Thursday, March 27, 2008
How to Pay Zero Taxes: Nearly 50 Million Americans Do It; But Once You See How, You'll be Glad You're Not One of Them (Money Magazine), by Marlys Harris:
Last year 49.2 million U.S. households filed returns that obligated them to pay absolutely no federal income taxes -- and they didn't necessarily do anything illegal. Before you start gnashing your teeth at the injustice, however, you should know that there are many reasons to be happy that you're not one of the tax escapees.
For starters, avoiding U.S. income taxes isn't easy. Citizens can't wriggle out of their bills by moving to another country because, almost alone among nations, the U.S. taxes all income, no matter where on earth it's earned. And although the tax code offers plenty of deductions and exemptions, if you take too many you'll be skewered by the AMT. ...
So how do the 49.2 million do it? That's what Money Magazine set out to learn. What we found offers a glimpse into the workings of the immensely complicated U.S. tax system, as well as valuable lessons in the dos and don'ts of cutting your own taxes.