Posted tagged ‘Tax Freedom Day’

Financial wellness is cool, high taxes are cruel

April 7, 2015

Financial Literacy Month

When my son was in first grade, his teacher game him an “If I had $100…” writing assignment. “If I had $100 I would buy a video game arcade. I would buy the arcade because I like to play video games all day!” My first thought was that we needed to cut down on his game playing! My second thought was that he doesn’t realize how much things really cost.

We’re not too young or too old to to be money-wise. April is Financial Literacy Month, and we could all take some time to think about our financial well-being. So many of us are living with credit card debt, student loans, or overwhelming mortgages.

Most financial wellness philosophies come down to budgets, balances, and goals – or, spending less than you earn, sharing what you can, saving the rest, and making good choices. Here are 4 ideas to help you and your money get healthier and happier:

  1. Pledge to take 30 steps to financial wellness. Money Management International offers 30 simple ways to improve your financial wellness. It all starts with a commitment to change.
  2. Plan your financial first aid kit. The Federal Emergency Management Agency (FEMA) offers a free “Emergency Financial First Aid Kit” to help you organize all of your financial information and records in one place.
  3. Make a lifestyle change. If you’d rather make a big leap forward to financial wellness, try one of these challenges. Take David Bruno’s 100 Thing Challenge, to reduce your stuff and refuse new stuff. Accept Courtney Carver’s Project 333 Challenge, to spend less on clothes and simplify your wardrobe. Limit your trash to one bag a week with Glad’s One Bag Challenge, to reduce spending and encourage recycling.
  4. For kids: learn about saving money and saving the day. Practical Money Skills has a free printable comic “Saving the Day” featuring Spider-Man and the Avengers. There’s even a “Budget Blaster” worksheet to budget like a superhero. The Federal Reserve Bank of St. Louis offers a free “The Piggy Bank Primer: Saving and Budgeting” to introduce kids to saving, spending, budgeting, and more.

Taking care of our financial well-being is just half of the battle. Our government’s financial well-being is just as important as our own, because the government is spending our money. On April 19, 2015, Hawaii residents and taxpayers will celebrate Tax Freedom Day – the day when we start to work for ourselves, rather than working to pay our taxes, according to the Tax Foundation. In Hawaii, we’ll have worked for the government (through federal, state, local, sales, and payroll taxes) for 109 days, celebrating our freedom five days earlier than the nation as a whole.

Here are 3 fun ideas to help you celebrate Tax Freedom Day:

  1. Pay yourself first. Put $100 in your savings account to symbolize your “first” paycheck of the year. You could even be ironic and spend 30% of it.
  2.  Turn dollar bills into art. Make friends with your money by trying out money origami. Create a $100 money lei from Instructables or a money origami shirt from Homemade Gifts Made Easy.
  3. Play with other people’s money. Challenge family and friends to a game of Monopoly. The Monopoly Hawaii Edition was issued in 1996. You could also play Hawaii-opoly by Island-opoly (with replica 1800s bank notes) and Hawaii-opoly by Late for the Sky.

How would you rate your financial well-being? How could we improve Hawaii’s financial wellness? Do you think that Hawaii’s government is worth the 109 days that we work to pay our taxes?

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If Disneyland ran the IRS…

April 15, 2014

Today is April 15, Tax Day, the deadline to file federal income tax returns (or request an extension) in the United States. This year, Tax Freedom Day, the day on which most of us have earned enough income to pay our federal, state, and local taxes, is on April 21 (according to the Tax Foundation). In 6 days, we start working for ourselves!

Last month, I visited Disneyland and was impressed by their impressive locations and productions, efficient operations, and attention to detail. I started to wonder: how would things change if Disneyland were in charge of the Internal Revenue Service (IRS)? Would Disneyland be able to simplify tax forms and streamline the tax code? Could Disneyland change our whole experience of paying taxes?

Imagine if Disneyland were in charge of the IRS…

Disney's IRS

* Tax return forms and instructions would be available on a planning DVD with step-by-step videos, hosted by your favorite Disney characters; with a personalized checklist of important forms, deadlines, and tax rates.

* Tax returns would be short, easy to fill out, and linked to your photo ID to prevent fraud. Forms and instructions would be limited to two pages and written so that a sixth grader could understand them.

* Tax rates would be set at CHILD, ADULT, and ORGANIZATION. There would be only three tax credits: a cost of living/cost of doing business credit (the standard deduction), a hardship credit (for the disabled, seniors, and veterans), and a calamity credit (for natural disasters, catastrophic medical suffering, and the terminally ill).

* E-filing would be simple, fast, and secure, with links to upload attachments and receipts. There would be two optional fee-based services: “Front of the Line Refunds” to help you get your money faster and “Back of the Line Payments” to help you keep your money longer. A smiling Mickey Mouse would let you know how to pay your taxes online or when your refund will be deposited in your bank account.

* IRS agents would be cheerful, helpful, and efficient, and sing encouraging songs. A “FastPass” reservation would let you schedule a meeting with an IRS agent – in person, on the phone, or via chat – who could answer your questions correctly, the first time. There would be no penalties if you receive inaccurate information from an IRS agent.

* IRS buildings would be clean and well-lit, with a People Mover to take you on a tour of the building and direct you to the right conference room. There would be copy machines, paper shredders, and video game break rooms on every floor (you could play “AstroTax Blasters” to relieve stress!).

* The IRS would improve its image and generate enough revenue to fund its operations by opening a theme park, with attractions like Star Savings Tours, Big Taxation Mountain Railroad, and Retirement Springs Racers. For kids, there would be a Money Treehouse and a Jedi Entrepreneurs Training Academy.

What is your opinion of the IRS? What changes would you make if you were the IRS Commissioner?

April 6: Celebrating Tax Freedom Day

April 12, 2011

It is with some irony that I write, Congratulations! On April 6, we celebrated Tax Freedom Day, the day that Hawaii taxpayers have earned enough money to pay for this year’s federal, state, and local taxes. The Tax Foundation (www.taxfoundation.org) calculates this date every year using government data on income and taxes, not including the deficit.

According to the Tax Foundation, there are five major tax categories: individual income taxes, payroll taxes, sales and excise taxes, corporate income taxes, and property taxes. We each have work for 96 days just to run our government, but today we are working for ourselves – 6 days earlier than the national Tax Freedom Day on April 12.

Now for the bad news: get out your wallet – by April 15, we have to pay taxes for 2010.

Something to remember: freedom isn’t free, but don’t allow our legislators to price us out of the market!