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January 13, 2006

SS Rips Off Employers

Prof. James Edward Maule has a good look at a long running scheme in which our rulers have been receiving more payroll tax revenue than they are entitled to. Basically, an employee is eligible to recover FICA taxes that were paid over the annual maximum because s/he worked for more than one employer during the year. There is no way for employers to receive similar refunds or even credits against other taxes. None of this is new. I have prepared hundreds of tax returns where my clients recovered thousands of dollars from the double or triple payments they had through their multiple employers. I have long noted that it was very unfair that there was no similar mechanism for the employers to similarly recover their share of the overpaid taxes. That money doesn't do anything to increase the employees' future SS benefits. It's just pure profit for our rulers to spend. Professor Maule wonders why none of us tax cutters takes up the cause to remedy this injustice. I have never seen it as even remotely possible for a number of reasons. First is the fact that our rulers couldn't care less about fairness when it comes to money for them to spend, which I rant about on a regular basis. Next is the fact that employers are perceived in our culture as evil entities that do not deserve any kind of tax break, and in fact need to be soaked with even more taxes. See Donald Luskin's excellent piece on how this is happening to Wal Mart for just one such example. To drum up any kind of public outcry sufficient enough to correct this issue would be next to impossible.

Posted by Kerry Kerstetter at January 13, 2006 5:35 PM | Print