ATLANTA, March 19 (UPI) -- April 15th marks a national springtime ritual that has nothing to do with April flowers. It's the official due date to file our federal returns for taxes we know about and those we never see coming until after they hit us.
Sneak-a-taxes are taxes buried in the 9-million-word tax code mess. Some of these sneak-a-taxes start out as temporary, but Congress conveniently forgets to end them. Or maybe they just pretend to forget.
Consider the withholding of income taxes. Congress enacted automatic withholding in 1943 as a way to fill the U.S. Treasury coffers each month and mask the true cost of federal spending. Congress explained to the public that, since the United States was busy fighting World War II, automatic withholding was necessary to fund the war effort in a timely fashion.
Congress also promised that withholding would end as soon as the war was over. That war ended 60 years ago.
Automatic withholding is a sneak-a-tax. When you receive a refund check, it means you gave the government an interest-free loan. Many workers have more taxes withheld throughout the year than they will owe on April 15th to avoid writing Uncle Sam a check or incurring an underpayment penalty. They then seem overjoyed that they receive a big refund check from the U.S. Treasury. We are so conditioned to celebrate our sudden windfall from the government that we forget that it is our money in the first place.
The alternative minimum tax is another sneak-a-tax that should have been repealed years ago. The AMT laws were enacted in 1969 by a Democratic-controlled Congress to sock it to the so-called rich.
The AMT is a calculation that assigns an alternate tax amount due if your regular income tax liability is not as high as Congress would like it to be. It is simply an unfair way of forcing people to pay more taxes, even if they follow all the rules and mandates in the convoluted tax code.
Each year, the AMT bandit holds up more and more of the so-called rich. In 2004, an estimated 2.6 million taxpayers fell prey to the AMT. By 2010 33 million, or an estimated one-third of all taxpayers, will be subject to the AMT. All because you and your spouse worked hard enough to earn at least $75,000, which in 1969 was considered rich.
The AMT does not consider inflation, a family's decision for both spouses to work, nor the promotion you received because you worked a little harder last year. The AMT punishes people for investing, working harder and growing their small businesses.
Herman Cain is the National Chairman of the Media Research Center’s Business & Media Institute. He is the former president and CEO of Godfather’s Pizza, Inc., and currently is CEO and president of T.H.E. New Voice, Inc., a business and leadership consulting company.
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