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TAX TIME! 





TAX TIME!


Image of today's outrage


We thought we’d lighten up the remarkably dull process of doing our
taxes by sharing a few random thoughts with our faithful readers. On
the bright side, the Tax Simplification Act was passed a few years ago –
they’re bound to have worked out all the kinks by now. So it’s time for
The Outrage editors to do our own taxes. No problem – we’ll whip these
things out in a half-hour.


Line 9 – Hmmm… Ordinary dividends – Nope, we never expected that
company to pay us anything at all – those must have been extraordinary
dividends. Maybe schedule D.

Line 12 – Business income (or loss). Well, we published The Outrage
again in 99. There aren’t any limits on losses are there?

Where does the gambling income go? Same place as capital gains on
publicly traded Internet companies? Gotcha.

Line 19 – Unemployment compensation – You can get paid for being
unemployed? Seems like the Wendy’s down the street is always looking for
help, and every other business seems to be hiring. We’re missing something
on this one.

Line 20a – Let’s see, we pay into Social Security so that Mother Outrage
and Grandma Outrage can have some more money, despite the fact that
they never paid into the system. No problem – We’ll probably inherit that
money back. Do we have to pay estate taxes when the money we paid into
Social Security is recycled to us? Wouldn’t it be easier if we just
mailed our elders some cash, and then they could mail it back later?

Line 22 – Total Income – Can this be a negative number?

Line 29 – Keogh and self-employed SEP and SIMPLE plans – Simple
retirement plans? Not likely.

Line 35a – Item to consider for next year – Deduction for marrying a
66-year-old blind woman.

Line 36 – Can we claim Sheba, the Outrageous cat, as a deduction? We
feed and house her, and she has more redeeming virtues than a large
portion of the voting population. Also, much better behaved than most
children – never cusses us out. (Unless, of course, we’re late with the
Tender Vittles.)


Time to take a smoke break. Holy cow, these things are expensive.
Almost forgot that cigarette taxes have gone up another 10 cents a
pack. Not to worry; soon, thanks to liability litigation, we won’t be
able to buy them at all.

While smoking, happened to notice a telephone bill lying on the desk.
Seemed unusually high, so we took a closer look: Federal subscriber line
charge, local number portability surcharge, FCC line port charge, public
rights of way use fee, federal tax, local tax; sales tax on a new line
installation. But what really caught our attention was our
“contribution” (mandatory) to the Universal Service Fund. But hey, this
is America, and we know that the founders guaranteed the right of
everyone to yap on the phone, forever, be they rich or poor.


Back to work:

Line 43 – Child Tax Credit – Maybe we should have a few kids. Can men
get Aid for Dependent Families? We’re already paying real estate
taxes to educate all the neighborhood children. We could even get
married – drastic step – and get a bigger deduction. And, later, isn’t
alimony deductible?

Line 50 – Self-employment Tax – Jeez, is this one high! Tell us again
why we have to pay double Social Security tax if we work for ourselves?
So the government will have plenty of money to take care of us in our
old age? Check.

Hey, does this line include Medicare tax? Isn’t this the one that funds
Medicare fraud? If old people need their sex lives recharged, can they
use Medicare to pay for Viagra? Hope so. But I think our local property taxes
already cover swing dancing for seniors.

Capital Gains and Losses – (Note: this is as of December 31, 1999, not
April 14, 2000. Pity.)

Let’s see, if we double reverse our passive section 1231 income gain
against our allowable passive loss from form 8582, then take the AMT
Section 1231 PAL carryover from 1998, put it all in a bag, dance like a
dervish to the latest Incinerators tune, and chant James Brown lyrics to
the dark forces, we should get a depreciation adjustment for post 1986
schedule C carryovers.

Sorry, getting a little carried away here.

Foreign Tax Credit – Well, we’re certainly glad that we didn’t have
dividends from a DISC (or former DISC), or, for that matter,
distributions from a FSC (or former FSC). And we narrowly escaped
having income re-sourced by treaty. (Although that one sounds kinda
sexy, and if they happen to resource it in our direction, we’d certainly be
grateful.)

Alternative Minimum Tax – We get to fill all the same forms over
again, in case the government didn’t get enough on the first round! How
exciting!

Incidentally, as far as expenditures for mining exploration – and
land clearing – we didn’t have any, after, of course, deducting
child support payments and elderly care credits from Section 1245
property and the applicable percentage of payments excluded from income
under section 126. We probably would have, except we recaptured the
amounts under section 179 and 280F(b)(2). In case you were wondering.

Passive Activity Loss Limitations – Is this, like, when Steve comes to
the office and pretty much just hangs out? Do we get a deduction for
that?


Well, we were hoping to delight, comfort, and inspire you with our
blow-by-blow account, but, since we started this 7 hours ago, we better
focus on finishing up. More power to tax protesters and everything, but
we’ve got no great desire to go to prison and get intimate with Julio
and Big Jack.

Tell us again; is there a fee for filing an extension?


OUTRAGEOUS FACTOID!

Think the rich don’t pay their share of taxes? Think again. Here are
the facts, according to the IRS:


  • In 1997, the most recent year for which data is available, those
    in the top 1% of income paid a third of all federal income taxes.
  • Those in the highest 5% of income paid just over half (52%) of all
    income taxes.
  • The top 10% paid 63% of all income tax.
  • Those whose income was in the bottom 50% paid only 4% of federal
    income taxes.







Rageback:


Share your thoughts about your income tax return – was it simpler thisyear? Did you pay more or less than in previous years? What part of theprocess do you find most outrageous?

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