Taxes
They say there only two things that we can be sure of in life, death and taxes. Maybe, just maybe, taxes attribute to our death. At any rate, they’re here to stay.
Unfortunately, there is no such thing as one size fits all when it comes to taxes. Individual circumstances vary, as do the specific strategies that make sense for any given situation. It’s flat out wise to first, always consult either a business savvy (not all are) IRS enrolled accountant, CPA or tax attorney…nonetheless, we’ll learn a little about taxes in this area and review sound strategies in the next.
Taxes – Who Do We Blame for This?
From early tribes to modern society, individuals have voluntarily (and at times, involuntarily) formed alliances and governments to provide what have been perceived as goals and objectives for the common good. Whether in basic survival-oriented societies, in which the best hunter-gatherers shared their bounty with the less skilled or less abled (children, “seasoned citizens”-my preferred terminology-or the disabled), to modern and more structured societies, members of the group have been required to contribute to the good of all. Thus, if viewed as taxes, they have been an integral part of civilization from the beginning.
A Little History
American history is rich with conflicts regarding who will be taxed, when, by whom, under what circumstances, and at what rate. The rallying cry of some early Americans was, “No taxation without representation,” in response to taxes levied on the colonies by the King of England. The Boston Tea Party was precipitated by what was perceived as an unfair tax on tea, the favorite beverage at that time.
When the United States was founded, there was no taxation on income. The first comprehensive individual income tax was enacted in 1862, during the Civil War. The top tax rate at that time was 10%.
Since then, tax laws within the United States have become a labyrinth of rules and guidelines that only the most savvy professionals can navigate. In the next area, we’ll review a few strategies that will reduce the tax burden of most citizens.
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