News reported that Florida will soon have greater population than New York, and that doesn't really surprise me. I have been to New York exactly twice, once to Rochester and vicinity, and once to the Statue of Liberty. As I looked across the harbor at New York City, I told my friend I was as close as I cared to be. Earlier this year, I knew a man who was a retired NYPD officer who retired to NV so that he could live on his pension without paying state income tax. Also today, there is talk that they may tax you for riding a bicycle in Chicago. Eventually they will find a way to tax you for walking, for breathing, for existing, and people will look at New York City and wonder why it was that people ever lived there. Taxes are driving people out of New York to places like Florida where the weather is more pleasant and the tax policy more lenient. They might go to California if not for confiscatory taxes there.
Like it or not, tax policy drives human action. People will do anything they can to legally reduce their tax bill. My parents bought a second house a few years ago so they could write off the interest and reduce their taxes. My dad would rather pay a bank than pay the government even though both he and I work for it. My financial advisor told me to invest rather than pay off my mortgage, because at 3.6% interest as long as there's a mortgage deduction, I can do better in the market than paying off my mortgage. I was excited last night to receive a flier from Big Brothers/Big Sisters because I have quite a bit to donate to them as a way to cut my taxes. For the past several years, I have shifted money at the end of the year into my traditional IRA and during the year into my 457b to reduce my Adjusted Gross Income and reduce my taxes. Although I do not make donations to church so I can write them off, now that I do itemize, I count them because it's a way for me to cut back what I give to the waste in Washington.
At the same time businesses suffer, politicians raise taxes. They seem to think that they way to get more of something is to tax it. They look at every turn to make taxes universal so that you can't flee New York with your pension for a place where you don't have to pay as much. There was a story today too about moguls who rent property in SD so they can stay tax free forever. If politicians really want to improve economic fortunes, they need to look at their tax policy. It isn't just "millionaires and billionaires" who put money away. It's regular people who reduce their taxes whenever possible. It's probably what attracts so many people to Vegas because NV doesn't charge income tax, our property taxes are lower than ever, and because so much money moves via tips and isn't taxed. It's a smorgasborg for people seeking to skip uncle Sam.
I already started filing my taxes for 2013. I knew based on last year's huge after the fact bill that I needed to make adjustments. I followed the JG Wentworth Theory of Taxes: "It's your money; use it when you need it" and shoved as much as I felt comfortable into my own retirement. Although I am SSI exempt, I am not assuming that the state of NV will fulfill its promises since they have tried to change our retirement from "top three years" to "first three years" and raised our contributions to PERS from 8.9% when I started to 12.1% now (and you guys all complain about 6% into SSI). I am taking control of what I can and putting the money where I know to look recognizing that if I invest wisely I will not have much later. I decided to put more into retirement and shifted a payment to this year since I expect my income to go down next year. I am doing everything I can to keep as much of my own money as possible. I know how much money is wasted where I work and know that we could do with fewer personnel if they hired better people. When the furlough first arose, I told the governor at the time to cut people knowing I might get cut because I knew we could do with fewer people.
Contrary to popular belief, I do not go to work so that the government can send my money to people I don't know. We just finished Christmas which, although a giving time, does show us that Bob Cratchett used his money to elevate his own family. That's what my money is supposed to serve- my family. Right now, as the government reminds me every year, that's only myself and whomever I wish to receive of my beneficence. My life is my own; I am not a slave to the IRS. They do not have any right to decide where I spent my money, in donations or health coverage. If I decide to piss it away, that's my call. If they decide to do it, I protest, and if ever my rights are questioned, here is my answer. The pen is mightier than the sword.
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