Archive for April 5th, 2010


Death and Taxes…Mostly Taxes

   Posted by: Michael Bernier   in Today's Reality

“In this world nothing can be said to be certain, except death and taxes.” ~Benjamin Franklin

My wife and I filed our tax return over the weekend. Ahh, taxes. It’s that special “season” that comes every year between January 1 and April 15 where, for a few hours at least and several days at most, everyone tries to remember their math skills as they fill in the lines on their tax forms. Some people have more forms to fill out than others; sometimes I think the number of forms grows exponentially with the number of people in the family. With three children, I shudder to think how many more forms it takes for me to file my taxes than for someone who is single.

Years ago, I gave up trying to fill out the forms by hand and started purchasing tax preparation software for my computer. It’s been a great help, especially when it comes to dealing with all the changes in tax laws that happen every year. How on earth would I have otherwise known I could have taken a substantial tax credit if I had purchased a new hybrid car? Of course, the tax laws don’t take into account the fact that I couldn’t afford to buy a hybrid car, or any other new car for that matter…but if I had, I could have received a credit for it.

Another advantage of using tax software is the ability to file taxes electronically. No paper forms to fill out or sign, no trips to the post office, and no chance that the return would get lost in the mail. Of course, it also means if you owe taxes, you can’t use any of those as excuses for not filing on time. But, the tax software can still help you there as well, by allowing you to electronically request a 6-month extension for filing. Yes, it looks like the software companies have thought of almost everything…except, of course, for how to pay your taxes in the first place.

My wife and I are getting a refund this year. Refunds, of course, are overpayments of taxes throughout the previous year. Some people try to walk a fine line and have just enough taken out of their paychecks to cover their taxes, and no more; that way they get the most in their pocket each payday. Raising three children, I already walk enough tightropes as it is, and I don’t need another one courtesy of Uncle Sam. So, I let them take more out than necessary, and I get it back as a refund the next year. Yes, that means I’m taking home a little less money each payday and it’s like giving the government a loan for a few months, but I’d much rather do that then get to the end of my tax forms and find out I need to pay additional taxes with money I don’t usually have in the first place. I like to think of it as a form of “indentured savings” where the government is helping us save throughout the year, and then they give it back for us to spend on the things we couldn’t afford to get all at one time otherwise, such as new wardrobes for the kids, or electronic gadgets, or appliances for the house. This year, it looks like appliances will take center stage; we have some that are in need of replacement, and others that could stand some repairs. If there’s anything left, it will probably go toward paying other bills that we’ve been putting off because, well, we didn’t have the money to pay them. Then, once the refund money is gone, the spending spree will be over with and life will return to normal, albeit with a few different things around the house.

At that point the cycle will start all over again, just as old Ben said it would over 200 years ago.