The Finch Formerly Known As Gold

16 October 2004

Two for them, fourteen for her

I have never felt that it was my obligation to contribute (if that's the word) as much money as possible to the government: while I'm not going to file a false tax return, I'm also not going to shy away from every last exemption and deduction and exclusion I can legitimately claim.

Which apparently is also the policy of Teresa Heinz Kerry, who managed in 2003 to reduce her Federal tax liability to 12.47 percent. (Disclosure: My own tax bill, on about 0.78 percent as much income, was 10.69 percent.) In the light of John Kerry's faux-populist sentiments these days, his wife has come under fire for paying so little in Federal tax; I would argue that the flaw, if flaw it be, is in the tax system itself, not in Mrs Kerry's presumably-legal gaming thereof.

As would Fritz Schranck:

What's the problem here?

I thought that's why these IRS Code provisions were put into the Code in the first place.

It's also not her fault that FICA is based on wages, and that her 2003 money didn't come from working.

If the New York Post or [Stephen] Moore [of the Club for Growth, quoted in the Post article linked above] or other people don't like the fact that Mrs. Kerry can use the current tax code to this much advantage, then they have another option available to them — seek to amend the tax code.

As I see it, that's where this story may become valuable. Her tax returns may provide an incentive to reduce or eliminate some of the legislative loopholes, special privileges, and other curious devices that fill so many pages of the IRS Code.

And a good argument for the so-called Fair Tax, as well.

Posted at 9:28 AM to Dyssynergy

Would you do my taxes for me from now on?

For the 30 years ended 12/31/03, we've paid an average of 20% of our taxable income in FIT.

That % was as high as 33% in the early 80s and it never dropped below 13% (mid-70s; early in our careers).

"Marriage tax penalty" accounts for some of that, of course.

Posted by: Eric at 10:56 AM on 16 October 2004

My bad...I looked at the wrong line on my spreadsheet.

Make that 30-year average 25%.

Posted by: Eric at 10:57 AM on 16 October 2004

My beef with Empress Teresa is that her boy toy is going around calling people eeeeeeeeevil for availing themselves of those very same loopholes. It isn't that there's anything intrinsically wrong with their tax gaming, it's that Long John is being a hypocrite (film at 11) over the issue.

And it doesn't help his case that the Bushes' effective tax rate is hugely higher than that of the Heinz-Kerrys, whose income is hugely more.

Posted by: McGehee at 12:56 PM on 16 October 2004

Actually, the percentage I quoted for myself is Federal tax liability (not counting FICA) divided by gross income before adjustments, which is approximately the way the Post figured Mrs Heinz Kerry's: 628401/5072533 is actually 12.39 percent, so perhaps they allowed her her personal exemption. :)

Recalculating based on my taxable income produces 14.28 percent. Keep in mind that I am single and broke.

Posted by: CGHill at 2:32 PM on 16 October 2004