Is Deferring Taxes a Sound Financial Decision?

This is from

This is a summary of the federal budget analysis and how they receive their income taxes and the money that the government takes in.

The top line is income they have received from income taxes.

In fiscal year 2011 they took in 1.154 .5 trillion dollars in income taxes. Their 5 year projection was to go from 1.15 trillion dollars to 2.25 trillion dollars in 5 years. That’s a 100% increase in income tax revenues that the government is planning on taking in.

A simple question to ask yourself is this, Mr & Mrs. Citizen, “Do you still think it is a good idea to defer taxes to a later date, understanding what the goals of the government are?”

If you go there and pull up the most recent one you see that from today to 2025 it doubles again.

Also, look at the bottom line. It is very intriguing also, the public debt was 15 trillion in the fiscal year 2011 and they are projecting it to go to almost 21 trillion in the same time that they are taking in 100% more revenue from income taxes.

Are we solving the problem or are we feeding the problem?

Next question, how can anyone make a financial recommendation or make a financial decision without this sort of information?

If you think our taxes could never go too high look at the history of our taxes from the beginning of the Federal Reserve in 1913

1940’s – Oh, but the government was so great because they increased the top tax bracket on the wealthy. Really? They forgot to tell everyone who earns between 5 mill. and 200 thou. that they are now considered the wealthy also. Could the govt. change their mind again? Of course. When they need more, they just throw out a bigger net.

1. What was the top income tax bracket in 1941?


2. What was the top income tax bracket in 1942?


3. What was the thresh­old in 1941?


4. What was the thresh­old in 1942?


And in the 1980’s??

Oh, the government is so great they lowered the top tax bracket on the wealthy.

1. What was the top income tax bracket in 1986?


2. What was the thresh­old in 1986?


3. What did they lower the tax brack­ets to in 1987?


4. What was the thresh­old in 1987?


You see, no one advertisers the change in the threshold.

We live in a world dominated by Keynesian economics. Since 1936 when John Maynard Keynes wrote his famous book, The General Theory of Employment, Interest and Money, most of our universities here in the United States, from Harvard to the smallest community college, have become vested in this way of thinking.
Consequently, our nation’s government now fully endorses and mandates this way of governing our monetary system.

Since the 2008 financial crisis, an older and much more classical school of economic thinking has reemerged and is growing in prominence.
Originating as early as the 1500s in Salamanca, Spain, this branch of knowledge was best articulated in book form by Austrian Carl Menger in his 1871 classic, Principles of Economics. This discipline of study has come to be known as Austrian Economics.

Two of Menger’s star disciples, Ludwig von Mises and Friedrich A. Hayek (who won the Nobel Prize in 1974) developed the now famous Mises–Hayek Business Cycle Theory, which best explains the causes and effects of economic booms and busts in an economy. While Wall Street, the media and Washington D.C. had no idea what happened during the financial collapse in 2008, many of the Austrians had predicted it all along.

The Austrian School is universal, but when Mises migrated to the U.S. in 1940, the United States became the school’s home base. Today, there are many American-born Austrian economists and students of this discipline, with some of the more famous being Leonard Read, Henry Hazlitt, Murray. Rothbard, Israel Kirzner, and more recently, Republican presidential candidate, Ron Paul.

While Keynesian economics endorses government central planning, the Federal Reserve’s control of money and banking, deficit spending and opposition to savings as the way to solve economic problems, the Austrian School advocates the direct opposite.
Espousing frugality and savings as the fuel for capital investments, Austrian economists and students of the school preach the sanctity of private property, a market economy free from government intervention, sound money, and the return of money and banking to the private sector.

There is no use in deceiving ourselves. Both national parties and American public opinion currently reject the capitalistic free enterprise system that provided us the highest standard of living ever attained. Is there any hope of reversing this thinking?
Actually, the solution is in our hands. Mises once said that what made Americans different was “the joint effect produced by the thoughts and actions of innumerable uncommon Americans.” He was talking about us. So, yes, there is hope—and this explains our motto of Building the 10 Percent.

Yours truly,
Carlos Lara and Bob Murphy

There is a phenomenal and highly misunderstood place to grow money for your passive income years. It was designed and has been around since way before the current IRS tax code came into existence in 1913. It has paid tax advantaged dividends every year through the great depression and every recession since then. It was not designed by the government but by free men who came together to resolve a common financial problem. It is a group of like-minded people contracting with one another and in so doing solve for their own financing, banking and life insurance needs within the one system. The benefits far out-way any other financial product or financial strategy if you know how to design and use it.

Your cash actually grows tax deferred BUT you can access the money, at any time, tax free, unlike Qualified Plans. It is NOT anything like a 401k govt. sponsored plan. Read my disclaimer here.

July 23, 2013 · Jennifer · No Comments
Tags: , , ,  · Posted in: Deferring Taxes, Uncategorized

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