Cost of Tax Complexity

I’m filing an amended return for the first time because I forgot I opened a taxable Betterment account in December (I thought I opened it in January).

Turns out I owe $8 ($2 to California, $6 to the feds).  Okay, so I have to print out 45 pages of shit, pay for 2 of the big-yellow-envelope postage, and write out checks to each location.

For California, for sure the economic cost of me preparing the most complicated $2 check of my entire life outweighs the benefit to the state of receiving $2 extra.  But rules are rules, and I don’t want to deal with this later in some horrible, more mutated form.

For the feds, likely the $6 will be consumed by the cost of any human who has to take the time to open the envelope and process the payment.

Taxation is depressing.  The redistribution reminds me of:

As a country, America is very productive. There are enough resources to live very well if those resources are spent wisely. We are twice as productive as we were 50 years ago. By all rational means it should be possible to work only two weeks a month and live perfectly happy lives. Alternatively, it should be possible to work for less than a decade and then retire early.

I did just that. You can do just that.

Unfortunately, many people did not. They spent their riches without a second thought.

Here’s the exact problem with middle-class consumers. As a group it’s net-negative productive. It takes more than it gives. Despite how hard it works, it consumes more than in produces. It spends more than it earns. It lives above its means. This is possible because banks and credit cards have enabled this behavior through cheap credit.

Cost of Refiling:

45 pages = $4.50

postage = $2.80

envelopes = $2

My time = $80




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