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Posted on 04/05/2013 7:20:50 AM PDT by SeekAndFind
Throughout our population, experts and non-experts alike, the verdict is nearly unanimous. The U.S. tax code is a hopelessly complex mess, antithetical to growth, and is crammed with conflicting incentives, which screams for reform. But there is little agreement on how to repair it. My preferences are necessary, just, and ordained in heaven. Your preferences are unnecessary, unjust and counter-productive.
Tax reform is the most difficult and complicated piece in the U.S. budget battle. It is integral to both the Republican House and the Democratic Senate budgets. As in every budget item, there is a conservative vs. liberal confrontation, but tax reform is loaded with more confusing detail, and it adds extra layers of difficulty to the budget debate.
Some liberal and conservative inclinations tend to intersect when the conversation focuses on elimination of tax preferences. But, both sides have their favorite exceptions. Democrats love tax expenditures for the less affluent. Republicans love the preferences they suspect will stimulate growth.
Additionally, there are wide divergences about how the deficit savings from eliminated tax preferences should be used. Republicans like deficit-neutral solutions which invest all savings in lowering rates for growth. Democrats would like to spend those savings, either for compassionate spending or for Keynesian growth stimulus.
More real difficulties arise when tax preferences, individual and corporate, are considered one at a time. This is where powerful lobbying interests intervene. These are the interests that finance campaigns and parties. Regional factors arise, too. The normal political “rules” are often overridden. In some committee votes, it is hard to distinguish Democrats from Republicans.
(Excerpt) Read more at forbes.com ...
I think everyone should file a paper return. Overwhelm the entire system. F**k em!
The tax code works JUST FINE, and there is no need to reform it...
...if you are a congressman looking to grant tax favors to various special-interest groups, groups that have campaign contribution money to spread around.
Why it can’t be done on one sheet of paper (or even a post card) is beyond me. List your gross income, no matter who you are, multiply by 5%, and send in that amount.
A few years ago I saw a copy of the most simple tax form.
Line 1: How much did you make last year?
Line 2: Send it in.
The article mentions something about the possibility of a limitation on overall tax preferences. Perhaps the author did not know that such a limitation already exists for people with relatively high incomes. It is the reduction in the deductions under Section 68. This section did not apply for the last several years, but it is back for 2013.
Get rid of it. All of it.
Replace it with...
nothing.
RE: Replace it with...
nothing.
___________________
So, how does the government run from now on?
Consider the millions of dollars spent each year by ordinary citizens to have their tax returns professionally prepared because the tax code is beyond anyone’s comprehension. Again this year I will fork over $250 to a CPA to prepare my taxes even though my tax situation is relatively simple. I just don’t trust myself to complete a return even with computer software because of the byzantine tax laws. My niece is an accountant working for a major national auditing firm and even she doesn’t do her own tax return.
My preferences are necessary, just, and ordained in heaven. Your preferences are unnecessary, unjust and counterproductive. -- from the article
I like simplicity, I do. So when talking about tax deductions, here is a simple formula: can the majority of working people take it? If yes, keep it. If not, then throw it out of the code.
So one benefit that goes out is the home mortgage deduction. Everyone knows how this came about: all loan interest used to be deductible, but during the last "reform" all interest deductions were thrown out -- except home mortgages.
Medical deductions have been effectively phased out for all but the most sick, because the threshold to take the deduction has been set so high. I had a heart attack, with $30,000 of the bill paid out of my picket, yet I still didn't meet the minimums.
How about the R&D tax credit? How much of that is being paid for research? From my experience working in high-tech companies, damn little. Development yes, but nothing that expanded the boundaries of knowledge.
And so on.
Right now, businesses can pass their increased costs down the line, so that for the end consumer the cost of living keeps going up because of government fees and regulation costs get passed down the line. (What does Congress think? That stockholders and owners take a hit on profit and earnings?)
I pay a lot extra for a tax attorney (who can argue in front of the Supreme Court) to prepare my small business return because I don’t trust the tax system.
Taxpayers need to wake up demand that lawmakers comply with Justice John Marshall’s official clarification that Congress cannot lay taxes in the name of state power issues, basically any issue that Congress cannot justify under the Constitution’s Section 8 of Article I.
Excise taxes on a much, much smaller budget.
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