W-4: The ‘American Working Family’ Way to Fair and Equal Taxation
Wake up America! Your pay-stubs are sending you an important message you won’t read in the papers or see on TV....
Why spend 1/4 of your working lives toiling for the IRS? Why allow Washington to collect your hard-earned dollars to pay off Wall St.’s gambling debts (while the Banksters go Scot free)?
You know why! The answer is simple! You think you can’t help it. The IRS takes the money out of your paycheck before you ever see it. Meanwhile, the Banksters and Bosses are pocketing their profits every nano-second and pay their taxes (if any) at the end of the fiscal year.
But you do have the power to turn the tables! The name of your “loophole” is the IRS W-4 Form.
How to Use your W-4 Form to Save Money and Eliminate Inequality
When you list the number of your dependents on your W-4, your Employer is obliged to lower the amount of Withholding in proportion.
For example, an average salaried single person, Jane Doe, earning $42,900 a year. Normally Jane files as “S-1” (Single, no dependent). The Employer subtracts Jane’s personal deduction of $6200 from Jane’s projected annual income, reducing it to $36,700 on which she owes taxes amounting to $4,426. So the Employer must deduct that amount from her paycheck in monthly installments of $369.
But what if Jane wrote “S-11” (Single with Ten Dependents) on her W-4? Do the arithmetic. If you multiply the number of Jane’s new “dependents” by the standard exemption (11 X $3900 = $42,900) her projected taxable income is reduced to zero. So the employer deducts nothing!
Believe it or not, once Jane writes “S-11” on her W-4, she starts collecting the FULL AMOUNT of her actual earnings. Jane is free to change her W-4 filing at any moment, and so are you. The only way the IRS can get greasy paws on Jane’s hard-earned money is to wait until the next April 15, audit her tax return, challenge her deductions for the ten extra dependents and win in court. Now SHE is in the power position, just like a big corporation, and the burden of collection is on the government. The fact of the matter is that the IRS doesn’t have enough auditors to go after thousands of wage-earners who have filed “S-11.” It would take them years and create total chaos if they tried.
But where, you may ask, can Jane (and you) find extra “dependents” to list on her W-4? Simple: Jane calls up her friends and forms an “American Working Family” -- an affinity group of three, five, seven or eleven W-4 Tax Resistors who agree to list each other as “dependents!” That’s right, do like Jane, and you and your friends all become each other’s ‘dependents!’ (Just make sure that you all check the box on the W-4 marked ‘someone else can claim me as a dependent.’ )
Try it yourself! Go to the IRS online withholding calculator and see how much YOU can save this year.
If the IRS tries to audit Jane, the other members of her ‘Family’ all show up at the audit and swear they are her dependents. Chaos results!
Create one, two, ten thousand “American Working Families”! Use the power of the alternate media and your network of organizations and newsletters to spread the “S-11 Revolution!” By the time the government catches up with the first W-4 Resistors – and the IRS often takes years to get an audit going – you will be part of a mass movement.
That is exactly what happened when the dust cleared after the Great Collapse and the fast-track bailout of the too-big-to-fail Billionaire Banksters. Wage-earners woke up to the fact that they were now stuck paying off another $23 trillion in government debt. It was the $23 trillion straw that broke the camel’s back. When the crazy W-4 Tax Revolt appeared on an obscure website called Accountants Anonymous, the idea went viral.
Even before the Meltdown, most wage-earners had come to understand that the corporations and the rich, while always complaining about ‘high taxes’ and ‘big government,’ were not actually paying a significant share of the nation’s expenses. In the 1950’s under Eisenhower (a Republican) corporate had taxes accounted for 80% of Federal revenues ; John Q. Public paid the remaining 20%. After the ‘Reagan Revolution,’ the ratio was reversed : By the end of the century 80% of government spending derived from payroll taxes on the working middle and lower classes, while the Billionaires paid only 20%. And after the Crash of 2008, this inequality got even worse.
By the time of the Meltdown, the the Billionaires were literally coming out ahead on April 15 Tax Day. Thanks to the work of their high-priced lawyers, lobbyists, accountants, tax loop-holes, government subsidies and off-shore tax-havens, big corporations actually received more from the government than they paid out in taxes ! It was thus the salaried employees and wage-earners ended up paying for EVERYTHING. They had no choice. Every week, their employers deducted their taxes from their pay on their W-2. So it was John Doe and Jane Roe who were paying out all the dough for the bloated no-bid weapons contracts of the military-industrial complex and the huge interest payments on the National Debt (which went right into the pockets of the Banksters). And thanks to Congressional ‘austerity,’ there was little left over for Health, Education, Housing, Retirement and Social Services (all cut back drastically and farmed out to for-profit private corporations).
Worse still, the IRS systematically went through ordinary wage-earners’ tax returns with a fine-tooth comb, ruthlessly demanding back taxes from waitresses with undeclared tips and teachers’ with ineligible ‘home office’ deductions. This was because Congress had quietly cut back on the IRS’s budget for tax inspectors. An ‘economy’ measure that cost the government trillions. There were too few inspectors left to investigate the trillion-dollar tax-fraud of the corporations (which would have taken dozens of specialists several years to prosecute), and so in order to make their quota the investigators were forced to go after the little fish, easy to catch. So every time a ‘Family’ of W-4 Tax Resistors stood up and demanded a trial, they won mass sympathy and inspired more W-4 Tax Resistors to join the Movement. One hundred Resistors snowballed into a thousand and a thousand into ten thousand, and the IRS was paralysed!
Back in the 1960’s religious pacifists and anti-war activists had tried in vain to start a symbolic ‘War-Tax’ revolt. Some War-Tax Resistors, acting in the tradition of Thoreau and Martin Luther King, choose to go to jail, rather than to contribute to injustice. But the movement never got off the ground because it couldn’t appeal to wage-earners whose taxes were automatically deducted. The W-4 “American Family” affinity groups brought people together in struggle linking them to create power and solidarity. Government attempts to single out individual W-4 rebels for “tax fraud” fell afoul of the legal doctrine of “no selective prosecution” established by the mass movement of young people who successfully undermined the Selective Service System in the 1970’s by refusing to register for the Draft. No way to prosecute one of them without prosecuting all of them.
The “W-4/S-11 Tax Revolt was a wonderful combination of idealism and good old American “tax-chiseling.” It mingled save-the-world altruism with plain self-interest, mass organizing with do-it-yourself screw-the-government Americanism. It created major problems for the war-machine while bringing people together in a massive new movement which combining a basic economic (class) issue with the more overtly political issues of the nuclear threat, militarism and injustice.