Check out these four tricks used to get you to spend more (without you knowing it).
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Nearly four years have passed since the federal government passed a budget. Most of us know what happens when there’s no budget—we spend too much! Considering the $11 trillion Washington has spent since 2009, overspending might be an understatement.
With a number like that, you can be sure there’s rampant misuse of taxpayer dollars. For the last three years, Oklahoma senator Tom Coburn has released a report called Wastebook, detailing some of the government’s most questionable expenditures. Here are some of the projects your tax money has paid for:
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Wasted Food Stamps
In a case of obvious mismanagement and poor program design, some food stamp recipients were allowed to purchase $4.5 billion worth of junk food, gourmet coffee, alcohol … even firearms and cars! And each month, $1.4 million is wasted on duplicate benefit payments and benefits for deceased and ineligible recipients.
Tax Credits for College … Without the College
The American Opportunity Tax Credit was supposed to help students pay for college with a tax credit of up to $2,500. However, 1.7 million filers received the credit without providing proof that they even attended a college or university. Among these were claims from 250 prisoners and 85,000 students who did not have valid Social Security numbers. It was projected that erroneous claims could reach nearly $13 billion by end of the 2012 tax year.
Other expenses that made Senator Coburn’s Wastebook:
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- The government allocated $1 million per year to create recipes for pizza and other meals that could be served on Mars some day.
- We paid $2 million in monthly services fees to maintain 28,000 empty and expired grant accounts. A simple code entry would close out the accounts and end the service fees.
- The Treasury Department lost $70 million producing 5 billion pennies last year. That’s because it costs 2.4 cents to produce one penny.
Taxpayers Still Pay $1 Billion More Than They Have To
Wasteful spending like this, especially when the country is already deeply in debt, makes tax-time frustrating. Even more frustrating is the fact that every year, taxpayers voluntarily hand over more than $1 billion to the government by failing to file a return or claim credits they’re eligible for. That’s money that rightfully belongs in the taxpayers’ pockets, but they leave it all for Uncle Sam without batting an eye.
After three years, this money becomes the property of the U.S. Treasury, and the government gets to decide how to spend it. And we’ve seen how that ends up.
Don’t Give the Government a Handout
To find out how to keep more of your money from the government and get your entire refund, we can help you find a trustworthy tax professional in your area.