It's That Time Of Year Again - Tax Season

[Duncan Taylor]

I'm curious to learn who here looks at income taxes they way I do.

I want to reduce my tax burden as much as I can but increase my tax liability as much as I can.

If that seems to be a conflicting position to you, let me explain.

By tax burden, I am referring to my marginal tax rate from the IRS and my states. By tax liability I am referring to the total amount of money I have to pay in taxes.

Once I get my effective marginal tax rate (the burden) down as low as I can, I want to owe as much tax at that rate as I can.

Why?

Because that means I am maximizing the total amount of money I keep after paying that tax!

As I wrote on my blog today, "tax" is not a four letter word.