And this is what they say we are doing wrong…

From Zero Hedge:

IRS Reports 40% Surge In People Underpaying Their Tax Bills

Paying taxes is just about as much fun as a root canal.  As such, apparently more and more people are just deciding not to do it.  As the Wall Street Journal points out today, the IRS saw a 40% surge in returns that owe tax penalties between 2010 and 2015.

For reasons that aren’t clear, a growing number of people who pay taxes quarterly are getting their payments wrong and incurring penalties as a result. These taxpayers often owe estimated taxes because they have income that’s not subject to the same withholding as wages earned by employees.

According to Internal Revenue Service data, the number of filers penalized for underpaying estimated taxes rose nearly 40% between 2010 and 2015—to 10 million from 7.2 million.

In 2015, the total number of filers owing penalties may have exceeded the number filing estimated taxes, although final results aren’t out yet. This is possible because some who paid quarterly taxes may have made mistakes, and others who didn’t pay them should have.

“The data suggest that millions of people don’t understand they need to pay quarterly taxes, or at least increase their withholding to avoid penalties,” says Eric Smith, an IRS spokesman.

Estimated tax payments are Congress’s way of keeping non-wage earners from having an advantage over wage earners. More than 80% of taxpayers have wages that are typically subject to withholding, and most people pay most of their income tax this way. Thus the law requires people with other types of income to make quarterly payments based on amounts received during each period.

Taxpayers with a mixture of wage and non-wage income must either pay tax quarterly or raise their withholding to cover the non-wage income. If total payments don’t meet certain thresholds, then the taxpayer owes a penalty on the underpayment based on interest rates charged by the IRS. Currently the rate is 4%.

Of course, there’s any number of reasons why people may be underpaying their tax bills.  Some people, you know…those who count themselves among the 95 million ‘discouraged’ workers who have left the work force completely, have been forced to take on random contract work to make ends meet and simply don’t understand that they have to make quarterly estimated tax payments.

That said, others understand the tax system perfectly well and are all too happy to take a 4% loan from the federal government courtesy of the Janet Yellen’s accommodative interest rate policies.

 Tax preparers suspect several factors are at work. For most of the period penalties grew, the interest rate was 3%—the lowest in decades, making the pain of paying them lower as well.

 “Some people don’t mind paying the toll, especially if their income bunches in the last quarter, and they just owe it for a few months,” says Don Williamson, noting the decision also could explain why average penalties have declined. Mr. Williamson is a certified public accountant who heads the Kogod Tax Policy Center at American University and has a private practice.

To that end, and while unclear if it’s true, Floyd Mayweather’s tax attorney, Jeffrey Morse, recently said that he was simply taking advantage of Yellen’s low rates by ‘deferring’ his $22 million tax bill from 2015.  Of course, we suspect this could be just a clever way to avoid fessing up to blowing through nearly $1 billion in career prize winnings…because that would just be embarrassing.

“If he is investing money and getting a rate of return that far exceeds what he has to pay the IRS in interest, then any smart business person is going to take advantage of that deferral.”

Then again, maybe it’s all much more simple and people aren’t paying their taxes because they need the money to fund that $500 monthly BMW lease payment they could never afford but finance companies were all too willing to underwrite…just a thought.

    • YOU ARE 100% CORRECT!!! IRS IS THE COLLECTION AGENCY OF THE CORRUPT UNCONSTITUTIONAL FEDERAL RESERVE SYSTEM SINCE 1913!!! that has destroyed our country! This video will wither make you VERY SICK to your stomach OR VERY SMART!!!! AMERICA FREEDOM TO FACSISM

      https://www.youtube.com/watch?v=kE8RtL3azDg

      It made me VERY VERY SMART!!! THINK and use your head! there are many ways of Skinning the Cat!

       

  1. Don’t complain.  If you pay personal taxes, its your own fault.

    Only entities pay income taxes.  Sovereigns living under common law do not pay taxes.

    Unfortunately, most of us believe we are “persons” and so fall under the IRS and corporate tax laws.  Yes, it was a shady, shifty move on their part, but ignorance on our part does not equate to innocence before the judge.

    Learn the truth, and choose life.

     

     

     

  2. Render unto Caesar… the things which are Caesars… which is not a problem until Caesar wants it all.   Excessive and complex taxation is just another tool used by the deep state to destroy small business and to force the large corporations off shore.  It is all part of the destruction of the middle class to take down the country.

    Many former employees have been off-loaded to the realm of contract employees to avoid the tax, benefits, and wage garnishment burden.  The created problem is most contract employees can’t begin to tackle the complexities of  accounting and taxes.  The digital money trail is created and tracked by the IRS to the scapegoat who has already spent his money… forcing a garnishment at the bank account level… forcing the employee to request mostly cashback on his deposits… which will create the government mandate for a cashless society.

     

    It is hard to tax physical gold and silver… and I do not think they will ever tax it… because they are also the ones accumulating it.

  3. Nothing to fear from the I.R.S, I am more focused on the state and federal authorties.. search and seizures. Always follow the money…

    I was hit up by two so called irs scams in the past two weeks. One from San Fransico and the other in Washington D.C. I told em to [*]. Notice that the calls came from two liberal strongholds. They fear the red State of Texas. Apply nicknamed ” The Lonestar State”.

    Stacking and packing.

  4. The IRS is about as evil as you can get.  It’s all about control.  One “volunteers” for the income tax system by using Federal Reserve Notes.  The standard deduction is to offset the coins minted by the US Mint.

    Once they get you on their radar screen there is no way you can beat them.  I’ve been a victim of their abuse several times.  I learned the hard way.   They have vast resources and deep pockets and can bankrupt you if you fight them.  They did just that to a friend.  He eventually won his case in tax court, but it cost him his company. Best to stay invisible.  Thus my concern about self directed gold and silver IRA’s that one keeps the phyzz in their possession.  If the IRS goes after you, you will lose.  Doesn’t matter what your CPA says or if you have a white paper in support from a tax attorney.  You will lose.

  5. ‘ FOR REASONS THAT AREN’T CLEAR’  Why there’s a 40% increase in people underpaying their taxes?   Are you shitting me!?!?  Low low rent moron wrote that statement—from Zero Hedge no less

    People are fucking broke. They don’t have any money to pay taxes   This isn’t rocket science. When the tax slaves are broke, unemployed, stripped of any spare cash, of course they’re going to underpay.  Big Effing DUH!  Well over half of every dollar earned is taken in taxes

    Well over half of every produce or service we buy consists of the tax cost of that product or service.

    Our GDP is, at best,  $9,000,000,000,000   The rest is government spending that comprises the other half.   Our GDP is a complete sham as is the unemployment rate of at least 35% and inflation of at least 7% and that’s a low ball estimate

    The local state and federal governments spend, er, I mean, piss down the drain trillions for nothing  They do nothing. They build nothing  They waste trillions on the Mooch Class, stupid shit and wars.  What little trickles down to the proles, like poor people buying lottery tickets, is spend on survival.  What do we produce?  Maybe $9 trillion in good and services.  The rest if government bullshit.

    The IRS rules are obtuse obfuscating pieces of shit that are designed to confuse and bewilder  the tax slaves.  Like the people of Borneo and New Guinea  who created cargo cults derived from the US supply drops during WWII that showered manna from the skies, the people of this country have been cowed, intimidated and threatened by the big bad IRS, the inverse of a cargo cult, designed to sprinkle terror on the proles to keep them in constant fear that if you don’t pay Da Man he gonna take you out.

    If you dont pay your taxes like a good little slave then booga booga the big bad IRS man gonna come and gitcha.

    The simple fact is this.  There are only a few thousand agents capable of doing anything to really threaten a person with their tax monstrosities.  There are 100,000,000 of us.  The numbers really suck if you’re an IRS agent with a gun,  told by your masters to go git sum from some poor tax slave.  A small army of tax resisters could root out and eliminate the IRS in 3 days.

    The only reason the IRS doesn’t kill more of us is we have 150,000,000 guns and billions or rounds of ammo.  Those make for some really bad odds. You may give up some God given freedoms but if you give up your guns and ammo you are nothing more or less than a naked, afraid and unarmed slave, like most of the people in this world

     

    It still amazes me how an infinitesimally small fraction of the US government thugocracy can cow and intimidate the proles of this country into believing they have the power and we are powerless to stop them.

     

    • they say knowledge is power. and apparently someone is applying knowledge of the human condition in a very silly way. That is my current see on the shitshow.

    • @agxiik …My wife and I have just spent the last week touring Yellowstone and Grand Teton National Parks.  National parks are one thing that government got right.  But, between national parks and interstate highways that’s about it I’m afraid.

       

      Founding Fathers knew an income tax was evil thus the 5th Amendment declaring it unconstitutional.  But don’t try writing 5th Amendment on you 1040 and declaring no earned income.  That doesn’t end well.

    • @AGXIIK

       

      “… and inflation of at least 7% and that’s a low ball estimate”.

       

      Indeed it is.  A more practical estimate for inflation is in the range of 8-9% per year.  If using the Rule of 72 in reverse here, it tells us that the value of our money is being reduced by half every 8-9 years… and some folks don’t get why some of us prefer to hold our wealth in PMs.  lol

       

      Agreed @UglyDog re: IRS and fighting them.

      Best way to deal with the IRS, IMO, is to remain as invisible as possible.  Like turkeys during hunting season, popping up your head up is a great way to become the center of attention… and that rarely ever ends well.

      Also agree on the US National Parks.  We’ve been to several of them and have enjoyed all of the ones we’ve visited.  I even got us one of those America The Beautiful senior cards that allow us to enter the national parks and monuments for free.  In some parks, these cards can be used to get various discounts on things like horseback rides and other things.  Sometimes, such as at Grand Canyon National Park, we got to get in via a special low-traffic lane while others were tied up in a traffic jam, trying to get in.  For only $10, it was the best deal EVER.  🙂

       

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