I'm not paying taxes... I've reduced my taxable income to the point where I no longer pay taxes...
Going Galt Definition:
Going Galt is a voluntary financial strike of decreased income. An individual might choose to do this in order to protest the amount of money going to the federal government, or to protest what they feel are unfair taxes (if they earn less, they will be taxed less, therefore hurting the government). The term is taken from a character in Ayn Rand's novel "Atlas Shrugged"; the main character John Galt leads a movement where the wealthiest individuals leave their jobs for low-paying jobs in order to protest the socialist economy.
investorwords.com
Going Galt And Protesting Government Waste
Going Galt is one way at looking at retirement
MAKING LESS FEELS SURPRISINGLY GOOD!Many people have asked whether I’ll feel bad no longer earning a steady paycheck. I told them I wasn’t sure until I experienced the lack of income. Now that I no longer have the income, I feel surprisingly good!
The ideal adjusted gross income (AGI) for maximum happiness is $200,000 per individual and $250,000 per couple. Why? Because $200,000-$250,000 is a healthy amount of money to live a good life, save, and take advantage of the deductions the government provides. Earn any more and your deductions begin to phase out and you will be assaulted by the government through income profiling and tax increases.
Believe it or not, it takes a lot of effort to make a lot of money. I regularly had to put in 12 hour work days, travel constantly, and entertain clients. Now I’m just a starving writer trying to support his tennis habit and survive off ramen noodles. I “work” on average two to four hours a day and that’s it. I guess writing posts, connecting over social media, responding to comments, and responding to e-mails is work. But boy, I’ve got to tell you that my work doesn’t feel like work at all!
Any income over $200,000 is seriously just gravy for most individuals. I would say 99% of the world out there can live happily on $200,000 a year. I also believe most people who earn $200,000 a year save most of their money beyond this income level. Wouldn’t you agree?
Saving money feels good, but it’s not that rewarding in the near term. Only when you get to spend your saved money when you’re free does savings provide you the most return. In the medium term, savings just keeps you comfortable, which is not a bad feeling at all.
THE BENEFITS OF MAKING LESS* Less taxes. Assuming no itemized deductions, your effective Federal tax rate is only about 18% at $200K. The effective Federal tax rate obviously goes down the less you make.
* Less agitated by the Government. Your ears no longer burn when you hear the President talk about class warfare when all you’ve been doing is working hard, paying taxes, and minding your own business in a peaceful way. You might even start chanting, “Let’s get the rich!” in your head for fun!
* More deductions. Alternative Minimum Tax and income phaseouts aren’t as aggressive at $200,000 or below. Therefore, you get more deductions and pay less taxes. If you want to start a family, you will finally be treated equally and also receive a Child Tax Credit if your household income is below ~$110,000.
* Less contempt by others. It’s human nature to attack those who have more than you, whether it be money, fame, power, health, looks, and so forth. We like to blame others for our short comings because it’s easier than improving ourselves. The less income you make, the less people will come and hunt you down.
* More aligned with your consumption habits. If you are single person earning $200,000, are you really consuming $40,000 a year of taxes from public works? Perhaps if you were a single parent with 15 children in public school and spent much of your family’s time at the wonderful parks and libraries then yes. For most individuals, this is not the case.
* More confidence. Given you’re closer to middle class, you will have more confidence in doing business and living life in general because politicians can’t afford to assail the middle class. The middle class is the majority, and politicians will pander to you now! You don’t have to worry about being denied XYZ benefits because you make too much.
* Feel more patriotic. Earning $200,000 is a great income, no matter which way you slice it. Paying $40,000 in Federal taxes as an individual is a lot, but it will make you feel proud that you are supporting your country. Pay much more than $40,000 a year in Federal taxes starts reversing that good feeling inside.
* Increased happiness. Given making over $200,000 doesn’t bring more happiness, you will become more happy because of all of the things mentioned above! $200,000 is plenty enough for a single person to have a great life.
Everything Is Relative
It’s important to understand that everybody’s definition of Going Galt is different since everybody makes a different amount and derives a different level of return from the government. My definition so happens to be making $200,000 or less to protest government waste and not pay more than $40,000 a year in Federal income taxes. If I had 10 kids who benefited from public school and always hung out at the public library for several hours everyday, and were eligible for the $1,000 per year per kid child tax credit, I wouldn’t mind pay more than $40,000 in Federal taxes.
Another good definition of Going Galt is matching your income exactly to the amount of itemized deductions you have to pay no taxes. For example, if you have $50,000 in mortgage interest and property taxes, just make $50,000 a year and use your savings to make up the difference to fund your lifestyle.
financialsamurai.com
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