The Manlius Formation

Happy Halloween, everyone! It’s been quite a week. We baked halloween cookies, Daniel and Thomas enjoyed their robot costumes, and Daniel won FIRST PLACE (in the “funniest” category) in his cub scout pack’s pumpkin contest…

We also experienced our first snow of the season (about 6 inches, which is already gone ’cause it’s 60 degrees today) and went for a hike at Green Lakes State Park.

Well, off to trick-or-treat with the boys…

First of all, a big shout out to the fam in Painted Post, NY. Thanks for the comments on earlier posts. With that out of the way, I need to make a very personal plea to my nephew, Will. He had three comments on this site:

1) He doesn’t like it
2) He was concerned that his feedback was deleted because it didn’t appear on the site immediately after he submitted it
3) He requested more photos of himself

My responses follow:

1) Will, I pledge do my best to convert you. Consider my responses to 2) and 3) as the first steps in this process.

2) You have been added as an approved comment provider so your comments should now appear instantly. Please contact customer service (Aunt Kath) if you experience any difficulty in the future.

3) Check out the random photos gallery for some photos of you and the guys. As a teaser, there’s a picture of you in Cape Cod included below. Also, check out the gallery devoted entirely to your birthday weekend a few weeks ago.

I lamented in the previous post that the following process occurs for many of our tax returns:

1) Various distributed computers report wage and interest earnings to the IRS
2) These data are then printed out and mailed to taxpayers
3) Taxpayers fill out and mail their tax forms
4) IRS employees enter this information
5) There is some data verification performed (I can say this because I’ve had my tax forms corrected in the past)

If only there existed a way to link these various computers together via some kind of “interconnecting network” such that we could access our tax information, make corrections, and submit our taxes all from a remote and affordable “personal computing station” located in our homes. You see where I’m going with this.

Obviously this gets harder as the taxes grow more complicated: deductions, capital gains, etc. So I tried to find statistics on how many filers had relatively simple taxes. I defined simple as a tax return with no more than the following common forms required: 1040, Schedule A (itemized deductions), Schedule D (capital gains and losses)

For the tax year 2006, 138,372,000 returns were filed, with the following stats on the total:

• 89.25% computer prepared (10.75% handwritten)
• 36.22% Schedule A attached
• 20.11% Schedule B attached
• 16.50% Schedule C attached
• 16.67% Schedule D attached

First of all, I was blown away by the fact that almost 90% of returns were computer-prepared! Of course, some of those were printed and became paper returns (about 44M returns), but if electronic filing were free things might look different.

Secondly, a full 83% of the returns did not report capital gains or losses, and 63% didn’t itemize deductions. Assuming that the majority of filers who reported a capital gain or loss also itemized deductions, this means that 63% of filers would be classified as having “simple” taxes. Of course, we would need to account for other common forms like Schedules B and C for a full analysis, but I don’t think it would skew the numbers too much since there is likely a lot of overlap.

So is there a candidate who supports this kind of initiative? There’s at least one:

Simplify Tax Filings for Middle Class Americans: Obama and Biden will dramatically simplify tax filings so that millions of Americans will be able to do their taxes in less than five minutes. Obama and Biden will ensure that the IRS uses the information it already gets from banks and employers to give taxpayers the option of pre-filled tax forms to verify, sign and return. Experts estimate that the Obama-Biden proposal will save Americans up to 200 million total hours of work and aggravation and up to $2 billion in tax preparer fees.

Well, it’s almost election time so I figured I’d do my research. We’re past (most of) the posturing and I figure it’s about time to read up on where Obama and McCain stand on a few key issues. The key question for me is, “Which of the candidates has the interests of the majority in mind.”

My friend, Chris, put up a few posts recently on this topic, along with some thoughts about John McCain’s proposed spending freeze (or non-freeze as the case may be).

As I was perusing the candidates’ websites, one assertion in particular caught my eye. Let’s have a closer look, shall we? I found this quote at John McCain’s website:

Allow Families To Keep Their Businesses: John McCain proposes reducing the Estate Tax rate to 15 percent and permit a generous $10 million exemption.

Being a supporter of local and small businesses, I thought this was great – until, that is, I looked at the facts (pesky things, those facts). I went to the IRS website and an article from this summer for the numbers.

The article states that 440 small businesses and farms paid the estate tax in 2005. The IRS website shows 45,070 estate tax returns for that same tax year. So less than one percent (0.976%) of the estate tax returns were filed by small businesses. So who filed the other 99%? Not the family-owned business around the corner.

According to Barack Obama’s website, he proposes to make no change to the estate tax structure coming in 2009: estates under $7 million per family are exempt, with a tax rate of 45% applying to the remainder.

So what does this mean? The total taxable value of all 2006 estates worth over $10M was about $30B. Assuming those numbers are the same for 2009 (close enough for this analysis), if we end up with McCain’s plan, the US Treasury will see about $9B less in its coffers. First of all, if we want to decrease tax receipts by $9B, why not lower tax rates for families whose main concern doesn’t happen to be a multi-million dollar estate? Secondly, it is misleading to use small businesses as the justification when only 1% of the affected returns fall into that category.

Now, don’t get me wrong, I think the estate tax reeks of double-dipping and I’m not a huge fan. But for the 2006 tax year, 138,372,000 individual tax returns were filed. In that same year 49,051 estate tax returns (form 706) were filed. For those mathy folks out there, that’s 0.035%. Not exactly an issue for the masses.

Yeah, I know this wasn’t a profound exposition on the war in Iraq or the state of health care, but other people get paid to write about that stuff, and those topics are more philosophical. I had to pick a bite-size, bloggable topic with easily-accessible data. I hope it was informative.

Check back soon for another interesting proposal, this one found on Barack Obama’s website. Hint: Did you ever wonder how many times your tax information is printed out and subsequently fat-fingered into a compter between the time your info is reported to the IRS by your employer/bank and the time when you receive your refund?

While posting more photos to the gallery for mom and dad, I came across a few I considered blog-worthy. Check out these photos of Thomas on a lunch break during a May 2006 hike…

… and here’s a photo of Daniel in Oct 2006, accompanied by a shot of the boys and their cousins at Cape Cod in summer 2007.

My mom and dad (Glo and Lou, aka “Nanny” and “Poppy”) have kept a trailer at Russell Brook Campsite in the Catskill mountains for several years now. They spend most summer weekends there, and we try to bring the boys to visit as often a we can. In fact, for the past few years we’ve left Daniel and Thomas there for almost a week to swim and fish!

This year Glo and Lou upgraded to a newer model. Our latest trip was a few weeks ago to check out the new digs. Check out some photos in our Russell Brook album.

Kath, the boys, and I headed to J-town this weekend for our annual apple-picking, pumpkin-acquiring, cider-donut-eating, corn-maze-negotiating extravaganza. Daniel (left middle on ladder) and Thomas (left bottom) had great fun in the orchard with their cousins…

… Chris (my bro-in-law) demostrated his remarkable physical prowess…

… and we ended the day with a bonfire at Mayfield.

That’s Marybeth (my sis-in-law) feeding the fire and “Emmy” (my mother-in-law) boozin’ it up.

See the full album for more photos.

Well, it’s the moment you’ve all been waiting for.  The photo gallery has arrived! It is fully functional at this point, but there are some layout improvements I will be making in the future. Until then, enjoy some randomly-selected photos uploaded into the inaugural album.

Here are few samples:

Just a quick note to start things off.  The main reason behind this blog (and the gallery, for that matter) is to keep family and friends informed about what’s happening with me, Kath, and the boys.

I anticipate weekly (or so) updates on recent activities, along with some photos - once I get the gallery up and running.  You might catch an occasional bit of commentary here and there, but with two energetic boys running around the house, my capacity for deeply intellectual thought is somewhat diminished.

That said, I just might surprise you one day; you’ll be reading along about some mundane occurrence in our lives when - WHAM! - you’re sucker-punched by a brilliant flash of keen insight you wish you had come up with yourself.  Or maybe not.