I like to think of November as “Gratitude Month.”
It is kind of a short leap of logic, with a holiday called Thanksgiving located conveniently before the most insane shopping day of the year before the month ends.
Have you ever heard that phrase, “What we think about and thank about, we bring about?”
I really believe this is true.
Gratitude for what we already have, and yes, what we are about to have, tends to lubricate its passage into our personal world.
I think most people reading this get that.
But hey…isn’t being grateful for taxes kind of stretch?
It’s just the government exercising their appointed right to put their greasy mitts into our pockets.
Stick with me a moment. Here’s why:
When I started teaching myself to do my own taxes many years ago the object of the game was simple.
To pay nothing, or as little as humanly possible.
When I was living off the generosity of various people and doing the whole starving musician bit it wasn’t terribly hard, really.
In those spurts of effort where I had some kind of work, of course, the job would just do withholding, and there was nothing to think about.
I found, though, that as my fortunes rose later in life one thing became clear:
I’m not only going to have to actually pay tax, but I really need to do it, on my own, without anybody reminding me, MORE than once a year.
Blecch. What a revolting predicament.
Then a simple truth entered my consciousness. I’m sure it was at least partly because of something I read somewhere.
It was some paraphrase of the idea that you WANT to have higher taxes, because as day follows the dawn that means quite logically that you’re doing better.
Who in their right mind doesn’t want to be doing better?
I know I do! I work hard for it, in my most humble opinion.
And…I am abundantly grateful for what we’ve accomplished so far.
For what I get to keep. What I get to donate to help others.
Yes indeed, ladies and gentlemen, even for the taxes that I pay.
I know that the income tax in this country, and most others, is progressive.
That means those with the greater ability to pay, pay more.
If you’re in a position of paying more taxes that simply means you’re creating more taxable income.
Now of course, I do NOT pay a penny more than I have to.
I know every single legitimate write-off of my own business and those of my clients.
I’d venture to say many if not most of them for everybody else, also.
This is kind of my thing. I don’t just pencil-whip a tax return and bill a fee.
In fact, if you are working with me you know I don’t even do tax returns anymore unless I’m working for you all year, anyway.
My explanation of how that works is that this invests my firm in getting you the best possible result not only during tax season, but the entire year.
Here’s a simple example: suppose you know you’re going to owe $40,000 in federal income taxes for tax year 2021.
Does that sound like a lot? I have people paying far more than this, because they’re doing that well on the income side, but I like round numbers for illustration purposes.
You know your owing this, so you quite properly have already paid $10,000 on April 15th, June 15th, and September 15th.
You’ll take a distribution or a draw out of your business for the January 18th deadline, and make that payment timely as well.
Gratefully, I hope, because that’s a clear indication you’re banking some decent revenue.
In fact, even at the 18% effective tax rate that’s over $220,000 a year. Well done!
Now guess what happens when you file at April?
More importantly, what DOESN’T happen?
Stress, anxiety, and the inevitable safe-hanging-over-you-by-a-thin-thread feeling of having to wipe out one or more accounts to pay your taxes.
Or even worse, having to do an installment agreement, and pay even more in monthly compounding interest.
This Sunday, the first Sunday of November, I declare to the public at large that I am grateful to pay my taxes, and to never be behind on them.
I know people that do not share this warm fuzzy feeling, and I empathize.
It’s kind of like having your house completely cleaned up, sitting back in your most comfortable chair with a delicious cup of coffee, and feeling perfect contentment.
Be grateful today. In fact, if you’re lucky enough to share your life with someone go give him or her a random impulse hug, right now.
When they ask why, say, “Just because.”
It’s a good life. Thank you so much for spending a few minutes of it with me, and have an amazing day!