The one thing I’ve seen consistently is a lack of organization and planning. This isn’t to say the government is unique, I’ve seen the same thing at a lot of larger Fortune 500 companies I’ve worked at too. They just have more incentive ($$$) to get things right. The government just prints more money when they run out.

So I’m pleasantly surprised with the IRS and their emphasis on the electronic filing and direct-deposit of our returns this year. I filed electronically with TurboTax this year, on April 14th (Note: I usually try two-three different programs to see which is easiest, and TurboTax holds the lead with being able to download my W-2s and most of my investment earnings information directly. TaxCut is a close second though, having a slightly easier user experience).

I have ALREADY received my state return, and the federal is due back in less than a week!

This is a TERRIFIC turnaround rate as compared to years past. I remember when it’s taken months to get the return, even when I filed electronically. Filing by paper almost GUARANTEED a month or more wait for the cash. I don’t know whether it’s the bad economic environment that has spurred the fast turnaround in payments (to get money back in the consumer’s hands) or the advances in technology, but I DO say; GOOD JOB INTERNAL REVENUE SERVICE.

I must be hallucinating. I bet you do a Google search on that phrase and this web site will be number one!

When is Yours Due?

For those with outstanding taxes, you can go to the IRS Website and see when your return is due.

Average turnaround times are around a week for electronic filers, or around 2 weeks for paper filers. That’s a great improvement over years past.

Remember also, that a lot more people are filing this year than usually do because of the economic stimulus package. To get the economic stimulus checks as soon as possible, you had to file a tax return this year whether you needed to or not. People that normally don’t have to file, because they make under the current minimum tax filing limit (somewhere around $15,000 I think) are filling out forms so they can get the stimulus checks as soon as possible. That’s a few million more forms than the IRS would normally get and they’re STILL turning things around good.

Dare I say that the IRS could be a shining example of how government OUGHT to treat its citizenry??

Brrr, what a thought! Kind of like saying sharks are wonderfully efficient swimmers (they are, but they can also gnaw a leg or arm off if you’re not careful).

Expecting a return this year? What do you think about the better turnaround times? Leave us a comment and let us know!

You’re Missing Yours!!

What to Do, What to Do?

First – Make doubly sure that you HAVEN’T received it somewhere in your mail and accidentally left it with another pile of mail on the kitchen counter. You’d be surprised how often this happens, especially if one person in the family does the taxes and the other person usually gets the mail. The importance of that little piece of paper often doesn’t register with mail-retriever.

Next – Call the HR department of the job you’re missing the W-2 for and ask if all the W-2’s have been sent out. (I know, by law they are supposed to be sent out by Jan 31st, but sometimes things happen at big companies too. It might be ‘in the mail’ to you and will arrive a couple of days from now.)

If the statement has been mailed out, and it isn’t in the mail, ask to find out what the procedure is for having another W-2 sent to you ASAP. If it HAS already been sent, find out when it’s expected to arrive, and note that day on the calendar. If it doesn’t arrive by the following day, CALL THE COMPANY BACK and arrange for a replacement.

The Wonders of the Electronic Age

If you’re one of the lucky ones (and more of us fall under this category each year) your pay stubs are being automated through ADT or another pay system. If this is the case, it’s almost a certainty that they are online and available for you to download and view or print by now. If you get your pay statements electronically (or have the capability to do so), your W-2’s should already be available from the same web site.

Log into your ADP account (or whatever electronic access you have) and look around for "W-2" entries. Pull the ones for 2007, and you’re good.

They’re Still Not There George!

Ok, last resort, until you get the replacement W-2’s from your work. Take the last pay statement of the year and use those totals for ROUGH CALCULATIONS of your taxes. Don’t use these as the official numbers, as there might be changes due to 401k contributions, supplemental insurance deductions, and other deductions/additions not shown on your pay stubs! This is just to give you some working numbers to put in your tax programs to show the amount due or size of the return.

Once you get the actual W-2’s you can complete the calculations and either pay (by April 14th) or file for the return (ASAP!!).

Do you have comments? We’d love to hear them. Leave us your thoughts and ideas!

Rocket Finances has responded to my article "How Do You Want Your Tax Money Spent?" with some very strong rhetoric. Needless to say, the battle is on,..

Corrections

Just a brief one. The article was on what I saw on Family Feud VERBATIM. I didn’t choose the categories or the actual answers, I just commented on them. However, having said that, I pretty much agree with what was chosen and in what order.

Let the Battle Commence

#5 Highways and Streets, Rebuttal - The interstate system is just that, INTERSTATE. Having the individual states take accountability for their own road infrastructures is one thing, but when you’re talking about a huge system that supports everyone, I believe it should be managed overall for a consistent system. If the money is passed on to the states directly, there’s no guarantee that the quality of the highway system won’t be affected. Rich states might end up having highways paved in gold, poorer states might revert to dirt roads. I don’t want to risk both the defense and industrial capabilities of the interstate system this way. If it were up to me, any highway that crosses one or more state borders would be under the federal organization. Anything else will be the states’ responsibility.

#4 Poor and Needy, Rebuttal – While it’s true that from an ABSOLUTE dollar amount, the DHHS budget is larger than the DOD’s budget, but that’s misleading until you look under the covers.

When you take a look at the programs in DHHS that take up the money, Medicare and Medicaid combined take 84.4% of the budged amount. That comes to an outlay of $588,727MM for medical assistance for those already covered by Medicare/Medicaid. Are you suggesting that we shift the burden of support for these people onto the state??  That would work out to only an additional $11.774 BILLION dollars they would have to come up with, not to mention the increase because of the Baby Boomers nearing retirement age. Either that or are you suggesting that we start denying aid to people. (We’ll go with your family first if you don’t mind).

The issue has been brewing for decades, and it won’t be fixed instantly. In any huge system there are inefficiencies and bureaucratic rot, but abandoning the poorer and needy isn’t the America I want to live in.

Also, I would love to see your supporting documents that show that "Governmental policies tend to encourage greater dependence on the government".

#3 Healthcare, Rebuttal – As was mentioned earlier, we ALREADY spend $588 Billion on just CURRENT medical procedures and expenses (Medicare/Medicaid). What does that money buy us?

(source World Health Organization 2007 statistics)

• Life Expectancy – Male – 75, Female – 80
• Infant Mortality Rate – 7/1000 births
• Neonatal Mortality Rate – 4/1000 births
• Maternal Mortality Rate – 14/1000 births
• Physicians in the U.S. – 730 801
• Density of Physicians – 2.56/1000 people
• Nurses – 2 669 603
• Density of Nurses – 9.37/1000 people

Let’s compare these against the country with the longest life expectancy rate – Japan

• Life Expectancy – Male – 79, Female – 86 (+4 years for men, +6 years for women)
• Infant Mortality Rate – 3/1000 births (~50% decrease)
• Neonatal Mortality Rate – 1/1000 births ( ~75% decrease)
• Maternal Mortality Rate – 10/1000 births (~15% decrease)
• Physicians in the Japan – 251 889
• Density of Physicians – 1.98/1000 people
• Nurses – 993 628
• Density of Nurses – 7.79/1000 people

Japan is providing its’ citizens with health care that is prolonging their lives. They don’t have a ’socialized’ medicine model, but a hybrid system (some healthcare is provided by the government, while other healthcare is covered by private insurance, employers, and government subsidized programs). They have a higher life expectancy, lower infant mortality, and do it with less doctors and nurses. How is it that the United States, with all it’s GREAT medical procedures, and THREE TIMES the doctors can’t provide the same life expectancy numbers??

Japan is at the top, life expectancy-wise, but they’re followed closely by; Andorra(77/84), Australia (79/84), Austria (77/82), Canada (78/83), Cyprus (77/82), France (77/84), Germany (76/82), Greece (77/82), Iceland (79/83), Ireland (77/81), Israel (78/82), Italy (78/84), Kuwait (77/79), Luxembourg (76/82), Malta (77/81), Monaco (78/85), Netherlands (77/81), New Zealand (77/82), Norway (77/82), Quatar (77/78), San Marino (80/84), Singapore (78/82), Spain (77/84), Sweden (79/83), and Switzerland (79/84);

That puts the United States around 27th place. WHAT’S WRONG WITH THIS PICTURE??

#2 My Pocket, Rebuttal – While having more money in the pocket is never a bad thing, none of the ‘effects’ you quoted have ever been verified as correct. The 1980’s Trickle-Down theories and Voodoo Economics have been interpreted and re-interpreted to suit those on either side. I don’t think it’s safe to attribute ANY sweeping statements on the effects of individual tax cuts on our economy IN EITHER DIRECTION.

Tax cuts are a short-term financial stimulus that can have long-range unexpected consequences. Having said that, I like having more money in my pockets too. But if more taxes gets rid of the National Debt, and keeps us from CONTINUALLY running the government in the red, I’ll write the check. Our government and leaders have been fiscally irresponsible for so long that it’s become institutional. And any candidate that tries to make a change IN ANY PARTY, is draped with the political albatross of "Tax and Spend Liberal". The bills are coming due, and the country is starting to come up short.

#1 Education, Rebuttal – Education doesn’t necessarily get the shaft, it just needs to be more effective. Teachers making less than garbage men doesn’t really induce the best teachers to teach. More money isn’t an effective strategy any more than the ‘test-everything’ mentality of the No Child Left Behind act.

Our school systems are getting old, and deteriorating. New schools aren’t being built fast enough to keep up with the flood of new students. The districts with good educational reputations are overcrowded with transfer students while districts with lower reputations suffer from money shortages caused by the SAME move in students away from them.

A fundamental reexamination in the way we educate mass student bodies is needed, and more effective incentives to teachers (carrot, not stick) need to be in place to promote good teachers and lure new graduates to the field.

Schools should be administered locally, but I’m doubtful about cirriculum being administered locally (I live next to Kansas, and the Intelligent Design discussion comes to mind). From my own point of view, watching my children go through the No Child Left Behind effects, the only thing I’m seeing is a cutback on the arts, and a concentration on test grades, to the exclusion of other subjects/education. We’re working at creating a whole generation of ‘good little workers’ that don’t know how to perform critical thinking and decision-making tasks. All they’ll be good at is following directions and working in their own little jobs. It scares me.

Now to Tear Apart Rocket’s Choices

Not really, but I liked the header,   

#1 Defense – Defense is very important, I don’t disagree, but there are varying kinds of defense. Military and force options for defense are a deterrent. They should be the option of last-resort, but recently they have been front and center for much of our foreign policy actions. It perpetuates a circular effect; You have to have MORE defenses against the people you’re fighting against, because you’re making MORE enemies DEFENDING from those enemies. We have a HIGHER number of active terrorist groups AFTER the 9/11 incident than before. How does one exactly "WIN"  a War on Terrorism??

#2 Civil Defense – Again, the question is "protect against WHAT exactly". More money for police and fire fighters isn’t a bad idea, but what exactly is the Department of Homeland Security providing that wasn’t there before, or is needed now?? It’s all scare-tactics to keep people voting for the ‘right’ party (no pun intended).

Other countries, England, Germany, Ireland, Greece, etc. have been dealing with domestic terrorism for decades longer than we have, and they haven’t whipped their own people into an anti-terrorist froth over it. A low-key, but continuous prevention policy has been fairly effective in these cases.

The Rainbow-of-Terror is a perfect example of a scare tactic. When HASN’T it been Yellow or Orange?

#3 Government itself – Couldn’t agree more. Upper officials in Norway make close to $1 Million a year!!! That prevents corruption, and also provides for WELL qualified candidates to fill the slots.

My only caveat for upping the pay rates for government employees is to reduce the paperwork and roadblocks for getting rid of low and non-performing government workers. I’ve worked in the government as a contractor and have seen people that do NOTHING on a daily basis, still receive their pay for decades. This is what causes the huge bureaucracies to flourish, the idea that you can’t be fired.

Increase pay/qualifications, but get rid of the ‘deadwood’.

(To those government employees that DO do a good job, I apologize and want to commend you. Government work in the U.S. isn’t the most glamorous or high-profile, but it is NECESSARY and VITAL to keeping the country going.)

Ok Rocket/Readers, let’s hear your views on this. Weigh-in with your views by commenting. I guarantee I’ll let any statements through (that aren’t spam).

This episode actually had the question "How Do You Want Your Tax Money Spent" and I thought it’d be interesting to talk about the answers as listed. So without further adieu,.. Show me #5!!

#5 Highways and Streets

Surprisingly, the 5th most popular answer was about the highways and streets. In the United States we have an estimated 46,837 miles of highways (as of 2004), maintained by both state and federal authorities. The highway system, put in place by Pres. Eisenhower was originally designed as a means of civil defense (in case the U.S. was ever invaded by foreign troops). Today, it’s a vital infrastructure component that is in need of improvement and repairs.

The reason I’m surprised (pleasantly) is that this need for repairs doesn’t seem to be on the radar screens of any of our leaders, even though the continuing deterioration of this system could cause the transportation of goods across the country to suffer.

#4 Poor and Needy

Another pleasant surprise. There’s a lot of sentiment against helping those less fortunate than ourselves in this country, but it seems that this sentiment isn’t the norm. I’ve always thought that a country should be judged by how they treat their poorest/most disadvantaged citizens. The U.S. isn’t a stellar example of success, but things are SLOWLY shaping up. Welfare reforms aimed at educating and training people to move back into society are on the rise, and more people are succeeding at re-entering the workforce because of these programs.

Free medical programs and food programs are still available for those that need them, and social work is on-going to make society better, a case at a time. Like I said, it’s not perfect, but it’s getting incrementally better.

#3 Healthcare

Not so surprising. With an estimated 30-50 million Americans not covered by health insurance, this is going to be a hot-topic item in the upcoming elections. But even with the high demand for universal healthcare, the ‘how to pay’ questions still have yet to be answered. And additionally, the last time that this issue was tackled by our leaders (Clinton, 1991) it turned into a political free-for-all with a majority of the Republicans and not a few Democrats warning that "Universal Healthcare leads to Communism". (Even with a number of countries, England, Canada, France, Cuba, etc. as examples where universal healthcare is working).

#2 My Pocket

TOTALLY unsurprising, this one. People continually want more money in their own pockets. Tax cut after tax cut is proposed, promised, and delivered. We only have about $9,202,133,302,099.65 in National Debt because of the continual shortfall of taxes and the continual spending. So why isn’t  it reasonable to give everyone a $300 bonus, since on a per-person basis, we owe $30,266.78. I’ll write them a check.

#1 Education

Education is a standard ‘desired recipient’ of tax money. Unfortunately it’s also the one that gets short-shrift when it comes to funding sometimes. Since it’s ALWAYS in need of large funds, our leaders sometimes think that it’s ok to skimp just a little this time if they ‘promise’ to make it up in the future. The problem is no one ‘makes it up’ so the United States’ education system continues to suffer. Other first-world education systems that actually cost LESS money turn out better educated pupils and workers. We’re dropping farther and farther behind the education curve each year because this is only a pseudo-high priority.

Taxes, the Necessary Burden

Of course no one LIKES paying taxes, and you should only pay your fair share based on your financial situation. When you pay your taxes, rather than being resentful for the money the government is "taking away" from you, remember all the services that these taxes are providing; Military protection, infrastructure (roads and highways), public services (police and fire departments), and many social programs (Women, Infants, and Children [WIC], Social Security, Medicare/Medicaid, and money for welfare recipients). Without these programs, society as a whole would break down.

Try to remember that the next time you write a check to Uncle Sam.

Where would you like YOUR taxes to go?? Let us know by leaving a comment.

If you make over $97,500 this year you probably already know what I’m talking about. The Social Security Old-Age, Survivors, and Disability Insurance (OASDI) stops taking money out of your paycheck once you’ve hit the the income upper limit ($97,500 for 2007 and $102,000 for 2008).

That means that you get an additional 6.2% of your money coming back to you, rather than to the government. The higher your income, the earlier in the year you start receiving this ‘free money’. I usually start seeing this money in late Oct to early Nov, and look forward to it each year.

What to Do with All That Money

Getting an extra 6% raise, even if it’s only temporary, is a pretty nice thing. But don’t fritter it away!! There are lots of things that you can do with it.

• Up your 401k Contributions
• Max out your IRAs
• Pay for those Christmas presents IN CASH
• Donate it to some good charities (that are definitely needing it this time of year)
• Put it into an education account of some kind
• Pay off your Highest Debt Snowball balance

Reflect on your Good Fortune

The first year that I actually went over the contribution cap, I couldn’t figure out why my paycheck was hundreds of dollars more than I though it should be. I actually called the HR and Finance department to tell them they’d made a mistake in paying me (not wanting to have to pay back the overpayment at some random time when I don’t want it to).

They calmly explained to me the whole concept about Social Security tax contributions had maxed-out. I’d never heard of the concept before, being new to things like that. It give me a "I’ve finally Made It" feel-good moment.

If you’ve reached this point, take a minute to congratulate yourself. You’re earning about three times the national average (The national average wage index for 2006 is $38,651.41) if you see some money back before the year end. Good Job!

Redouble Your Efforts

However, don’t get too full of yourself too fast. High pay brings high expectations. Now’s also a good time to step back and see if you’re still performing ‘up to snuff’. It’s easy to coast once you get to a certain level in your career, but keep in mind that having a job, and a well paying job, is a privilege, not a right. If you feel like your performance isn’t all it has been, make an early new years’ resolution to bring your game up.

Remember the Others

You’re at your position hopefully through your determination, skills, and abilities. But don’t forget that everyone usually has a dollop of luck that helps them along too. Others sometimes don’t have that luck. Don’t forget that if things were just a little different, it might be you and yours without a home.

During the upcoming season, I’d challenge you to do just one thing extra that will help someone else. It doesn’t have to be big, but do something more than you did the year before. And next year, do a bit more, and soon, maybe the whole world will be a better place for us all.