Today I met with my accountant, Nathan. This past winter, Nathan helped me incorporate my business, which consists of a small income derived from writing and a larger income earned from teaching Latin, history, and literature to area homeschoolers. The idea behind this incorporation was to reduce the level of my federal and state taxation, which had approached approximately 33% of my income. (This figure references income taxes only, and doesn’t include taxes on food, purchased goods, gasoline, property—I rent, but still pay property taxes through my landlord—and other bites from the government.)
For various reasons, I incorporated in January, but only now have begun paying my annual corporate taxes. As a result, from June through December I must play catch up and pay a total monthly sum of about $1325 to the feds and $275 to the state of North Carolina.
This rate--$1600 month for the next eight months—is based on a taxable income of slightly less than $60,000 per year.
Next year, when the situation becomes normal, I will pay about $1100 per month on the same income.
That comes to about 25% of my income for the year. Just for income taxes.
My taxes are high in part because I have few deductions. I have no children at home anymore. I own neither home nor property, though both the state and the city of Asheville annually tax my car. The classrooms I rent at the church and a small portion of my home are deductible for business purposes, along with a few other expenses. But that’s it.
I recognize that taxes of some kind are a necessary evil. Like many who pop checks into the mail to the government, I don’t mind funding our military. I don’t mind paying for highways or schools or parks. I don’t mind assisting folks who have hit hard times.
But if you look up government waste online, you’ll see that a sizable percentage what I am paying in taxes is indeed wasted by the government through inefficiency, duplication of services, bureaucratic regulations, and occasional cheating on departmental budgets. Google Wastebook, for example, and you’ll find the site of Senators Coburn and Flake detailing just some of the ways government flushes dollars down the pipes every year. Some of these expenditures are humorous—hundreds of thousands spent on studying chimps running on tread mills, for example, or more hundreds of thousands spent by a government agency promoting tourism to Lebanon while another agency officially warns tourists to avoid Lebanon as dangerous and violent. The current Wastebook 2015 runs to over two hundred pages and gives you a tour of the fiscal sinkhole we call the federal bureaucracy. (See http://www.flake.senate.gov/public/_cache/files/03714fa3-e01d-46a1-9c19-299533056741/wastebook---the-farce-awakens.pdf).
Many of these expenditures might be amusing, but the balance in my checking account throttles my laughter.
Any business in the same financial shape as the federal government would have already closed its doors. Any American household in this same shape would be living in a homeless shelter.
Meanwhile, neither of the leading contenders for the presidency is calling for cutbacks to the federal government or to government expenditures. These candidates, and many others, can’t make such a call, because they wouldn’t be elected. Too many Americans now look to the government for assistance, too many have their finger—or in some cases, both hands—in the American pie.
This year I turned sixty-five. Friends have asked me if I intend to retire soon. This question always brings a smile. For the last thirty-five years, I have worked independently of any company or government agency. Until I was fifty-five, just paying the bills was a struggle. Now the same is true of taxes. My poor financial planning coupled with years of high taxes and health care payments have left me little in savings.
So retirement is not an option. Fortunately, I love teaching, so retirement has little allure for me anyway.
Given these circumstances, I am considering choosing a different path in the near future. I will give this corporation thing two or three years. I will go on paying my taxes. But if I am still alive, and if the government keeps expanding and demanding more of my earnings, then I plan to quit—not my job, but paying taxes.
That’s right: I plan to diminish or cut entirely the monies I pay toward taxes. If necessary, I will resort to barter in my teaching, taking meals, grocery store gift cards, and labor in exchange for tuition while earning just enough money to pay my rent and other necessary bills. I will lower my standard of living. I will cut and cut until my income falls below any taxable rate. By then, I will also be eligible to work and receive Social Security without penalty, so that will help as well.
In the last two centuries of the Roman Empire, many members of the dwindling and heavily taxed middle class began going “off the grid,” engaging in barter of goods and services rather than using cash. I plan to do the same. I am happy to make do with less if it means no longer working for the robber barons of the Washington beltway.
I’ll be just fine. We serfs know how to scrape by.
A last note: if it remains apparent that our government has no intention of seeking a balanced budget or of getting control of our debt levels, then let me encourage my readers to do two things. First, do everything the law allows to pay as few taxes as possible. Second, take as many government services as are offered to you. If our legislators and bureaucrats can’t control spending, then it behooves us to collapse that spending.
This rate--$1600 month for the next eight months—is based on a taxable income of slightly less than $60,000 per year.
Next year, when the situation becomes normal, I will pay about $1100 per month on the same income.
That comes to about 25% of my income for the year. Just for income taxes.
My taxes are high in part because I have few deductions. I have no children at home anymore. I own neither home nor property, though both the state and the city of Asheville annually tax my car. The classrooms I rent at the church and a small portion of my home are deductible for business purposes, along with a few other expenses. But that’s it.
I recognize that taxes of some kind are a necessary evil. Like many who pop checks into the mail to the government, I don’t mind funding our military. I don’t mind paying for highways or schools or parks. I don’t mind assisting folks who have hit hard times.
But if you look up government waste online, you’ll see that a sizable percentage what I am paying in taxes is indeed wasted by the government through inefficiency, duplication of services, bureaucratic regulations, and occasional cheating on departmental budgets. Google Wastebook, for example, and you’ll find the site of Senators Coburn and Flake detailing just some of the ways government flushes dollars down the pipes every year. Some of these expenditures are humorous—hundreds of thousands spent on studying chimps running on tread mills, for example, or more hundreds of thousands spent by a government agency promoting tourism to Lebanon while another agency officially warns tourists to avoid Lebanon as dangerous and violent. The current Wastebook 2015 runs to over two hundred pages and gives you a tour of the fiscal sinkhole we call the federal bureaucracy. (See http://www.flake.senate.gov/public/_cache/files/03714fa3-e01d-46a1-9c19-299533056741/wastebook---the-farce-awakens.pdf).
Many of these expenditures might be amusing, but the balance in my checking account throttles my laughter.
Any business in the same financial shape as the federal government would have already closed its doors. Any American household in this same shape would be living in a homeless shelter.
Meanwhile, neither of the leading contenders for the presidency is calling for cutbacks to the federal government or to government expenditures. These candidates, and many others, can’t make such a call, because they wouldn’t be elected. Too many Americans now look to the government for assistance, too many have their finger—or in some cases, both hands—in the American pie.
This year I turned sixty-five. Friends have asked me if I intend to retire soon. This question always brings a smile. For the last thirty-five years, I have worked independently of any company or government agency. Until I was fifty-five, just paying the bills was a struggle. Now the same is true of taxes. My poor financial planning coupled with years of high taxes and health care payments have left me little in savings.
So retirement is not an option. Fortunately, I love teaching, so retirement has little allure for me anyway.
Given these circumstances, I am considering choosing a different path in the near future. I will give this corporation thing two or three years. I will go on paying my taxes. But if I am still alive, and if the government keeps expanding and demanding more of my earnings, then I plan to quit—not my job, but paying taxes.
That’s right: I plan to diminish or cut entirely the monies I pay toward taxes. If necessary, I will resort to barter in my teaching, taking meals, grocery store gift cards, and labor in exchange for tuition while earning just enough money to pay my rent and other necessary bills. I will lower my standard of living. I will cut and cut until my income falls below any taxable rate. By then, I will also be eligible to work and receive Social Security without penalty, so that will help as well.
In the last two centuries of the Roman Empire, many members of the dwindling and heavily taxed middle class began going “off the grid,” engaging in barter of goods and services rather than using cash. I plan to do the same. I am happy to make do with less if it means no longer working for the robber barons of the Washington beltway.
I’ll be just fine. We serfs know how to scrape by.
A last note: if it remains apparent that our government has no intention of seeking a balanced budget or of getting control of our debt levels, then let me encourage my readers to do two things. First, do everything the law allows to pay as few taxes as possible. Second, take as many government services as are offered to you. If our legislators and bureaucrats can’t control spending, then it behooves us to collapse that spending.
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