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IRS Declares Federal Tax Holiday

As an example, consider a florist who earns $7.00 per hour, eight hours per day, and is taxed at the 10% rate. By choosing to celebrate the tax holiday, the florist will save $5.60 in 2007 taxes.

In a controversial move, IRS Commissioner Mark W. Everson declared April 17 a tax holiday in celebration of the federal income tax filing deadline. House Speaker Nancy Pelosi (ND) was quick to criticize his actions, “This is just another example of pre-election-year pork barrel politics.” Even some Republican Party stalwarts chimed in, but Former Speaker Newt Gingrich defended the Commissioner’s actions, “This Administration understands that taxes belong to the people, not the government. And you know what? This Administration also respects your freedom of choice. If you want to pay taxes, you don’t have to take this holiday. It’s completely optional.”

Under the terms of the tax holiday, taxpayers will be invited to take the day off on Tuesday, April 17. Those on unpaid leave will be allowed to deduct the full amount of their unearned wages from line 7 of Forms 1040 and 1040A, or line 1 on Form 1040EZ. Only wages will be affected, and other income will be taxed at the taxpayer’s marginal rate or AMT.

As an example, consider a florist who earns $7.00 per hour, eight hours per day, and is taxed at the 10% rate. By choosing to celebrate the tax holiday, the florist will save $5.60 in 2007 taxes.

This new holiday currently has no official name, although the Commissioner mused, “We might call it pwnday ’cause, you know, we totally pwn you.”

April 17, 2007
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