Although the break is welcome, it is a little late - leaving taxpayers just a few days to adjust their finances. Congress also missed the IRS deadline for printing forms and instructions, and updating computer systems - meaning those who file early may be flagged incorrectly as owing the dreaded AMT. The IRS announced this week, however, that it will immediately begin the final reprogramming steps for its income-tax processing systems to prepare for the upcoming tax season. To help the tax professional and software communities prepare for the upcoming filing season, revised copies of the 12 tax forms impacted by the AMT legislation will be posted to IRS.gov within 72 hours after the AMT patch is signed into law.

I guess we have to be glad that Congress did something this year, even if it does end up costing taxpayers millions of dollars to implement. But I think Clint Stretch of Deloitte & Touche summed it up best when he said:

“This is the minimum amount of change you can make this year. They just keep passing the dead cat down to the next people who will have to deal with it. At some point the music will stop and somebody will be left holding it, but that’s probably not until 2009 or 2010.”

The AMT debate has been going on for years now. Everyone seems to think it’s a bad idea, especially the way it swallows up a larger and larger percentage of Americans, but nobody has the guts to make a change!

Let’s add “fixing the AMT” to the list of Congress’ New Year’s Resolutions.

The surtax would be a percentage of your tax bill, and if you don’t like the cost, then shut down the war. It’s a backhanded way of cutting off funding to the war, but it does put more power into the hands of the people. Right now, Congress does not necessarily want to cut off funding to the war because that would signify a lack of support for the troops. And as taxpayers… we don’t seem to care. We don’t seem to care about the ridiculous cost and strain on our resources - because we obviously haven’t been vocal enough to spark change.

But you know what would prompt change? Feeling the cost of war in your very own pocket.

The measure - sponsored by Obey, Rep. Jack Murtha, D-Pennsylvania, and Jim McGovern, D-Massachusetts - would require low- and middle-income taxpayers to add 2 percent to their tax bill, while higher-income taxpayers would add 12 to 15 percent.

“This is the first time in American history that when a president has taken a country to war and said ‘by the way folks, we’re going to have to sacrifice and the way to sacrifice is by cutting your taxes.’” Obey said. “It makes no sense.”

So regardless of your political views, what do you think about a war surtax - for the current war in Iraq or any other future conflicts? Is the best way to sacrifice for our country include paying additional tax?

This woman, Kathleen Casey-Kirschling, filed for early retirement Monday, becoming the first baby boomer to start collecting Social Security. Born one second after midnight in January 1946, the retired teacher leads the way for as many as 80 million individuals who will qualify for the retirement payout. And thus begins the end of social security…

What? Do you think I’m being a little too over-dramatic? Well, David Walker agrees with me! He’s the comptroller general of the Government Accountability Office, Congress’ legislative arm, who warned the Social Security system will soon have more recipients coming than it can afford to pay out.

“We face a tsunami of spending due primarily to the retirement of the baby boom generation and rising health care costs,” Walker said. “So what’s happened is we’ve gone from 16 workers paying into Social Security for every person drawing benefits in 1950 to 3.3 to one today, and we’re going down to two to one by the time the boomers retire in big numbers and that’s about where it will stay over the long run.”

Democratic Representative Tim Penny is also worried.

“We’re going to have tens of thousands of baby boomers retiring every week over the next decade or so and that means that by time we get to 2017, just 10 years away, we will no longer be collecting enough payroll taxes to pay Social Security benefits.”

Under current law, Social Security won’t have enough money to pay promised benefits in 2041, but there is another crunch much, much sooner, the result of the the federal government relying on Social Security to pay for its annual spending.

When Social Security gets payroll taxes it pays out most of the money in benefits. The rest is supposed to go into a trust fund. Instead the government, in it’s infinite wisdom, has been spending the money on other government programs, and putting IOUs into the trust. When Social Security needs the money it’ll turn to the government waiting for the payback. But the government won’t likely have any. It’s estimated that over the next 75 years between Social Security, Medicaid and other entitlements, the federal government will be in a $50 trillion hole.

So by the time I hit retirement age… I’ll be pulling in a nice $3/month from the government, after paying thousands and thousands of dollars into it during my lifetime.

That’s why I’m a little worried…

The most recent podcast was entitled America’s Budget Crisis and contained a panel of bi-partisan economists, comptrollers, and others to discuss the state of the U.S. budget crisis. I highly recommend listening (or watching below) this program. Although the topic might bring to mind a lot of “gloom and doom” talk, the program is actually full of hope, helpful ideas, and recommendation on how we can make a difference.

Listen to the podcast here, or simply watch below.

You’ve undoubtedly heard me talk about how minimizing taxes can be one of the easiest ways to save money. However, I usually only talk about how you can save money on your personal income tax returns. Another way in which you can save EVERYONE money is by helping the federal government save money.

Helping Uncle Same save money = Less taxes from your paycheck

I imagine at least a few of you are already rolling your eyes or even laughing out loud right now, but I want you to hear me out. I believe that all of the wonderful freedoms and rights that we enjoy on a daily basis are directly tied to responsibilities. One of the responsibilities that you and I have is to keep tabs on the spending habits of the government. If you and I don’t keep some of the boneheaded, bloated, and outrageously expensive legislation from being passed… you’ll eventually feel it in your back pocket.

A reader recently tipped me off to a great little site called WashigntonWatch.com which helps us all (regardless of your political affiliation) keep tabs on new legislation that’s being pushed through congress. But the site doesn’t stop there. The good folks at WashingtonWatch.com go so far as to report the financial effect each piece of legislation would have on the average American family.

For example, the Department of Homeland Security Authorization Act for Fiscal Year 2008, which authorizes the Homeland Security budget of $40 billion (yes, billion) is going to cost each American family approximately $372.97.

Have you heard of the John R. Justice Prosecutors and Defenders Incentive Act of 2007? This bad boy authorizes the appropriation of $25 million for fiscal year 2008 for the Attorney General to establish a program to repay student loans for certain prosecutors and public defenders who agree to serve for at least three years in those positions. Our cost? Only $0.74.

Not only can you get an overview of what’s happening on Capital Hill, but there are handy links to read the actual bill itself, read an analysis of the bill by the Congressional Budget Office, and see what people are saying about the bill.

With websites such as this one, it’s now even easier for you and I to fulfill our American responsibilities. I hate paying taxes as much as the next guy, but I REALLY hate when my hard-earned cash funds ridiculous pieces of legislation. Help me keep the government on budget and in turn, save yourself a little cash in the long run.