In a previous post entitled, “The Government Encourages Small Business Owners To Fire Employees” I discussed how my friend Zach let go of one of his employees to make room to pay for potentially $30,000-$40,000 more in taxes in 2011 and beyond. As you all know, the government won’t be squeezing small business owners anymore thanks to the tax compromise signed by the President on Friday Dec 17, 2010.
The tax compromise adds some $850-$900 billion to the Federal deficit over 10 years, which is a big problem if the economy and therefore revenue collection doesn’t pick up during this time. Our children will pay for our excesses and that just doesn’t seem fair. But what about Zach’s state of mind and his fired employee who is paying the price now?
I grabbed a quick beer with Zach last night and asked him how pumped he was that he no longer has to budget for increased tax expenses going forward? “A little bit, but not so much“, Zach replied. What a downer, I thought to myself as I believe a tax compromise is good for all Americans.