WHAT’S THE BUZZ, TELL ME WHAT’S A HAPPENNIN’ - TUESDAY EDITION

* Check out my article on "When Should You Begin Collecting Social Security?" at MAINSTREET.COM.

 * If you need any more proof that the current members of Congress are idiots there is “Deadlock in Congress Appears to Worsen as Midterms Loom” from CNBC -

“ . . .minimal expectations for achievement in the final months of the 113th Congress — and at the midpoint of President Obama's second term — are sinking lower, if that is possible.”

Any chances for any kind of tax reform are dead.  If the idiots do pass another temporary extension of the “extenders” it will again be at the end of the year, and will cause delays in the beginning of the 2015 tax filing season.

If only we could just impeach the whole lot en masse.

* A google search on the IRS’ ridiculous new voluntary certification program led me to a new (to me) tax blog.  The search results included the post “A View of the IRS Annual Filing Tax Season Program” at THE TAX DOC SPOT blog written by John Stancil, CPA.

John agrees with me on the specifics of many of the problems with this new nonsense.

* Also weighing in on “The New Voluntary Tax Preparer Program” is Enrolled Agent Trish McIntire of OUR TAXING TIMES.

Trish agrees that tax pros will not be rushing to volunteer, due to the lack of actual value of the “benefits” provided to those who do.  She is interested in seeing the numbers for the program come next January.  She, like I, doesn’t think they are going to be as high “as the IRS hopes”.

* BTW – one of my posts on this nonsense is included in the “Any Volunteers?” installment of TAXPRO TODAY’s weekly BUZZ-like “In the Blogs”.

* We move from IRS nonsense to Obamacare nonsense with a “summer rerun” of a 2013 post from Jason Dinesen - “From the Archives: Patient-Centered Outcomes Trust Fund Fee – An Exercise in Bureaucratic Futility”.

To quote one of Jason’s earlier posts on the Patient-Centered Outcomes Trust Fund Fee -

“This is insane, of course. An abject waste of a small business’s time.” 

 

I am looking forward to Jason's promised series of posts on the history of marriage in the US Tax Code.

* Scott Hodge, President of the Tax Foundation, provides an excellent assessment of the basic problem with the mucking fess that our Tax Code has become and what needs to be done in “The IRS Needs Tax Reform Not a Bigger Budget” at the Foundation’s TAX POLICY BLOG.

“Over the past two decades, lawmakers have increasingly asking the tax code to direct all manner of social and economic objectives, such as encouraging people to: buy hybrid vehicles, turn corn into gasoline, save more for retirement, purchase health insurance, buy a home, replace the windows in that home, adopt children, put them in daycare, take care of grandma, buy bonds, spend more on research, purchase school supplies, take out huge college loans, invest in historic buildings, and the list goes on.

In too many respects, the IRS has become an extension of, or substitute for, every other cabinet agency – from Energy and Education to HHS and HUD. But perhaps the most troubling development in recent years is that the efforts of lawmakers to use the tax code to help low and middle-income taxpayers has knocked millions of taxpayers off the tax rolls and turned the IRS into an extension of the welfare state.

The U.S. tax system is in desperate need of simplification and reform. The relentless growth of credits and deduction in the code over the past 20 years had made the IRS a super-agency, engaged in policies ranging from delivering welfare benefits to subsidizing the manufacture of energy efficient refrigerators.

I would argue that were we starting from scratch, these are not the functions we would want a tax collection agency to perform. Tax reform would return the IRS to its core function—simply collecting revenues to fund the basic operations of government.”

Right on, Scott!

Of course we have the idiots in Congress to blame for this mess.

* Over at ACCOUNTING TODAY Michael Cohn reports “IRS to Impose Direct Deposit Limits to Prevent Identity Theft” -

“The Internal Revenue Service plans to put in place new procedures starting next January to limit the number of refunds electronically deposited into a single financial account or pre-paid debit card to three, as part of an effort to combat fraud and identity theft, including fraud committed by unscrupulous tax preparers.”

It seems to me that there should never be more than two direct deposits per year to a single bank account or debit card – refunds from the separately filed returns of a married couple to a joint bank account or jointly held card.  Why would there legitimately be three?

The article mentions direct deposit of childrens’ refunds to their parents’ account.  I did not think refunds could be directly deposited to an account that was not in the name of the taxpayer claiming the refund.

I do not know why the IRS did not restrict the number of direct deposits to two per account per year from the very beginning.

 

What the IRS should limit to perhaps a handful is the number of refund checks mailed to the same foreign address.

* INC.COM brings us an “infographic” from the University of Southern California on “How to Legally Structure Your Startup”.

* Strange but true.  On July 4^th I was working on an article identifying the difference between Social Security and other retirement accounts as a source of retirement income when I come across a “tweet” touting a new article at MOTLEY FOOL titled “Social Security: 27 States That Won’t Tax Your Benefits”. 

* Jeff Brown tells us “When It Makes Sense to Take a Loan From Your 401(k)” at THESTREET.COM, where my MAINSTREET.COM tax tips have often been reprinted.

“Though experts typically caution against taking loans from the 401(k) {myself included – rdf}, the strategy has its good points.”

* I was never a big fan of the tv show SEINFELD.  I found the main characters too self-centered and not particularly sympathetic (unlike the friends of FRIENDS).  I do admit it was occasionally funny, but certainly not the iconic “best tv comedy ever” that many seem to think. 

However, since many readers apparently think highly of the sitcom I bring you “Seinfeld's 10 Enduring Lessons---About the IRS” from Robert W Wood at FORBES.COM.

* Joe Kristan started off yesterday’s Tax Round-Up at THE ROTH AND COMPANY TAX UPDATE BLOG, titled “IRS Stands Down on Imaginary 750-hour Rule for Real Estate Pros. And the Real IRS Budget Problem” with a discussion of the fact that “A newly-released memo indicates that the IRS will no longer hold real estate professionals to an illegal standard in determining passive losses.”

THE FINAL WORD:

Item #10 on the new IRS-issued Taxpayer Bill of Rights is “The Right to a Fair and Just Tax System”.

In order to assure this right to taxpayers the Tax Code would need to be totally rewritten and all current members of Congress would have to be replaced by competent and intelligent legislators who actually give a damn about the American public.

TTFN