The taxman cometh with some very strange rules

American humorist and writer Mark Twain once said the difference between a taxidermist and a tax collector is that a taxidermist takes only your skin. And science fiction author Robert A. Heinlein cautioned, “Be wary of strong drink. It can make you shoot at tax collectors… and miss.”

For folks across the nation, Tax Day is inevitable and we owe the government our fair share. Since that’s the case, why not follow the writers’ lead by finding humor in the situation? Here are some wacky and weird tax tales from the U.S. and around the world:

  • Some nations have caused a stink by proposing taxes on cow flatulence. That’s because cow toots produce methane, which has been linked to global warming. In Ireland, the proposed tab is $18 per cow, but Denmark’s farmers are holding their noses at the prospect of forking over $110 per bovine.
  • Canada, our neighbor to the north, grants tax-exempt status to cereal makers whose boxes include free toys. The exemption applies only if the toys aren’t beer, liquor or wine.
  • Several centuries ago, powdered wigs were all the rage in Europe, primarily because thinning hair was considered a sign of poor health and hygiene. The trend caught on in earnest when the king of France, Louis XIV, hired a fleet of wigmakers to hide his balding pate. His cousin, British King Charles II, followed suit. Soon, the upper middle class adopted the look. Wigs remained in fashion until 1795, when England levied a tax on the “aromatic powders” that kept them smelling fresh.
  • Visitors to Charleston, S.C., will notice that many of the city’s historic homes sit sideways on their lots. In other words, the short side of the house faces the street while the longer front faces the side yard. That’s because property taxes were based on building frontage and residents devised a clever way to reduce their bills.
  • Many U.S. municipalities levy what’s known as a “jock tax.” When athletes travel to an away game, they have to pay taxes to the city or state in which the game is played. Talk about complex tax returns!
  • Great Britain taxes residents for each television set they own, with most of the proceeds going to fund British Broadcasting Company, or BBC, programming. The current tax on color TVs is $237, while the tax on a black-and-white model is $80.

Tax-time tips

If you’re like most Americans, you’ll spend time scurrying around and digging through drawers gathering receipts, statements and other paperwork needed to complete your tax forms by the April 15 deadline. Once you have them in hand and start working on your return, you’ll have a clearer picture of how much you made last year, how much you owe the government and your financial situation overall.

That makes tax season a good time to weigh your financial health and make sure you’ve set the foundation for a fiscally solid 2014 and beyond. Make sure you’re saving enough for retirement and are setting aside funds for things like vacations, emergencies and kids’ college needs. At the same time, take a look at your insurance coverage, including both life and health insurance.

Make sure your life insurance coverage is keeping pace with your family’s needs and that benefits will ensure your loved ones can maintain their standard of living without your income. As for health insurance, make sure your major medical insurance is backed up by voluntary insurance that can help pay expenses major med doesn’t cover, such as deductibles, co-payments and the household bills that keep rolling in when you’re sick or hurt and cannot work. Policies to consider include:

  • Disability insurance, which helps protect your most valuable asset: the ability to earn a living. Disability insurance pays a percentage of your salary if you experience a covered sickness or injury. Some policies provide benefits not only in the event of total income loss, but also in the event of partial income loss.
  • Accident insurance, which allows you to stay ahead of the out-of-pocket expenses that add up quickly after an unexpected injury. Benefits can be used to help pay for emergency treatment, hospital stays and medical exams, as well as to help with treatment-related transportation and lodging costs.
  • Critical care and recovery insurance, which helps pay for treatment related to serious, life-altering events such as heart attacks, strokes, kidney failure and third-degree burns.
  • Hospital indemnity insurance, which helps with out-of-pocket costs associated with serious accidents or illnesses. If you’re hospitalized, you’ll receive cash benefits that can be used to help with living expenses, including the house payment, utility bills, groceries, credit cards, child care and other necessities.

Claim your exemptions

We all want to do our civic duty by paying the taxes we owe, but there’s no sense giving Uncle Sam more than his due. When you’re completing your state and federal returns, be sure to claim the exemptions you’re entitled to. And remember, just as history is laden with strange taxes, there are strange exemptions too. For example:

  • You may be able to deduct the cost of your child’s instrument and music lessons – but only if the instrument of choice is a clarinet. That’s because orthodontists have successfully argued that playing the clarinet can help with an overbite, qualifying it as a medical expense.
  • If you live in New Mexico and are over age 100, you are exempt from taxes if you are not claimed as a dependent on someone else’s tax return.
  • If you’re in the adult entertainment industry, you may be able to deduct cosmetic surgery if you can show that the enhancements allow you to make more money at your profession.

Finally, remember that Tax Freedom Day, or the day you’ve earned enough to cover your state, local and federal taxes for the current year, arrives in mid-April. After that, the money you earn is your own.

This content is for informational purposes only and is not intended to be a solicitation.

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