Tax Evasion on the Road

One annoyance that I seem to stew over repeatedly is traffic.

It’s never the number of cars on the road — my commute is quite tame. All two miles worth.

Instead, even with such a short commute, it’s the number of, well, criminals and just plain idiots out there on the road with me.

I’ve ranted about Virginia drivers — I’m sorry, you’re terrible.

I’ve gone on and on about how practically every other car in Connecticut has a temporary handicapped placard hanging from their rearview when it’s quite clear that there isn’t anyone with a physical handicap in the car.

Red lights? who cares! Apparently these days you just need to honk your horn as you speed through one and it’s okay.

It drives me bonkers when I see a smoker toss a butt out the window. That’d be like me throwing gum wrappers out the window (which I don’t). The former is apparently okay but the latter is littering? Explain that one to me…

I nearly explode when I see someone empty an entire ashtray at a stop light (if they even bothered to stop.)

School buses? Don’t even get me started.

And I’m not even going to go into my feelings on texting while driving.

Would you believe that I actually saw a guy texting while on a motorcycle a couple of weeks ago? No joke… I should have run him over…

So go back up to the photo at the top of this post.

This guy was in front of me at an ATM last weekend. Everything seems to be pretty normal to the untrained eye but when you look a little closer, this is kind of like when a bank robber puts on a fake moustache to hide their identity…

The dealer logo on his truck indicated that he bought the truck less than one mile from where I live so… isn’t it a but odd that he has a Florida license plate? A special one, even…

Wonder why that is?

Well, I’ll tell you why…

He’s a tax cheat.

Here in Connecticut, we need to pay personal property taxes on our automobiles.

It sucks — I’ll be the first to tell you.

The very illegal way around this, though, is to register your car in another state. That way Connecticut has no idea that you even own the car (which seems odd in this digital age)…

Florida, apparently, is an easy state to “use” in this situation.

Seriously, I’d say that 10% of cars on the road in Connecticut have Florida plates slapped on them right from day one. Really, I’ve never seen a space shuttle or a manatee in Connecticut but they’re all over the license plates up here.

Further, 90% of the cars with Florida plates have bogus handicapped placards too.

Hey, if you’re going to break the law, why not go all out, right?

So back to this tax cheat, I mean, you’d think that allegedly being a fire fighter, you know, he’d hold himself to a higher standard being a pseudo government official of sorts.

Really, some even consider them heroes. I’m not of that sort but that’s neither here nor there…

Even still, I think we can all agree that heroes should pay their taxes.

What really blows my mind is that the police (also apparently heroes) don’t seem to care.
You’d think that our state government would be upset about all of this lost tax revenue, not to mention illegal tax evasion going on.

It’d be quite easy to stop and then enforce — I mean it’s right out in the open under their noses.

Just using the guy up top as an example:

• His car was purchased at a dealership in central Connecticut.
• He has a bumper sticker touting that his kid was a student of the month at a local elementary school.
• His freakin’ vanity plate clearly indicates that he’s a “Connecticut Fire Fighter”.
• His car is registered in Florida.

Um, can you say guilty?

Posted on May 15th, 2010 at 9:08 pm by Brainy Smurf
Rants, Taxes | No Comments »

Taxes Filed – Refund(s) Received!

I’ve been *so* behind with posting over the last few months so much so that I didn’t even do my annual “I Filed my Taxes Today” post this year.

Cutting to the chase, I filed my taxes back on February 13. It was a fun filled Saturday morning spent in front of the computer telling TurboTax that, no, once again, I did not earn any income working on a farm and I don’t have an illegal alien working as a maid and living under the basement steps.

Seriously — you spend far too much time answering questions that only apply to a tiny tiny tiny slice of the population but good luck finding where to enter how much you paid in property taxes…

Or how to get your $1000 credit for making a person? I checked the box but I didn’t see my refund magically go up $1000… Whatever…

Anyway, 2009 was a bit of a step backwards in the Smurf household. We earned around $10k less.

That’s okay though — unlike a lot of folks my age, I’m fully aware that my top earning days are behind me. I neve expected my income to continually rise the way it did through my twenties and I’ve definitely run into a plateau of sorts.

Maybe 2010 will be better but I doubt it. Some might blame the economy, or whatever, but the fact is, at a certain point, you just level off. I’m cool with that.

The good news is that we didn’t owe this year like we did last year. I wasn’t sure *how* that was the case last year but we took steps to make sure that it wouldn’t happen again.

Making $10k less didn’t hurt our cause either.

In the end, as you can see up at the top, we received $2585 back Federal and $1262 back from the State for a grand total of $3847.

No small sum but I have to admit — I really thought we’d be getting more.

I’m glad that I wasn’t counting on it but I almost feel naive for actually thinking that having a kid would “aid” me in my taxes in a get-rich-quick sort of way.

Right now, it sorta feels like that “buy a house and you’ll get tons of money back on your taxes” myth. I fell for that one too.

Gee — borrow over a hundred thousand dollars, pay thousands upon thousands of dollars in interest and then we’ll give you $30 back on your taxes for your troubles. Such a deal!

Maybe it’s just me…

Oh, and I’m pretty sure I ranted about this last year but I’m going to rant about it again this year cause it really rubs me the wrong way…

In the mail, I received a Form 1099-G from the State of Connecticut indicating that I “earned” $1258 from them in 2009 and that I had to report it as income on my taxes.

Okay, so I was over taxed in 2008 by $1258. Then, in 2009, they refunded me the $1258. And finally in 2010, I need to pay taxes on that same $1258 that I overpaid in 2008.

So, wait, why again do I have to pay taxes on my refund?

I already over paid taxes on it once — the state gave it back to me — and then I had to pay taxes on it again?

Double taxation, no?

Posted on February 27th, 2010 at 9:45 am by Brainy Smurf
Finance, Rants, Taxes | 3 Comments »

Celebrating Independence by Writing a Check

What could be more patriotic than paying your property taxes?

That’s exactly what my wife and I did for the Fourth of July.

In Connecticut, we have to pay local property taxes on our automobiles. We used to be pretty unique in that respect but, from what I’ve heard, now roughly half of the country has a similar tax. Greedy government… Grrrr…

The bill came on Wednesday.

Not including her car (she pays her taxes, I pay mine), total tax due for my two cars was $385.18.

That’s $42.36 less than last year but it still seems like an awful lot for an 11-year old BMW and a 5-year old subcompact Scion.

Here’s an updated chart of my personal property tax bill for the past nine years:

Sure, looking at the tax that I’ve had to pay in the past, I should be quite pleased.

I’m not — $385.18 is a lot to pay on top of the registration fee, my drivers license fee, and the emissions test fees that I have to pay for on each vehicle.

And if I’m not mistaken, upon purchase, I also paid a 6% sales tax on top of the sticker price.

Grand total on the BMW, I’ve probably forked over nearly $10k to the State of Connecticut in taxes alone.

I dunno, seems a little excessive when you put it all together…

Anyway, it’s a good thing that July is a three paycheck month for me — just like last year.

I can spare it.

Posted on July 4th, 2009 at 9:47 pm by Brainy Smurf
Finance, Rants, Taxes | 1 Comment »

Taxes Filed : Feelings Mixed

Yep, spent some quality time with TurboTax this morning finalizing everything to the point where I was comfortable enough to file.

Things weren’t as rosy in 2008.

That was my final conclusion before clicking the “Submit” button.

See, our 2007 tax return landed us $3444 total. That broke down to $2643 from the federal government and $801 from the state government.

This year, our refund is just $798.

We actually owe $460 federal. That’s never happened before.

It’d be safe to say that I’m a little disappointed right now.

It’s not that I was counting on a huge sum to roll in… I guess I’ve just come to expect it. And this year, it won’t be there. That kinda hurts.

But, at the same time, I have to pat myself on the back a bit for all of those calculations I did back in December of 2007.

Without asking you to go back and actually read that original post, I adjusted my filing status and withholdings in an attempt to “balance” things more to my own benefit.

In a nutshell, I tried to increase both my take home pay and my 401k contributions by decreasing the tax withheld — but only to the point where I wouldn’t owe anything to the government come tax time.

I came pretty darn close.

In fact, the only reason that I went over is because the hockey team that I quit working for in November of 2007 (because they were *months* late in paying me) finally paid me on January 6, 2008.

Yep — that one check, just six days into 2008, resulted in a 1099-Misc. Grrrr…

In other news, I find it really aggravating that the state charged me sales tax for e-filing.

Gotta love the double taxation. Call it what you want, but that’s what it is.

More puzzling, that $0.20 works out to around a 1% sales tax.

Last time I checked, 30 seconds ago, Connecticut’s sales tax rate was 6%.

I *really* don’t get it.

Posted on February 22nd, 2009 at 11:56 am by Brainy Smurf
Finance, Taxes | 5 Comments »

My PMI Battle: Re-Ignited

So I started doing my taxes this week and, while going through the motions, I stumbled across something that drove me bonkers last year.

I’m in shock that I didn’t blog about it then. Perhaps I did, but I couldn’t find any mention of it…

And, honestly, I wasn’t going to blog about it this year either until reader Doug Hill posted a comment on one of my better entries regarding my PMI battle with Countrywide — the one I eventually gave up on.

See, last year there was a “new” deduction that homeowners could take. You could deduct your PMI!

How about that?

I was pretty pumped — until TurboTax told me that I didn’t qualify for the deduction.

It didn’t indicate why, so I just assumed that it was because I was too awesome, um, that it was because my income was too high. You know, something positive.

But this year, the same thing happened and I made a lot less. For a minute or so, I got all excited when it allowed me to enter that I’d paid $1021.80 for PMI in 2008, you know, thinking that I’d get most of it back from Uncle Sam.

No dice. I don’t qualify. Still.

So, modified slightly, here’s what Doug Hill said to get me all fired up:

Only those that took out a loan after 1-1-07 can deduct the cost of PMI through 12-31-10.

I took my loan out in August 2005…

Look up P.L. 110-142. Newest version of section 3 (b) doesn’t say anything about when you took out a loan; but IRS Code Section 163 Section H (iii) says the loan must be after 1-1-07.

Now we have two classes of homeowners who pay PMI — Deductible and Non-Deductible.

He’s right.

Like Doug, I’m getting hosed because I bought my house before the market started to falter. As MoneyMateKate so eloquently stated in another post, “No good fiscally responsible deed goes unpunished these days. Grrr.”

Grr is right.

Once again, it feels like I’m getting the shaft for making a wise move and paying my mortgage bill on time and in full for all of these years… while the people who are walking away from their mortgages because they bit off more than they could chew could potentially be “bailed” out…by the taxes I’m paying.

Posted on February 5th, 2009 at 8:48 pm by Brainy Smurf
Finance, PMI - Mortgage Insurance, Rants, Taxes | 5 Comments »

Forthcoming Quality Time in Front of the Computer

Figures…

Just when I said that I wasn’t eagerly awaiting my W-2 this year, I’ve already flip-flopped…

No, that’s an overstatement.

I received my W-2 from my employer today and it truly had me thinking about doing my taxes for the rest of the work day.

Of course, I haven’t purchased any tax software yet and I’m still waiting on a few 1099-MISC’s so I can’t really get going anyway buuuuuuuuut the juices are definitely flowing.

I’d be shocked if I make it through this weekend without installing TurboTax…

(Yes, I’m actually going to use the same product in consecutive years… Sorry TaxCut…)

Posted on January 27th, 2009 at 7:45 pm by Brainy Smurf
Finance, Taxes | 3 Comments »

Eagerly Awaiting Your W-2?

Crazy how things can change in the span on one year…

No, I’m not talking about the economy. Or maybe I am…

I dunno, you can decide…

Last year, at about this time, I was eagerly awaiting the arrival of my W-2 and other assorted 1099-MISC’s so that I could sit down, file my taxes, and get my nice fat tax refund — we received a check for $3444 last year!

This year, though, I’ve barely given a thought to doing my taxes.

Haven’t priced out the different versions of TurboTax and TaxCut.

I haven’t even opened my last pay stub of 2008 to get an idea of how things may fall yet.

In all honesty, I’m not even salivating about the “thousands” that could potentially be coming in just a few weeks.

Why?

My best guess is that it has something to do with being debt free.

Last year, we threw almost all of that money towards debt.

This year, we don’t have that hanging over us. We don’t really *need* the refund.

Oh, wait, we did just spend $1650 on baby furniture, didn’t we?

Okay, I take that “we don’t need it” line back — the tax refund will again be paying down debt this year…

The big difference is that it’s not weighing on my mind like it used to.

Posted on January 23rd, 2009 at 8:35 pm by Brainy Smurf
Finance, Taxes | 3 Comments »

Seems I Spoke Too Soon about my Property Taxes…

Yeah, sure, the personal property tax on my two cars went way down (un-expectedly far down) this year, but upon logging in to my Countrywide account this morning, I see that they’ve just paid the city $1912.09 on my behalf for the property taxes on my home.

That’s up nearly $269 from the last property tax payment back in January 2008. Ouch.

Now I can’t say that an increase was completely unexpected — back in April I posted an article from our local paper with this quote:

“Most homeowners will see a property tax hike of at least $150 this year if the proposed budget eyed by the city’s Board of Finance is approved.”

With my personal property taxes (on the cars) dropping so much, I assumed that this tax increase (the budget was approved) would take effect in 2009. Evidently, I was mistaken. I hope, anyway…

So now I’m not sure whether to pat myself on the back because this proves that my house is more awesome than everyone else’s in town or if I should be irate that my taxes went up so much more than $150…

(In reality, my house is smack dab in the middle when it comes to awesomeness in the city.)

Sadly, though, this large of an increase will effectively wipe out half of the savings I’d receive if I ever manage to settle my PMI issue with Countrywide…

Too bad I didn’t realize how great I had it back in 2003…

Posted on July 19th, 2008 at 6:12 am by Brainy Smurf
Finance, Mistakes, Taxes | 1 Comment »

Personal Property Taxes Are (were?) Due

Well, it’s that time of year again. Yep — tax time.

That is, if you live in one of the states that has a personal property tax.

Here in Connecticut, we have to pay local property taxes on our automobiles. We used to be pretty unique in that respect but now roughly half of the country has a similar tax.

Each year, the personal property tax is due on July 1st. The city mailed the bills out on July 3rd.

So, by the time we received the bill, after the Independence Day holiday, we were already 5 days late. Hmph!

Maybe it’s just me, but I just can’t understand how municipalities can get away with stuff like that… Granted, they don’t start charging interest until you’re a month overdue, but still…

Even worse, looking at the bill — they don’t have a due date printed anywhere. Seriously. Just a threatening paragraph about not being able to register your vehicle in the future if your paid taxes aren’t current. No return envelope either. And you can’t pay online.

Not very convenient.

I can’t remember the last time I actually addressed a blank envelope.

Probably about this time last July.

Anyway, this year the tax due on my two vehicles totals $427.54.

I’m pretty happy about that. Much less than I’d expected and far less than just last year.

I was prepared, actually, for an increase back in April when I’d read that, “Most homeowners will see a property tax hike of at least $150 this year if the proposed budget eyed by the city’s Board of Finance is approved.”

That proposed budget was approved, but upon re-reading the article, it (the budget) didn’t go into effect until this month so the tax hike will actually hit us on next year’s bill.

For fun, I went back and dug up all of my previous personal property tax bills. Okay, not all of them, but as far back as I still had the stubs on file — back to 2001 — and I was surprised by what I found:

Turns out, I had much reason to be pleasantly surprised by this year’s bill. It’s the least I’ve ever had to pay. A full $200+ less than last year! Fantastic!

Don’t get me wrong though… Not for one second am I saying that getting a $400+ bill in the dead of summer is anything to be jumping for joy about.

It’s not.

But July just so happens to be one of those mystical 3 paycheck months for me, so paring an additional $400 from the budget isn’t anything to worry about.

And how on earth was I able to pay a $701 tax bill back in 2002? Yikes!

Posted on July 10th, 2008 at 2:04 pm by Brainy Smurf
Current Events, Finance, Taxes | 3 Comments »

Cha-Ching! Tax Stimulus Refund Arrives

So last night I went to the IRS website and played with their new “Where’s My Refund?” script.

As is common for the IRS website, in my experience, it crapped out and didn’t tell me anything.

Seems most government sites have this problem — you know, a nifty calculator or pay online option where you enter all of your information, click submit, wait a few seconds, and then get an Error 500 — Internal Server Error.

Anyway, last night, the “Where’s my Refund?” script said my SSN and number of exemptions from my 1040 didn’t match their records…

Um, hello? Yes they do — my 1040 is right in front of me.

Anyway, I was out of luck.

This morning, though, I find myself $1200 richer. Thanks America.

Posted on May 2nd, 2008 at 4:48 am by Brainy Smurf
Current Events, Finance, Taxes | 2 Comments »

2008 Economic Stimulus Payment Plans

Since it was first announced that we’d all be receiving an Economic Stimulus Payment in the mail back in January, I’d been hearing varying numbers. For us, at first, it sounded like we’d automatically receive $1200…

I was pretty excited about that news.

Then the media made it out like it would be only $600 or perhaps even nothing, because of our income. More recently, I read elsewhere that it would be $1000 based on our situation. There didn’t seem to be a real concrete number — a hazy gray area.

Don’t get me wrong, even on the lower end, $600 for nothing is pretty nice. $1200, though, is a totally different game.

Our plan is (was?) to use the $600 to buy my wife a new computer. She’s never had a new computer — always one of my hand-me-downs, overloaded and customized with all of my personal crap.

We’re going to get her a new one and she can set it up as she likes. It can even come with a pink keyboard and fuzzy mouse if she likes — this one won’t be mine.

So this morning, I ventured on to the IRS’s website to see if they’d posted any new information on the stimulus checks…

I’d visited before, but all they had was a bunch of hard to understand legalese. Even their “rebate calculator” was a hassle (and for the first few weeks, it would error out).

Now though, it appears they’ve got some pretty solid info with easy to understand examples:

Examples of ways the Economic Stimulus Act of 2008 may affect taxpayers who are married, file a joint return and are either childless or do not have children who qualify for child tax credit payment:

1) Married couple with no children, wages of $4,000, no federal income tax liability.
Rebate is $600

2) Married couple with no children, no wages, veterans’ payments of $2,000, social security benefits of $2,000, no federal income tax liability.
Rebate is $600

3) Married couple with no children, no wages, no social security benefits, veterans’ payments of $4,000, no federal income tax liability.
Rebate is $600

4) Married couple with no children, no wages, no social security benefits, no veterans’ payments, AGI is $20,000, federal income tax liability is $250.
Rebate is $600

5) Married couple with no children, AGI is $25,000, federal income tax liability is $750.
Rebate is $750

6) Married couple with no children, AGI is $60,000, federal income tax liability exceeds $1,200.
Rebate is $1,200

7) Married couple with no children, AGI is $160,000, federal income tax liability exceeds $1,200.
Rebate is $1,200
Phaseout reduction is ($500)
TOTAL is $700

If I’m reading it right and I’m sure I am because, for once, they give real life examples in plain English, we’re going to receive the originally advertised $1200 sometime during the first week of May. That is uplifting news.

Even with payout to be double what we’d expected and planned on, I think the plan is still to buy a new computer — maybe with a few more bells and whistles than originally thought.

And I’ll probably blow around $200 on myself for something short-sighted and stupid (hey, I want something shiny and new too!) with the remainder likely going into savings.

Or perhaps we should save it to pay our property taxes in July?

Nah…

Posted on April 15th, 2008 at 8:19 am by Brainy Smurf
Current Events, Rants, Taxes | No Comments »

Rising Property Taxes: Argh?!

When it comes to taxes, Connecticut is by far the worst state to live in.

I know, I know, everyone knows it’s expensive to live in New England, but Connecticut takes it up a notch from Massachusetts and Vermont.

Did you know that if you live in Connecticut, you have to pay local property taxes on your automobiles?

 It’s called a personal property tax. Roughly half of the country has a similar tax.

Making matters worse, in Connecticut, is that the tax on identical vehicles can swing wildly from town to town, based on the communities’ relative wealth. It’s not a state tax, it’s a local tax.

So my BMW may leave me with a yearly tax bill of $350 right now, but if I moved one town over, it would only be $100. One town in the other direction, my bill could be $500.

In the past I’ve seen figures for a generic car, like a Ford Taurus, where one owner will have to pay around $75 while another will have to pay in excess of $200. For the *exact* same car. Hardly a fair tax.

This is the main reason you see so many illegal Florida license plates up here. Tax fraud is rampant. And it’s not enforced, much to my dismay.

With three cars in our household, each July, the city comes looking for between $850 and $1000 dollars from us. Hardly chump change.

Now word comes in that our regular property taxes will be going up this year:

The Board of Finance is briefed on the city’s fiscal situation Monday in City Hall.

Most homeowners will see a property tax hike of at least $150 this year if the proposed budget eyed by the city’s Board of Finance is approved.

The $171.5 million spending plan that fiscal overseers appear poised to endorse this month would drive the mill rate up by 6 percent, officials said.

The City Comptroller said spending requests were up more than 8 percent to $177.3 million. But revenues, he said, are flat.

His department recommended cuts totaling $5.8 million that bring the increase to a more manageable 5 percent level.

But revaluation makes the pain greater.

Because almost all the property in the city is worth more than it was in 2002, up an average of 42 percent, the mill rate could drop from today’s 34.71 to 24.95 to bring in the same amount of money to city coffers.

The budget, though, requires a mill rate of 26.45 to bring in the necessary revenue to cover anticipated costs.

The Comptroller said that means most homeowners will pay more than $150 extra this year and some will pay much more than that, if their homes rose in value by significantly more than 42 percent.

Condominium owners are going to take some of the largest hits because their assessments generally rose much faster than single-family homes.

The finance board plans to adopt a budget April 22. A joint session of the City Council and finance commissioners will put the final seal of approval on a new budget in mid-May.

The budget takes effect July 1, when a new municipal fiscal year begins.

Thankfully it won’t break the bank for us, but I have a feeling, based on our 2007 tax assessment that jumped well over 50% from the 2002 assessment, we’re going to get hit with a big increase.

Hopefully next year as a result of the proposed lower mill rate and the fact that our cars will have depreciated another year, the city won’t tax them as high. If we could only be so lucky.

Even so, we’re looking at between $5000 and $6000 in property taxes alone next year.

Good grief.

I just hope the city uses the piles and piles of extra money wisely instead of building a “skate park” for skater dude thugs — which is actually the plan. Ugh…

Posted on April 9th, 2008 at 7:14 am by Brainy Smurf
Rants, Taxes | 2 Comments »