Thursday, April 15, 2010

Happy Tax Day! Why Americans Should LOVE Paying Their Taxes

Ah, April 15 th . A day when the thoughts of many Americans are focused, like a laser, on the money we personally spend for the "public good" (or the "public bad", depending on your perspective).

Whether you're grumbling over your morning tea or joining a tea party protest today, if you're not skipping merrily down to the post office today all excited about the investments you get to make in our nation's infrastructure just repeat to yourself one (or all) of the following mantras. You might not wind up skipping, but hopefully you'll feel a little better.

I'm Investing in My Country

Do you like roads? Parks? Mail? The job our military does to keep us safe? Health care for the poor and elderly? Food stamps? Public broadcasting? Whatever your particular interest is, some portion of your tax dollars are going toward that project. If you're curious as to where your tax dollars go, check out the National Priorities Project and their interactive tax chart . Here you can enter the amount of taxes you actually paid (if it doesn't make you cry) and determine where those dollars went. Then, as you're filling out your 1040, pretend to yourself that you're making a donation to the programs you love best. You can even include that in the "memo" portion of the check - believe me, IRS workers have seen it all. That might ease the pain a little.

I'm Investing in Myself
If you're not convinced by the broader benefits to society that paying your taxes brings, think about it from a purely selfish perspective. Every minute of every day you are impacted positively by government actions. Think about it. Did you wake up this morning? If you did and heard the clock radio alarm or watched television, you were affected by FCC regulation of the radio spectrum. Did you take a shower? Clean water regulations (hopefully). Have some coffee? Trade tariffs on coffee beans. With cream? Dairy price supports. Use the restroom? You better hope there are combined sewer overflow regulations in your area. Drive on a road? Well, you get the point.

If you want to test this out, pick a day when you'll stop every few moments to write down how government impacts you (you can even use Twitter, if you're so inclined). Then, imagine that your personal tax dollars are bringing you these benefits. In fact, I'll be doing this through my Twitter feed today, so sign up to follow AdvocacyGuru and see what I come up with!

I'll Gain Access to Potential Perks

You know the old adage "you've got to spend money to make money?" Well, that definitely applies in the tax world. This year, thanks to the American Recovery and Reinvestment Act and other recently passed bills, Americans can claim all kinds of credits on their returns. The catch is, you've got to file to get the cash.

For example, if you bought a car or a house, credits may be coming your way. There are more education and energy efficiency credits as well. So take a careful look at all the existing and new deductions and credits. You may be surprised at what you'll gain!

I'll Avoid Public Humiliation and Additional Fees (and possible Jail Time)
Famed mobster Al Capone wasn't sent to jail for the many violent crimes he allegedly committed. No, what brought him down was tax evasion. And, although they certainly shouldn't be equated with mobsters, tax problems have dashed the career hopes of everyone from cabinet nominees like Tom Daschle to the coffee shop owner here in DC who just didn't pay his local taxes for about ten years. With penalties and fees, his tax bill topped $400,000 - and now he's out of business.

Whether you're concerned about how your tax situation will be addressed during your nomination hearing, or just want to avoid losing your business, it's important to stay on top of your tax obligations. In fact, many employers now look at how individuals manage their finances as one important hiring criterion. You don't want to lose your dream job because you just couldn't bring yourself to write that check on April 15 th .

I Have the Right (and Responsibility) to Advocate on Government Spending
"But wait," you're thinking. "The main reason I don't want to pay my taxes is because government spends my money on things I don't like." Sure, it's all very well and good to imagine that you're spending money ONLY on those government programs that make sense to you. But as a practical matter, that isn't really the case, is it?

Well, here's the most wonderful thing about our tax system and our overall system of government. If you don't like where your tax dollars are being spent, you have a right and a responsibility to let your elected officials know! For example, if you paid $5,000 in taxes, you'll find out that $1,470 went to the military and just over $1,000 went to health services. For some people those ratios are just fine: others believe that more should be going toward non-military programs. Wherever you stand on the spectrum, let your elected officials know what you think we should be investing in as a nation. How cab you do that? Here are four simple steps:
  1. First, make sure you know what you're talking about. Don't rant about the huge portion of the budget being spent on foreign aid, for example. It's ½ of 1 percent. Try a site like www.usaspending.gov to be sure you've got the latest information.
  2. Second, be clear about what you want. If you want a specific program cut, say so. If you want a specific tax increased or decreased, be explicit. Don't simply say "we need to pay less in taxes."
  3. Third, be able to answer the question "why should this legislator listen to me?" You'll be far more compelling and persuasive if you are a constituent, if you represent constituents or if what you want connects with policy issues the lawmaker is interested in.
  4. Finally, connect your "ask" to your personal story. How would what your asking for you benefit you and other constituents?
You can find your legislators and e-mail them directly through a site like www.congress.org .
When All Else Fails...
If things get too stressful just try to be thankful that at least you've got some income to pay taxes on, right? There are too many Americans struggling to make ends meet (especially in this economic climate). So sit back and relax with a glass of wine - and who knows? That Cabernet might not have made it to your glass without some sort of taxpayer investment.

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