That argument doesn’t cut it with me. FICA “tax” is made up of payments to Social Security and Medicare. These are not true “taxes”.
Payments to Social Security are contributions to a retirement and disability fund. Individuals who pay into Social Security will receive a pension for life upon retirement, with benefits also available to surviving spouses and children, and are eligible to receive benefits if they become permanently disabled.
Payments to Medicare are a form of health insurance premium, the benefits of which are available upon reaching age 65.
State “payroll taxes” usually consist of contributions to an unemployment, disability or family leave fund that provide specific benefits in specific situations.
Regardless of how the mechanics of the Social Security and Medicare “funds” actually work, payments for FICA is not an income tax. The way the Tax Code is currently written, the cost of government is truly born by only half of those receiving its benefits.
++ I have been a vocal supporter of the concept of licensure and registration of 1040 preparers from the very beginning. However I do take exception with some of the individual regulations and requirements that are or will be in place.
It now appears that in addition to having to take a test to prove to the IRS that I know what I have been doing, without incident, for almost 40 continuous years now, and pay to waste two (2) hours each and every year sleeping through a repetitive sermon on ethics (if I am not honest and ethical at this point 2 hours a year of preaching ain’t going to make me so), in order to continue to practice my chosen profession, I will also be required to send my fingerprints to Washington.
Do the members of all professions that require a federal license have to provide their fingerprints as part of the initial application process? Will CPAs and attorneys who apply for a PTIN be required to submit their fingerprints?
I seem to recall hearing somewhere that once the fingerprints are submitted they will be compared to a national database to see if the applicant is a convicted felon, and that once this check has been completed the fingerprints will be destroyed. If this is truly the case I suppose it is another one-time inconvenience that I will simply have to “grin and bear”. But if the fingerprints will be kept forever in some kind of federal file then that is another thing altogether – something that I oppose.
So, what is the story on the fingerprints?
++ With recent talk of balancing the budget leading once again to the simple solution of “tax the rich, because they can afford it”, let me quote from a TWTP post of a few years ago with my thoughts on this solution -
“I am also against taxing the rich simply ‘because they can afford it’. Recent studies have shown that the ‘rich’ already pay more than their share of taxes. The Tax Foundation’s TAX POLICY BLOG recently posted “Tax Burden of Top 1% Now Exceeds That of Bottom 95%”.
Close the loopholes and do away with all the various special interest deductions and credits – yes (as I have done in my series on re-writing the Tax Code). But do not just automatically raise the tax rate of the successful.