Been working through our taxes for 2009. Many, many deductions for this year. I guess this is the government's way of refunding us so that we can spend more. Some of the deductions produced the following tax refund:
- Work (some sort of work pay thing, $800 back)
- Children (we have TWO)
- Education (my seminary classes, $150 back)
- Housing (Interest, Tax, PMI, $770)
- Home Improvement (energy savings renovations, $900 back)
- Tax savings for my wife's traditional IRA ($700 back after a $5000 contribution=instant 14% return)
- Charitable donations (getting back for giving away, $700)
I used Turbo Tax Deluxe and went through their supposedly 350+ deductions to see how much I would get back.
Stuff I could have deducted on but didn't have receipts:
- Medical Expense (even though we did have baby in 2009, I did not keep all the receipts, co-pays, and medicines)
- State Sales Tax
- Items donated to Goodwill, salvation army, thrift store (again no receipt)
- Mileage for church work (as a deacon of a presbyterian church, again I did not keep records)
Haha, money left on the table. One of my complaints for this year's deductions was that there was just so many of them (then again there probably always was this many, I just didn't pay attention). I didn't complain when I got the $7500 First time Homebuyer credit in 2008, but now that I look back, I got it because America's economy and financial situation is in much worse shape (than we actually see) and that the government must resort to these things to prop it up.
The more deductions I take, the more stimulus money I take, the more the government is trying to stimulate the economy through consumption and spending. They are hoping with the $4-5k return that I get I will go out and buy American products and eat American food in order to spur America's commerce so businesses profit and hire more people and pay more taxes. But in doing so, the government is taking a huge hit, and hence our deficit spending and huge multi-trillion dollar debt.
My co-worker says America must become a production society opposed to consumption. I think he's right. We need to encourage growth through some other means beside buying from China and having China buy our debts.
So my point: government can't fix everything, giving tax incentives for certain things cannot change spending habits, just like having a budget doesn't change a person's motivations. And the way we are going, we won't be leaving any inheritance to our children or children's children. Instead we will crush them with huge debts.
It's got to be the other way around. Our motivations and having an end in mind brings about change that results in things like budget and wise spending and charity and entrepreneurship.
As Jesus said when questioned if he should pay taxes to the Roman government, "Render unto Caesar the things which are Caesar's and unto God the things that are God's."
Our attitudes towards taxes, our attitudes toward government, money, spending, saving, etc. will change when we "render unto God the things that are God's."