Posted on 09/13/2004 10:11:21 PM PDT by neverdem
As a tax guy, I found myself chuckling quietly when President Bush said in his speech at the Republican National Convention that he would "lead a bipartisan effort to reform and simplify the federal tax code." Before long, I was howling with laughter. Sorry, folks, but efforts to "simplify" the code always bring clients streaming through my door. And the president quickly went on to show why: he wasn't able to offer simplification without adding two levels of complication within the next two minutes.
O.K., the president said, I'm going to lead an effort to simplify. But I'm also going to "create American opportunity zones" in which "we will provide tax relief." Thank you, sir, and please add Form AOZ to Forms 1116, 2106, 6251 and all the others we now have. Next came a "tax credit to encourage small businesses and their employees to set up health savings accounts." Please add Form TC-HSA.
I did get a little nervous, however, when Mr. Bush directed listeners to his Web site for more details. Would it explain how he planned to reconcile these new exceptions and credits with his promise of simplification? I needn't have worried: regarding simplification, it said only that "President Bush will work to make the tax code simpler for taxpayers, encourage saving and investment, and improve the economy's ability to create jobs and raise wages."
As a bonus, the site included some proposals not mentioned in the speech. One was for an "above-the-line tax deduction that individuals could claim for long-term-care insurance premiums" (add Form LTC). Another was an "additional tax exemption for home caregivers of family members" (add Form TEHCFM).
And, trust me, should the president really "simplify" things, an avalanche of other deductions and exemptions would be sure to follow.
Form M: Let's get serious. Somebody making $100,000 a year and spending half of it on round-the-clock care for a seriously ill spouse says, "Hey, how come I pay the same tax under simplification as the guy who makes a $100,000 and doesn't spend anything on medical care?" Let's make an exception for catastrophic medical problems.
Form DTUUC: The United States was founded on a revolt against unfair taxation. You can't have a guy in New York City paying about $10,000 in state and local taxes on his $100,000 income and also paying federal taxes on the same income. Shouldn't he at least be able to deduct the taxes he paid to New York to get closer to a level playing field with people in no-tax states like Florida, New Hampshire and Texas? (The DTUUC stands for double taxation unfair under the Constitution.)
Form M (No, make that Form I, we've already used M for medical): A man's/woman's home is his/her castle. And that castle was built with a mortgage. Don't pull the rug out from under the indebted baby boomers just as they reach retirement age and are worrying that Social Security won't be around (see budget deficits). The mortgage-interest deduction stays.
Form C: For charity, so people can give money to the groups running those faith-based initiatives that are filling in for the social-service programs the administration is so intent on cutting.
Form E: For the expenses of the self-employed and others who, unlike salaried workers, need to spend a lot of money to make their money.
Of course, it's not that simple. We would need to put some limits on the exceptions. For example, catastrophic medical deductions could be limited to expenses over 7.5 percent of income; mortgage interest could be limited to two personal properties and to the first $1 million of mortgage debt plus $100,000 home equity debt; gifts to certain charities could be no more than 50 percent of income, while others would have 30 percent or 20 percent limitations. Looking forward to that paperwork?
Well, the president has one thing right: doing away with the old forms and having a lot of new ones would at least give the appearance of change. So if he wins in November, you can make your appointment with my office at any time. Thanks to his plan to "simplify," you're going to need the help.
Jim Weikart is a partner in a tax preparation firm and the author of "Harry's Last Tax Cut," a novel.
Uh OH! Unfortunately, Lewis has proven himself incapable of such a task.
BTTT
Does the book address the intricacies of a national sales tax that not only doesn't exist but has never been tried? Not interested. Thanks
Buy a book you can get on Amazon called "Taxing Ourselves" if you are interested in this topic. It is very fair and balanced, and has all the numbers.A second recommendation for this book. Very fair review. There's a third edition, be sure to get that one.
Once again a moron devoid of any facts makes the issue about me.
Does the book address the intricacies of a national sales tax that not only doesn't exist but has never been tried? Not interested. Thanks.For that get United States Tax Reform in the 21st Century.
You can't have a guy in New York City paying about $10,000 in state and local taxes on his $100,000 income and also paying federal taxes on the same income. Shouldn't he at least be able to deduct the taxes he paid to New York to get closer to a level playing field with people in no-tax states like Florida, New Hampshire and Texas?We don't pay taxes in Texas? News to me. I pay taxes and I live in Texas. And I don't get to deduct most of them (just property taxes).
All that anyone need do to discover the truth of what I said is to look at your history on this very forum.
Eliminate the tax on individuals altogether. No sales tax. No personal income tax. Turn the welfare over to the states. If they need more money, let them enact taxes where the individual has a greater say.
While we are at it, eliminate the Department of Education. Return control back to the states.
Sensei Ern
I'm sorry, lost my mind and did not read close enough.
I thought you wrote the article.
ha ha
Well, why don't they ever discuss how it will put
more money in the government's handS.
Every time they discuss tax cuts, the opponents
always say, "well they have to get the money from somewhere and it takes away from health care, education programs that now can't be funded." (you get the point)
Why do they let them get away with that! Tax cuts and sales tax will put more money in the governments hands!!
Post it.
I spend $5800 per year complying with government requirements. That is the minimum. I think it is more like double that if everything including my time is included.
Damn, I'd like to be free again.
Post it.The truth is everything would be great with a NRST if we could only increase our labor supply 30% in one year!
I want to abandon the progressive tax system. It is a communist idea.
Like the cost for preparing a tax return?
Like the cost of preparing a tax return. As a miscellaneous itemized deduction subject to a 2 percent floor, most people do not receive any benefit of that particular deduction.
A deduction from income (subsidy) just the same. These are your words:
that is what we do when we allow a deduction from income for anything
So now its anything, except my deduction?
I am not disagreeing with you. I am just saying that many people do not receive any benefit from the deduction because only the amount of the deduction over 2 percent of AGI is deductible.
You can't believe anything you read in the NYtimes.
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