Tax Day Deconstructed

Tax season is once again upon the American population, and this year, just as in years past, people are less than enthusiastic.  It is estimated that the average taxpayer contributed slightly more than $11,000 dollars to federal taxes in 2012 and those figures are on the rise.  As might be expected in the current backdrop, however, not everyone shares the same opinion on taxes.

How Do Americans Feel About Doing Taxes?

Only 5% of the population actually professes a “love” for doing taxes.  Another 29% of Americans say they “like” doing taxes.  The reason most often given is the receipt of a tax refund.

On the other end of the spectrum, plenty have an utter disdain for the process of filling out a tax return.  More than half of Americans either hate or dislike tax returns.  The most commonly cited reasons are the complexity, inconvenience and concern with how the government spends the money.

Are Taxes Too High, Too Low or Just Right?

Despite strong attitudes towards the process, there is a sharp division between people who feel taxes are too high and those who think they are just right.  Gallup surveyed 1,000 Americans and determined that 50% think taxes are too high, while 45% feel they are just right.  That leaves a small percentage of the population who expresses an opinion that taxes are too low.

Where Do Those Tax Dollars Go?

Nearly two-thirds of every tax dollar is spent on a combination of defense, health care and interest on our federal debt, according to the National Priorities Project.  Other major expenditures include unemployment costs, veterans’ benefits, education, energy, and food & agriculture.

April 18 – Tax Freedom Day

In order to pay the aggregate tax bill, including state and local, it will take the typical American 108 days of work in 2013, according to the Tax Foundation.  By those calculations, come April 18, taxes for the entire year of 2013 will already be paid.  That suggests there is more to be thankful for come mid-April than just completing your tax returns.

 

Barry Glassman, CFP®
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