Tax Guru – Ker$tetter Letter

Helping real people win the tax game.

Archive for June, 2003

Posted by taxguru on June 30, 2003

Firms’ Prop. 13 Savings Are Coveted – Newer property owners resent the lower taxes paid by long time property owners. It’s amazing how much energy is expended in our country in support of envy over what others have. Didn’t envy used to be one of the seven deadly sins? We’ve evolved to the point in our society where it is very acceptable and literally drives official government policies, as I described below.

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Acceptable Targets

Posted by taxguru on June 30, 2003

As I’ve pointed out on far too many occasions, it is considered acceptable to discriminate, penalize and do all sorts of nasty things to the evil rich among us. Once it is agreed that it is proper to do bad things to a certain segment of our society, it comes down to defining where the line is between those to have bulls-eyes painted on them and the others who don’t deserve the harsh treatment. As I’ve described, in most areas, this line is defined by AGI (adjusted gross income) on 1040s. Those having income over the arbitrarily set amounts are to be penalized and persecuted.

If it isn’t obvious enough where I stand on this issue, it’s that we should all be treated equally. I dislike the entire concept of someone on their throne in Washington DC deciding who has enough and who doesn’t. That is just fine for communist societies; but has no place in a capitalist free market economy as established by our founding fathers.

For estate (aka death and inheritance) taxes, the defining point of who should have their family’s wealth stripped away and who may pass it on is defined by the size of their net estate at the time they pass away. That is currently one million dollars per person and scheduled to increase over the next few years.

Those of us who believe that nobody should be deprived of the right to retain his/her hard earned wealth in the family are having to fight people like this who openly resent rich people and feel it is the responsibility of government to equalize everyone by force. There is a name for these kinds of people. Just the idea of one group of elitists dictating who is average and who is evil rich is disgusting and is no different than having the government mandating what size home is allowable for each person in this country or in other ways telling us how to live our lives.

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Posted by taxguru on June 30, 2003

We have an increasingly unmistakable case of deja vu here. In spite of a huge approval rating after the 1991 Gulf War, Bush 41 alienated plenty of his conservative base by breaking his “read my lips, no new taxes” pledge, leading to his record as a single term president. Bush 43 is following the same path with his support of bigger government spending. Many conservatives are expressing their displeasure with this blatant and very unprincipled attempt to buy votes from the DemonRats’ traditional constituency.

Let’s hope that, in acting on this disapproval, disenchanted Bush supporters will vote for a real small government choice (Libertarian Party) in November 2004 rather than sit out the election or waste their votes on a crackpot like Ross Perot.

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Posted by taxguru on June 30, 2003

Our rulers have done such an excellent job in forecasting the costs of other huge entitlement programs, why not let them just keep on going?

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Posted by taxguru on June 30, 2003

Calif. Near Financial Disaster – They’ve been on the brink of collapse before, and always survive. They’re trying to scare people into accepting higher taxes rather than cuts in the cost of government programs.

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Posted by taxguru on June 29, 2003

Once Again, Democrats Take On Tax Issue – Same song: repeal the Bush cuts and ream the evil rich.

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Posted by taxguru on June 29, 2003


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Posted by taxguru on June 28, 2003

CBS Wails: “With Only $400 Billion to Spend”; NBC Rues Tax Cut – And the lefties still claim they need another news network to counter Fox News. They don’t think they have enough outlets with just ABC, CBS, NBC, PBS, CNN and MSNBC to spread their socialist propaganda.

Very Richest’s Share of Income Grew Even Bigger, Data Show – And the NY Times’ answer to this disparity is to have our rulers in the government equalize everything by redistributing wealth from those who earn it to those who don’t.

Drugs and the Deficits – The Libs couldn’t care less about the deficit when it comes to more government spending programs; but they claim that the Earth will stop spinning if tax rates are reduced and people are allowed to keep a tiny bit more of their own money.

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Posted by taxguru on June 28, 2003

“Commuter Taxes” are Taking Many Workers for a Ride,Tax Research Group’s Study Finds Just as with tourist taxes, government rulers love to be able to take money from people who are not able to vote against them.

The new decade of greed – The Clinton 1990s far surpassed the Reagan 1980s.

Time to retire General Washington – Has the one dollar bill outlived its usefulness in the USA?

Entitlements have history of cost overruns – Just as with projected effects of tax law changes, the numbers used to describe new government programs are complete fabrications. Our rulers have a long history of intentionally understating the expected costs of government programs. They know that nothing will ever happen to them when the truth materializes; costs hundreds of times higher than predicted. Most of the current rulers will be out of office by then. They also know that, just as with Medicare, by the time the true costs are realized, everyone will be so used to the system that there will be no political support for discontinuing the program. They are no different than drug pushers, getting as many people addicted to their government programs as possible.

Taxing retirement funds – Our rulers are literally salivating at the idea of getting their mitts on the trillions of dollars people have stashed away.

Social security imbalance sheet – There are still some in DC supporting the concept of allowing people to have more control over their SS money (aka privatization).

What Gives? The Possibilities of Private Charity – People are very generous in support of causes they agree with and efficient local charitable organizations can accomplish a lot more with a lot less than bloated corrupt government programs.

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Mean Testing Is Standard Practice

Posted by taxguru on June 28, 2003

I’ve often discussed how many of the tax deductions and credits are only available to those people whom our rulers consider to not be evil rich, as defined by the AGI (adjusted gross income) on their income tax returns. They refer to this as “means testing,” implying that people with substantial income (means) don’t need additional tax breaks. I prefer to call it “mean testing” as a penalty for being successful.

In the recent discussions over expanding the government medical programs to cover prescription drugs, I never bought for a second the argument that many people were raising that the taxpayers would end up paying for the medicines of the super duper evil richest of our country, such as Bill Gates, Donald Trump, Ross Perot and Rush Limbaugh. I knew that was a bogus claim because any new government program would have to have a means test to weed out the undeserving. As Robert Novak describes, that means that the medical establishment will be provided with our income data in order to know which of us are entitled to the government benefits.

I’m not in favor of expanding the size and scope of government control over our lives. However, I am also not in favor of using bogus arguments in discussions of those issues. Claiming that the taxpayers would be picking up the tab for billionaires was never appropriate and just makes opponents of the program look stupid for mentioning it as a realistic possibility.

However, allowing government bureaucrats to have more actual life and death power over us is very scary. Need I remind everyone that our rulers in DC have already established the cut-off between the deserving and the evil rich for Social Security recipients as $25,000 AGI for single people and $32,000 for married couples? Is it too much of a stretch of the imagination to foresee someone being denied life saving cancer medicine because his/her AGI is $40,000?

For anyone who thinks using AGI as a test of eligibility for benefits is a good idea, please check the AGI on your most recent 1040. It’s the number at the bottom of Page 1. Now, ask yourself how much of that you have in actual cash with which to buy medicines or anything else. AGI has very little relation to the amount of actual disposable cash people have on hand and has never been a fair measuring stick for wealth. However, it has become enshrined in the mentality of our rulers in DC whenever deciding who may or may not participate in any new benefit.

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