by Terry Mitchell

Created on: February 22, 2009

I was recently talking to a lady who told me she would have to see her financial advisor soon because she and her husband were nearing the "magic" age of 70 1/2, when the IRS requires people to start taking distributions from their 401(k) accounts or face stiff financial penalties. Why does the IRS get to tell us when we have to spend our 401(k) dollars?

Yes, I know a 401(k), for most people, is the best vehicle for tax-free growth of their retirement nest egg. However, because of restrictions like the one I mentioned above, I decided several years ago to hedge my bet and start taking a portion of the money that I had been putting into my 401(k) on a pre-tax basis, and put it, on an after-tax basis, into a Roth IRA, which is less restrictive than a 401(k). However, that's a decision I should not have had to make.

And why is it that very few people question the requirement by the IRS that we spend time keeping receipts and preparing taxes? In essence, we are being required to perform accounting-type duties by the government - with no compensation. When someone is required to do work for no pay, he or she is essentially a slave - in this case, a slave to the IRS. I thought slavery was abolished in this country during the Lincoln presidency. Apparently, someone carved out some kind of government exception to the Emancipation Proclamation as well as the Thirteenth Amendment to the U.S. Constitution.

A few years back, after having spent some time preparing my taxes, I calculated the market value of that time by multiplying the average hourly rate of an entry-level accountant (information that was readily available on the Internet) times the amount of hours I had spent on my taxes, both the collecting of receipts and other data and the preparation of the forms. I then sent this information to the IRS and requested payment for my time. Needless to say, the IRS worker who responded to my request didn't see the humor in it at all.

As long as we have the income tax, we will all continue to be slaves to the IRS. The keys to emancipation can only be found in the replacement of the income tax with a federal sales tax. Under such a system, our only responsibility as taxpayers would be to ante up at the cash register. That's it! No more receipts to keep! No more time or money spent to prepare forms! No tax returns to file! No more unintelligible rules to try to figure out! No more deductions or exemptions! No more penalties or interest on back taxes you may have mistakenly not

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