What To Keep More Money of Every Paycheck in 2009?

In light of all I have learned over the past few years, I am deciding to protest with legal civil disobediance.

January 1, 2009 starts a new fiscal year for the Federal Income Tax. Many of us have submitted to having money withheld from each and every paycheck in order to pay the taxman come April the following year. We have voluntarily withheld a piece of our labor and have it sent immediately to the IRS on a regular basis in order to satisfy this morally wrong confiscation of our time and efforts.

Times are tougher in this economy. The government has submitted itself to borrowing our futures away by overtly spending more than they have coming in; all of the while pointing a finger at consumers by saying we borrowed too much. It is true; many of us citizens have over-borrowed, but we are just following the guidance of our nanny.

I for one would like to keep ALL of my money and use it the way I wish. I would like to pay off my house so that I can, in the future, have enough to pay the future property taxes (or rent as I like to call it) for the use of my land and home. I would like to pay off those last few whimpers of my credit cards, and I would like to invest my money in a true keeper of wealth – GOLD.

Paying off my debt obligations quickly is becoming harder to do as every paycheck that comes to me comes with a voluntary, automatic withdrawal of over $500 every two weeks. I have voluntarily donated over $1,000 of disposable income every month. $12,000 plus on an annualized basis for me alone and the government usually asks for more at the end of the year after receiving all of my voluntary payments.

Did anyone know that through the IRS one could stretch out his or her tax obligations for ten full years? Of course there is an interest charge for delaying payment, but the monetary inflation that is already locked into place coupled with the foreseeable and continued monetary inflation mathematically puts the dropping value of the dollar on par or better than the interest and penalties for the government’s available payment plan. In essence, I will have more purchasing and debt reduction power of my dollar if I delay my payment to the government. An extra $1,000 a month in payments to my home loan for just one year will reduce 3 years and 4 months off the term of my loan. In paying this extra $12,000 towards my home loan, it would equate to a savings of $88,000 over the term of my loan.

Now I am not suggesting anyone not pay their taxes necessarily, but I for one would like to take a year off from submitting every paycheck to a deduction from the IRS. I voluntarily submitted to that anyway, so I voluntarily want to take a full year of my time and labor back for once in my life.

Starting January 1, 2009 my withholdings will be zero from each and every paycheck.

In looking at the IRS website they claim, “You should consider financing the full payment of your tax liability through loans, such as a home equity loan from a financial institute or credit card. The interest rate a bank charges is usually lower than the combination of interest and penalties imposed by the Internal Revenue Code.” I have been lied to for over 30 years now by the government. Whatever they say ends up being the opposite of the truth. Putting your home at risk to pay for this robbery is ridiculous and credit card companies have been charging substantially more than the government’s IRS interest rates.

Let’s take a look at the math. For ease of this calculation, let’s say my tax liability is $12,000. If I decide not to have any Federal Income Tax withheld for 2009, I will have an extra $1,000 every month of income. Come April 15, 2010 I will have a tax bill of $12,000. According to the IRS, http://www.irs.gov/businesses/small/article/0,,id=174252,00...., penalties and interest will be charged in paying off my taxes to them over a loan period with the IRS. Interest charges fluctuate month-to-month with the IRS http://www.irs.gov/businesses/small/article/0,,id=112482,00...., but that rate has been hovering around the 3-4.5% mark this whole year. Late penalties are .5% http://www.irs.gov/businesses/small/article/0,,id=174252,00..... Filing late adds a 5% bump, so I would still file on time. Assuming an interest rate of 6.5% over the next ten years and adding the late payment penalty, my tax loan payment amount would be $136.26 and my late payment fee would be $60 on top of that. This would in effect double my tax liability to the government by adding $11,551.20 in interest and late payments over a ten year term. That's OK though.

There will be guaranteed inflation over the next 10 years. In going to the government's CPI inflation calcualtor http://data.bls.gov/cgi-bin/cpicalc.pl, one can see that 10 years ago a dollar amount of 196.26 would take 260.76 of today's dollar to meet that same buying power. The past tens years of the government statistic of CPI inflation is a flat out lie anyway and most of the past ten years have not seen the most recent monetary inflation practices of the Fed anyway. The inflation of the coming ten years will be ridiculous if the US is even around then. That $196.26 will be worth substanially less ten years from now.

This will be my legal tax protest. I am still filling my taxes, I am still paying them, but I am just asking for more time on the Fed's dime. I am following their rules by the book.

Taking a year off of taxes sounds like a good idea to me. For all of 2009, I will have an extra $1,000 in income that I have always had. I am just choosing to take it back this coming year. Sure I will be paying $196.26 every month for the next ten years, but I need the money now and the government likes to lend anyway. Hell, even Paulson says the consumers need to be able to borrow more and that will help the economy. Instead of going through the governmental intermediaries of the banks and credit card companies, I am going to tap Uncle Sam.