TALKING TAX REFORM

 

Tax “reform” is once again in the news – as the GOP TAX ACT 2 attempts to make permanent the provisions of the original GOP TAX ACT.

Tax reform discussions rarely touch on actual "reform" or the many inequities and basic “unfairness” in the US Tax Code.  And they usually minimize the growing complexity.  What the politicians call "tax reform" legislation actually continues to add complexity to the Code – and the current big allegedly beautiful bill working its way through Congress is no different.

As a retired veteran tax professional I am well aware that the Internal Revenue Code has grown into a convoluted “mucking fess”.

The major source of tax return errors, by both paid tax preparers and taxpayers who self-prepare, and tax fraud is the excessive complexity of the Tax Code.

As I have said often in the past, like Frankenstein in the Hammer film, the Internal Revenue Code must be destroyed!  The current US Tax Code, as revised by the recent tax legislation, must be totally shredded, and rewritten from scratch.

The new Internal Revenue Code MUST acknowledge and confirm the fact that the one and only purpose of the federal income tax system is to raise the money necessary to fund the government. 

The Tax Code MUST –

(1) Be simple – easy for everyone to understand.  Simplicity for simplicity’s sake. 

(2) Be fair and equitable - treat all taxpayers equally.

(3) Be consistent – treat specific conditions, situations, and activities, and maintain specific definitions and descriptions, the same in all instances.

(4) Encourage savings, investment, and growth.

(5) Index for inflation all allowable deductions and credits.

The Tax Code MUST NOT –

(1) Be used for social engineering, to redistribute income or wealth, or to deliver social welfare and other government benefits.

(2) Encourage or discourage certain economic decisions (other than savings, investment, and growth), or provide exclusive benefits for specific industries, business activities, or classes of taxpayers.

(3) Contain any refundable credits, or any phase-outs, exclusions or adjustments based on Adjusted Gross Income or Modified Adjusted Gross Income.

(4) Contain any “alternative” tax calculation systems (such as the current “Alternative Minimum Tax”).

(5) Contain any temporary deductions, credits, benefits, or provisions.

I discuss in some detail my personal recommendations for actual tax “reform” in my book THE JOY OF PREPARING TAXES – and also reminisce about my 50 years as a tax professional.

I will send you a copy of this book – as a pdf email attachment – for only $3.00!

Send your check or money order payable to Taxes and Accounting, Inc – and your email address – to:

TAXES AND ACCOUNTING, INC
THE JOY OF PREPARING TAXES
POST OFFICE BOX A
HAWLEY PA 18428

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