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A Modest Amendment Proposal To The "Move Your Money" Campaign: Increase Your Withholding Exemptions
Over the past few months, Arianna Huffington has initiated a grass roots campaign called "Move your money" whose purpose is to forcefully shift an allocation of the deposit base from the TBTFs which have captured the government via the Wall Street-D.C. lobby complex. While we hope this campaign succeeds, we are somewhat skeptical that it will achieve its goal. First, the logistics of transferring one's account are non-trivial and can be daunting to most people. Second, the overarching problem lies not so much with the banks themselves, as with the one supreme enabler of not just artificial "profitability engineering" but of the broad range of market interventions, which will ultimately result in the collapse of America. Just today we demonstrated that the US monthly budget deficit hit an all time record, which, paradoxically, and completely counter-intuitively was accompanied by a record drop in the interest rate paid on public marketable debt. This is an artificial and perverted relationship which will soon breaks, and when it does the suffering will truly begin. Yet therein lies the rub: as the Administration, with the full complicity of the Treasury, borrows deeper into the red and consigns America's future to a 3rd world fate, can now only be stopped by precipitating a full systematic reset of a Treasury-Fed duopoly set on testing whether or not America can default. Unfortunately, the guinea pigs in this experiment are some 300+ million Americans. We suggest a simpler solution to facilitate this the much needed reset: increase your tax withholding exemptions (a far simpler process to moving one's deposit account), thereby forcing the treasury to tip its hand on just how much debt it will need, as it pretends to have some semblance of authority over an out of control budgetary situation.
This is a perfectly legal practice: here is the IRS itself providing a useful primer on how taxpayers can bump up their withholding exemptions all the way up to 10, in this way forcing the Treasury to delay receipt of tax funds via paycheck withholdings well into the post April 15th future. We are confident that the capital reallocation that the banks will experience as a result of "Move your money", coupled with the need to run a much more balanced budget (which we now realize is impossible, and the only alternative is eventual sovereign default or complete dollar devaluation) once tax withholdings dwindle, will finally force this administration and the banking cartel to listen to the silent majority of 95%+ Americans which are not on the list of burgeoning millionaires, and who couldn't care less if the market shot up 100% today on some algo gone wild, yet which is somehow supposed to indicate that the economy is getting better. Just look at today's record budget deficit number to make your own determination just how much "better" the economy is getting.
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+ "10"
:)
+F the 1040
This will be sent out to all I know who see what is taking place.
Elegant approach.
Simple, brilliant, and effective. I'll log in and change mine yet today.
Wow. I'm smarter than I thought. I was already at the limit. I can't increase my withholdings because I have a "lock-in" letter on file. How the hell does Ceridian know that? Must be an employer-set flag.
And all my money remains where it's been -- at my credit union, who practices full transparency, has a beautiful boring investment portfolio and their loan portfolio is performing as if there was no recession, because they never dabbled in fantasy lending.
Nope, Big Brother issued that lock-in letter. Click on the link in the article and go to the section titled "IRS Review of Your Withholding," at the bottom of page seven. It says:
The main result will be lots of people who won't have enough money saved to pay their tax liability come April 15
TD when are you going to write a piece encouraging default of bank loans? Encourage people to honor their commitments to one another, but deny the fraudulent banking system the source of its vitality. Between income, payroll, property, excise and sales taxes and then interest how much does a person take home?
30% income including state
15% payroll
7%+ sales tax
1%+ property tax
mortgage note: 28% of gross annual income x .8 = interest
22.4% mortgage interest
car note: 10% of gross annual income x .8
8% auto loan interest
that leaves about 17% for the average person to live off of.
GTFO!
file dependents and stop paying debts!
And many of those people won't voluntarily pay their tax liability at that point. Which could make things very interesting.
finally you get it TD. ACTION is required...Fed and Treasury run this country. this is oneo f the few THINGS millions of Americans can do...jack up your W4
there is only a small irs penalty if you miss by 1000 or so at end of year. a small price to send a message. I hope You get Huffington to cover this
The IRS and Treasury beat you to it. Look at the 2009 tax law and you will notice a $100 to $1,500 penalty for excess exemptions. Basically, you will be charged a flat fee (that will be significantly more than most Americans would make off of interest from the withheld amount, particularly since no one is paying interest except for borrowers) if you withhold too much.
Can anyone provide a link this change?
but it would be great to just have everyone jack it up to 10, pull out all their 401k's, stop ALL payments on cars/homes, convert to gold and drive up to Canada then fly somewhere, anywhere with a one way ticket...
hell its at least worth a movie...
Its already happening. People realize that there is no rule of law in the US and are simply walking away. The ideal situation would be to have a rental property and continue to collect rent while not making payments. Of course if the property is cash flow positive you might as well continue to make payments. Cash flow positive; now isn't that an idea?
The recommended action on 401K is to simply take a loan on it and buy physical gold, hold it in cash, or go 50/50 cash/gold. That way you avoid the withdrawal penalty. And when Ben goes to do a reverse repo on your account, whoops!, there is nothing there except a promise that you will pay back. If you quit your job or get fired, and they ask you to pay it back, tell them to get phucked.
So, yes, starve the beast in ALL aspects. No holds barred. This is our tea party, and this is the 2010 way of declaring our independence.
yes - i tested the waters on the 401k loan... did a small one to pay off a high interest loan... i'll pay that back, wait the 6 months and then go max on whats allowed to take out..
I closed out my IRA in early 2009 and plowed it into metals. The IRS can go fuck themselves. It's MY money.
Only losers pay federal income taxes.
I am Chumbawamba.
Same with me... yes, they got me for 30% on the AMT. But I predict 50% coming soon on the AMT, so the decision was sound. With so many falling into poverty, the middle class will soon be declared "rich".
reggie, its a small irs underpayment penalty if you witheld too little, ie over 1000
its a small price to pay
and like i said, just underwithhold by 1k and you're fine! 300 million americans
I've done both. In the last 6 months, I've moved almost 80,000$ out of Bank of America and into smaller, community banks (several of them). I've also changed my withholding to as close as possible to what I anticipate my tax situation to be, rather than just getting a refund all the time.
I encourage everyone to do this.
Is there a good online calculator for this?
Next, how to withhold property taxes, to starve the local and state governments without losing your house (that's if you want to keep it in the first place).
local and state aren't really the problem.. they can't print money (they have to bend over and beg for it)
Have you seen the Pew study (http://www.pewtrusts.org/news_room_detail.aspx?id=32368).
Cities and states all over the country are taxing people based on bubble assets and continue to refuse to lower commitments and spending.
All politics are local.
yeah but you can get engaged locally - if you cant bother with it, then its time to move to a bunker in montana
I already did this!!!!!
Off-topic, but who has kidnapped Marla? She has been MIA for a few weeks now.
I was beginning to wonder if Marla broke up with Tyler. Free Marla now.
probably out spending her GS bonus...
corporate tax season, impending mkt top and a few of us are still gainfully employed. plus, absence makes the ....
She's gone undercover...
will just put the allowances at a point were the government or state owe you nothing .. and nothing more than that is withheld ,, the idea that millions and millions wait for refunds is indicative of a pretty lazy lot of tax payers...
I've never understood the mentality that people are "happy" when they receive a tax refund. Huh? You are getting your own money back.
You should strive to just owe a little each year at tax time.
because it is PATRIOTIC!!! feed the beast!!
Props good idea. Starve the beast.
Increasing 401k (if you can manage) withholdings also can help starve the beast.....
Really? Taking your earnings and toss them into the paper beast that is controlled by the Federal Reserve and Treasury will starve the beast of the Federal Reserve and Treasury?
Dude, please pass da piiiiiippppppeee baby, cuz I want whats yous gots.
yeah if your 401k lets you pick physical gold, sure
Already done, I only withhold about what I will pay out in taxes. I also advise all of my employees to do the same. Why give Uncle Sam an interest free loan?
Marla is busy chopping off heads in Wonderland.
Wait a minute. If you don't pay as you go, you are going to pay more in the long run. (Unless you plan to default.) Borrowing is bad.
PS - I find your math question ambiguous. I assume you intend for me to use base 10, but you don't say that. The answer to the problem depends on the base used.
CPA's and financial advisors across the globe are cringing. "in no way does this constitute tax advice. please seek the advice of...."
now, how to subterfuge OSHA n FICA ?
To get more eyeballs for this great idea, vote it up here.
I actually think that this has been going on for some time.
I just opened a cross border account with the Royal Bank of Canada. The Canadian end took about a month to open but now that it is active it is the best solution possible. At the click of a button I can transfer funds overseas into CADs and not have to worry about the FDIC.
Highly recommended to anyone who is done with the TBTFs like yours truly. Also lets you have a little more liquidity than solely holding PMs.
Old News for most engineers in Silicon Valley.
Went from a commercial bank to a credit union half a year ago. Not a big deal. Most things can be changed online and I did it over longer time. Still have my commercial bank account just in case with a minimum balance to avoid fees, but I haven't done any business on this account over the last four months. I will close it soon.
Another variant of this is to underwithhold in
the first 3/4 of the year and overwithhold in
the last 1/4 of the year to reach your -$1k
position at the end of the year.
move your money and sell your mutual funds that have bank stocks (which is just about every mutual fund).
Establish a no-interest "savings account" with the government by allowing it to take more of your money than they are owed.
Borrow the money to service your life @ 30% interest because now you don't earn enough.
Let this situation stew for 12 months until you are desperate for cash.
File your taxes on Jan. 2 at Jackson-Hewitt and take a "tax-refund loan" for 500% interest to pay the bills that you could have paid if you had not loaned your money to the US Gov @ 0% interest yada yada....
Capitalism: what a concept.
holy cow!
ive posted "increase your tax withholding exemptions" in various threads on this site no less than a half dozen times!
better nate than lever!
Nothing personal TD, but I am very gun shy about ANYTHING that originates out of Huffin' Glue dot com
At face value it's a good idea, but Huffin' Glue talks the two-party establishment bullshit. Which to me means that they are either clueless as to "where it's at" or they know the game and act as a steam vent for frustration.
hey Pete, actually it was Catherine Austin Fitts (gata, solari etc) idea & Huffigton jumped on it.
Actually, *I* moved my money out of BofA in '07 & advised everyone I knew to do it too. Alas I am not published and have little influence excepting an occasional market blog comment....sigh.
no pete they are just covering all the bases. why not! deception is the power. huffpost is just an index a clue to what the masses are interested in just scan it in the morning to see what the rest of the sheeple might be open to. hell they dissed jesse ventura conspiracy theory with JFK. so she has some boundaries. who cares anymore.
Frankly the best thing to do is move your money to a Credit Union. There are locations nearby all over the country and membership rules are much looser than they were say 25 years ago
go next step to peer-to-peer lending!!! end the banks!!
"I just opened a cross border account with the Royal Bank of Canada. The Canadian end took about a month to open but now that it is active it is the best solution possible. At the click of a button I can transfer funds overseas into CADs and not have to worry about the FDIC."
I have been using SwissQuote (http://www.swissquote.ch/index_e.html). They take accounts of US Persons, and can do foreign exchange or as well as act as an online stock broker. Online service works well. No quirks. Good reporting. Reasonable fees. The only downside is a 35% withholding tax on dividends and interest, refundable by filing proper form on US tax return.
Anyone who holds more than $10k outside of the US must report the account(s) each year on a form Report of Foreign Bank and Financial Accounts (TD F 90-22.1). There is a $10k fine for failure to file. Also a checkbox disclosure must be made on form 1040.
Let me add that I also have had a UK trading account for a number of years. My account keeps getting moved because every brokerage firm has eventually ejected the accounts of US Persons. My account presently is with Brewin Dolphin and my broker informed me that they are trying to find some other firm to take the accounts of US Persons as B/D would like to eject them as well. This is all due to the actions and policies of our own Treasury Department.
I find that an increasing number of financial institutions will not accept accounts from US Persons.
Land of the Free? Not any longer.
I feel dirty and unwell agreeing with Arianna Huffington on anything but I must say I like her 'move your money plan' ...if you're willing to forgo whatever bells and whistles your TBTF bank offers you.
What's so hard about transferring accounts? Can't you just open an account at the new bank and get a certified check for the balance of your old account from your old bank?
Thanks for the great info! Brilliant! Just changed mine today! Pass this info along to all your friends!!:))
IMHO the best bet is to buy physical gold, thus taking the money and getting something of real value in return. Avoiding taxes now is a good idea, yet FIAT currency devalues over time and, as such, you are losing the buying power (value) of your money. Gold protects value and buying power.
I asked my accountant if my savings account with Citi counts as donating to a non-profit charity for tax deduction purposes. In fact one of the branches near by got closed down and next day a sign went up "Non-Profit Banking" I don't know what the difference is.
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