Tuesday, July 28, 2009

California Thinking

To give you an idea of how California finally arrived at a "balanced" budget, one of the methods was to increase income tax withholding. Not income tax, as they cannot do that, merely the amount withheld from paychecks during this fiscal year. Residents will get a refund next year, but that is next year's problem. California income tax withholding is already greater than the amount of the tax, so this will mean helping to balance this year's cash flow at the cost of even bigger refunds next year.

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