7 ms·

I have a better idea. Simplify the tax code so anyone can do theirs on an index card. There is absolutely no reason for the gargantuan tax code in a free societ

I have a better idea. Simplify the tax code so anyone can do theirs on an index card. There is absolutely no reason for the gargantuan tax code in a free society.

georgemcbay 10y ago
Not that I believe you think it is, but this isn't exactly a startling new idea. The same forces described in the article are also responsible for lobbying against simplicity in general. There is a whole giant industry that would go away in a puff of smoke (or at least be drastically reduced) if individual taxes weren't unnecessarily complex.
- eli 10y ago
  Also, everyone wants a simpler tax code except for the parts that benefit them. Few economists think the mortgage interest deduction is a good idea, but try telling that to homeowners.
  - smsm42 10y ago
    I'd exchange MI deduction for equivalent reduction in income tax. But the government wants to keep power to induce people into doing what it thinks is better, taxes and deductions are a major tool in this. Without explicitly giving up that power, nothing would change, so homeowners are not the main thing to blame it, they just do what the government wants them to do and makes profitable for them to do.
afarrell 10y ago
The problem is that every individual provision is popular with one group or another. But we could move to a system like the UK has where taxes are calculated for you and if you don't have contractor income you don't even need to file. But this would need changes to things like the Married Filing Jointly status.
- abrowne 10y ago
  How about the IRS calculates, you click OK if you agree, and if you don't, you're free to file? (Maybe this is how the UK system works; I've only done American and Canadian.)
- scurvy 10y ago
  Married filing jointly is one of the more sexist things codified in US law. It basically says women make no money and the man has to provide for everyone with a big salary so deductions and credits for the big earner. Or it says that if you're a dual income bunch of shmucks, that your wife must make 80% of what you do. Think about when these laws were written and look at it through a historical context. Once you do, it will outrage even the most even keeled.
  - alaaibrahim 10y ago
    could you elaborate more, where does it say that your wife should make 80% than what you do?
  - smsm42 10y ago
    > It basically says women make no money Could you explain this? I don't see where MFJ assumes women make no money. > if you're a dual income bunch of shmucks, that your wife must make 80% Also don't see how it means that. Could you explain your argument in a bit more detail?
    - scurvy 10y ago
      Sure. When the federal income tax was instituted in 1913, all of the tax rates were individual (and the lowest bracket covered most Americans). People who were married could lump sum their income and divide by 2 to find the correct rate. Married filing jointly back then was just a way to save on paperwork and hassle. Lump the two incomes together, divide by two, and treat the two people equally. That was it. In 1948, you got the official married filing jointly "status" and with it, the various income credits, deductions, etc. One would think that the married filing jointly tax rates would simply be double what the individual rates were, right? Wrong. The joint rates were about 1.8x the individual rates. Someone was 100%, someone was 80%. This being 1948, the woman in the dual income family was 80%. The IRS didn't want to appear to favor married couples over single people (even though they did), so they said 1.8X instead of 2X the individual rates. If you were lucky enough to be a big wage earning white male in 1948 America, you got a huge tax break since stay-at-home moms were the norm, there was a baby boom going on, and only about 20-25% of women worked. Married filing jointly is silly. It should be a sum of the family income, divided by two, then mapped to the individual rates.
charlesdm 10y ago
Great idea in theory, but hard to implement. Tax breaks were often created for a reason. Take them away, and that special interest group will try to protect it and lobby to keep it in place.
- deleted 10y ago
  [deleted]
fnord123 10y ago
>Simplify the tax code so anyone can do theirs on an index card. Aim higher. In the UK, your employer informs the government about your wages and HMRC figures out how much you paid and whether it's the correct amount. And if you want you can check the numbers. In other countries it's basically the same but you have to log into the e-government portal to click 'yes, the values you have are correct'. Obviously if your finances are more complicated then you need to file; but it's not very difficult.
- zw123456 10y ago
  Yes, of course. Obviously if the IRS knows your income, knows you mortgage interest, interest on savings and dividends and it is all electronically recorded, there what is the point of filing. Only to keep accountants and tax software companies in business. I can guarantee you that if you file a return and copy the numbers in wrong from your W4 you will get a computer generated letter. I did that by accident once I transposed two digits in the amount on a 1099 and I got a letter from them that was computer generated. So obviously they are having computers check it, so what is the point of me wasting time and money on filing. The UK system (and many other countries) is obviously the way to go.
  - sokoloff 10y ago
    Even on mortgages, the IRS doesn't have all the information. I refinanced my mortgage and paid points for the refi. Those points have to be amortized over the life of the loan (which the IRS knows the law, but doesn't know that I paid points on the loan). I just refinanced that mortgage again, meaning next year that I'll write off the rest of the points for the previous loan as a 2017 expense. There's plenty that the IRS doesn't know until you tell them.
    - xienze 10y ago
      That just sounds like a situation where the bank needs to supply information to the IRS for you so come tax time they already know about it.
geofft 10y ago
That's what the 1040EZ is. Seriously, take a look at it, it's a single page, only half of which is calculations: https://www.irs.gov/pub/irs-prior/f1040ez--2016.pdf https://www.irs.gov/pub/irs-prior/f1040ez--2016.pdf If you object that this isn't sufficient for you or someone else, I'll be happy to argue that whatever behavior would make you 1040EZ-ineligible should either not be permitted in a free society (because it's a tax-avoidance scheme for certain types of rich people with political power) or should be taxed as W-2 income (because otherwise it'd become such a tax-avoidance scheme), but good luck getting the people who benefit from those schemes to allow it.
- smsm42 10y ago
  One thing that is not 1040EZ is charity donations. I mean we could kill all charity deductions but not sure NGOs would be happy about it.
  - geofft 10y ago
    Do we get more value out of charity donations by normal people than we lose in charities being used as a tax-privileged vehicle for rich people to exert their desire on the world? Also, charitable donations have weird constraints. My church would like to end deportations of undocumented immigrants based on our reading of Leviticus 19:34, and the most effective way to do that would have been to campaign against certain presidential candidates. We couldn't do that. Another church wanted to end civil recognition of same-sex marriage based on their reading of Leviticus 18:22, but that involved campaigning for a ballot initiative, and they were allowed to do that to the tune of millions of dollars. I'm obviously not inclined to say "Please start taxing my church," but the fact that we can participate essentially by chance in some political activities and not others doesn't seem like it would exist in a "free society".
    - smsm42 10y ago
      First, your distinction between "normal people", which are moral, and "rich people", who are just evil, are kind of disgusting. Having a lot of money doesn't automatically make one evil (to remove all suspicion, I am not rich and likely never will be, at least by US standards :). I'm not sure what your point is there, but it doesn't sound good. > the most effective way to do that would have been to campaign against certain presidential candidates That's certainly not the most effective way. US law has very clear immigration provisions, which require certain documentation, and US president swears to uphold the law. Most efficient strategy would be to change the law, thus voting for specific - namely, open-border - candidate for Congress, that can change the law so that US has immigration procedures no longer, and thus does not have to deport people who violate them. Note that I did not say "efficient" but "most efficient" - I see no really efficient strategy that would make US a country without immigration law anytime soon, and having such law, it is natural to have to enforce it - otherwise there's no point in having it. In any case, nothing prevents you to from campaigning for or against any policy or any candidate, be it open border or not, as a private person or as a part of an organized effort. Why you need the church to do it? Just create an independent organization and campaign as your hear pleases. > I'm obviously not inclined to say "Please start taxing my church," If you register a non-profit and make all the requirements that tax-exempt non-profits have, and do charitable work and so on, nothing prevents you from calling your organization "church", but I don't see why doing so should give you any special status not available to any other nonprofit. And if it doesn't qualify as nonprofit, then it should be taxed by the same rules as the rest of organizations are.
deleted 10y ago
[deleted]

I have a better idea. Simplify the tax code so anyone can do theirs on an index card. There is absolutely no reason for the gargantuan tax code in a free society.

georgemcbay 10y ago

Not that I believe you think it is, but this isn't exactly a startling new idea. The same forces described in the article are also responsible for lobbying against simplicity in general. There is a whole giant industry that would go away in a puff of smoke (or at least be drastically reduced) if individual taxes weren't unnecessarily complex.

eli 10y ago
Also, everyone wants a simpler tax code except for the parts that benefit them. Few economists think the mortgage interest deduction is a good idea, but try telling that to homeowners.
- smsm42 10y ago
  I'd exchange MI deduction for equivalent reduction in income tax. But the government wants to keep power to induce people into doing what it thinks is better, taxes and deductions are a major tool in this. Without explicitly giving up that power, nothing would change, so homeowners are not the main thing to blame it, they just do what the government wants them to do and makes profitable for them to do.

afarrell 10y ago

The problem is that every individual provision is popular with one group or another. But we could move to a system like the UK has where taxes are calculated for you and if you don't have contractor income you don't even need to file. But this would need changes to things like the Married Filing Jointly status.

abrowne 10y ago
How about the IRS calculates, you click OK if you agree, and if you don't, you're free to file? (Maybe this is how the UK system works; I've only done American and Canadian.)
scurvy 10y ago
Married filing jointly is one of the more sexist things codified in US law. It basically says women make no money and the man has to provide for everyone with a big salary so deductions and credits for the big earner. Or it says that if you're a dual income bunch of shmucks, that your wife must make 80% of what you do. Think about when these laws were written and look at it through a historical context. Once you do, it will outrage even the most even keeled.
- alaaibrahim 10y ago
  could you elaborate more, where does it say that your wife should make 80% than what you do?
- smsm42 10y ago
  > It basically says women make no money Could you explain this? I don't see where MFJ assumes women make no money. > if you're a dual income bunch of shmucks, that your wife must make 80% Also don't see how it means that. Could you explain your argument in a bit more detail?
  - scurvy 10y ago
    Sure. When the federal income tax was instituted in 1913, all of the tax rates were individual (and the lowest bracket covered most Americans). People who were married could lump sum their income and divide by 2 to find the correct rate. Married filing jointly back then was just a way to save on paperwork and hassle. Lump the two incomes together, divide by two, and treat the two people equally. That was it. In 1948, you got the official married filing jointly "status" and with it, the various income credits, deductions, etc. One would think that the married filing jointly tax rates would simply be double what the individual rates were, right? Wrong. The joint rates were about 1.8x the individual rates. Someone was 100%, someone was 80%. This being 1948, the woman in the dual income family was 80%. The IRS didn't want to appear to favor married couples over single people (even though they did), so they said 1.8X instead of 2X the individual rates. If you were lucky enough to be a big wage earning white male in 1948 America, you got a huge tax break since stay-at-home moms were the norm, there was a baby boom going on, and only about 20-25% of women worked. Married filing jointly is silly. It should be a sum of the family income, divided by two, then mapped to the individual rates.

charlesdm 10y ago

Great idea in theory, but hard to implement. Tax breaks were often created for a reason. Take them away, and that special interest group will try to protect it and lobby to keep it in place.

deleted 10y ago
[deleted]

fnord123 10y ago

>Simplify the tax code so anyone can do theirs on an index card. Aim higher. In the UK, your employer informs the government about your wages and HMRC figures out how much you paid and whether it's the correct amount. And if you want you can check the numbers. In other countries it's basically the same but you have to log into the e-government portal to click 'yes, the values you have are correct'. Obviously if your finances are more complicated then you need to file; but it's not very difficult.

zw123456 10y ago
Yes, of course. Obviously if the IRS knows your income, knows you mortgage interest, interest on savings and dividends and it is all electronically recorded, there what is the point of filing. Only to keep accountants and tax software companies in business. I can guarantee you that if you file a return and copy the numbers in wrong from your W4 you will get a computer generated letter. I did that by accident once I transposed two digits in the amount on a 1099 and I got a letter from them that was computer generated. So obviously they are having computers check it, so what is the point of me wasting time and money on filing. The UK system (and many other countries) is obviously the way to go.
- sokoloff 10y ago
  Even on mortgages, the IRS doesn't have all the information. I refinanced my mortgage and paid points for the refi. Those points have to be amortized over the life of the loan (which the IRS knows the law, but doesn't know that I paid points on the loan). I just refinanced that mortgage again, meaning next year that I'll write off the rest of the points for the previous loan as a 2017 expense. There's plenty that the IRS doesn't know until you tell them.
  - xienze 10y ago
    That just sounds like a situation where the bank needs to supply information to the IRS for you so come tax time they already know about it.

geofft 10y ago

That's what the 1040EZ is. Seriously, take a look at it, it's a single page, only half of which is calculations: https://www.irs.gov/pub/irs-prior/f1040ez--2016.pdf https://www.irs.gov/pub/irs-prior/f1040ez--2016.pdf If you object that this isn't sufficient for you or someone else, I'll be happy to argue that whatever behavior would make you 1040EZ-ineligible should either not be permitted in a free society (because it's a tax-avoidance scheme for certain types of rich people with political power) or should be taxed as W-2 income (because otherwise it'd become such a tax-avoidance scheme), but good luck getting the people who benefit from those schemes to allow it.

smsm42 10y ago
One thing that is not 1040EZ is charity donations. I mean we could kill all charity deductions but not sure NGOs would be happy about it.
- geofft 10y ago
  Do we get more value out of charity donations by normal people than we lose in charities being used as a tax-privileged vehicle for rich people to exert their desire on the world? Also, charitable donations have weird constraints. My church would like to end deportations of undocumented immigrants based on our reading of Leviticus 19:34, and the most effective way to do that would have been to campaign against certain presidential candidates. We couldn't do that. Another church wanted to end civil recognition of same-sex marriage based on their reading of Leviticus 18:22, but that involved campaigning for a ballot initiative, and they were allowed to do that to the tune of millions of dollars. I'm obviously not inclined to say "Please start taxing my church," but the fact that we can participate essentially by chance in some political activities and not others doesn't seem like it would exist in a "free society".
  - smsm42 10y ago
    First, your distinction between "normal people", which are moral, and "rich people", who are just evil, are kind of disgusting. Having a lot of money doesn't automatically make one evil (to remove all suspicion, I am not rich and likely never will be, at least by US standards :). I'm not sure what your point is there, but it doesn't sound good. > the most effective way to do that would have been to campaign against certain presidential candidates That's certainly not the most effective way. US law has very clear immigration provisions, which require certain documentation, and US president swears to uphold the law. Most efficient strategy would be to change the law, thus voting for specific - namely, open-border - candidate for Congress, that can change the law so that US has immigration procedures no longer, and thus does not have to deport people who violate them. Note that I did not say "efficient" but "most efficient" - I see no really efficient strategy that would make US a country without immigration law anytime soon, and having such law, it is natural to have to enforce it - otherwise there's no point in having it. In any case, nothing prevents you to from campaigning for or against any policy or any candidate, be it open border or not, as a private person or as a part of an organized effort. Why you need the church to do it? Just create an independent organization and campaign as your hear pleases. > I'm obviously not inclined to say "Please start taxing my church," If you register a non-profit and make all the requirements that tax-exempt non-profits have, and do charitable work and so on, nothing prevents you from calling your organization "church", but I don't see why doing so should give you any special status not available to any other nonprofit. And if it doesn't qualify as nonprofit, then it should be taxed by the same rules as the rest of organizations are.

deleted 10y ago

[deleted]