"That is why more and more seniors are answering the call for additional taxes on the 15th of Damocles by saying two words to Minnesota - 'Bye-bye....'"
When I was growing up, both my sister and I left home at age 19. Not that we did not love our home and our parents - we did indeed. But it was time. My sister got married and moved to South Bend with a man who was studying to be a pastor. I went in the Navy.
When I got out of the active Navy in 1973, my Father told me something interesting. He said he made the last payment on the house when I was gone, and the combination of that and losing his two kids as deductions were a killer on his income taxes. I really did not understand much back then, so I just nodded and listened politely. Boy oh boy - was my Dad ever right.
My Dad would have really squawked about his taxes if Social Security was taxed back then as it is now. 85% of it taxed on federal and 100% of it taxed on state. It really does make seniors totally vulnerable. For example, my wife and I not only claim "zero" on our W-4's for our retirement accounts, we also have additional money withheld. We also give as generously as we can to our church as well as many different charities. Even with that, we have very little tax sheltering, and get hammered every April 15th.
It is for that reason, I would like the month of April to be renamed Damocles. Then on the 15th of that newly named month, we could picture the sword of Damocles, hanging over our heads by a single hair. Sound dramatic? Sorry. But here is the story in a nutshell. In our working days, like most working couples, my wife and I paid in a boatload of taxes. And we tried to do everything right. Had IRA accounts, a 401k account and a 403b account. Ends up the path we took might not have been the correct one.
Last year I read an article about how seniors get fleeced on taxes. And it specifically pointed out deferred income accounts. How they are not such a good deal for seniors after all. Why? They are not tax free, only tax deferred. Then when you are retired and start to draw on them, you do not have the tax protection like when you were younger. Bottom line - on every 15th of Damocles, get your pen and checkbook out. Living in Minnesota, it hurts bad.
Sorry for the griping this fine morning. It is my annual rant once I finish our taxes. Could the Minnesota legislature help? Sure they could. And this year they have a tepid fix in the tax bill (of which I am sure Dayton will veto). The thing I have heard over and over and over again from some in St. Paul is "Gosh, we would like to eliminate the tax on Social Security, but we don't know if we can afford it." Really?
Maybe the State of Minnesota does think it can't afford to not tax the socks off of seniors. Well guess what Minnesota - the seniors in this state cannot afford having their socks taxed off by a state, mired knee deep in largess.
That is why more and more seniors are answering the call for additional taxes on the 15th of Damocles by saying two words to Minnesota - "Bye-bye...."