Think You’re Finished Paying Your Taxes? Not So Fast.

by Andrew Collins: “A century ago, the income tax form was a single page,” writes Watchdog Arena contributor Peter Ingemi, but “today the tax code has become increasingly complex to the point where very few people actually do their own taxes.” In fact, a recent survey found that most Americans get an “F” in their understanding of income tax basics, scoring an average of 51 percent on a ten-question quiz.

We may have solved the problem of taxation without representation in 1776, but “it has been replaced by something almost as bad and nearly as destructive: taxation without understanding,” Ingemi quipped.

This is only the tip of the iceberg when it comes to the mess that is the American tax system. Granted, it may not seem like that big of deal that most people don’t really understand the tax code when they can use a computer program like TurboTax or hire an accountant. But to send your taxes off to an expert or computer is to concede that you don’t understand precisely how much you’re paying Uncle Sam – and why. It also means sacrificing a substantial amount of time (or money) to work your way through all the forms. Estimates of how long it takes to do an average individual return range from eight to almost 12 hours, and total tax compliance costs for the country are estimated to be as high as $182 billion. If you are “fortunate” enough to get a refund, don’t celebrate too much; it just means the government has been taking your money all year as an interest-free loan.

In the end, this widespread public ignorance makes it all the easier for government to collect and spend ever more money in ways unbeknownst to the typical taxpayer.

What can the average citizen do to start making sense of it all? The journalists and citizen contributors at Watchdog believe the first step toward understanding the present situation of our tax system is to realize just how much Americans are taxed. Every year the Tax Foundation releases a report that calculates America’s Tax Freedom Day, the point in the year at which the nation as a whole has earned enough money to pay off its tax bill for the year. This year, Tax Freedom Day falls on April 24th, which is 114 days – or 31 percent – into the work year. It’s also a day later than last year. When all federal, state, and local coffers have been filled, Americans will have paid a grand total of $4.85 trillion in taxes, according to the Tax Foundation report. That’s more than they will spend on food, clothing, and housing combined.

But that’s not all; it gets worse. As Watchdog Opinion contributor Kathryn Hickok pointed out, when you include annual federal borrowing in that calculation (which we will eventually have to repay anyways), Tax Freedom Day falls back another two weeks to May 8th.

You can find where your state ranks on this map. If you live in Nevada, Pennsylvania, Wisconsin, Oregon, or Virginia, Watchdog writers and contributors have written a more in-depth analysis of their state’s ranking and what it means for you.
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Andrew Collins (@ACwords) when not writing an article, spearheads Franklin Center’s social media campaigns, promoting journalism through Franklin Center, Watchdog.org, and Watchdog Wire-branded accounts on various social media platforms. Previously, Andrew worked in campaign communications and television news.

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