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Family

'This isn't how it's supposed to be': Family with ‘good jobs’ lives paycheck-to-paycheck

“Go to college, get a degree, work to support your family. Here we are. Did that. Now what?”

via Mackmoan1988/TikTok and Karolina Grabowska/Pexels

A mom in Pennsylvania is having a hard time getting by even though she has a good job.

There’s a specific trait that exists deep in the American collective psyche that suggests that one’s financial well-being is somehow a reflection of their moral compass. Many people assume that if someone struggles to get by, they don’t work hard enough or make poor choices.

But that knee-jerk reaction couldn’t be farther from the truth. There are countless reasons why hard-working people struggle, especially these days with historically high inflation. Just about everything costs an arm and a leg.

For many, the sharp increase and costs forced them to go from being comfortable to getting by paycheck to paycheck. In addition to the financial stress, many feel stigmatized because of their struggles.

Mackenzie, a stressed-out mother from Pennsylvania, recently took to TikTok to share how hard it is for her family to get by even though she and her husband are responsible.

Normal people are struggling.

“I feel like my husband and I are doing everything right. We both have good jobs. I'm a nurse. I'm a registered nurse, work full time. He works full-time. We just got paid this past Friday, right? We paid the mortgage, bought some groceries, put some gas in the car,” Mackenzie said. “Guys, it is Tuesday. We have like [two hundred] or $300. To last us until next Friday.”

Mackenzie’s stress is only compounded by the frustration that comes with doing everything you were told to do and still coming up short.

“This isn't how it's supposed to be,” she continued. “Growing up, we were told to go to college, get a degree, work to support your family. Here we are. Did that now what? Now what?”

She then pointed out that our leaders seem out of touch and aren’t doing enough to help the average person. She sees a big disconnect between Washington, D.C. and Main Street, U.S.A. and hopes voices like hers can be amplified through social media.

“Feel free to share this video. Talk about it more. Maybe somebody who can do something about it will see one of our videos,” she added. "I just want to share our struggle, and maybe someone else can relate. I dunno, maybe we just need to support each other until things change."

A lot of people could relate. The video has received over 1 million views and 17,000 comments, where people shared how the salaries that once allowed them to live comfortably are now too small to get them through the month.

They also vented their frustrations at the fact that America’s political class appears to be ignoring the elephant in the room: the cost of living.

"I promise it’s not just you. It’s all of America," Trent Britton wrote. "I've never been in credit card debt and now I'm in debt because of GROCERIES," Chantelle Cyr added. "I make 6 figures and am STILL paycheck to paycheck! How in the hell?? I don't live beyond my means, either. It is so depressing!" Amy Knox Scott wrote.

In a follow-up video, Mackenzie shared a way forward for all struggling Americans, regardless of their class or political leanings.

"I am blown away by the kindness on that last video ... there were a few rude comments here and there, but for the most part—not only the kindness—but the thousands and thousands of people in the comments that are sharing their stories and their struggles,” she said.

Mackenzie suggests that we look for "commonalities, not differences" between people and communities and that we can find solutions through understanding everyone’s struggles.

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inflation

Pop Culture

This guy breaks down why he thinks a 90 percent tax rate is actually good for the economy

A pretty compelling argument for the top earners that most people don’t think about.

Jordan Waggoner|TikTok

Man explains how taxing the wealthy at 90 percent works.

Taxes are confusing for a good number of people, but we pay them anyway, and we think raising taxes is a bad thing based on how a tax hike would affect our personal finances. But no one really explains how having higher taxes for extremely wealthy people doesn't trickle down to mean higher taxes for lower tax brackets.

Apparently, the top earners used to pay up to 90% in taxes, and it helped stimulate the economy and create infrastructure in a way that hasn't been seen since. There has not been much of an effort to make taxes less confusing, so hearing the breakdown of how these absurdly high tax rates are helpful is refreshing.

Jordan Waggoner, who goes by @off_jawaggon on TikTok, often creates videos of him musing about policies, historical events and U.S. presidents. In a recent video, he explained how heavy taxing on the extremely wealthy actually works and people are thanking him for the easily digestible lesson.

The seven-minute video even had CPAs applauding his ability to explain such a highly confusing topic with immense accuracy. Waggoner is responding to a comment that says in part, "Tax cuts are the way out of our financial problems." Instead of dismissing the comment, he explains exactly how tax cuts are harmful and it turned out to be a lesson a lot of people could benefit from, even if on its face it sounds ridiculous.

"In fact, not only does higher top tax rate not kill jobs and stifle spending, it creates jobs and promotes spending," Waggoner says before explaining further. "When you hear that we should raise the marginal tax rate on top earners to 50, 70, 90 percent, that sounds insane because if we apply it to if we were paying that, that means that we would be paying that much percentage of our income to the government. And that does seem pretty ridiculous from pretty much anybody's perspective."

Yes, it does sound ridiculous at the start of the video, but the business owner goes on to explain in detail how it actually helps, answering most questions that pop into your head about how it works. You can watch the entire video below.

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tax the rich

Education

Teachers now get a higher tax deduction for supplies they buy. It's still totally insulting.

The new amount still doesn't come close to covering what teachers pay out of pocket.

Photo by Monica Sedra on Unsplash

The IRS raised the tax deduction limit for teachers from $250 to $300.

When I first saw the headline that the IRS was raising the tax deduction limit for teachers buying classroom supplies with their own money—you know, the necessary items to do their jobs well—I was thrilled. The previous deduction of $250 was laughable, a virtual slap in the face to professionals who regularly spend two, three or four times that amount per year buying supplies for their students out of their own pocket.

But when I saw the amount the deduction was raised to, I rage laughed. $300? Are you kidding me?

It sounds great to say, "We're raising the tax deduction for teachers by 20%" until you realize that the teacher deduction hasn't been raised since 2002 and that 20% increase is a measly $50.

Fifty bucks spread over 20 years is $2.50 a year. Whoop dee frickin' do. That doesn't even come close to keeping up with inflation, for the love. Just to keep up with inflation, that $250 deduction from two decades ago should be over $400 now.

And again, even that amount wouldn't be close to enough. An AdoptaClassroom survey of 5,400 PreK-12 teachers at public, private and charter schools across the U.S. found that teachers spent an average of $750 out of their own pockets for school supplies during the 2020-21 school year. About 30% spent more than $1,000.

In the face of that reality, raising the deduction limit from $250 to $300 is ridiculous, gross, rude, disrespectful and insulting. Teachers are professionals who are already paid less than what they're worth. The fact that they have to buy supplies out of their own pockets at all is a travesty. The least we can do is let them deduct whatever they spend out of their taxes.

I've been a teacher and I've also been a business owner. The number of things a business owner can legally deduct is bonkers. You can deduct so many things from your business income that you pay zero taxes on it, and we're putting this painfully low limit on out-of-pocket teacher supplies? Why? Who wins here?

Honestly, why do we even have a deduction limit for teachers at all? It feels like whoever makes these decisions either doesn't fully trust teachers or thinks they aren't deserving of reasonable compensation. I mean, how much do they really think teachers are going to be able to deduct here even if there were no limit? Newsflash: Teachers aren't rolling in extra dough. They're not looking for ways to game the tax system to avoid tax liability. They're literally spending their own money on their jobs—which is ridiculous—and hoping to get some back from the very same government that employs and pays them.

In recent years, some teachers have shared that they're simply refusing to buy classroom supplies out of their own pocket anymore, pointing out that it doesn't solve the problem, but masks it. It's also simply not doable for many. The teaching profession tends to draw people who are willing to make sacrifices for kids, which is admirable, but financial sacrifice should not be an expectation inherent in the job.

When I say teachers aren't paid what they are worth, I mean it literally. People who haven't worked in a classroom have no idea. The energy it entails, the responsibility it requires, the emotional toll it takes and the time outside of school hours dedicated to the work are beyond any other job I've ever had. Yes, the work can be rewarding, but a lot of times it isn't. In no other profession do we expect people to do so much for so little.

It's not just that teachers deserve to be paid well. (Not merely adequately, but well.) Our kids also deserve teachers who are valued by everyone around them. They deserve teachers who have all the resources they need to educate to the best of their ability. They deserve beautiful learning environments and classrooms full of learning materials that their teachers didn't have to dip into their wallets to pay for. They deserve to live in a society that prioritizes education above everything else, a society that understands quality education is the root of solutions to most problems.

Teachers are quitting in droves and many of those who are staying are barely hanging on. We can't afford to keep losing good teachers. Money isn't the only reason teachers are quitting, but it doesn't help. Let's drop the tax deduction limit altogether. It's quite literally the least we can do.

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Democracy

The IRS requires criminals to report and pay taxes on their illegal income. Yes, seriously.

@litcapital/Twitter

The IRS requires criminals to report their illegal income.

You know how sometimes you see something come through your social media feed and you think, "There's no way that's real," only to then have your mind blown when you find out it actually is real?

This is one of those times.

Twitter user @litcapital shared a post that appeared to be a screenshot from the IRS website with two entries on it:

"Illegal activities. Income from illegal activities, such as money from dealing illegal drugs, must be included in your income on Schedule 1 (Form 1040), line 8z, or on Schedule C (Form 1040) if from your self-employment activity.

Stolen property. If you steal property, you must report its fair market value in your income in the year you steal it unless you return it to its rightful owner in the same year."

Yes, you read that right. Dealing illegal drugs? Gotta pay taxes on that income. Stealing property? Gotta report that as income.

Surely this is made up, right?

Nope. Go here: https://www.irs.gov/publications/p17. Do a "Find" search with your browser and enter the word "illegal." Then put in "stolen." You'll find the entries listed under "Other Income," worded just like this.

We can all agree that taxes are overly complicated, and few of us have the time to read through every single IRS publication to figure them out. But requiring criminals to report illegal activity and stolen goods on their taxes? Really?

Someone had to actually come up with this policy. Someone had to say, "Hey, I think we should tell criminals that they have to report their criminal profits on their taxes," and someone else had to say, "Yeah, that's a good idea." Someone had to approve it. Someone had to type it up and publish it, too.

Did they all do this with a straight face? Was it a serious conversation? Did any brave soul say, "Um, that's stupid. No one is going to do that," because it's obviously stupid and clearly no one is going to do that?

That was my first thought upon seeing these tax requirements.

However, as it turns out, there actually is a good reason these policies exist. Illegal income does get reported sometimes, namely when someone has been caught (or thinks they're about to be caught) in some illegal activity and they don't want to get hit with a tax evasion charge in addition to whatever financial or property theft crime they've committed.

According to CNN Money, New England accountant Tom Hughes paid taxes on money he stole from his clients in 1999, 2001 and 2004. "I knew the money was taxable, there was no doubt about that," Hughes told the outlet. "I had already been caught, and I didn't want to face federal tax charges."

He now gives speeches on financial crime and professional responsibility. Go figure.

However, Hughes is the exception, as tax experts told CNN that most criminals don't report their illegal incomes. Duh. According to San Francisco tax attorney Stephen Moskowitz, most of those who do are facing embezzlement charges and are trying to avoid Al Capone-ing themselves. He has helped some of those clients document their illegal gains to avoid doubling their legal trouble due to illegal tax activity.

So basically, we have to have official tax requirements for illegal income in order for criminals to not be able to get away with tax evasion for that income. Still seems like a bizarre policy to actually write out in words, though, even if it makes sense from a legal perspective.

Humans are weird and money is weird and both things just seem to keep getting weirder. Yay us.

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Confused? This is exactly how the federal government's new Child Tax Credit works.

Photo by Kelly Sikkema on Unsplash

Families are beginning to receive direct monthly payments from the IRS, and some people seem to be confused about the what and the why of it. Heres' a brief explainer:

As part of the American Rescue Plan Act (passed by Congress and signed into law by President Biden in March), two things changed about the Child Tax Credit that families receive as part of their normal taxes. 1) The amount per child was increased, and 2) The distribution of those funds was changed for the year 2021.

Last year, the tax credit was $2,000 per child up to age 16, and the money was included in the calculation of a parent's tax return at tax time. (A tax credit is different than a tax deduction, just to be clear. It's basically a direct refund. A $2,000 tax credit is $2,000 handed back to you.)

This year, that tax credit amount was increased to $3,000 per child ages 6 to 17, and $3,600 per child under age 6. In addition to that increase, half of the tax credit amount will be paid out in monthly installments for the rest of 2021. The other half will be included in a person's tax return next spring, as usual.

The full increase amount impacts couples who earn up to $150,000 per year, or single parents making up to $112,500.

If you are a parent, you don't have to do anything to start receiving these payments as long as you filed taxes in 2019 or 2020. The money will come as a direct deposit or a check, depending on how you usually receive your tax return. If you didn't make enough income to file taxes those years, you have to sign up for the credit here.

President Biden explained briefly how it works on Facebook, but judging by the comments, the basic idea still isn't clear to many people. Some seem to have been unaware that parents always get tax credits for having children, and others believe that the extra funds are a free government handout instead of a financial hand-up that it's intended to be.

The COVID-19 pandemic took a particularly intense toll on parents, both logistically and financially—the extra funds for the tax credit increase come from the America Rescue Plan and are designed to strengthen the economy by putting more money back into the hands of working American families.

The Child Tax Credit changes in the American Rescue Plan only apply to the year 2021, but President Biden wants to extend this benefit beyond this year with the American Families Plan. Analysts have already called it a game-changer for child poverty. As The Atlantic reported:

"Despite the program not being targeted only toward low-income kids, our colleagues at Columbia University estimated that a child tax credit comparable to Biden's would cut child poverty by 45 percent. It would cut poverty among Black children by 52 percent and among Native American children by more than 60 percent."

Governments providing financial relief to citizens with children is nothing new. At least 10 wealthy nations provide universal child benefits to assist with the cost of child-rearing, either as a matter of course or as an incentive to counteract dwindling birth rates.

The White House website's information page about the Child Tax Credit for this year has some specific scenarios for families of various sizes and incomes to show how it works. But here's one real-world scenario:

My husband and I have two kids within the age range for the tax credit, and we make under the $150,000/yr income threshold. So here's the comparison between last year's tax credits and this year's for our family.

In 2020:

12 y.o. = $2,000

16 y.o. = $2,000

$4,000 total tax credits.

All $4,000 given at tax time.

In 2021:

12 y.o. = $3,000

16 y.o. = $3,000

$6,000 total tax credits.

Half ($3,000) will be distributed as $500 monthly payments from July through December of this year.

The remaining $3,000 will be given at tax time.

The one thing we have to be aware of is that while our family is receiving more money overall for 2021 ($6,000 vs. $4,000), we will see $1,000 less of a credit on our taxes than we saw last year come tax time, because of the distribution of half of the credits ahead of time. So more money in our pockets now, which is great. But we also need to make sure we're prepared for $1,000 less than we might have been anticipating on our tax return because we will have already received $3,000 in the form of the monthly payments.

For millions of families who have found themselves struggling due to job loss, furloughs, business shutdowns, childcare woes, and more, these increased child tax credits and advance payments will ease some of that economic hardship.

For more info go to www.whitehouse.gov/

From Your Site Articles

Replace libraries with Amazon? Not if these librarians have anything to say about it.

In case you didn't know, libraries are cool as heck.

They've been around for — well — ever (or at least thousands of years), there are more than 17,000 of them in the U.S., and they serve a myriad of purposes beyond just access to an unlimited number of free books (which, let's be honest, is pretty great in itself). Nearly all libraries offer access to computers and Wi-Fi, and many serve double as venues for community events. Best yet, libraries can help people develop the tools they need to combat the spread of false stories on the internet and identify reputable sources of information.

Don't worry! No books were harmed in the making of this photo. Photo by Thomas Lohnes/Getty Images.

With all those awesome things about libraries, it's kind of mind-boggling that someone call for them to be replaced by Amazon.

Economics professor Panos Mourdoukoutas published a (since deleted) blog at Forbes on July 21 arguing for shutting down local libraries in favor of brick and mortar Amazon stores "in all communities." His argument centers around the idea that "third places" like Starbucks and affordable content-streaming options like Netflix and Amazon Prime have all but made libraries irrelevant.

He wrote:

According to the American Library Association, Americans check out an average of eight books a year, which costs them an average of $36.96 in total taxes. As far as plans to "save taxpayers lots of money" go, this is a pretty huge dud.

Naturally, librarians weren't exactly thrilled about the idea.

Not to get too snarky here, but if you're planning to write an opinion article about why a private company should replace a public good, a librarian would be the perfect person to help with your research.

Many (correctly) said that the article's premise seemed to ignore the fact that there are millions of low-income individuals who rely on libraries. Replacing them with Amazon stores would take away their ability to apply for jobs, learn new skills, or just be able to read bedtime stories to their kids.

And not everyone has the cash to dish out for a Netflix account, either. A year of Netflix costs more than the average taxes that go to local libraries.

Plus, there's a community element that just can't be replaced by a for-profit company like Amazon. When the end goal is to make money versus to provide a service, events that don't help increase profits get cut.

The idea that physical books are some kind of relic of the past is simply false.

Some suggested that maybe, just maybe, the author hadn't actually visited a library in recent years.

And others reiterated this idea wouldn't actually save people who need libraries any money.

If there's a lesson to be learned here, it's that replacing public services with private ventures is a bad idea. That and don't piss off librarians.

Libraries are a lifeline to people of all income levels. Replacing it with something that would cater solely to middle and upper class families in order to save $40 a year won't exactly elicit a standing ovation from most people.

According to these tweeting librarians, it sure sounds like Mourdoukoutas didn't do his research. If only there were a place where he could go to read up on subjects he doesn't quite grasp...

OK, so this is a runway model during some sort of library-themed fashion show in 2015. Photo by Tristan Fewings/Getty Images.

Feel good about your splurging.

It's April, which begs the question how are you going to spend your tax refund this year?

(If, of course, you're fortune enough to get a refund. My condolences if you end up owing Uncle Sam.)

Bills need to be paid. And the zeroes in your student debt total should, at least in theory, keep dwindling. You should probably stock the pantry while you're at it, and make sure the gas tank is filled, too.

But if you cross off all the boring payments on your "being a responsible adult" list and still have a good chunk of change at your disposal, I have a few suggestions that could make you feel good about where your money is going.

Here are 23 seriously rewarding ways you can spend your tax refund this year:

1. Buy individual sets of flowers and visit a senior center.

Image via iStock.

Bring a friend if you like, too, and pass them out room by room. You'll definitely make (at least) one person's day.

2. Find a cool and important project helping teachers and students on DonorsChoose.

The online platform allows educators, mostly in underserved communities, to raise funds for neat learning opportunities for their students — from getting new computer tablets to providing enough instruments to create a drum line for music class.

3. Donate it to a local nonprofit helping your own community.

Big, national, or international nonprofits do vital work, of course. But there's something pretty special about seeing how the people in your own city can benefit from a little generosity.

4. Pay it forward in the drive-through line — or, better yet, the grocery store.

You've seen the viral stories of folks grabbing the tabs of other patrons ahead of or behind them in line. You could be the person who starts the next chain reaction.

5. This one isn't immediately gratifying, but ... your savings account may need some padding.

Image via iStock.

Just because something doesn't give you instant gratification doesn't mean it won't eventually be rewarding, right? Save up to pay off that loan, buy that car, be prepared for a rainy day, or be less burdened when next semester's tuition bill arrives. It'll be worth it.

6. Sponsor a person or group that has been taken advantage of by our flawed justice system.

News flash: The power structures at play in our law enforcement and justice systems favor white and wealthy people. Funded Justice is a crowdfunding platform where donors can help foot defense expenses — like legal and bail fees, for example — for those seeking a fair shot.

7. Throw a pizza party at your local food bank.

Ask the Pennsylvania man who did just that in 2016 — it's great knowing every cheesy bite is greatly appreciated.

Image via iStock.

8. Reach out to that friend you've been meaning to call and take them out to dinner and a movie.

You both deserve each other's company.

9. Chocolate.

Hey now, it's good for you. Indulge a little.

10. Give cash to a friend or family member who could really use it this month — in the form of a money cake.

Image via Jodi McKinney, used with permission.

OK, this is a bit lavish, but if you're feeling especially generous, here's how to make it, courtesy of Jodi McKinney's blog, "The Creative Life In Between."

11. Buy new socks and feminine hygiene products to give to a homeless shelter.

They're always among the most requested items, but — because you can't donate these sorts of items used — many donors don't realize how tremendous the need is. (Here are other vital products to donate you maybe haven't thought of.)

12. Donate to Meals on Wheels, then grab a friend and volunteer for the group locally.

After seeing President Donald Trump's proposed budget, the organization may need all the help it can get in the years ahead.

Photo by Justin Sullivan/Getty Images.

13. Commit to guilt-free purchases for the week.

Shopping for food, clothes, and other products that are fair trade, locally sourced, and produced by ethical companies can be an expensive, exhausting privilege not everyone can afford.

But with some extra cash on hand, try to take the leap for a few days. You may be able to work in some better long-term spending habits, too.

14. Book a solo weekend getaway on the fly.

Depending on whether you're an impulse buyer, this probably sounds either exciting or terrifying. Either way, you should indulge in some R and R. In today's 24/7, on-the-go world, recharging mentally and physically is important. (Plus, solo travel rocks.) Quick, go!

Image via iStock.

15. Donate to an organization that helps people who are particularly vulnerable in the era of Trump.

So many groups — immigrants, LGBTQ people, women, people of color, Muslims, and others — are facing a hostile administration attempting to strip away their rights and send us backward. Help them out.

16. Buy house plants and bulk up on garden items just in time for spring.

Research suggests that greening up your living quarters can actually benefit your health and boost happiness. If you're new to the plant game, maybe start out with some succulents (they practically take care of themselves).

17. Order a bunch of Girl Scout cookies for the neighbors you love or the ones you haven't met yet.

Photo by John Moore/Getty Images.

What's a better icebreaker than "Hi, here are some Thin Mints"? Another option: Hoard all of the Samoas and Caramel deLites for yourself (no judgment). Either way, you'll be supporting an important organization doing great things.

18. See if there's an Amazon Wish List registry for an animal shelter near you.

Animal shelters need lots of specific items to care for their four-legged friends — things like outdoor, durable furniture, cat and dog food, and specialized collars to keep pups (and their humans) safe.

19. Buy some Dogsbutter for your pup. Your purchase will helping another sweet doggo in need.

Dogsbutter — made from peanuts and flaxseed (minus any sugar, salt, or hydrogenated oils) — is a healthy snack for your pup they'll certainly enjoy. For each item you buy, Dog for Dog also gives an equal amount of food to a pet shelter, so dogs in need will benefit, too.

20. Buy "(R)evolution: The Girls Write Now 2016 Anthology" and help underserved teen girls pursue their creative dreams.

The book of essays and poetry was published by Girls Write Now, a New York-based after school program that connects girls with accomplished female writers, who serve as mentors. All proceeds of the book benefit the program.

21. Donate to a bowling team that's helping fund abortion access.

The National Abortion Access Bowl-a-Thon allows people to set up bowling teams and fundraise on behalf of abortion access across the country. Donate or — better yet — join a team. It's a sort of unconventional but equally awesome idea.

22. Get your neighborhood excited about books again, and snag some supplies to set up your own Little Free Library.

Once you build and stock one of these (ridiculously adorable) mini-libraries in your yard — or any other public-facing space you think might be a great spot — readers take a book from the stockpile and leave a different one in its place.

23. And last but not least: Treat yo' self.

GIF via "Parks and Recreation."

Get that flat-screen. Book that massage. Splurge a little (or a lot).

You work hard, and you deserve it.

Correction 4/12/2017: Several references to "tax return" in this article have been corrected to "tax refund."