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No, the US tax code is not that hard to follow at the macro level. The complexity of the tax code comes from the thousands of potential write offs and exception

No, the US tax code is not that hard to follow at the macro level. The complexity of the tax code comes from the thousands of potential write offs and exceptions that favor certain industries as a result of lobbying.

gspr 6y ago
It sounds to me that if this were true, you could corner the tax preparer market. That's a strong hint that it's not true.
- gamblor956 6y ago
  How would you corner the market? There are thousands of tax preparers who have already made that observation and are already helping clients take advantage of those loopholes.
AnthonyMouse 6y ago
Complexity is complexity. If the write offs exist and you think you qualify so you take them, and then it turns out that there was an exception on page 28,274 of the amended tax code that meant you didn't quality but you took the write off anyway, welcome to jail.
- gamblor956 6y ago
  That's completely false. At worst you would owe a penalty. Due to the complexity of the tax code, there is a very high bar for criminality.
  - AnthonyMouse 6y ago
    > At worst you would owe a penalty. Not if they claim the violation was intentional. Which, whether or not they can prove that, means they can arrest you, and deplete the money you'd have used for your defense as bail. And they do so enjoy that trick where "intentional" generally applies to whether you intentionally did a thing that was against the law, even if you didn't know that it was against the law. Let's also not so easily dismiss as unproblematic a conclusion that you owe five times more money than you actually have in back taxes plus penalties and interest, which someone wouldn't have who filed the same tax return as you but didn't raise the ire of anyone in power. > Due to the complexity of the tax code, there is a very high bar for criminality. If only all of the complex laws actually worked that way.
    - kortilla 6y ago
      A judge wouldn’t give an arrest warrant for a deduction issue like that.
      - AnthonyMouse 6y ago
        A prosecutor wanting to give someone a hard time would choose tax law as the mechanism only if the amount in contention was large, e.g. it was against a business owner. You don't think a judge would issue a warrant in a case alleging million dollar intentional tax fraud?
        gamblor956 6y ago
        No, because charges for violating tax laws must originate from the tax authority, i.e., the IRS for federal taxes. Prosecutors don't have the authority to file charges for tax law violations on their own.
        srtjstjsj 6y ago
        Can you name a single case of it ever happening?
        AnthonyMouse 6y ago
        https://www.kare11.com/article/news/crime/former-officer-derek-chauvin-wife-charged-with-felony-tax-fraud/89-89eea2ad-28ff-438e-9ab5-cebcc5cda1cc https://www.kare11.com/article/news/crime/former-officer-der... My suspicion is that felony tax fraud would not have been charged there, or maybe even investigated, if he hadn't been implicated in the death of George Floyd. They had their man so they found his crimes. Obviously nobody is going to feel sorry for him, but only getting charged with something because you became a political target over something else entirely is exactly the problem in general. Registering your car in a lower tax state may not be legal but it's not exactly uncommon, and plenty of people probably don't even realize it's illegal.
        6y ago
- anfilt 6y ago
  The IRS generally just asks for the money back. You would have to ignore their requests before any criminal prosecution. If that is not the case your doing something more than just making a mistake when it comes to a deduction.
aksss 6y ago
Well, even for an individual, optimizing their tax burden is ridiculously complex if you just take the IRS forms and code in hand. For a price (e.g. TurboTax) you can probably get to 80%+, especially if you live a simple life of a rental and a w-2. The process certainly favors those with the time and resources to understand the nuances of the tax code and most people don’t/can’t prioritize that. So it makes money off the “lazy” and non-confrontational in the same way that a car salesman does. That such a comparison makes even a bit of sense doesn’t speak highly of our system. We all rely on the herd defense to protect us from minor math mistakes and code violations. Lord knows you don’t want to end up on the wrong side of the IRS. All my interactions with them have thus far been easy but if you listen to some stories during testimony in the nineties about IRS reform they weren’t always that way. I like to think a simple flat rate would be better across the board. Many smart people disagree though.

gspr 6y ago

It sounds to me that if this were true, you could corner the tax preparer market. That's a strong hint that it's not true.

gamblor956 6y ago
How would you corner the market? There are thousands of tax preparers who have already made that observation and are already helping clients take advantage of those loopholes.

AnthonyMouse 6y ago

Complexity is complexity. If the write offs exist and you think you qualify so you take them, and then it turns out that there was an exception on page 28,274 of the amended tax code that meant you didn't quality but you took the write off anyway, welcome to jail.

gamblor956 6y ago
That's completely false. At worst you would owe a penalty. Due to the complexity of the tax code, there is a very high bar for criminality.
- AnthonyMouse 6y ago
  > At worst you would owe a penalty. Not if they claim the violation was intentional. Which, whether or not they can prove that, means they can arrest you, and deplete the money you'd have used for your defense as bail. And they do so enjoy that trick where "intentional" generally applies to whether you intentionally did a thing that was against the law, even if you didn't know that it was against the law. Let's also not so easily dismiss as unproblematic a conclusion that you owe five times more money than you actually have in back taxes plus penalties and interest, which someone wouldn't have who filed the same tax return as you but didn't raise the ire of anyone in power. > Due to the complexity of the tax code, there is a very high bar for criminality. If only all of the complex laws actually worked that way.
  - kortilla 6y ago
    A judge wouldn’t give an arrest warrant for a deduction issue like that.
    - AnthonyMouse 6y ago
      A prosecutor wanting to give someone a hard time would choose tax law as the mechanism only if the amount in contention was large, e.g. it was against a business owner. You don't think a judge would issue a warrant in a case alleging million dollar intentional tax fraud?
      - gamblor956 6y ago
        No, because charges for violating tax laws must originate from the tax authority, i.e., the IRS for federal taxes. Prosecutors don't have the authority to file charges for tax law violations on their own.
      - srtjstjsj 6y ago
        Can you name a single case of it ever happening?
        AnthonyMouse 6y ago
        https://www.kare11.com/article/news/crime/former-officer-derek-chauvin-wife-charged-with-felony-tax-fraud/89-89eea2ad-28ff-438e-9ab5-cebcc5cda1cc https://www.kare11.com/article/news/crime/former-officer-der... My suspicion is that felony tax fraud would not have been charged there, or maybe even investigated, if he hadn't been implicated in the death of George Floyd. They had their man so they found his crimes. Obviously nobody is going to feel sorry for him, but only getting charged with something because you became a political target over something else entirely is exactly the problem in general. Registering your car in a lower tax state may not be legal but it's not exactly uncommon, and plenty of people probably don't even realize it's illegal.
        6y ago
anfilt 6y ago
The IRS generally just asks for the money back. You would have to ignore their requests before any criminal prosecution. If that is not the case your doing something more than just making a mistake when it comes to a deduction.

aksss 6y ago

Well, even for an individual, optimizing their tax burden is ridiculously complex if you just take the IRS forms and code in hand. For a price (e.g. TurboTax) you can probably get to 80%+, especially if you live a simple life of a rental and a w-2. The process certainly favors those with the time and resources to understand the nuances of the tax code and most people don’t/can’t prioritize that. So it makes money off the “lazy” and non-confrontational in the same way that a car salesman does. That such a comparison makes even a bit of sense doesn’t speak highly of our system. We all rely on the herd defense to protect us from minor math mistakes and code violations. Lord knows you don’t want to end up on the wrong side of the IRS. All my interactions with them have thus far been easy but if you listen to some stories during testimony in the nineties about IRS reform they weren’t always that way. I like to think a simple flat rate would be better across the board. Many smart people disagree though.