Taxes

Topic(s): me,government
2004-03-21 23:35:21 PST

Yesterday had me doing my taxes. A bit early I guess. The deadline is April 15th.

Every year I dread doing my taxes. It gets tougher and tougher every year. I think next year I may have to hire H&R Block or somebody. The laws are so confusing. There's no way an ordinary citizen can understand the tax laws.

When did you buy your stock? When did you sell your stock? What was the fair market value versus the purchase price? How long did you hold the stock? Were the stock options qualified or non-qualified? What was the stock price at the start of the plan?

The biggest snag I hit this year was my vehicle registration fee. The vehicle registration fee is supposed to be, atleast in part, tax deductible. Which is nice since my vehicle registration fee was near $800 in 2003. But there's a catch! When Arnie was elected governator, he refunded most of the vehicle registration fee. I got a check from Arnie for $572, in 2004. So does that mean I can still claim a $800 deduction for 2003? Do I have to report $572 as income in 2004? Also, I paid the vehicle registration fee for my old car before I sold it last May. But I had to give the vehicle registration to the new owner, along with the tax deduction numbers. How do I go about getting that deduction?

Arrgghhhh!

If I were the head honcho of the United States, here's what I'd do:

You make X amount of money, you pay Y amount of taxes. Period. This has the advantage of not screwing poor people, who can't hire tax advisers. It also has the advantage of no tax dodging by the rich.

Here's my tax formula:

   Y = (X1.1) / 31.62

               X              Y
  -----------------------------
         $10,000           $794
         100,000         10,000
       1,000,000        125,903
      10,000,000      1,585,032
   1,000,000,000    251,210,700

More generally,

   Y = XA / B

Where A is the rate at which the tax progresses. It's a product of average income. 1.1 seems fair to me based on the table above.

B is a product of how much moolah the government needs to operate. It would change every year.

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