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Did you ever stop to think that there was a reason why people started having it deducted from their pay?
The last time I checked, people in this country were horrible at managing their own personal finances.
You do not have a legal choice for federal taxes. You cannot choose to not have taxes withheld.
The reason they are withheld is that it serves the government's interest - to collect taxes from you as invisibly as possible.
If people took home $1000 per week, then wrote checks back to the government for 30-40%, they would get pissed off in a hurry. Congress wouldn't like it.
Before 1943, there was no withholding; people just paid their annual taxes every March 15. But President Franklin Roosevelt and Congress dramatically increased tax rates in 1942, months after America entered World War II, and the new rates hit tens of millions of Americans who had never before paid federal income taxes. That, Amity Shlaes writes, is when the "class tax" became a "mass tax."
There was one little problem. A Gallup poll showed that only 5 million of the 34 million people subject to the tax were saving to make their annual payment in March 1943. As March 15 approached, Treasury Secretary Henry Morgenthau fretted, "Suppose we have to go out and arrest five million people?"
Enter Beardsley Ruml, chairman of the Federal Reserve Bank of New York and an adviser to the president. While treasurer at Macy's, Ruml had noticed that customers didn't like big bills, preferring to pay in installments. So he proposed that employers deduct estimated taxes from workers' paychecks. The government accepted his proposal and added a sweetener: Taxpayers were granted amnesty on 75 percent of the lower of their 1942 and 1943 liabilities. So was born withholding, "the most ambitious bait-and-switch plan in America's history."
Actually, you can complete IRS Form W-2 in such a way as to have ZERO federal income tax withheld from your pay check. I'm not suggesting it's a good idea. I'm just correcting you.
If ya writing one every April then your also paying a penalty for not filing quaterlys.
Actually, if your underpayment is within 10% of the amount due then there is no penalty. In other words, it IS possible to avoid paying quarterly estimates and NOT pay a penalty.
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