31–40 of 301 posts
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Which works the opposite way as well: people not setting aside enough, which would probably happen if it was not pre-deducted. Just ask then-musician / now-actor Will Smith:
* https://www.youtube.com/watch?v=y_WoOYybCro
* https://www.youtube.com/watch?v=6qCZfS_I-zM
* https://www.thethings.com/will-smith-28-million-irs-tax-debt...
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Being someone who has some experience with tax law, the cycle of tax complexity goes like this: 1. Tax law is passed. 2. Really smart CPAs and Tax Lawyers figure out ways to legally avoid paying taxes. 3. Tax people issue regulations intended to close those loopholes. 4. Administrations change and they want to win votes and tweak the economy so they lower some taxes and add tax breaks. 5. New administration comes in…
For example, for decades Canada has had a "personal amount" tax credit -- for arcane reasons, rather than saying "the first $X of income isn't taxed", the lowest tax bracket starts at $0 but there's a non-refundable credit equal to the lowest tax rate times $X. Then a politician came along and said "we should increase the personal amount so that people can earn more money without paying taxes... but we don't want to decrease taxes on the top 1%". So now we have a "personal amount" which depends on your income. Similarly, in BC we have the "BC Tax Reduction" which is an extra tax credit given to people with incomes between (roughly) $22k and $36k.
Both of those examples could have simply been implemented as tax brackets but voters get far more excited about a "Tax Reduction" than they do about a new tax bracket.
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Im in the same boat - would you mind explaining to us every other Friday folk why the employer match isn’t free money?
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A 401(k) match _is_ free money though. When you leave the company, you can just cash out the account - the penalty will still probably be less than the match gave you, so you come out ahead. Of course, it's best to just let it sit in retirement accounts until you can take a qualified distribution.
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Last century, but yes :)
Earlier quoted context omitted.
To be fair, Nova Scotia, Yukon, and Ontario each only add a handful of extra nodes. I just didn't want to bother with those because I'm in BC. Quebec is a different matter; far more complicated to calculate payroll deductions for there.
And if the crazy proposal from the UCP in Alberta to divorce from the CPP and have their own pension system (like Quebec) is successful, it will get even crazier. Imagine the complications of moving back and forth between provinces. Or seasonal work, etc.
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Are there any countries with good, reasonable tax systems? I'm only familiar with Canada and the USA, both of which are a bit of a mess, though seemingly in different ways. I'd be very interested in hearing what the process is like in other places.