![\"\"](\"http:\/\/www.minnesotamajority.org\/Portals\/0\/images\/shakedown.jpg\" "\\"Shakedown\\"")
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New York State, in an obvious attempt to see just how much it can piss off its taxpayers, has sent an extraordinary notice to all its citizens.\u00a0 It warns them that not only will their tax rates be raised in 2009, but they will have to recalculate their 2008 taxes now<\/em> based on the new 2009 tax rates in order to comply with the new law.\u00a0 I know you think you just misread that last statement, so read it again, and rest assured that it is correct.<\/p>\n Here’s how it works.\u00a0 Most income taxes need to be paid each quarter on an estimated basis; the state doesn’t want to wait until the end of the tax year to collect its loot.\u00a0 The typical rule for estimated taxes is the lower of either (a) 90% of your actual tax bill that you’ll eventually have to pay or (b) 100% of your last year’s actual tax bill.\u00a0 For most filers whose incomes are flat or growing, the easiest thing to do is to look at your tax bill for last year and just pay that in equal installments over the current tax year.\u00a0 Simple enough.<\/p>\n This year, New York is saying that if you wish to use the second option to pay estimated taxes, i.e., 100% of last year’s taxes paid, you need to recalculate<\/em> the amount you would have owed last year based on this year’s higher tax rates<\/em>.<\/p>\n That’s right, the lovely time you recently spent calculating your New York taxes, you need to go through that again now<\/strong> using the new tax rates so that the state can squeeze that last $100 from you without having to wait until next April.\u00a0 We really are talking about chickensh*t sums, here.\u00a0 For the 60% of people who hire accountants to do their taxes, the vast majority of them would ending paying more for this recalculation than they would owe in additional estimated payments.<\/p>\n Why would the state do such a crazy thing?\u00a0 Because the state’s politicians are desperate for those incremental dollars, and they truly don’t care if what it costs you to pay them the lawful amount.<\/p>\n Most debates on tax policy center on the elasticity of supply, i.e., the degree to which an increase in taxes will reduce the willingness of the person being taxed to continue engaging in the taxed behavior.\u00a0 For example, if raising the sales tax causes people to buy less such that the actual tax raised is minimal, and businesses will otherwise suffer from the reduced sales, most policy makers would say that’s not an efficient tax.\u00a0 In New York State, we now have proof positive that if a business has to pay someone doing no productive work $10,000 in order to get the state an extra $8,000, the politicians feel they are ahead.\u00a0 Such abuse of New York State taxpayers is why we are seeing more of this<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":" New York State, in an obvious attempt to see just how much it can piss off its taxpayers, has sent an extraordinary notice to all its citizens.\u00a0 It warns them that not only will their tax rates be raised in 2009, but they will have to recalculate their 2008 taxes now based on the new […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12,23],"tags":[],"class_list":["post-1340","post","type-post","status-publish","format-standard","hentry","category-revealed-preference","category-stupid-laws"],"_links":{"self":[{"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/posts\/1340","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/comments?post=1340"}],"version-history":[{"count":8,"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/posts\/1340\/revisions"}],"predecessor-version":[{"id":1348,"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/posts\/1340\/revisions\/1348"}],"wp:attachment":[{"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/media?parent=1340"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/categories?post=1340"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/tags?post=1340"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}