Why Do I Owe Taxes

Why Do I Owe Taxes?

Every single year, you probably reach the point where you ask yourself, “Why do I owe taxes?”

You have probably heard the only two certainties in life are death and taxes. Some people would argue over which is worse, over which is more unfair.

If you have ever had to hand over a large portion of your paycheck to the government, then you have probably rolled your eyes and asked yourself, “Why do I owe taxes in the first place?”

You might not want to hear the answer, but it is an important one.

What do my taxes pay for?

There are two types of taxes that you will have to pay once April rolls around. They are called federal taxes and state taxes.

Federal taxes pay for health programs like Medicare and Medicaid, social security, defense, and security.

Your taxes also go toward safety net programs like food stamps, unemployment insurance, low-income housing assistance, and programs for abused children.

Basically, you are paying your taxes in order to help out your fellow citizens. To make sure they are able to access basic health care and pay for enough groceries to make it through the week.

Meanwhile, your state taxes are going towards your local school districts, transit systems in your town (like railroads and bridges), corrections facilities, environmental programs, pensions, and parks.

Those taxes are making sure your state remains a nice place to live, grow, get an education, and raise a family.

Together, your federal taxes and state taxes assure your community continues to run smoothly.

How does the IRS determine the amount of taxes I should pay?

Your income determines the amount of money you have to pay the government. If you have a high-paying job or if you sell stock and make a bundle, then your taxes are going to be higher at the end of the year, because the more money you make, the more money you are going to have to hand over to the government.

Your family status is also taken into consideration. Your forms will ask you about any dependents (which are usually children) who you are paying to take care of in addition to yourself. The more dependents you have, the lower your taxes will become.

Some people will pay their taxes slowly, throughout the year, while other people will pay them all at once. It depends on your place of work.

Your boss might take a certain amount of money out of your paycheck each month. If that does not happen, then you are going to owe a surprising amount of money at the end of the year.

Tax day is not necessarily something you should fear. There is a chance that you will have to pay money — but there is also a chance you are going to earn money. It’s called a tax return.

If enough money was withheld from your paycheck throughout the year, you will receive a refund check. That means you will actually get a check instead of writing one out yourself!

What happens if I refuse to pay my taxes?

Even though paying your taxes is probably the last thing you want to do, you have to make sure you do it correctly. If you lie on your forms about your income or about anything else asked, then you are going to get in trouble.

You have to be honest — even if that means you are going to end up paying more money.

Tax fraud is a major crime. If you are caught, you could end up paying a large fee (much larger than your taxes) or you could end up with jail time.

That is why you have to make sure to file your taxes and pay your taxes each and every year. It is never fun forking over money that you worked hard to spend, but it is going toward important building blocks of our community.

Without taxes, government workers would not be paid, schools would not have funding, and injured men and women would not have access to medical care. Taxes are what keep our country running. Paying them is considered a civic duty. Thought Catalog Logo Mark

January Nelson is a writer, editor, and dreamer. She writes about astrology, games, love, relationships, and entertainment. January graduated with an English and Literature degree from Columbia University.