I have two camps of critics when it comes to taxes and benefits.
"You should take more government benefits."
Many readers advocate that we take more benefits, like WIC and Food Stamps. Right now, we receive health insurance, which is for emergencies only, although we have used it in the past, and we take the Earned Income Tax Refund (EITC), a tax credit based on my husband's income.
We don't take WIC, Food Stamps, Section 8, or heating assistance, all of which we qualify for, because we don't need them. My husband makes enough to cover these expenses without a problem, and we usually have enough money left over at the end of the month to throw some into savings.
"You should take less government benefits."
Readers have said that my viewpoint is not valid or genuine because we take some government benefits. I advocate small government and am generally opposed to government spending, although that is not the focus of this blog.
For these critics, I want to go over some of the fuzzy math involved in government spending.
Taxpayers pay for roads, bridges, highways and traffic lights, along with all of the administrative work it takes to have and maintain them. Can you be sure that what you pay in the gas tax is more than how much you wear down the road? Have you ever taken the last exit before a toll on the highway to avoid paying the toll? Is that stealing from the tax payers, or being smart with your own money?
One of my pet peeves is public school, not that it exists, but that people don't calculate it as a benefit. If you have one child in school for one year, it costs tax payers an annual average of $9,866.
No one can calculate the cost benefit of a war on our quality of life. Although I don't agree with all of our foreign policy, I do know that our life would be different if people weren't fighting for us.
Property taxes are a common complaint of homeowners. Believe it or not, I pay property taxes as well. The property owner isn't taking a loss on me. He has calculated how much the property costs in maintenance, taxes, mortgage, sewer, and heat and he charges me my share.
Public transit costs more than the cost of a token. If you use the bus or subway, that is being subsidized by tax payer dollars.
We pay Social Security taxes, which we will never see again. I am 24, my husband is 29. We don't expect to receive anything from Social Security, but we still pay it.
To say that you pay taxes and I don't is untrue. To say that I receive benefits and you don't is untrue.
As far as crunching the numbers, we estimated that based on the national average cost per student, if we had ten children (we want a big family) going to public school, it would cost the taxpayers
10 (kids) x 13 (years, K-12) x $9,866 (the national average cost per kid per year) = $1,282,580
What if God doesn't give us ten, but only gives us these three? Well, I hope that doesn't happen, but,
3 (kids) x 13 (years, K-12) x $9,866 (the national average cost per kid per year) = $384, 774
We get the EITC, which combined with the Additional Child Tax Credit and any refund, as Dan had taxes withheld for part of the year, is about $6000. It will be different in different years, depending on Dan's income, but for the sake of a round number, we'll call it $6000. It will not go up with more children. Here is a link to an EITC calculator, in case you don't believe me.
If we get it for forty years, which is about how long we would qualify for it if we had ten kids, it would be $240,000, costing much less than sending our ten kids to public school, which we will not do.
If we get it for twenty years, if this were our last kid, it would cost tax payers $120,000, still much less than the cost of public school for three kids.
We don't know how long we will need this tax credit, so I'm not sure we will take it for this many years, but it shows the numbers clearly. If there's nothing wrong with sending your kids to public school, I don't see anything wrong with accepting less money in a tax credit that moves our family closer to our goals and toward financial independence.
Where can we save the tax payers some money?
Weeks ago, a reader suggested dropping the insurance and in case of an emergency, picking it up again. My husband and I have been discussing this and are for it. We would save the tax payers the administrative costs of us just being on the insurance. We know that with our income, they would put us back on with no trouble, and our state insurance will pay up to three months of back bills in certain situations, so we wouldn't have to worry about paying massive bills that we incur before we can fill out the paper work. We are, of course, hoping that we never have to resort to this.
I am hoping this will be the last post I write on this topic. I am hoping that it will put all of the questions about our position to rest. I am hoping I was clear enough.