Category Archives: taxes

Tax Day

By Congressman Steve Austria

Because today is the day Americans are required to have their tax returns mailed back to the government, I thought I would take the opportunity to share some thoughts on taxes with you. When it comes to the U.S. Tax Code, the numbers are simply astonishing. The most recent tax code has more than 3.8 million words in it. The most recent version of the IRS regulations contained nearly 7 million words – 9 times the total number of words in the King James Bible. No wonder most Americans are frustrated with our tax code. Trying to complete a tax return is so complex that many must rely on an accountant or computer software to make it easier.

These are troubling statistics for most Americans. Additionally, more complicated tax increases may be imposed on taxpayers in 2012 if Congress does not permanently end the crushing tax hikes. Because Congress and the President only agreed to a temporary two-year extension, we are in jeopardy of seeing those tax hikes again in a year and a half. This continues to bring uncertainty to our financial markets, hurting small businesses and hard-working families.

Like most Americans, I believe the current tax code needs to be simplified and reformed. In the end, I trust our families and our small businesses – the taxpayers – to spend and invest their money back into their economy creating long-term sustainable jobs in the private sector. That is what will get Americans back to work. I’m pleased that this new Congress is placing a high priority on reducing federal spending to help put our economy back on a fiscally-sustainable path forward. It is time for Congress to work together on both sides of the aisle to simplify and reform our tax system.

Dayton Tea Party Tax Day Rally on Monday 18th

The Rally begins at 6:30 p.m. in downtown Dayton at Courthouse Square. The event is free with a request for those attending to bring a nonperishable food item or canned good to donate to the Dayton Foodbank.

Speakers lined up for the event include Eric Golub, C.L. Bryant, and Ohio Congressman Jim Jordan.

Eric Golub, who is a nationally known political comedian, columnist and blogger from Long Island New York via Los Angeles, California. Golub was Brooklyn born, Long Island raised, and has lived in Los Angeles since 1990. He received his Bachelors degree from the University of Judaism, and his MBA from USC.

C.L. Bryant is a native of Shreveport, LA. As the son of a WWII Veteran, L.C. Bryant and Elnola Bryant, C.L.’s roots run deep into the Cane River Area of Louisiana. He has studied Western Civilization, mortgage finance and has a Masters degree in Theology. This will be the third time he has spoken at the Dayton Tax Day Rally.

Ohio Congressman Jim Jordan, R-Urbana, also will be speaking at the third annual Dayton Tea Party Tax Day Rally this Monday in downtown Dayton at Courthouse Square. He is one of the top conservative leaders on Capitol Hill serving as Chairman of the Republican Study Committee.

To learn more about the Tax Day Rally and the above speakers, go to the Dayton Tea Party website.

Boehner-Obama Debt Reduction Deal In Perspective

The Boehner-Obama plan cuts the $14.3 trillion national debt by $38.5 billion, which is a little less than 3/10%. This is not a very impressive amount.

No wonder many conservatives are calling it a Republican sell-out.

Since fiscal year began on Oct. 1, 2010, the national debt has increased by $653.4 billion. According to a CNS report, the federal debt increased $54.1 billion during the eight days preceeding the deal. Compare that to a $88.4 billion increase over the 58 days covering February and March; the only reasonable conclusion is the federal government went on a spending spree. Why? The mostly likely reason was to cover the losses to be incurred during April. Consequently, there was no reduction of the national debt because there was no a decrease in spending.

I heard one expert say the debt reduction deal was a miniscule amount when compared to the overall debt. No, there was not any reduction. It is like the inflationless great recession: the inflation came prior to the recession i.e, housing prices, fenergy prices, food prices, and devaluing of the dollar.

Let’s hope the next round of budget cuts are real reductions of government spending and debt.

Nothing “Certain” About Taxes

by Cameron Smith

This time of year, flowers are blooming, birds are singing and most Americans are indoors putting together their tax returns. In 1789, Benjamin Franklin famously stated that “in this world nothing can be said to be certain, except death and taxes.”

Unfortunately for many Americans, taxes are anything but certain. Yes, they must be paid, but how they are paid is a source of considerable heartburn for households across the nation.

In the 2010 fiscal year, the IRS processed just over 141 million individual income tax returns. At the same time, the IRS issued more than 119 million refunds with an average refund of over $3,000. In total, the Government held more than $358 billion of individual taxpayer money in 2010.

Before taxpayers rejoice at the refunds returning to their bank accounts, they should stop to consider the economic cost of the practice. Every dollar in overpayment held by the IRS is a dollar removed from the U.S. economy and job creation efforts. Consider that the national median household income in 2009 was $49,777. The money sitting on the economic sidelines because of the inefficiency in our tax code could have “funded” over 7.2 million households. Even though that money eventually makes its way back into the economy as refunds are issued, billions and billions of dollars of economic productivity are lost.

The economic inefficiency in the tax code comes in part from the code’s complexity and how taxes are collected. In 1943, Congress passed the Current Tax Payment Act which established the quarterly income tax withholding system that Americans experience today. Rather than suffering through the pain of writing the IRS a large check at the end of the year, most Americans make rough estimates of their tax liability through their payroll departments. The obvious benefit of this system is that it improves the federal government’s ability to collect taxes. The downside is that most Americans have little awareness of how much tax they are actually paying because they essentially estimate their tax liability. Often this estimation fails to include many of the credits, deductions, and other provisions contained in the tax code.

Not only do Americans make educated guesses at how much they owe the IRS, they are also fail to correctly interpret the code itself. This confusion leads to even more headaches in the form of dreaded IRS audits. In fiscal year 2010, the IRS conducted almost 1.6 million examinations, up from less than half that number a decade earlier.

The most recent major simplification of the tax code was the bipartisan Tax Reform Act of 1986. Almost 25 years later, the tax code has bloated into a patchwork of specialized provisions providing little encouragement or clarity to the average American simply trying to pay what he or she owes.

Regrettably, after the tax bill is paid and refunds are issued, the American taxpayer enters yet another uncertain area. Taxpayers are ill-informed about the effectiveness or direction of their tax dollars moving through the federal government.

Even the Department of the Treasury’s Resource Center recognizes the importance of tax clarity:

Government has become a dominant factor in our economy, absorbing significant resources for its purposes and redirecting many more resources through its regulatory policies and through a mixture of taxation and spending programs that remove resources from some areas to transfer those resources to other areas. It is critical, therefore, that citizens have as much information as possible regarding these diverse programs and regarding their aggregate totals so they may decide for themselves whether the government’s activities are appropriate. Taxes, and especially the paying of taxes, yield citizens a personal sense of the total price of those activities.

The federal government created by the American people also works for the American people. Americans slogging through their tax returns recognize the unnecessarily complex burden placed upon them and the subsequent drain on the economy. The challenge before them now is to decide whether that complexity and drain is necessary or justified by the way the federal government uses the resources it collects.

Most Americans know that we can do better funding our nation, and we must. The beauty of the American democracy is that the will of the people can reform something even as “certain” as taxes.

Cameron Smith is General Counsel and Legislative Liaison for the Alabama Policy Institute, a non-partisan, non-profit research and education organization dedicated to the preservation of free markets, limited government and strong families, which are indispensable to a prosperous society.

Planned Parenthood CEO’s False Mammogram Claim Exposed

A series of new undercover phone calls reveals that contrary to the claims of Planned Parenthood CEO Cecile Richards and other supporters of the nation’s largest abortion chain, the organization does not provide mammograms for women.

In the tapes, a Live Action actor calls 30 Planned Parenthood clinics in 27 different states, inquiring about mammograms at Planned Parenthood. Every Planned Parenthood, without exception, tells her she will have to go elsewhere for a mammogram, and many clinics admit that no Planned Parenthood clinics provide this breast cancer screening procedure. “We don’t provide those services whatsoever,” admits a staffer at Planned Parenthood of Arizona. Planned Parenthood’s Comprehensive Health Center clinic in Overland Park, KS explains to the caller, “We actually don’t have a, um, mammogram machine, at our clinics.”

Opponents of defunding Planned Parenthood have argued in Congress and elsewhere that the organization provides many vital health care services other than abortion, such as mammograms. Most prominently, Planned Parenthood CEO Cecile Richards recently appeared on The Joy Behar Show to oppose the Pence Amendment to end Planned Parenthood’s taxpayer subsidies, claiming, “If this bill ever becomes law, millions of women in this country are gonna lose their healthcare access–not to abortion services–to basic family planning, you know, mammograms.”

The calls were recorded by Live Action, the youth-led pro-life group responsible for recent undercover videos showing Planned Parenthood staff, from management on down, willing to aid and abet the sex trafficking of young girls at 7 clinics in 4 different states. Live Action president Lila Rose says the new recordings further confirm Planned Parenthood’s corruption: “Planned Parenthood is first and foremost an abortion business, but Planned Parenthood and its allies will say almost anything to try and cover up that fact and preserve its taxpayer funding. It’s not surprising that an organization found concealing statutory rape and helping child sex traffickers would misrepresent its own services so brazenly, playing on women’s fears in order to protect their tax dollars.”

Former Planned Parenthood Director Abby Johnson notes that the recordings demonstrate Planned Parenthood is not a comprehensive health care provider. “For so long PP has touted that they are a provider of mammogram services. This is just one of the lies that PP uses to draw people into their clinics. PP is not able to provide quality services on their own, so they are forced to lie to the public about services they don’t provide–and mammograms are just one of those services.”

Both Rose and Johnson call on Congress to revoke all taxpayer subsidies from Planned Parenthood. In the last reported year, Planned Parenthood received $363 million in government money.

The new undercover recordings are available here: http://www.youtube.com/watch?v=aq0kBkUZbvQ

An Ohio Budget Perspective

Ohio’s new budget preserves $7 billion in tax breaks and keeps in place tax cuts exceeding $10,000 a year for the wealthiest 1% of Ohioans. It also cuts over $2 billion from schools and over $1 billion from local government, and slashes state spending for libraries, mental health and children’s services, while proposing selling the state liquor profits, five state prisons, expanding charter schools and vouchers, and proposing a semi-privatized state for higher education institutions called ‘charter’ universities. Weve heard it called a “slash and sell budget” and a “pass the buck budget” and both seem right, as it will certainly result in more unequal services across communities and higher local taxes. Here are (just some of) Policy Matters Ohio’s initial analyses:

Local Government Fund – The state seizes more than $440 million in local government funds, and more than $560 million in replacement funds for local government tax sources eliminated or reduced through state action. This will result in cuts to basic services delivered at the local level from policing, to fire protection, to snowplowing, to recreation. Expect longer waits, fewer hours, weaker services and higher local taxes as a result.

Education – The two-year budget slashes more than $2.3 billion from education compared to the 2010-11 budget while putting potentially hundreds of millions more into charters and vouchers. The proposal would drop state funding for schools below 2003 levels by 2013 and push more of the funding burden to local taxpayers.

$7 Billion in Breaks – While shredding schools and local governments in the above ways and more, the budget does not examine even one of the 128 tax breaks that cost the state more than $7 billion, preference some businesses over others, and continue crazy credits like the one to hire a lobbyist without paying a sales tax or to pay a pittance in tax when purchasing a timeshare for a private jet.

And Break some More – Amid disingenuous cries that “we’re broke”, is a continued push to add new breaks for the very wealthiest. Two new proposals would give special favors to those who need them least. The capital gains cut would save middle-income taxpayers $2 a year on average while the top 1% would pay more than $6,500 less. The estate tax grab would hurt local government and preference the wealthiest heirs more than 90% of Ohioans would never owe the estate tax after they die.

Gov. Kaisch’s State Budget: The Ugly, the Bad, and the Good

In my opinion, Gov. Kaisch is not the handsomest dude on the planet. I suspect his wife may have a different opinion.

What the governor lacks in appearance he makes up in statesmanship. His speech to the legislators on the budget was downright inspirational. Not only that but he even dared to praise the members of the opposing party for their work and accomplishments on a number of issues.

It almost made me cry.

I did say–almost!

Seriously, the budget itself is a mixed bag of missed opportunities (the bad) and a number of advancements for Ohioans and their economy (the good). Of course, it all depends on who you talk to, or, in this case, whose report you read.

According to the report by Matt Mayer, President of the Buckeye Institute, the governor’s budget missed some important opportunities. The bad news is the general revenue fund will be $1.26 billion greater for 2012 than in 2011 and $1.73 billion for 2013. That is a biennium increase of 12 percent. This is the second highest increase since 1990.

So how can the Governor increase spending with an $8 billion deficit? According to Mayer, the governor’s budget shows total revenues exceeding the deficit by $8 billion, which causes Mayer a lot of concern. It shows Gov. Kaisch has chosen to continue the same old policies of the past that eventually resulted in the present fiscal crisis.

Equally disturbing is the governor’s cuts to local governments. Instead of innovating new strategy to fund both state and local governance, the governor chose the slash-and-burn approach. This easy money strategy doesn’t reduce the size of state government and thus return local tax dollars back to local governments who must continue or fund new programs. Gov. Kaisch simply cuts funding to local governments to increase spending and balance the budget.

The $5 million budget deficit proposed by Xenia city and school officials may be nothing more than advanced notice of the state budget cuts. On the other hand, the budget deficit could be the typical 10% inflation budget estimates for contingency purposes; all institutions increase budget estimates for unforeseen costs. Budgets are based on previous year revenues, expenditures, known issues that will increase costs, plus 10% for unknown costs usually in addition to a contingency fund for emergencies.

Be that as it may, Mayer wishes Gov. Kaisch would have made the difficult choice of cut government employee compensation a little as well as cut the executive and legislative branch budgets. If he had cut the death tax, the bill making away through both houses, he would have as much money to spend, and many others will wish he had less money to throw at his program agendas.

Mayer did find some good in the Gov. Kaisch’s budget. The governor made noteworthy strides in such areas as prison reform, healthcare cost containment, and education funding. He included alternative sentencing approaches to non-violent offender that along with reforms nursing home service costs to Medicare will save taxpayers millions of dollars.

Some think his nursing home reforms are ugly and bad too.

Gov. Kaisch chalked up a few more good points with a number of his educational reforms. For example, his “support for Teach for America and doubling of EdChoice scholarships are vital lifelines to the most vulnerable and will inject more competition into our broken K-12 system.” Scraping the previous governor’s unfunded, evidenceless, one-size-fits-all Evidence Based School-Improvement Model will end the veiled attempt to increase dues-paying membership for unions. At the college level, the governor calls for professors to use fewer assistants for classroom instruction and a three-year degree. (Here, it is assumed that also means high schools will be required to ensure college-bound student meet the once first year prerequisites whether through coursework in high schools, college campuses, or virtual schools. That in itself would not only save a lot of money but would also be a systemic great achievement.)

Many of us may like Governor’s enthusiasm and business acumen, but analysts like Mayer give us reason to doubt his ability to help Ohio innovate its way to a better future and greater prosperity. If he cannot find innovative ways to fund government, can we expect he will achieve his inspiring goals for Ohio? Unless his goals are primary for big corporate concerns, maybe not.

To read Matt Mayer’s report on Governor Kaisch’s budget, visit the Buckeye Institute website: http://www.buckeyeinstitute.org/reports.

Tax appeals, parks, libraries, weights & measures: Policy Matters finds erosion of basic state services

A new report from Policy Matters Ohio finds that Ohio has seen a decline in the capacity of state government to deliver basic public services in disparate areas ranging from tax appeals to policing the ethics of public officials. The state’s library and park systems have been eroded. Service to localities has suffered at the Division of Weights and Measures, while new cuts could imperil the Ohio Civil Rights Commission’s ability to handle discrimination complaints. The paper focuses on areas outside of human services and education, and it is not comprehensive, it is merely a review of several areas that have been cut in recent years, including:

Board of Tax Appeals: Homeowners and businesses that appeal property-tax valuations now have to wait more than two years for a hearing because of staff cuts and the rising volume of cases. Between Fiscal Years 2005 and 2010, cases nearly tripled, from 1,608 to 4,679, yet the state sliced funding by $815,847 or 41 percent in Fiscal 2010 from FY09. Funding for FY11 slipped another one percent, to $1,149,715. The board was forced to lay off 60 percent of staff in 2009, leaving just three examiners, compared to 10 three years ago. The last full year that the BTA kept up with its caseload was FY2006. In February 2011, the examiners were hearing cases filed more than two years earlier.

Division of Weights and Measures: This division ensures honest commerce by helping ensure that scales weigh items properly and that counties adequately monitor supermarket scanners, gas pumps and other measuring devices. Over the past five years, General Revenue Fund (GRF) funding for Weights and Measures in Ohio dropped precipitously by 81.4 percent, from $1.074 million to $200,000. Field services provided by the state have been slashed, and spot checks in some instances have replaced the previous regular inspections. Ohio and its counties share responsibility for these services, and the state’s retreat leaves hard-pressed counties struggling to pick up the responsibilities in the face of their own budget shortfalls.

Division of Parks and Recreation: Seventy-four state parks in 60 counties encompass 174,212 acres of land and water, attract more than 50 million visitors annually, and generate over a billion tourism dollars per year. According to the November 2010 budget request letter, the General Revenue Fund request for FY2012-13 matches the 1988 request. Over the last decade, funding for parks and recreation has declined in inflation-adjusted dollars by 23.5 percent. The parks have deferred maintenance projects, including EPA-mandated sewer and water upgrades. We’ve seen a 45 percent staffing reduction, a $556 million backlog in maintenance, and a decline in perceived safety by visitors. Ohio is considering selling Jefferson Lake State Park to Jefferson County for one dollar. The County would sell timber and drilling rights to pay for dam repair and campsite upgrades.

“Years of investment in a system of parks and recreational facilities could be lost, hurting tourism and removing affordable recreation options for Ohio families,” said Wendy Patton, report co-author and senior associate at Policy Matters Ohio.

Ohio Civil Rights Commission: In FY 2000, the Ohio Civil Rights Commission had 199 employees; there are now 94. GRF funding of $10.6 million in 2000 was hacked to $4.6 million in FY 2010, a decline of 54 percent. Flat or ten percent reduced funding is expected to result in the elimination of an additional 17 to 23 positions. A loss of 23 individuals would mean 1,600 fewer investigations per year, a 36% decline. More cuts could bring quality problems, negative press, even lawsuits, as in the mid-1990s, when a burst of activity and lack of capacity undermined service provision.

Ohio Ethics Commission: Ethics cases rose an average of 18 percent each year since 2000 and ethics filings are up 30 percent over the past 15 years, but the budget hasn’t kept up. In the Strickland administration’s first year, Ethics Commission funding rose by about 16 percent, inflation-adjusted. But by FY2010, GRF funding had fallen by 19 percent after inflation from the 2007 high. As a result, ethics education was reduced by 19 percent; staffing fell from 25 to 21; the operations budget was cut by 30 percent; and equipment has not been updated for three fiscal years.

Environmental Review Appeals Commission: GRF funding for Environmental Review Appeals Commission has fallen by 20 percent over the past decade after inflation. Staffing has fallen from 14 to 2 since the agency was founded in the mid 1970s. Length of time in investigations has caused legislation and litigation.

Public libraries: Historically, Ohio libraries have dominated the ranks of the nation’s top libraries. Over the past two years, state support for library funding has been chopped by nearly 23 percent. Overall, libraries received $347.9 million from the state Public Library Fund last calendar year, compared to $450 million in 2008, despite a successful grassroots effort that reduced the cuts. In response, libraries reduced hours, closed branches, reduced purchasing, cut programming and shed staff. Overall, Ohio public libraries cut hours by more than 10 percent in 2009. The slashed state support has meant a huge increase in proposed property-tax levies. According to a recent analysis by Driscoll & Fleeter, the 71 library levy proposals that appeared on the ballot across the state in 2010 were twice as many as in any previous year since 1980, except 2009. Greater dependence on local levies will result in disparity of service.

Recommendations include protecting taxpayer return on investment, restoring capacity to services eroded by inflation, and reducing dependence on fees to avoid politicization and disparities between communities. “Cuts to education and human services rightly get a lot of attention,” said Zach Schiller, report co-author and Research Director at Policy Matters. “This report shows that we also need to pay attention to some of the very basics. Ohio has slashed staffing and funding to ensure that your public library is open, your park’s sewage system is safe, your tax appeals are reviewed and your community’s employers are not discriminating. Such cuts threaten business, individuals and communities in Ohio.”

Policy Matters Ohio is nonprofit, nonpartisan research institute with offices in Cleveland and Columbus.

Ask Your Senators to ‘Cut It Out!’

Last week, the U.S. Senate voted down the federal funding bill passed through the House weeks ago. This bill included ending taxpayer funding of Planned Parenthood and taxpayer-funded abortion in the District of Columbia, as well as taking away funding for President Obama’s czars, among other budget cuts.

As you may recall, Congress has been in limbo for months working to pass a spending bill that both cuts expenses and funds the necessities, and has narrowly avoided a government shutdown multiple times because of the lack of a bill that funds the federal government’s expenses.

The Senate has made it clear that it will not pass a bill that cuts spending, if the proposed cuts include ending taxpayer-funding of Planned Parenthood or President Obama’s czars. In fact, the Democratic Party sent an email to its supporters earlier this week in which it condemned the plan to end Planned Parenthood funding because it could eliminate jobs at the organization’s facilities! How’s that for misunderstanding the American people’s concern about the unemployment rate?

While this is disappointing, it’s not surprising. However, you can make a difference by asking your Senators to stand for important funding cuts like these.

Source: Liberty Watch, March 11, 2011

Greene County Property Taxes Higher Than State and National Median

The newest on-line tax tool is Tax Foundation’s County Property Tax Lookup. Anyone can look their county’s median property tax payout for the past 5 years as compared to both state and national median tax payments.

Median is a statistical term for the highest number in the middle of the statistical bell curve. It is not exactly a true average but the median is close to the average. In this instance, it is the middle point of property taxes paid beginning with those who pay the lowest taxes to those paying highest amount of property taxes.

I looked up the median property tax paid in Greene County Ohio. What I found was Greene County property owners pay higher taxes than other property owners throughout the nation and Ohio.

Based on a five year average (2005-2009), median real estate taxes paid by Greene County property owners was $2,326. Ohio median real estate taxes for the same period was $1,752 and, nationally, it was $1,805.

The Tax Foundation included comparisons of real estate taxes paid as a percent of median home value and as a percent of median income. Over the same five year period, the above Greene County real estate taxes equated to 1.49% of median home value and 3.22% of median income. Ohio property taxes equated to 1.3% of home value and 2.94% median income and, nationally, land owners paid 0.97% of home values and 2.81% of median income.