April 15, 2015 - Tax Day

Hello All,

Happy Income Tax Day!
Here in the U.S. today is "Income Tax Day", it is the day that everyone is required to file their U.S. Income Taxes.  One of the great things about being "retired"ll is that my tax forms are not as complicated or hard to complete as they used to be when I had my own business.  During one year of my business ownership, I really screwed up, and did very little bookkeeping or tax work until it was time to file the taxes.  At this time, I took basically a couple of cigar boxes full of various 1099's, deposits, expense checks, and put the whole mess in the lap of my "personal CPA".  And believe me it was a mess, it took us days to sort this mess out, and it cost me a fortune to 1. Pay the IRS  and 2: to Pay my Accountant.  As we were finishing up the return for that year my CPA politely reminded me that it would not have to be this bad or this expensive, if "I would bring my information into his office on a more regular basis."  I told him that "I would rather go to the dentist than come to his office".  He said "well Mike, you are right, it is like going to the dentist.....and if you don't wait so long to go...it doesn't hurt near as bad."  Those words, along with the taxes, penalties and interest left an impression on me....and I have tried to do a better job every since of keeping my records and tax reporting up to date.

Now that I am retired, my taxes or not nearly as complicated as they once were.  Of course, being retired, I no longer bring in as much money as I used to....and worse yet I have friends that ask me to "help then with their taxes".  I used to generally "just say no" to doing taxes for folks, but then I saw some of the amounts of money my friends were having to pay to various "tax preparers".....on top of which I saw a lot of cases where there were errors made that cost my friends even more money. Finally, I started doing a few here and there....even though I have generally thought that "income tax preparation" is one of least enjoyable parts of the the accounting business you could get into.

Anyhow, today April 15th, I completed 5 last minute tax returns for friends and a non-profit organization that I support.  Sitting at a desk all day is hard for me, and I believe it is bad for your health as well....but when the work has to get done it has to get done.  I don't generally mind the work.......but today, one particular tax return that I completed really set me off!  

The Oil Field Worker Return:
I have a friend who works in the "oil patch" as we sometimes call it down here.  And if you have never seen it, it is rough and hard work, requiring specialized skills, performed outdoors in the elements, with large equipment, and plenty of backbreaking work to go around for everybody.  In fact, in the old days, people who worked out in the oil patch were often referred to as "rough necks", because by God this work is rough on anyone and these people do it everyday...in blazing heat down here in Texas...and in Freezing cold up in Wyoming and Montana.  Often times they are away from their families for weeks and even months at a time. About the only good thing that can be said about this work is that it pays a good wage; higher than you can make in most of the places around here.  Sometimes they live in "travel trailers, sometimes they live in cheap motels, they eat what they can find in some of the most backwoods parts of the country you can possible imagine.  Perhaps, worse yet some of them are confined 24 hours a day to oil rigs out in the ocean.....like the Gulf of Mexico.  The work is dangerous, and if you are not careful, you can be hurt or killed fairly easily.  Fortunately, safety standards have improved somewhat, and there are not as many injuries or fatalities as there used to be years ago before OSHA started fining companies for flagrant safety violations.  (Occupational Safety and Health Agency).  So what is so special about this "tax return".....that gets me so revved up?

After working through all of the earning and deductions and completing all of the forms......and doing all of the best that I can do.....this hard working, God Fearing, Tax Payer wound up owing an additional $2000 in taxes and was in a Federal Tax Bracket of over 22%!  Why is this figure so disgusting to me???  Is it just because the "rough neck" was dinged for a couple of more thousand dollars on top of what they had already paid?  No, not really.  What is a damn shame though is that for working this hard, to provide for his/her family....they wind up paying 7 - 8% higher percentage income tax than Bill Gates or Warren Buffet!  On top of this, many of the big oil corporations that these oil patch workers support pay no US Taxes at all and have trillions of dollars in overseas accounts to avoid paying US taxes!  

People who sit in nice Corporate Offices, surrounded by all the comforts you can imagine, and the Corporations they work for pay nothing in U.S. Taxes and the big wheels that run these corporations pay a lower % of their income than the Oil Field Worker.  Most people, including even Warren Buffet, know that this is unfair...and is the result of our broken income tax system.

WHO TO BLAME for this SHAMEFUL SYSTEM:
Not the IRS - they only enforce the rules made by the US legislators.

Not the President - he has nothing at all to do with the US Income Tax Code.

This system is the result of the spineless, elected politicians of the United States, both Democrat and Republican who get their marching orders from America's wealthiest 1% (Koch Brothers) and from Corporations.....who buy them off like the cheat tramps that they ALL are.
And what do we hear from radical Politicians like Ted Cruz?  Abolish the IRS.  Eliminate Food Stamps, Repeal the Affordable Care Act.
No discussion of taxing the wealthy, taxing corporations, bring US based jobs back home, eliminating loop holes for overseas investments.  Bring anyone of these subjects up and all you may hear is the sound of

crickets chirping in the dark.