Beech Tree News Network

The April 15th date causes many of us to feel a sense of dread. This of course is the filing deadline for personal tax returns. This year, due to the Washington D.C. Emancipation Day holiday being observed on April 15, the deadline is actually April 18 – the following Monday. So, tax anxiety can be drawn out a bit longer.

Income tax is a topic about which most people are willing to express an opinion. A few comments on that subject include the following (http://www.brainyquote.com/quotes/keywords/income_tax.html):
•    When there is an income tax, the just man will pay more and the unjust less on the same amount of income. –Plato
•    The income tax is a twentieth-century socialist experiment that has failed. Before the income tax was imposed on us just 80 years ago, government had no claim to our income. Only sales, excise, and tariff taxes were allowed. –Alan Keyes
•    We're going to look awfully stupid if we give income tax relief to people who do not pay income taxes. –Joe Scarborough
•    I think we ought to ban earmarks. I think we ought to give citizens the opportunity to designate up to 10 percent of their federal income tax toward debt reduction. If we did that, we would reduce our debt by $95 billion a year. –Carly Fiorina
•    Many states rely on sales tax as their principle source of revenue and do not have a State income tax. –William L. Jenkins

It’s hard for me to comprehend the funds collected by the IRS. For example, the IRS posted the following income statistics based on individual tax returns (https://www.irs.gov/uac/SOI-Tax-Stats-Tax-Stats-at-a-Glance):
•    Top 1-percent Adjusted Gross Income (AGI) break (TY 2013) [3] – $428,713
•    Top 10-percent AGI break (TY 2013) [3] – $127,695
•    Median AGI (TY 2013) [3] – $36,841
•    Percent that claim standard deductions (TY 2013) [3] – 68.5%
•    Percent that claim itemized deductions (TY 2013) [3] – 30.1%
•    Percent e-filed (TY 2014) thru 4/30/2015 [4]     – 92.2%
•    Percent using paid preparers (TY 2013) [3] – 55.5%
•    Number of returns with AGI $1M or more (TY 2013) [4] – 347,070
•    Average individual refund amount (TY 2013) – $2,843
These figures reflect the diversity of personal income within our country.

I asked friends and family when they filed their last tax returns, did they (1) pay additional tax, (2) break even, or (3) get a refund. Of those who responded, 24% paid additional tax, 9% broke even, and 67% got a refund. Breaking even seems the most difficult. However, 67% were able to make choices about spending their refund money. CNN Money reported that some of the ways people spend these funds include: paying down debt, building savings, or for everyday expenses, major purchases and vacations (http://money.cnn.com/pf/storysupplement/tax_refunds/index.html).

I always dread filing my tax return. I don’t break even. I either pay additional tax, or I get a refund. In recent years, I have filed early. And, remarkably, this lessens my tax-filing anxiety.