Here is the bottom line. If the "withholding scam]" (which was instituted during WWII to make sure the war got paid for with the increased taxes at that time) had been done away with as it should have been when the war was over, things today would be quite different.

Folks who are self-employed have to pay their taxes quarterly, and that's why most businessmen tend to vote for Republicans, or whatever politician is telling them that they will lower taxes.

Folks who work on the paycheck withholding system have been seduced into thinking that they are actually getting money back from Washington, like some sort of rebate, if they get a refund around tax time.

Here is an undeniable fact of life: If everyone in America had to write a check for their taxes each quarter or each year or each month, there would be a revolt of this crazy notion that we should pay such a high percentage of our income to support this bloated bureaucracy.

It just goes to prove the idea that if you ever let Congress get its hands on a tax dollar, you will have little if any chance of getting it back. There is no such thing as a "temporary tax."

In Canada, a tax levied on deregistrations from an RRSP. Since RRSPs are tax deductible, when you remove funds from the tax shelter, you need to pay tax on them. The rates are as follows:

For $5,000 or less, 10%
For $5,001-$10,000, 20%
For greater than $10,000, 30%

Since the rates get steeper and steeper, many people choose to do deregistrations in chunks of $5,000 at a time. You have to be careful doing this though - if Revenue Canada thinks you're trying to evade the higher tax rate, they'll ding you for it and possibly charge you with tax evasion.

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