[Cracker Jack]

I have noticed these Fair Tax discussions seem to come up most frequently during “tax season”, which for me is December through April 15. I spent several days in December assembling data to estimate my 2010 taxes and planning moves to (legally) minimize my income tax. During January and February, I will be reviewing W-2’s, 1099’s of various sorts, business expenses and receipts and collecting deduction information. Then I will assemble a package to send to my tax accountant. I may then file about March 15, unless I owe more tax. Then filing date will be April 15.

I mention this because the Fair Tax works way different than this. With the Fair Tax:

1. Tax is paid when I buy something and it is over. I don't have to tell the government where I got the money, or how many dependents I have, or what I gave to charity, or how much property tax I paid. I pay tax every time I buy something at retail. (Used items are tax-free.) There is no “tax season”. April 15 is just another day.

2. I don't have to keep track of where my money comes from, or how much tax has been withheld. Salary, profits, capital gains, dividends are all the same. I pay tax when I spend it, not when I earn it. And the government no longer cares about depreciation, or which formula was used to calculate it for a particular item.

3. Cute little gimmicks to defer taxes, like IRA’s (standard or Roth) or 401(k)’s or 403(c)’s, are totally unnecessary. Saving accounts are savings accounts. Income from them is not taxed until it is spent.

4. I don't have to keep track of donations to charities or worry about whether they are registered as a 501(c)(3) with the IRS.

5. It is no longer any of the government's business how much income I have. Fair Tax payments are anonymous, so they don't know how I spend it either.

As I read these posts, I see very little discussion of how much life would be simplified by the Fair Tax. That is a major benefit for me. Depending upon whose flat tax proposal is used, very little of the complexity of the current system goes away. What does a flat tax really gain us?

[phil_will1]

“What does a flat tax really gain us?”

You are right about that. The flat tax is appealing to the inside the beltway crowd because it essentially wipes the slate clean and enables the lobbyists to go right back to work peddling influence and reinstating the tax preferences that “the flat tax” wiped out. This is what history has taught us.

[Bigun]

Great post my FRiend! It really is ALL about

F R E E D O M ! ! !

[lewislynn]

As I read these posts, I see very little discussion of how much life would be simplified by the Fair Tax.

That's because you're wrong on most if not all points.

Wages, salaries and self-employment income are required to be reported.

If you want a (GAG!)"prebate" you'll have to disclose your dependants.

You are not "required" to disclose your charitable contributions now, what's your point?

How do you pay property taxes without the government knowing how much you paid?

If you have profits it means you sold something, you'll have to keep books on what and how much you sold it for, if they're taxable or not and if so remit 23% of your gross...including 23% of your self-employment income from services...How is that different again?

Savings and both interest paid and earned ARE taxable. There is a 23% tax on any amount over the basic FED FUND interest rate as well as a 23% (actually 30%) on any fees.

The Fairtax doesn't change banking laws requiring banks to report large deposits...so you could still hoard cash without the government knowing. But how is that any different?