411-Responses Week 4

Instructions: Read both short responses and write a 100 word response for each.

1. Nathan1-

Many people believe, myself included, that the government wastes many of our tax dollars. Wasteful spending of our tax dollars is a fact of life and will probably continue for many generations to come. I am sure many in government have good intentions in their spending endeavors but lack the foresight or knowledge to comprehend exactly what they are investing in. Conversely, I am sure many in government are spending solely to promote their agenda regardless of the consequences and lost tax revenue. Regardless, I would remind the taxpayer it does not give anyone the right to overstate expenses or not report the entirety of his or her income. We must remember even though there is obvious wasteful spending by the government; our taxes are collected to cover the costs of providing the benefits we receive from the government. Public schools, recreational parks, roadways, welfare and so on are available because of the taxes we pay. So, even if we are blessed and do not depend on the government to provide for us, not paying taxes or underpaying is hurting others.

Additionally, I would share my experiences with the taxpayer and explain to him or her that I have been fortunate and worked in various countries all over the world. The biggest lesson that I learned from working overseas is that we are blessed to be here in the US. For example, Australia has a personal income tax rate that ranges from 19% to 45% and that does not include their Medicare tax. Also, bear in mind that property taxes, sales taxes and a whole host of other common payments are not included in that tax (Current Australian Income Tax Rates, n.d.). When one actually experiences the several-months-long wait to see a doctor, or pay’s twice the price for a gallon of gas compared to the US or witnesses 5 and 6-year-old kids working in the streets for money, many realize that the US, even with the wasteful spending, is a pretty good place to live. I could go on and on with examples of Africa, Spain, Trinidad, Brazil but the bottom line is that the US actually spends our tax dollars wisely compared to many other countries and we need to realize that we are blessed to be able to live here.

Also, I would inform him or her on the current tax laws and the consequences for not following those laws. I know it is hard for people to give away the money that they have worked hard for to others, but as the Lord has explained our taxes are supporting his servants and helping others. Philippians 4:8 (New Living Translation), “And now, dear brothers and sisters, one final thing. Fix your thoughts on what is true, and honorable, and right, and pure, and lovely, and admirable. Think about things that are excellent and worthy of praise.” When we are faced with ethical dilemmas, we need to listen to what our heart tells us and honor God’s kingdom.

Current Australian Income Tax Rates – Resident and Non-Resident. (n.d.). Retrieved from https://www.exfin.com/australian-tax-rates

Whittenburg, G & Gill, S. (2017). Income Tax Fundamentals. Boston, MA: Cengage Learning.

2. Sarah1-

The home mortgages, interest deductions, and charitable giving can change people’s behavior tremendously. The home mortgages interest can be deducted which means more people will possibly buy homes instead of renting them. The government tries to encourage people to buy homes because it increases revenue so the government allows that deduction for the home mortgages. Also, there are interest deductions as well. There is actually two kind which is education loan interest and investment interest. As for the home mortgage deduction has the purpose to raise revenue so does the interest deductions. The government also encourages people to go to school and get a higher education. So one that goes to college and the loan is over $2,500 can get a deduction as long as one does not exceed the income of $60,000 or a married couple cannot exceed the income of $125,000. If one invests in something they can also put that on the tax refund and get a deduction from this. The reason being is to try to get more people to invest in their money. One can also get deductions on a charitable event. However, one has to make sure they are using a charitable event that the IRS allowed. Or one will not get a deduction from it. Also, there are some more rules on the charitable events but one can get deductions as long as they follow those rules. The purpose of all of these is to increase revenue within the economy and it does work for the people.