As the end of the year approaches, I’ll be focusing on tax breaks and deductions that can reduce your 2021 income taxes. Every once and a while as I help readers, friends, and family avoid paying higher taxes someone asks whether avoiding taxes is patriotic.
Remember that you are an American. As an American, you live in a democracy (technically a republic) and you vote to elect representatives who go on to make laws, rules, and regulations. As an American, it is your duty to comply with these laws, rules, and regulations. Beyond that you are free to do what is best for you, your family, and your community.
The influential jurist Learned Hand (No, I’m serious, he is a real person) once said,
Any one may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury; there is not even a patriotic duty to increase one’s taxes.
Gregory v. Helvering, 69 F.2d 809, 810 (2d Cir. 1934)
Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.
Commissioner v. Newman, 159 F.2d 848, 851 (2d Cir. 1947) – dissenting opinion
(I’ll let you look up the no longer popular use of the word “cant” in this context.)
Pay Lower Taxes Feel Good About It
Legally, you are allowed to arrange your taxes in such a way that you pay the lowest taxes possible.
Keep in mind this is very different than tax fraud, which is arranging your taxes in such a way that is not permitted by the rules and regulations of the IRS on behalf of the government you elected.
Also, keep in mind that no one, especially the IRS, is going to help you find the best way to arrange your taxes. It is your duty as an intelligent American citizen to study, learn, and understand enough of the U.S. tax system to find and implement your on tax saving strategies. That all starts by knowing about useful tax deductions and tax credits.
Follow along here on the Finance Gourmet, or add me on Twitter where I’ll be writing about tax deductions and credits in tweet-sized bites.
About the Author
For Tax stuff:
By Brian Nelson – Brian is a former Certified Financial Planner and financial advisor. He writes for the Finance Gourmet and other financial publications. The material provided on this website is for informational use only and is not intended for financial or tax advice. ArcticLlama, LLC, FinanceGourmet.com, and Brian Nelson, assume no liability for any loss or damage resulting from one’s reliance on the material provided. Please also note that such material is not updated regularly and that some of the information may not therefore be current. Consult with your own tax professional when making decisions regarding your tax situation.
