Monday, April 13, 2009

Tax Freedom Day is Finally Here

Tax Freedom Day for 2009 has finally arrived!

Congratulations! You are no longer a slave... at least not until next year.

As of 10:19PM April 13, you are no longer a slave. You are no longer working for the government. You are free to earn your own money... at least until next year.

Tax Freedom Day is the day on which the average US taxpayer has worked long enough to pay all of his taxes for the year. In actuality, Tax Freedom Day for each state is different and even different people, depending upon how their finances are structured, have different Tax Freedom Days.

In fact, when you consider that that 1.4 million taxpayers pay 40% of all income tax and a similarly large share of other taxes, you might think that Tax Freedom Day is heavily skewed toward the rich and therefore pushed later in the year than it would be for the average middle class American. But, nothing could be further from the truth.

That's partially because, while the richest taxpayers (1.4 million taxpayers) do pay 40% of US taxes, those same rich taxpayers earn 22% of US income. So, it isn't as bad as it first sounds. Then add into the mix, the fact that about 120 million US adults pay no US income tax, whatsoever and not enough other taxes to be significant, and an entirely different picture begins to take shape. You see, it turns out that the 120 million who pay no tax pretty much offsets the 1.4 million, who pay more than their share.

In the end, it all boils down to the fact that Tax Freedom Day probably does come pretty close to representing the average middle class American's tax bite. In other words, most middle class American taxpayers work more than a quarter of the year, for which they effectively do not get paid. Or to put it a little more bluntly, for more than a quarter of each year, you are a slave.

Well, what else can you call it? Like slaves of earlier times, neither do you have a choice, nor do you get paid. The only difference is that the new slave-masters don't take the benefit of ALL of your labors --- yet.

But the question that you should be asking yourself is, "Are the services that I receive from the government worth more than a quarter of my labor and couldn't private business supply most of those services to me at a higher quality and lower cost?" Think about it...

Watch the Tax Freedom Day Clock, as it tracks the time that the government has allowed you to keep the fruits of your labor - at least till the beginning of next year. It will automatically reset each January, to start displaying the time that you must work, before the government once again grants you temporary freedom. also provides a freeware Tax Freedom Clock widget, for the Macintosh Dashboard.

Both Tax Freedom Day Clocks will be automatically updated, each year, to use the new date for that year, immediately after the Tax Foundation calculates and announces the new date.