Today's Downsizer Dispatch
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Quote of the Day:
"The rule of law thrives when the law is at peace with the people, not when it’s a cudgel."
-- Jim Harper, scholar, Cato Institute
Subject: A message from the Unknown Taxpayer
We received a message from a DC Downsizer over the weekend. This person wishes to remain anonymous, but has agreed to let us share the message . . .
"I work for a charity, doing something I love that I think is important. But I don't earn much. I grossed $35,000 last year. According to an entry in Wikipedia, that makes me lower middle class, but I just did my tax returns, and now I feel poor.
"I believe my federal with-holding was done correctly, but I still had to write a big check to the federal government, and my situation with my state government is an even worse problem.
"I had more than $12,000 in medical expenses last year, mostly dentistry. But after spending the better part of two days reading through tax instructions, applying all the rules, and adding up all the numbers, I just missed having enough qualifying expenses to itemize.
"It doesn't seem that it would have made much difference anyway, even if I had barely qualified.
"I also found, in one small paragraph in the tax instructions, something indicating that I probably qualify for a fine for not doing enough federal withholding. But everyone I've consulted seems to agree that my with-holding was done correctly. I just owe more money. And somehow, when I do the numbers, it still seems that I qualify for this fine.
"The situation with my state taxes is even worse. My state has no mechanism for doing my with-holding because the non-profit for which I work is headquartered in another state. The company that does the payroll for my employer expressed despair when they learned where I live. Apparently my state is notorious for this problem. And the tax collection bureaucrats in my state won't do anything to help fix it. As a result . . .
"No state with-holding is done for me. I have to pay it all in one lump sum at the end of the year, or make quarterly estimated payments. The forms involved are mind-numbingly complex, the worst I've ever seen. And I can't help fearing that the state will fine me for all this, even though the problem is theirs, and not mine.
"I suppose I'm at the point where I need to hire professional help. But that's expensive, with no guarantee that I'll actually owe less tax as a result. I can barely pay the bills I already have . . .
"When I added my total tax payments for the year and my total medical expenses, the result was shocking. These two expenses consumed more than half of what I made in 2007. And it wasn't as if I had any really serious medical problems. Plus, I actually have health insurance, but my out-of-pocket was still huge, and most of it had to be paid with credit cards, at a very high rate of interest.
"I can't help thinking that this whole set-up is a backdoor corporate welfare scheme for the credit card companies.
But it gets worse . . .
"What if I added up my sales taxes, and my property taxes? My net income would look even worse. And what about all the hidden tariffs and excise taxes and corporate taxes that are passed on to me in the cost of the things I buy? Then there's the inflation tax. I know the government has been expanding the money supply. All of my costs are rising, but my income isn't.
"I also know that the government has distorted the health care market, causing costs to soar, and I know that the government was responsible for the housing bubble too, making housing unaffordable for me, even though I'm supposedly middle class.
"At this rate, how will I ever save for retirement? Social Security isn't enough to live on, and it's in trouble anyway.
"The politicians constantly claim they're doing things to help people, but I feel like they're crushing me.
"All of this makes me see the value of Ron Paul's health care bill. His tax credit would make a huge difference for me. And I'd like to be able to save more in my HSA for when I have real health care problems, and not just the minor things I had last year.
"I hope Downsize DC can get this bill passed, and cut the size of government in general. I really need it."
Well, we think that says it all. Please send another message to Congress asking them to pass Ron Paul's health care bill.
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