Sep 212007
 
Part of the Applied Anarchy Series - Previous in series         Next in series

A lot of anarchists and (libertarians) are not yet willing to take the big step of ignoring the income tax altogether. But they’d still like to keep control of as much as their money as possible as long as possible. Self-employment (even as a consultant or independent contractor) is always the best bet for doing this, but many of us are stuck being wage slaves for one reason or another. And that means having the IRS yank big chunks of cash out of our paychecks every payday.

The simplest way to retain these funds while still covering your employer’s butt is to simply increase the number of exemptions you claim on your W-4. This will reduce both the state and federal withholding that is stolen from your check. However, it will leave you with a bigger tax bill at the end of the year and may increase your chances of an audit. If your financial situation is secure enough that you don’t have to worry about covering a big tax bill in April, then you may well want to go this route. It allows you control over your funds for the longest period of time outside of simply not paying their taxes at all.

However, many of us living paycheck to paycheck know that we’ll never be able to cover that ‘spring surprise’ from big mommy government. But, believe it or not, the IRS is here to help. Their website has a handy little exemptions calculator. You simply enter how much you’ve earned so far this year, how much they’ve already stolen from your check, and how much you expect to earn for the year, and they’ll tell you how many deductions to claim in order to get your tax bill as close to zero as possible. Since you’re going to be paying taxes anyway they’re not getting any information they don’t already have, and they don’t collect any personal data in the process, anyway.

Last year I was able to end the year with a total federal tax refund of $5.00. An amount I was more than willing to allow the government to keep in exchange for not filing a return.

Part of the Applied Anarchy Series - Previous in series        Next in series

  One Response to “Applied Anarchy – Minimizing Your Income Tax Burden”

  1. […] become a pet topic of mine. Recently, the blog Philaahzophy posted an article on this very topic: “Applied Anarchy – Minimizing Your Income Tax Burden” Posted by Francois Tremblay Filed in The principles of […]

  2. Interesting post, what was your inspiration for this?

 Leave a Reply

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

(required)

(required)