get it back. If you are like me, figure out roughly what you will need to send in, and set it aside in an interest bearing account. Then on the 10th of April, send it in.
Thatisall
(3 votes, average: 5.00 out of 5)
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