My dad was an adept ‘tax preparer’, doing tax returns for friends and family.
While not a CPA, he’d been ‘trained’ at H&R Block, and really understood the ins and outs of taxes. It was a reliable source of cash, his customers became friends.
Or a reliable source of homemade jelly or crocheted goods, which a few customers paid in lieu of cash. A complicated return merited a grape jelly blanket.
He gave great advice: For a deduction you were uncertain about, “Take it, no one’s looking”.
But sometimes questionable: “You can take a cattle ranching deduction, but make sure your dog’s wearing antlers in the event of an audit”.
He did my taxes until becoming ‘too complicated’; one year I sent him a reimbursement check. His response: “No need to pay me”, to which I replied “I should have made the check for twice that”.
Most of his returns straightforward, and likely could have been handled by the customer, but fear – and doubt – a big part of the tax system.
Without fear, no one would pay their taxes.
Without complementing doubt, people not as fearful.
The doubt spawned by the stack of forms and oddly worded instructions – particularly on the IRS website.
As an aside, IRS.gov their website; IRS.Chuck, a scam site which comes up first on google.
And only IRS.Chuck makes outbound calls.
For 80-90% of returns, 2 pages should be enough.
But some ‘fears’ are myths, perpetuated on-line and by Bernie Sanders.
The first fear/myth: The rich need to pay their fair share.
It’s tricky : Fair share is 50% more than you’re currently paying, and the Rich is everyone but me.
Fact: The top 1% of earners pay 40% of all taxes.
Or are the top 40% paying 1%? Tax the Rich!
Also tricky, as multiple states contemplate ‘Wealth Taxes’, estimated to deliver ‘billions’ of tax revenues – your new neighbor could be a relocated CEO if you live south of the Mason-Dixon line.
The second fear/myth: Audits are common, to inspire honesty. The lore: Taxpayer arrives at IRS HQ with their records, and waterboarded.
Fact: All true. But mostly due to questionable deductions; my father recommending:
Children a $2k credit, per. Canadian kids double. My Captor and I’ve been serial adopting, we’re now parents to an entire Toronto suburb. Venezuelan kids triple – Maduro was a jackpot!
Declaring as a ‘certified resident of Puerto Rico’ worth something; you’d also be eligible for hurricane relief from 3 or 4 storms.
But the biggest windfall, checking the ‘deceased’ box. It reduces your taxes, and you’ll get a sympathy card every April 15th!
The third fear/myth: Put a wet phone in rice pilaf, JFK living at Mar-A-Lago, and your phone is listening to you.
Fact: Though unrelated to the IRS, I believe all these; IRS.Chuck has verified.
My phone nodding in agreement, so there’s something to this…
The fourth fear/myth: The Senate taking all the un-rounded 49 cents.
Fact: Yes. When you enter your income, anything under 50 cents doesn’t round up. All those small amounts add up, and they are seized by the Senate and used for their annual BBQ.
The good news: It keeps a lot of very old people off the streets for an afternoon.
The fifth fear/myth: All these tax proceeds are being spent wisely, on your behalf.
Fact: If you believe that, I’ll sell you a share of my cattle ranch.
On the plus side, the funds underwrite our elected representatives, keeping 535 thieves, inside traders and jackalopes off the streets.
Leaving us safe. Until they meet again to raise our taxes…
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And the new This Is Lorelei CD pretty good.
How long was he in jail?