I'm sure paying taxes or filing a return has been on everyone's mind lately. With less than 3 weeks left to go until tax day, here are some fun tax facts to lighten the mood and get you through the process.
- Do you think our tax system is too complicated? Well perhaps it is, the tax code is nearly 74,000 pages long. Isn't Form 1040 supposed to be one of the simpler tax forms? The instructions for this form alone are over 100 pages long.
- Identity theft has become a huge problem for the IRS. The most misused SSN of all time was 078-05-1120. In 1938, a retail company used a fake "Social Security" card to display in wallets it sold. The SSN belonged to the manufacturer's secretary, Hilda Whitcher, and over 40,000 people have used Hilda's number on their taxes.
- Are you a fan of the IRS? Some members of Congress are fed up with the IRS over recent scandals and have cut the agency's budget by $1.2 billion since 2010. Senator Ted Cruz, a 2016 presidential candidate, has even proposed to abolish the IRS. I wonder if Congress knows that the agency collected about $214 for every dollar it spent in 2012. Maybe these guys should start running the country! I'm kidding.
- Surely our government employees pay their taxes, right? As of September 2014, 3.12 percent of federal workers were delinquent on their taxes.
- In FY 2014, the IRS processed nearly 240 million tax returns and collected $3.1 trillion in taxes.
- Are you excited to get a tax refund? In FY 2014, the IRS issued 116 million refunds to individuals, amounting to over $330 billion. Tax refunds may sound great, but it's really like an interest free loan to the government. If you're getting a large tax refund, it generally means you withheld too much from your pay or made estimated tax payments that were too large. Be careful though, if you under withhold or pay too little in estimates, the IRS will slap you with penalties.
- If you do like refunds, don't wait too long! Generally, an individual only has 3 years to collect or claim a refund from the IRS. On the flip side, the IRS has 10 years to collect taxes from you. Does that sound fair?
- IRS audits are not always a bad thing. In FY 2014, of the 1.2 million audits of individual income tax returns, more than 38,000 resulted in additional refunds to the taxpayer of over $829 million.
- If you owe back taxes, now is the time to resolve your issues. In FY 2014, taxpayers proposed 68,000 offers in compromise to settle tax liabilities for less than the full amount owed, and the IRS accepted 27,000 offers.
Okay, so maybe not all of these facts about taxes are necessarily fun, but they are certainly interesting. They may even make you more irritated about having to file and pay your taxes, but you're running out of time so hurry up and get it done! Remember, if you file an extension, it's only an extension to file not an extension to pay.