DISQUS

Curmudgeon · 2 months ago

About income taxes, Steve. If we needed 100 percent agreement on everything our tax dollars were spent on, nothing would be spent (and that would be bad). A substantial part of my tax dollars are spent on things I would prefer they not, but at some level I have to trust the people (legislators, government bureaucrats, etc.) who are authorizing and spending them are not into wholesale theft. If you can't believe there is value in the system in general, you may as well find a deserted island to live on.

I do have more of an issue with the percent of people who don't pay income taxes. There are a lot of arguments both ways here, but I would like to think that people care more if they have "skin in the game." No matter what your income (to an arbitrary level that is probably a lot less than 47 percent), even if you're only paying $100, you may care more about what wars are being fought, and what highways being built.

And yes, I realize that this percentage doesn't include payroll taxes, which every legitimately working person pays, but they result in highly targeted benefits.

Steve · 2 months ago

@Curmudgeon: That was more or less my point on the taxes - since we're already in a system where you have to accept some unfairness in how it's spent, then it almost follows that it's unfair in the way it's collected.

And the people who don't pay income taxes certainly end up paying in other ways - sales tax, payroll taxes, etc. It would be an interesting experiment to have a one time "everybody pitch in $1000 this year to build a new airport outside New York" assessment and see if that motivated people to complain. You're probably right that it would.

Curmudgeon · 2 months ago

I've had a SEP for about 18 years now, and my biggest problem is not my ignorance, it is that of the banking and financial community, and of the IRS. Every time I care to make a deposit into my SEP, I have to budget at least two hours to explain to the bank representative what a SEP is, why I have one, what I can contribute, and what they have to do. Then they call up the home office for procedures, only to talk to others who require the same explanations.

It gets worse. I've been to financial advisors who are clueless about the savings options open to the self-employed. I've had to explain to IRS auditors (thanks in large part to my SEP, I get audited almost every year) what the rules are for a SEP.

The fact of the matter is that our society and our rules do not recognize self-employment as a legitimate way of earning a living. I've actually had IRS representatives tell me that they always authorize an audit for anyone filing a schedule C.

Mike Piper · 2 months ago

Thanks for including my article and for pointing out MyDollarPlan's series on self-employed retirement plans. Hadn't caught that one, but it's excellent. :)