Tuesday, May 20, 2008

Stumped

For the past few months, I have been walking the kids to school. Well, sort of. Their schools are located in a neighborhood ten miles from ours, so usually what I do is drive to the neighborhood, park my car along a popular walk route, and meet up with other families in the neighborhood.  This arrangement has been working out great for us because I squeeze in some morning exercise and the kids and I get to be sociable with people who will be our neighbors this time next year.  We also get to know the parents and their kiddos.  

Some of the parents are real jerks with whom Madhubby and I definitely do not want to be friends.  Other couples are strange conundrums and challenge my people watching skills.  But there is one couple we really like and, thankfully, our kids get along great.  We plan to have lots of play dates and barbecues with them once we move.  We'll call them the Millers.  

Last week, Dave, the husband, asked me in the kindest, most non-threatening way: What kind of tax structure do you support? I mumbled something coherent but I'm pretty sure I sounded like an idiot (this is what I get for announcing that I'm a Republican). Dave promptly pronounced me "politically confused" and "somewhere between an Anarchist and a Libertarian."  I immediately declared myself apolitical because obviously his political knowledge dwarfs mine.  I think he's written the whole conversation off, but now I'm determined to learn everything there is to know about U.S. tax structure so that next time Dave and I have that conversation I don't sound like flippin' idiot.    

I told Madhubby I've got to kick it up a notch because these are no ordinary parents.  He thinks learning the tax system is not worth it and that I should just avoid talking politics or taxation with Dave. Avoiding politics with Dave cannot be done so I may as well just suck it up and sharpen my game.  So far: the capital gains tax rate benefits people whose income is derived from investments.  But, AMT? I have no friggin' clue.  I think it's bad if you're wealthy (like the Millers) but doesn't even apply if you're middle class (like us), but I don't really know. Obviously, I've got more sharpening to do before I take on Dave again.  

1 comment:

Catherine said...

I'm not afraid of AMT and I've heard some people say it's a cut worth taking to help others, but hardly "fair" on the other hand plenty of nonprofits have taken tax dollars and justified the use of money for things that are not benefiting the cause. For the average HINRY - (High Income Not Rich Yet) this means one less vacation a year. We're talking a tax bracket of $250K to $750 to be considered a HINRY.

West coasters are going to hit this faster than anywhere else. They will expecially with two high earners, but really, less than 4% of families are HINRYs and it's hard to feel sorry for them. We will be.

There are many tax shelters that can be used to offset produced income as well...IRAs, Trusts, Educational Funds, and more. Then there is also charitable giving. It can be a tax that forces savings or clearly directed giving rather than future borrowing for things that could otherwise be planned for now.

The best way to find out what Dave thinks is to say, "I'm not sure - What do you think?" Most people want to talk about themselves anyway and being who you are, you're more likely to formulate an opinion or argument based on what he tells you regardless of whether or not you tell him.

You can keep conversations going without ever answering a question, just by asking questions...