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Carnival of Personal Finance #242 – Fun Tax Facts

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Welcome to the 242nd edition of the Carnival of Personal Finance. There were well over 80 entries this week, and I’ve pared it down to the best articles in each category. For those of you who haven’t yet been exposed to blog carnivals, they are a collection of recent blog articles on a similar topic, in this case, personal finance. The entries are limited to one per blog, and they must meet certain guidelines to be eligible, including being a recent article, topic, etc.

Because it’s tax season, I also added some fun tax facts after each category. I thought some of the fun tax facts were amazing, and others a testament to our bloated system. But like it or not, taxes are here to stay! I hope you enjoy these fast tax facts!

Editor’s Choice Selections

These were my personal favorites from this week’s entries. They are well written and get a point across that either reached me on a personal level, or was so well executed that it deserved a special mention. I hope you enjoy these, and the rest of this week’s entries.

Joe Plemon from Personal Finance By The Book shared his article, Unemployed? Are You Rocking or Are You Rolling?. Joe’s article is an encouragement to those who are currently unemployed, and offers tips to spur you to action. I left a long comment on this post because it spoke to me. I’ve been unemployed and it’s tough. But through hard work and dedication, I am much better off than I was before I was unemployed. I hope you will end up in the same situation if you ever face unemployment.

Mike from Personal Finance Ninja shard an awesome in-depth article titled, Everything You Ever Wanted to Know About Your Credit Score. The article includes graphics and information about your credit score, why it matters, how it id determined, and how to increase it.

EM from The Everyday Minimalist presents Confusing frugality with minimalism. I like this article a lot as it delves into the personal side of money and life… getting by with what you need, avoiding excess, and using what you have to maximum effect. Great article.

Pop from Pop Economics presents Paralysis and other effects of distrust. This article covers the psychological side of investing, dealing with up and down markets, chasing returns, and letting the media and other factors influence your decisions, and more importantly, your actions.

Fun tax fact: As of 2000, the Internal Revenue Code, not including the regulations, ran to 1.4 million words (according to the Joint Committee on Taxation), making it six times longer than War and Peace and nearly twice as long as the King James Bible or the complete works of Shakespeare.

Money Management

Fun tax fact: The related income tax regulations ran to another 8 million words spanning over 20,000 pages in six volumes. Together the Internal Revenue Code and the regulations are at least ten times longer than the King James Bible.

Investing

  • Austin from Foreigner’s Finances presents The 5 Minute Guide to Roth IRAs (Video). this is a short video guide explaining how Roth IRAs work. It’s a great primer for anyone who wants to learn how to open a Roth IRA.
  • Mike Piper from The Oblivious Investor presents Financial Advice: Hourly Fees, Asset-Based Fees, or Annual Fee?. Essential reading before hiring a financial advisor.
  • Darwin from Darwin’s Finance presents Short Leveraged ETF Pairs Strategy – Simply Incredible. Darwin outlines an Inverse Leveraged Short ETF Strategy designed to short opposing leveraged ETFs and ultimately make profits. Click through for more information about his process.
  • D4L from Dividends Value presents 10 Stocks With 100+ Years of Dividend Payments. Great resource if you are looking for companies with a positive dividend culture.
  • 2 Cents from Balance Junkie presents RRSPs: What Should You Put in Them?. This article covers investment options for RRSPs, which are similar to a Canadian version of 401k plans. Although RRSPs are a Canadian investment option, readers in the US and other locations may find value here because many of the investing, retirement, and tax planning options outlined in this article are general in nature and can apply to other situations.
  • Tom @ Canadian Finance Blog from Canadian Finance Blog presents How Much Do You Need To Retire? The 10% Rule.  The 10% rule simply states that you should save 10% of your gross income. Is this a good rule of thumb for retirement planning?
  • Helen from Science and Money presents The ABC’s of IRA inheritance for LGBT’s, and says, “LGBT couples are treated differently than heterosexual marriages when it comes to inheriting IRA’s. Here’s how to avoid having disapproving Aunt Sally end up with your dough. “
  • Silicon Valley Blogger from The Digerati Life presents How To Buy Stocks At The Prices You Want.
  • Mr. GoTo from Go To Retirement presents Forecasting Retirement Income Success, and says, “Investing towards a long term goal is important. When that goal is retirement, forecasting your retirement income is the proper test.”
  • Simon Zhen from Realm of Prosperity presents 5 Signs You Are Addicted to Investing.
  • Sun from The Sun’s Financial Diary presents Why Direct Stock Purchase Plan Still Makes Sense.
  • Dividend Growth Investor writes about how Dividend growth stocks are attractive buyout targets, and says, “The problem with many dividend stocks is that they could be attractive buyout targets by larger rivals or by companies which are looking to diversify into a new line of business. Shareholders usually receive a big premium which ensures that almost everyone makes a profit in the process. This doesn’t take into consideration the fact that a growing company might deliver much higher total returns if it stayed independent.”

Fun tax fact: In 1940, the instructions to the Form 1040 were 2 pages long. For the 2004 tax year, the instruction booklet alone was 79 pages long. The instruction to the supposedly simple Form 1040EZ for 2004 was 36 pages long.

Saving

Fun tax fact: As of 2000, the Internal Revenue Code, not including the regulations, ran to 1.4 million words (according to the Joint Committee on Taxation), making it six times longer than War and Peace and nearly twice as long as the King James Bible or the complete works of Shakespeare.

Frugality

Fun tax fact: Over 60% of Americans use a paid preparer to compute their taxes (compared to 47% in 1986).

Debt

Fun tax fact: Compliance costs associated with the income tax are conservatively estimated to be approximately $140 billion per year. This cost is roughly the same as giving $1,000 to every family in America, or the amount of money needed to fund the Department of Homeland Security, the State Department, NASA, HUD, the EPA, the Department of Transportation, the United States Congress, our Federal courts, and all foreign aid..

Credit

  • David from Credit Card Offers IQ presents How to Cancel a Credit Card, and says, “There may be a variety of reasons you have for wanting to cancel you credit card. You simply want to stop going into more credit card debt, and canceling your card would help you accomplish that goal. Perhaps you have a card you simply no longer use, or one that charges an annual fee you no longer want to pay.”
  • kyle from Amateur Asset Allocator presents 5 New Rules Of Credit Cards, and says, “The post-recession rules for using credit cards responsibly.”

Fun tax fact: There are 15 common tax benefits available to families – including provisions that relate to children, education and retirement savings – that provide 14 different phase-out provisions to reduce benefits above specified income levels that, in turn, contain 9 different definitions of income.

Real Estate

  • vh from Funny about Money presents Should You Pay Off Your Mortgage?. Paying your mortgage off early has no clear answer. vh covers this topic based on our current economic environment. With mortgage rates low and stock market returns recovering, she changes her mind on this endlessly debated topic.
  • Craig Ford from Money Help For Christians presents 10 Tips For Knowing When To Refinance A Mortgage. A refinance can be a good move as long as a person has the right guidelines in place.
  • J.D. Roth from Get Rich Slowly presents Does Renting Make Sense?, and says, “We’re not about to move, but you know what? If I had it to do again, I’d never buy this house. If we had stayed where we were, we’d now have just four years left on our mortgage. But knowing what I know now, I might even be inclined to rent. For most folks, renting isn’t a bad option.”

Fun tax fact: In 2003, the IRS received 89 million calls and had almost 9 million walk-in visits from individuals looking for assistance in completing their returns and understanding the tax code.

Taxes

  • FFB from Free From Broke presents The Government Thanks You For Your Taxes. The government loves that you overpay your taxes and give them a free loan, but is it right for you?
  • Jason from One Money Design presents Flexible Spending Account (FSA) Planning: The Grace Period and Run-Out Date. Jason covers great information about FSAs, and mentions that it’s important to plan properly when using a Flexible Spending Account (FSA) as well as understand if your employer provides an annual grace period with a run-out date.
  • Wealth Pilgrim from Wealth Pilgrim presents Roth IRA Conversions Can Wreck Your Tax Credit for Homebuyers. Roth IRA conversions are a hot topic right now. The Pilgrim points out a fact that many people may not have considered: Roth IRA conversions (done incorrectly) can ruin your chance of getting your homebuyer’s tax credit. Here are some tactics to make sure you don’t blow it.

Fun tax fact: More than one in three households (approximately 40%) does not pay federal income tax, compared to 1 in 5 in 1986.

Career

The IRS estimated that there were 1.2 million paid tax preparers in the United States in 1999. That amounts to more than twice the number of police officers in the United States and more than four times the number of firefighters. (The United States had 282,000 firefighters and 625,000 police officers as of 2002).

Other

Source: Fun tax facts from President’s Advisory Panel on Federal Tax Reform, a now defunct federal advisory board charged with generating recommendations for reforming the tax system.


Published or updated November 15, 2011.
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{ 17 comments… read them below or add one }

1 Funny about Money

LOL!!! I started to laugh merrily at this until I realized the timbre of the laughter was like something out of a demented Edgar Allan Poe story (Who, me? Mad as a loon?). Thanks for this original and hilarious (i think) theme! Thanks for including my latest mortgage rumination, too.

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2 Kyle C.

Thanks for hosting, great job with the facts!

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3 Four Pillars

Thanks for hosting. The tax facts were quite interesting.

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4 FFB

Oh man, I’m think I’m getting dizzy thinking about how many pages of tax code there is!

Tanks for hosting this week!

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5 Mike

Ryan-

Love the Fun Tax Facts.
I linked back to you on the Credit Score article. I’m glad you liked it – ninjas and all. Haha.

Thanks for hosting this week.

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6 Taking Charge

Great job on the carnival.
Thanks for including us in the roundup. Here’s our link back to you: http://blogs.creditcards.com/2010/02/charity-rewards-blog-carnival-of-personal-finance.php.
Connie

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7 Revanche

Thanks for hosting, Ryan!

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8 FB @ FabulouslyBroke.com

Thanks for featuring my Everyday Minimalist post as an Editor’s pick, and including my Haggling post from FB :D

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9 Len Penzo

Well done, Ryan!

Here’s another fun tax fact: Golf is a lot like taxes – You drive hard to get to the green only to eventually wind up in the hole. ;-)

Best,

Len
Len Penzo dot Com

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10 2 Cents @ Balance Junkie

Thanks for hosting! This is a great round-up.

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11 LeanLifeCoach

Ryan – Excellent job on the theme – Here is one more for you…

I’ve heard… the IRS employee manual has instructions for collecting taxes after a nuclear war!

Yet the fed didn’t know how to handle a little ole financial collapse? Go figure!

Thanks for including my post!

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12 Single Guy Money

Thanks for including my post in the roundup.

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13 Austin

Hey –

Thanks a ton for hosting. This must have taken a ton of time and the effort is much appreciated.

-Austin @ Foreigner’s Finances

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14 J. Money

I’m a hustla baby, I’ma I’ma hustla baby! (good work hosting)

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15 Cathy @ Chief Family Officer

Thanks so much for hosting, Ryan!

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16 pkamp3

Epic tax post; thanks for that! Also, thanks for the carnival hosting!

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17 Nicole @ RainyDaySaver

A little late to the party — thanks for hosting and for including my submission.

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