Friday, February 19, 2010

Death and Taxes

There isn’t a single one of us who won’t pause this year while doing our taxes in light of yesterday’s tragic attack on the Echelon 1 building in Austen, TX. Death and taxes, the two things we joke about being the only inevitability in life, slammed together in this desperate, horrid act perpetrated by yet another homegrown terrorist.

I can’t presume to understand what was going through Andrew Joseph Stack III’s mind when he burned down his house, got in his car, drove to the airport, got in his plane, flew low over the bustling city of Austen on an eerily beautiful, clear day, and then crashed into the giant windowed face of the Echelon 1 office building. Thankfully (if that’s even the phrase), there were limited casualties. Yet, even one life lost to violence (even in this day and age) is one life to many.

In the days and weeks that follow, we will come to learn Stack’s twisted reasoning. We’ll come to feel a deeper sorrow for the families touched by this tragedy, including Stack’s own. Many of us will probably ask: Are taxes really a matter of life and death?

It is easy (or not so easy) to forget that taxes have caused a great deal of violence around the world, especially in this country. (Second only to religion.) Five souls were lost at the Boston Massacre, 168 in the Oklahoma City bombing, 2 now in Austen, TX. (It should be noted here that no one died at the Boston Tea Party.)

We fought a revolution over taxation and the recent Tea Party Activists have been eager to remind us all of the heavy toll we pay at the end of the day to an ever-expanding government. To which others of us have responded: How high a price is too high a price to live in the greatest nation?

As a sound bite –Man Angry At IRS Crashes Plane Into Building – many could probably sympathize. (This is of course before reading two lines into the story to find out that lives were lost and people were hurt, which removes all sense of levity.)

While most of us hate doing our taxes; today, I am struck not by what our tax code says about death, violence, and revolution – this is, as far as I can tell, absent from the instruction book-- but instead by what its rulings are on a litany of life-altering choices. The 1040, in a certain light, serves as a "how to" live guide of sorts for those who want to enjoy the highest standard of living (keep the most of what they earn in their own pockets).

Some of these many of us are doing anyway:

  • Get Married. While historically taxes were structured in such a way to penalize high earning married couples both in the workforce, this year you save an average of $3 on your joint return.
  • Have children. Procreation is rewarded on line 42 (the higher the number the more the exemptions); 51 and 65 (depending on income brackets.) Put another way: for any one of this generation hoping to cash in on social security, you best pray we are multiplying like rabbits.

Some are slightly more controversial:

  • Buy a house on credit. Schedule A, line 10: The higher the interest the better. By the way, did this have anything to do with the housing meltdown we are clawing our way out of with line 67, the first-time home buyer credit?
  • Buy a new, preferably expensive car. Schedule A, line 8: This year it is perhaps an investment you’ll want to make in the company we all own as American taxpayers.

Some are just sound advice:

  • Get an education. Benefits abound here, see lines 33,34,49.
  • Save for retirement. Lines 32 and 50 because, let’s face it, many of us are not procreating like rabbits, despite the potential advantages already sited.
  • Give to charity. Schedule A, line 19: Even if you can’t keep it, there is pride in choosing your own worthy causes.

And some, while perhaps well intentioned, seem to fall far short of any intended benefit to society:

  • Outsource the care of your children or aging parent. Line 48, you only get a benefit if you hire someone else to raise your child, not if you sacrifice your own earning potential to do so,

If this all seems too complicated, you can hire a professional and get the expense back next year (Schedule A, line 22.) Yet, someone’s making money on your money for the year.

In reality, how many of us are going through the tax code to make up our minds to walk down the aisle, have a baby, take in an aging parent? It’s scary to think that with the right accountant, one could.

Perhaps more pointedly, with a list as complicated as this one, how many things have to go just right to pay the minimum tax burden? Probably just about as many things that went just right for Stack to steal the life of only one person.

National sales tax, anyone?