Tax Man Assumes, Makes An Ass Only Of Himself

I'm a bald eagle!  I pay my taxes!
Chirp, chirp!

So, I filed my 2012 federal income taxes, and I have to say I remain highly unimpressed with this system of taxation.  It makes some very broad assumptions and makes one particular judgment that I find to be hopelessly unfair and infuriating.

First, I will remind the reader that 2012 was my first year back from a deployment which took me away from my business for a year.  This was a year of rebuilding.  Fortunately, but unbeknownst to the Tax Man (not that I was hiding it), I was able to bring a large portion of what I made overseas home – a cushion to help make ends meet as I went about the task of rebuilding my piano tuning business.

As I filled out the forms for 2012, it was clear that the IRS was not interested in what I did or did not bring home from my deployment.  The IRS was not interested in the state of my business, whether it was steady over the last few years or being built up again after a year away.  None of those questions came up on the 1040, the SE, or the C-EZ.  The only thing they wanted to know about 2012 is how much money I made.

Technically, I file as a single individual.  For all practical purposes, I am also helping to support two children – materially, emotionally, developmentally.  Note that I included materially.  However, due to how things went down for me during the divorce, not having the benefit of a lawyer, I technically have to file as a single person.

I say this because for 2012, my total income fell below the poverty line for a single individual, and well below for a household of three which, again, for all practical purposes, is much closer to the reality based on how much time my kids spend with me.  At this point, what is left from the deployment, that cushion, will cover one month’s rent plus one month’s child support.  That’s all that is left.  What the Tax Man compelled me to fork over two days ago is a relatively small amount to most people.  However, relative to me and my situation, it wasn’t a small amount.  The assumption has been made that I didn’t need it.  But I did.  I do.

The IRS judges that the amount they squeezed from me is needed by the government.  Isn’t that what taxation is all about?  The government needs it.  And if they don’t get it, they can seize the working man's bank account and everything in it to settle the bill, and tack on interest and penalties to boot. But bless their bureaucratic hearts, over 100,000 individuals and families that made more than $250,000 last year will pay zero taxes on their income (if the figures from 2011 are any indication), and the IRS has judged that the tens or hundreds of millions of dollars that represents is somehow not needed.  Why?  Because an expensive CPA or tax attorney crossed some t's and dotted some i's, keeping tens of millions of dollars from the Tax Man’s grasp.  Oh, and those are the Tax Man’s own forms those guys are filling out, printed up in his own office.  It’s as if the Tax Man is telling these wealthy people, “Here, fill this out.  This form is for you.  I don’t even want your millions.  But Henning over there has something I need desperately, and count on me to threaten his property and even his rights to property to get it.  And if that low-life fails to report his paltry income, into the slammer he goes!  Bwah, ha, ha, haaaaaa!!”

Yes, the judgment I find so infuriating: the government needs the little it can get from me (money it assumes I don’t need) to the point that it will threaten my property and very freedom, but it doesn’t need the millions from those who, by the stroke of a pen, are let off the hook.

Some of you may have heard me interviewed recently on a friend's podcast about taxation, and you may have thought something along the lines of: Well, he just needs to be a better business man, or, He needs to do a better job finding those deductions for his business, or things to that effect.  I would just say that, as a working man trying to feed myself and my kids, which is perhaps my highest responsibility to society, I don’t need the arrogant and uninformed assumptions of bureaucrats and legislators as to what money I need or don’t need (especially money I've earned), and I don’t need to be judged by my fellow citizens as to my business acumen or the dexterity with which I handle a tax form.  I shouldn’t have to have an MBA or be a CPA to go out and earn my living.  I define success in business as not having to ask for handouts to support me and my kids, and in that light, I am successful.  I'm out there making it happen.  At least I was smart enough to know I’d need that cushion coming home from deployment, and smart enough to not blow it on a brand new car or think I can afford that two-bedroom now.  And I’m smart enough to have stopped using credit cards years ago.  Everything I buy is paid for right there and then; no looking back, no interest.  I’m a "credit" to myself – I don’t need some faceless banker’s approval as a measure of my success.  Want to measure something?  Measure this.  [crude gesture]

Save your platitudes on fairness.  This system was put in place by the rich, for the rich (see: history).  The better we understand this connection, the clearer it will become as to why the millions who are in my situation have to put up with this crap.  And all this crap goes away without a tax on our earned income: the assumptions, the judgments, the inquisition, the squeezing, and the threats of fines, confiscation of property, and prison being unceremoniously and unapologetically shackled to earning an honest living - a fundamental human right.  There is a better way.  I’m looking for it.  I am convinced that part of the answer lies in our past (obviously, pre-income tax), and part of it lies with the creativity of those in the present.  If I find it, I’ll let you know.  You might help by looking around yourself.