Is Paying Taxes A Form of Charity? Many Say Yes It Is

Sleepy Old Man

I just got done with two things: 1) Writing a check for another $1,000 more in taxes to the Federal Government for 2011, and 2) Re-reading the article, “The Average Percent Of Income Donated To Charity Can Improve“.  Hopefully all of you are on pace to finish doing your taxes before the April 17th deadline.

Forget about filing an extension and putting off paying your taxes.  Do it now!

Several things I’ve learned from doing my taxes:

* I paid almost as much in taxes as I’ve saved.  In fact, most of my friends, and probably most of you have paid MORE in taxes than what you’ve saved, since most people don’t save more than 20% of their gross income, let alone 55% of their after-tax income.  Go ahead, make the calculation and start vomiting.

* The amount of total taxes I paid in 2011 could buy a nice 4 bedroom McMansion in the MidWest or a Lamborghini Gallardo.  With the money left over from the Lambo, I could pay for five friends to go to Vegas for a week.  We’d stay in suites at the Aria Hotel and reserve a private booth each night at Tao with an endless flow of Crystal, Ron Zacapa, and Goose.  And here I am, a total fool trying to keep my credit card spending below $1,500 a month so I can save more for retirement and build more financial security.  I might as well live it up since the government is living it up with my money!

* I seriously do not feel I have derived even 1/5th the return from the government for what I’ve paid in taxes.  There are potholes and broken signs everywhere in San Francisco.  Meanwhile, when I call the city to fix anything, they don’t, or take months to get around to it.  I recently spent $50 on green paint so I can paint over the occasional graffiti on the government owned mailboxes myself!  If I did receive just 20% of value for my taxes in return, I think I would feel better about paying taxes, but I don’t.

* Despite paying so much in taxes, the Federal Government wants to raise my taxes even more even though apparently half the nation pays no net federal income taxes.  Furthermore, why are there still homeless and jobless veterans in America?  These are the very men and women who risk their lives to serve our country, and the Government can’t even ensure they have food, comfortable living standards, and a job when they are waiting back home?  Are you shitting me?  This is an absolute FAILURE by our leaders in Washington not to take care of our troops.

* On the State level, California is close to bankrupt given politicians have spent way more of our funds than the State has taken in.  The State is now firing some of our most important people: teachers, police officers, and firemen!  So let me get this straight, the State is going to fire people who make $50,000 a year who add tremendous value to our society because politicians in Sacramento were extremely careless with their spending all these years?  This is total bullshit!  If I am to pay this much in taxes, I want more public service people, and I no longer want to hear rhetoric about how people making more than X are bad!

* Taxes are painful and really do make me want to stop working.  In fact, there’s a part of me that wants to give everything up and go on unemployment for a year or two so I can recharge my batteries and finally get something back from the government.  Perhaps I’m just burning out.  Regardless, this is how I feel and I’m not denying it.

* I truly am thankful for the money I make.  It’s just that the thankfulness is diluted due to how broken and inefficient our political system is.  If I knew all my taxes went to help a family of 5 who lost their home to a flood and set them up for the entire year, I would be ALL FOR IT!  But, I know that only a small fraction of my taxes will go to directly helping others.


Given I don’t feel I derive even a 5th of the benefits from the taxes that I pay, I’m wondering who gets my other 80%+?

If the government uses our tax dollars to fund public services to those who need it most, isn’t paying taxes a form of charity?  From the “Average Income Donated To Charity” article, we discover that there is a percentage drop off in donations once one’s income hits $75,000-$100,000.  After $100,000, the percentage of income donated to charity climbs back up again presumably due to more disposable income.

The theory for the drop off in donations is that as one starts to make more money, one sees a ballooning tax bill that increases faster than the rate of their income increase.  Once people realize they are paying more in taxes than they are saving, they get upset and start cutting back on charitable donations.  Since the government is taxing their incomes at a higher percentage, the logical conclusion is that their tax proceeds should be used to assist the poor and most needy.  Otherwise, what on earth is the government doing with our money?


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