It is that time of the year again friends, when a man’s thoughts turn to his financial relationship with the duties of citizenship, which include annual exercises in rendering unto Caesar. As I am self-employed in a sole proprietorship, I pay “estimated taxes” every quarter, which I did throughout 2021 at a rate that to some extent exceeded what was required. I never really know how things are going to look at tax time until I actually do my taxes, and over the past couple of weeks it has been revealed that I stand to have a refund coming my way, both from Uncle Sugar and the People’s State of Maryland.
Paying estimated taxes—the act of affirmatively parting with a great deal of money every quarter through electronic means—should be the way all Americans pay income taxes. Withholding it from paychecks immunizes the taxpayer from a great deal of the impact that taxation has, which is of course, why it is done this way. Were we all to have to “stroke checks”, we would demand more and better of our various governments.
I do my own taxes each year with the assistance of Turbo Tax. I cling to the notion that my financial situation is not so complex as to require the services of a “Tax Preparer”, but as I age and prosper, this decision becomes less attractive. This year—flush with the suspicion that I had a bonanza coming my way, I collected up all the various scraps of paper necessary to do battle with the software early, believing that a snappy electronic filing would bring to me money I had mistakenly loaned the government. But it was not to be.
In order to file electronically and securely, I was asked to provide my last Adjusted Gross Income (AGI). I duly went to my electronic copy of my last return and entered the numbers. Then I hit send. A bit later, I received a notice that my return was rejected because the AGI was not correct. So I went back to the return. Looked at the number. Entered that very number. Hit send. And it was again rejected.
So I thought that maybe what I believed the number to be and what the IRS believed the number to be might be different. So I went online into the IRS site and downloaded my “Tax Return Transcript” which contains the facts, just the facts, as the IRS sees them. There it was, AGI exactly as I thought and entered. Given that the feds were not going to be able to pull off this e-Filing, I printed up the requisite documents, signed the return, and mailed it off to the IRS (and the State of Maryland). This was all two days ago.
Then yesterday I read this doozy from the Washington Post:
Nearly 24 million taxpayers are still waiting for the Internal Revenue Service to process their tax returns from last year — a number far larger than previously reported by the agency — with many refunds being held up for 10 months or more.
And:
The IRS’s productivity plummeted during the coronavirus pandemic as thousands of employees worked from home for months without access to returns, audits and other business — difficulties that followed years of budget cuts. The federal stimulus measures also added to the agency’s workload, as it emphasized getting relief money to millions of Americans. Paper returns took the greatest hit, as mail piled up on trucks outside closed offices for months.
Interestingly, a friend of mine had told me about this very thing a week or so ago, but because I believed I’d be e-Filing, I didn’t consider it applicable. Silly me.
So, let’s talk about the IRS for a minute. Don’t worry, they’re apparently too understaffed to be able to listen in
As a conservative, I participate in a daily battle between my desire to retain as much of my hard earned money as I can legally do, and the moral and legal requirements of citizenship. I have no problem paying taxes, but I do have a problem…many really….with how that money is spent. I pursue these complaints through the political process, which is how adults are supposed to do these things.
The problem is that the political process with respect to the collecting and processing of taxes is broken, at least at the Federal level. The tax code is far more complex than it ought to be, and a good many people like it that way as it works for their personal bottom line. Because of the complexity, the IRS must be staffed with a sufficient number of trained bureaucrats to administer the system and it must be equipped with the requisite data processing power to efficiently carry out these tasks.
My friends on the right have always been leery of the IRS, and Obama era charges of politicization of the agency only added to this mistrust. Deep in the counsels of conservatism is a general feeling of ease in “starving the beast”, with the IRS as a primary target thereof.
But I don’t think you get to have it both ways as a conservative. You don’t get to underfund the federal agency in charge of taxation and then bitch and moan when your refund is late. It seems to me that conservatives have a vested interest in the IRS working efficiently—as it does ALL government working efficiently. The IRS is not doing so, and this should trouble conservatives. Those elements of the current inefficiency that are COVID/remote work oriented simply have to be accepted for the time being. But insufficient staffing and sub-optimal data processing are things that can be fixed, and so they ought to be. But what is standing in the way of this? Ah, the other edge of the double-edged sword.
You see, it is an article of faith on the left that Americans aren’t paying their required taxes, and without this revenue, it is difficult to make the political case for spending priorities like the President’s ill-fated “Build Back Better” initiative. Part of the kerfuffle associated with the bill has been in the facile debate over “how it should be paid for”. One way the left wishes for this to happen is for the IRS to receive a shot in the arm for staffing and data processing—exactly the kinds of things necessary for the IRS to operate more efficiently (as in getting refunds back to people). But this is NOT the reason they put forward. Their rationale is that they need a souped-up IRS in order to squeeze (rich) taxpayers with more of a threat of audits, so that they can gain revenue that they believe is “lost” due to avoidance and evasion. There are few messages that resonate better with right of center voters than “we need to make the IRS better at what it does so we can take more of your money”. But that’s how it is perceived, and that’s how it is marketed.
There is a bargain to be had here, if anyone on Capitol Hill were serious about it. Real tax code simplification in exchange for a more effective IRS. Would there be more audits and would more revenue be collected? Probably. Would the time and energy we spend on our taxes decrease, and would the time required to get one’s refund be cut? Also probably.
This is the kind of compromise that used to be possible in a functioning republic. I am unsure if it remains so.
Memorable Olympic Moment
I spend a lot of time slagging the Olympics, but I still get goosebumps when I watch this performance. I’ll never forget watching it as a ten-year old, thinking it was the most amazing thing ever. Just looked on the Google machine and I see that Franz Klammer is still alive. I’m glad of that. I hope he’s never bought a drink in Austria since.
Because you asked (well, maybe you didn’t), my two other most memorable Olympic moments were:
The 1972 US/USSR Basketball game. I remember this mostly for the volcanic anger it evoked from my Dad.
And then of course, there is the grandaddy of all Olympic moments—The Miracle on Ice:
Super Bowl
I’m writing this on Sunday morning 13 February, and kickoff for the Super Bowl is seven and a half hours away.
I’ve never really been a Super Bowl fanatic, but probably the most enjoyment I got out of them was when the girls were younger and we would have family Super Bowl parties with all the finger foods little girls (and big boys) could desire. We’d put a big blanket down on the floor, and watch the game. Before the game however, we watched “The Puppy Bowl”, which was entertaining to no end. Today, my girls are off in big cities going to college and Catherine is there with one of them for a visit. I’ll watch solo, and I am certain I’ll miss the old days.
Cincinnati 24 Los Angeles 21.