Matt has a point , but I think his analysis is somewhat simplistic.
Sure, simply being chronically unemployed will dramatically reduce your income taxes. But it also leaves you without any money! The trick is to become unemployed at just the right moment, so that you end up with a bunch of money when you can really use it. Here is the strategy I used:
- Be gainfully employed for the first half of the year, earning lots of money and paying taxes at a breathtaking rate (based on what the government thinks you’ll earn over the entire year).
- Lose your job in June and don’t work again for the rest of the year, slashing your annual income in half and placing yourself in a much lower tax bracket.
- The following April, file your tax return, collect a large refund from the government, and deposit it in your bank account.
- On your way home from the bank, stop off at your auto mechanic’s shop to ask him why the words SERVICE ENGINE SOON have appeared in glowing letters on your dashboard.
- After the mechanic finishes replacing your transmission, write him a check for all the money you got back from the government and drive home.
See what you can accomplish with a little planning and strategic forethought?