I apologize for making such a vacuous comment, but this is just sad. Was it just a slow day for the feds, or do they really not have anything better to do with their time? If it's the latter, maybe we should start laying off FBI agents.
The expense incurred is in the loss of one's privacy.
One already lost his privacy when he gave the information to the tax preparer.
My point is that it is immoral and unethical for corporations to collect and then sell personal information without the express consent of the individual.
When you sign up for the TurboTax service they give you their privacy policy, and ask you whether or not you agree to it. An entire section of that policy is devoted to telling you all about the information that Intuit collects via cookies, how they use the information, and how it may be made available to third parties. How is this not obtaining your express consent?
I think it naive to rely upon the ethical rigor of data-mining/marketing corporations to not attempt to make money at an individual's expense.
I fail to see the expense incurred by the individual.
Making money off of information, when there is no contractual obligation not to make money off that information, is perfectly legal. That does not mean that it is moral or ethical to do so.
If you get special privileges from government that gives you an economic advantage over private unincorporated businesses, then you should be included.
I think these "special privileges" you're talking about are relatively overrated. What we're really talking about here is common law, not government privileges. In fact, pretty much all the advantages of incorporation could be handled through contracts - corporate law just simplifies things so we're not signing a contract every time we engage in a transaction with a corporation.
Yes, services would be taxed, but "Business-to-business purchases for the production of goods and services are not taxed."
Well, this wouldn't be business-to-business, since a construction worker isn't a business, but I suppose I'm reading too deeply into things.
If you bought the brick for yourself, yes, you pay sales tax. If you bought the brick to build something you are going to sell, no sales tax (you would collect the tax from the consumer).
So...what if you bought the brick to build a house to live in for a few years and then sell? I guess the only reasonable answer is that sales tax would be due on the initial purchase, and not the resale...
Since you would be the consumer, you would have to pay sales tax for the materials, but I'm not sure how the workers would be handled. In theory I'm guessing they would be providing you with a service and therefore should collect the sales tax from you.
It can get even more complicated, too, if you take a used item and improve it, then resell it. To avoid loopholes, you'd probably have to tax the difference in the taxed value and the new value, essentially, a Value Added Tax (VAT). But if you added in the value accrued over time, it'd be similar to a capital gains tax. I dunno, this stuff gets confusing quick.
I would much prefer a flat tax on income that exempts the first x number of dollars and applies to both individuals and corporations equally.
Raise X high enough, say to 20-25,000, and I wouldn't mind that, for individuals. For corporations I'm not sure that'd work. You couldn't give corporations an exemption, because someone could just create thousands of corporations each with their own exemption. And then there's the problem of double taxation, which I think is problematic. If you don't tax dividends or capital gains, then the rich will basically pay nothing in taxes. One proposal to avoid this double taxation is to allow corporations to treat dividends as an expense. I guess that'd be fair.
But I'm not a big fan of income tax in the first place. It's just too artificial - if I do something for you and you do something for me in return, why should we have to pay the government for that? I dunno, I've got a headache now just thinking about it:).
You're right, cutting spending should be top priority. We need to find some way to force that....
Yeah, and Reagan's idea, to cut taxes and thereby force ourselves to cut spending, didn't work. I think the only way to force the government to cut spending is to elect people to congress who will...cut spending. I think privatization is usually a good plan too, though. I look at the US Post Office as a good example of what we should be doing with as many government services as possible.
Well, it probably isn't worth the time to make sure you owe exactly $999. But if you aim for owing $500, and you can get it to within $499, then you haven't done so bad.
As for your 1% estimate, I think most people can do a lot better than that. If you've got a mortgage, then you can "earn" 6, 7, 8% by prepaying that. If you've got credit card debt, same thing. Personally I'm invested in REITs, which average a return a lot better than 1%.
But hey, even trying to break even at the end of the year is a lot better than what I've seen far too many people do: they contribute way too much intentionally so that they can get a big refund - then they pay some ridiculous interest rate for a refund anticipation loan so they can get it back faster.
The underpayment penalties are based on your prior year's return and a percent value - For example, you pay penalties if the tax you owe is greater than 10% of your total tax bill this year and if the tax you owe is greater than the tax you paid last year.
And if you owe $1000 or more. Also, for those in a certain income bracket, they have to pay 110% of the tax they paid last year.
But basically, for those of us who pay little in taxes (less than $10,000), and have a relatively stable income, it usually comes down to whether or not we owe $1000 or more.
The point of the whole article is that those who used Intuit's site to file their taxes might (should) be disturbed that Intuit is paying a third party (Omniture) to collect information that most people would consider to be of a sensitive nature
That might be the point. But it isn't true!
Similarly, it is immoral for a company to make money off of information that you give to them (or, in this case, information you've given to an entirely different company) for a specific other purpose
I have to disagree. Giving a merchant someone else's credit card number without their permission when you buy something is fraud. You're stealing that product from the merchant that you bought it from. Making money off information, when there is no contractual obligation not to make money off that information, is perfectly moral. No one owns information, after all.
I think the rate they're talking about is 23%, maybe a little less.
Well, they've done some mathemagic on that number to try to make it look better. See the FAQ. 23% of $260,000 is about $60,000.
From what I understand, though, the price of the home would drop quite a bit, because there wouldn't be any income taxes (or tax compliance costs) embedded in the cost of building the home.
I seriously doubt that the income tax savings on a $260,000 home would be anywhere near $60,000. Most labor in a new home construction is performed by low-income workers who pay little or nothing in income taxes.
And I thought the "FairTax" proposal imposed a tax on services, as well as goods. So wouldn't the contractors have to pay a tax on the services being provided by the construction workers? Or is that just a big loophole?
And then, what about the building materials? If I buy a brick, do I have to pay taxes on it? Or is there an exemption for building materials, or something? The whole thing seems like a bunch of hand-waving to me.
Oh yeah, what if I am my own general contractor? What if I buy the building materials and hire the workers and build the house myself. Then there is no sale, so am I exempt from sales tax? Would I have to then pay sales tax at the point that I resell the house?
Also, there is no tax on used goods. If you buy a used home, there is no sales tax collected.
What about repairs? Do you have to pay sales tax on repairs? If you hire someone to make the repairs? If you do the repairs yourself? Would you actually save on taxes by building the house then selling it, then repairing it, rather than building it, repairing it, then selling it? It just doesn't make sense. Why should someone who only buys used goods get through his whole life without paying any taxes?
And, when you sell a home there is no capital gains tax.
Capital gains taxes on the sale of a property you live in were already pretty much eliminated years ago anyway (a married couple gets a $500,000 gain tax free every 5 years).
Keep in mind that I am not an economist or an expert on the FairTax plan and, for all I know, it could be a terrible idea.
From what I've seen, it seems like it is.
The current tax system MUST be overhauled, though, and I don't have a better plan.
I agree with you that the current tax system sucks. I'm especially opposed to the regressive FICA tax. But I think the best plan is to cut spending. I think we could probably cut it all the way down to zero eventually. This would of course put a larger burden on the states, but states could raise property taxes a bit to compensate.
if you're so naive as to think that it's ok that they can do it simply because they don't
OK? It seems to me it's an empirical truth. You give information to a company, it's therefore possible for that company to sell the information to someone else. I don't see how that can be OK or not OK, it's just a fact.
I read their definitions. They state a regressive tax is one that effects poor people more. Such as a gas tax, or tax on food.
I read "A tax that takes a larger percentage from the income of low-income people than the income of high-income people." "A tax that takes a higher percentage of low incomes than high ones. Sales taxes, especially on food, clothing, medicine, and other basic necessities are widely cited as examples of regressive taxes." "A regressive tax is a tax which takes a larger percentage of income from people whose income is low."
Therefore the FairTax is not regressive, because there is a prebate to cover the sales tax on those basic necessities.
This just shifts the portion of the curve over which the tax is regressive to the right a little bit. Sales tax is still regressive by any standard definition, because it "takes a larger percentage from the income of low-income people than the income of high-income people".
On average, people that have more money spend more money.
Yes, this is true, on average.
They therefore pay more in taxes.
On average (that is, if the sales tax were based on all spending, which no sales tax I know of is).
That is a fair way of doing things which doesn't penalize success or hard work, nor unfairly benefit sloth and laziness (or treachery and fraud).
I disagree that it is fair. In fact, I'd go so far as to say that any tax is unfair unless it can be proven that it funds a service which is absolutely necessary for a functioning society and that it does so in proportion to the amount of that service which is provided. Taxing someone more because they spend more makes no sense. There is nothing wrong with spending, and it should not be discouraged by the government.
Those hated rich people that have earned a lot of money (yes, EARNED it) benefit everyone in our economy when they are able to invest it, rather than having to fork it over to the government.
What about those hated rich people that haven't earned a lot of money? In any case, I'm not saying we should tax intangible property, such as investments, so apparently you misunderstood me. I'm talking about taxing tangible property, in fact, mainly real property (land, houses, buildings).
And that is ignoring the complexity of taxing "a percentage of what you own." Can you imagine the loopholes?
No, I can't, that's actually one of the benefits of a tangible property tax, especially with regard to titled property.
The lobbyists would have an orgy over something like that. The FairTax does not give lobbyists any footholds. It is fair and transparent.
Why? Because you say so? You don't think there are any loopholes in a sales tax? I'll get back to this.
Taxing what people "own" is even more egregious than taxing their income. It would punish people who are successful, who save, who invest, and it would favor those who are lazy, who don't make much, who don't save anything, who spend it all.
Again, you must think I'm talking about intangible property.
Honestly, I don't think you've thought this through at all. Conversely, the people studying the FairTax proposal have been studying it for a decade. It has had hundreds of economists studying it for many years.
So why don't you explain it to me, then. Forget the rest of the arguments, and just explain to me why "FairTax" is fair, and how it's going to close the loopholes. Because when I go to the site, I see a bunch of hot air and contradictory claims.
I'm arguing that a tax should be based on the actual utility a person gains in life, not merely the *potential* for utility gain.
Well, personally i think a tax should be based on the services provided, but let's go with the utility gained.
When someone creates an inheritance and passes it on to his heirs, isn't there utility derived from that?
That means taxing expenditures instead of income.
You can't have income without having an expenditure.
This is more than a semantic argument, which is all your comments seem to be addressing.
Fine, I'm going to ignore the question of whether or not the tax would be regressive.
This is about fundamentally changing what the federal government considers to be a measure of a person's worth, from potential utility gain (or money) to actual utility gain (goods and services purchased with that money).
I would think the measure of a person's worth would be to measure that person's worth (assets minus liabilities). That has nothing to do with income or expenditures.
The example of the traditional IRA was meant to indicate that the concept of not taxing potential utility gain was already present in our economy.
I don't think that was the purpose of the institution of the traditional IRA. If you have some evidence that it was, feel free to point it out.
Actually, a better argument on your part would have been that Roth IRAs are generally more popular these days *because* they are taxed up front while leaving the gains on investment tax-free.
Roth IRAs are more popular? I've seen hundred of taxes this year and not a single person who was eligible for a traditional IRA deduction chose to contribute to a Roth instead. Between those who contributed to a traditional and those who contributed to a Roth it was about 50/50, but all of those who contributed to a Roth IRA were either ineligible for a deductible traditional IRA or had no tax liability and therefore would not have received a deduction.
In any case, as I said, I don't think the purpose of a traditional IRA is to tax people more fairly because of some notion of taxing only utility. If that were the case, the limit would be a lot more than $3000, and it wouldn't be phased out for high income tax payers. The traditional IRA was set up to try to encourage people to save for their retirement (at least on its face, in reality it was more likely set up to appease certain segments of the population to try to win their vote).
No. Because someone that works at Wal-Mart or Brown & Co. might find out your SSN, bank account # (if you sign up for direct deposit), date of birth, etc. and open up multiple credit card and/or checking accounts in your name.
And I care about this because?
(That is, if the tax company would actually sell SSNs and bank account numbers, which I seriously doubt.
He who would give up Essential Liberty to save 37 cents, is one cheap-ass bastard! -- Ben Franklin (sort of;-) )
Telling someone who I'm doing business with my SSN and bank account info isn't giving up Essential Liberty.
Right, because the fact that it's technically possible to do something which they don't actually do is a bad thing. RTFA, and the actual quote in context, if you don't know what I'm talking about.
Ummm... No. I used TaxAct this year (and last). It's free to create your return, but you have to print it and mail it in.
No, you got ripped off. I filed my return through TaxAct and my girlfriend filed her return through them, and both of them were free.
You must have gone directly to the site. If you do that, you have to pay. But if you enter the site from the IRS's free file page, it's free. Free to print, and free to e-file. You gotta pay for the state, though, that is, if your state has an income tax (mine doesn't).
Investments create growth, provide jobs, bolster the economy, etc., and the government *will* get its share when those people (or their heirs) spend the money.
I'm sorry, I don't understand what you're saying. Property tax would cause feudalism? Just the opposite is true. No property taxes would cause feudalism.
Wow, I just looked at the page, and apparently most of them don't have income restrictions. I believe this has changed since I filed back in Februrary. I remember TaxAct being the only one which had no restrictions back then.
Well, I don't know much about TaxAct, but if they are offering software to the public for free, then how do they make their own living?
Many ways. For one thing, the only way to get to the free version of TaxAct is to go through the government website. They also charge for state returns, for special deluxe features, and for a professional tax preparer to look over your return.
Could there be a motivation inside there to capture and use peoples information in a similar way to what this article is complaining about?
I highly doubt that would be in their best interests, and depending what information it was it would probably be illegal.
A direct federal tax entry system would bypass that issue.
All I can say is, give it time. In ten years, I bet there will be open source software out there which enables you to e-file for less than the cost of a stamp.
But wouldn't the expense of creating a secure cross-platform e-filing system, be more than offset by the efficiency savings resulting from more people e-filing?
Well, the government is trying to get it both ways. They're trying to get more people e-filing without building the e-filing system themselves. It'll take longer, perhaps, but in the long run I think it's the smart thing to do. In ten years, e-filing will likely cost less than a stamp, and I'm talking about a full open source software package. You can already e-file for free if you can find the right place to go (hint, it's linked to from the government's list of Free File Alliance Companies. I e-filed for free, and my girlfriend e-filed for free. Everyone is eligible to e-file for free through TaxAct.com. The only problem is that "free file" isn't very highly publicised.
Well, that and the fact that the US tax code is too complicated for most people to file on their own anyway. But even here, the federal government might go the same way as California, and start mandating that paid preparers who use software packages e-file all returns that are eligible.
It saves the government heaps in terms of manually checking paper-work and entering figures.
If this were done in the US, it'd probably affect government revenues the most just from the fact that so many people would fill out their taxes incorrectly as a result of not going to a professional. But I don't know how complicated the UK tax system is. And I'm not sure if it would increase or decrease revenues here. But I do know that most people don't know how to properly fill out their tax returns.
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I apologize for making such a vacuous comment, but this is just sad. Was it just a slow day for the feds, or do they really not have anything better to do with their time? If it's the latter, maybe we should start laying off FBI agents.
The expense incurred is in the loss of one's privacy.
One already lost his privacy when he gave the information to the tax preparer.
My point is that it is immoral and unethical for corporations to collect and then sell personal information without the express consent of the individual.
When you sign up for the TurboTax service they give you their privacy policy, and ask you whether or not you agree to it. An entire section of that policy is devoted to telling you all about the information that Intuit collects via cookies, how they use the information, and how it may be made available to third parties. How is this not obtaining your express consent?
I think it naive to rely upon the ethical rigor of data-mining/marketing corporations to not attempt to make money at an individual's expense.
I fail to see the expense incurred by the individual.
Making money off of information, when there is no contractual obligation not to make money off that information, is perfectly legal. That does not mean that it is moral or ethical to do so.
Nor does it mean that it is immoral or unethical.
If you get special privileges from government that gives you an economic advantage over private unincorporated businesses, then you should be included.
I think these "special privileges" you're talking about are relatively overrated. What we're really talking about here is common law, not government privileges. In fact, pretty much all the advantages of incorporation could be handled through contracts - corporate law just simplifies things so we're not signing a contract every time we engage in a transaction with a corporation.
Yes, services would be taxed, but "Business-to-business purchases for the production of goods and services are not taxed."
Well, this wouldn't be business-to-business, since a construction worker isn't a business, but I suppose I'm reading too deeply into things.
If you bought the brick for yourself, yes, you pay sales tax. If you bought the brick to build something you are going to sell, no sales tax (you would collect the tax from the consumer).
So...what if you bought the brick to build a house to live in for a few years and then sell? I guess the only reasonable answer is that sales tax would be due on the initial purchase, and not the resale...
Since you would be the consumer, you would have to pay sales tax for the materials, but I'm not sure how the workers would be handled. In theory I'm guessing they would be providing you with a service and therefore should collect the sales tax from you.
It can get even more complicated, too, if you take a used item and improve it, then resell it. To avoid loopholes, you'd probably have to tax the difference in the taxed value and the new value, essentially, a Value Added Tax (VAT). But if you added in the value accrued over time, it'd be similar to a capital gains tax. I dunno, this stuff gets confusing quick.
I would much prefer a flat tax on income that exempts the first x number of dollars and applies to both individuals and corporations equally.
Raise X high enough, say to 20-25,000, and I wouldn't mind that, for individuals. For corporations I'm not sure that'd work. You couldn't give corporations an exemption, because someone could just create thousands of corporations each with their own exemption. And then there's the problem of double taxation, which I think is problematic. If you don't tax dividends or capital gains, then the rich will basically pay nothing in taxes. One proposal to avoid this double taxation is to allow corporations to treat dividends as an expense. I guess that'd be fair.
But I'm not a big fan of income tax in the first place. It's just too artificial - if I do something for you and you do something for me in return, why should we have to pay the government for that? I dunno, I've got a headache now just thinking about it :).
You're right, cutting spending should be top priority. We need to find some way to force that....
Yeah, and Reagan's idea, to cut taxes and thereby force ourselves to cut spending, didn't work. I think the only way to force the government to cut spending is to elect people to congress who will...cut spending. I think privatization is usually a good plan too, though. I look at the US Post Office as a good example of what we should be doing with as many government services as possible.
Well, it probably isn't worth the time to make sure you owe exactly $999. But if you aim for owing $500, and you can get it to within $499, then you haven't done so bad.
As for your 1% estimate, I think most people can do a lot better than that. If you've got a mortgage, then you can "earn" 6, 7, 8% by prepaying that. If you've got credit card debt, same thing. Personally I'm invested in REITs, which average a return a lot better than 1%.
But hey, even trying to break even at the end of the year is a lot better than what I've seen far too many people do: they contribute way too much intentionally so that they can get a big refund - then they pay some ridiculous interest rate for a refund anticipation loan so they can get it back faster.
The underpayment penalties are based on your prior year's return and a percent value - For example, you pay penalties if the tax you owe is greater than 10% of your total tax bill this year and if the tax you owe is greater than the tax you paid last year.
And if you owe $1000 or more. Also, for those in a certain income bracket, they have to pay 110% of the tax they paid last year.
But basically, for those of us who pay little in taxes (less than $10,000), and have a relatively stable income, it usually comes down to whether or not we owe $1000 or more.
The point of the whole article is that those who used Intuit's site to file their taxes might (should) be disturbed that Intuit is paying a third party (Omniture) to collect information that most people would consider to be of a sensitive nature
That might be the point. But it isn't true!
Similarly, it is immoral for a company to make money off of information that you give to them (or, in this case, information you've given to an entirely different company) for a specific other purpose
I have to disagree. Giving a merchant someone else's credit card number without their permission when you buy something is fraud. You're stealing that product from the merchant that you bought it from. Making money off information, when there is no contractual obligation not to make money off that information, is perfectly moral. No one owns information, after all.
I think the rate they're talking about is 23%, maybe a little less.
Well, they've done some mathemagic on that number to try to make it look better. See the FAQ. 23% of $260,000 is about $60,000.
From what I understand, though, the price of the home would drop quite a bit, because there wouldn't be any income taxes (or tax compliance costs) embedded in the cost of building the home.
I seriously doubt that the income tax savings on a $260,000 home would be anywhere near $60,000. Most labor in a new home construction is performed by low-income workers who pay little or nothing in income taxes.
And I thought the "FairTax" proposal imposed a tax on services, as well as goods. So wouldn't the contractors have to pay a tax on the services being provided by the construction workers? Or is that just a big loophole?
And then, what about the building materials? If I buy a brick, do I have to pay taxes on it? Or is there an exemption for building materials, or something? The whole thing seems like a bunch of hand-waving to me.
Oh yeah, what if I am my own general contractor? What if I buy the building materials and hire the workers and build the house myself. Then there is no sale, so am I exempt from sales tax? Would I have to then pay sales tax at the point that I resell the house?
Also, there is no tax on used goods. If you buy a used home, there is no sales tax collected.
What about repairs? Do you have to pay sales tax on repairs? If you hire someone to make the repairs? If you do the repairs yourself? Would you actually save on taxes by building the house then selling it, then repairing it, rather than building it, repairing it, then selling it? It just doesn't make sense. Why should someone who only buys used goods get through his whole life without paying any taxes?
And, when you sell a home there is no capital gains tax.
Capital gains taxes on the sale of a property you live in were already pretty much eliminated years ago anyway (a married couple gets a $500,000 gain tax free every 5 years).
Keep in mind that I am not an economist or an expert on the FairTax plan and, for all I know, it could be a terrible idea.
From what I've seen, it seems like it is.
The current tax system MUST be overhauled, though, and I don't have a better plan.
I agree with you that the current tax system sucks. I'm especially opposed to the regressive FICA tax. But I think the best plan is to cut spending. I think we could probably cut it all the way down to zero eventually. This would of course put a larger burden on the states, but states could raise property taxes a bit to compensate.
if you're so naive as to think that it's ok that they can do it simply because they don't
OK? It seems to me it's an empirical truth. You give information to a company, it's therefore possible for that company to sell the information to someone else. I don't see how that can be OK or not OK, it's just a fact.
I read their definitions. They state a regressive tax is one that effects poor people more. Such as a gas tax, or tax on food.
I read "A tax that takes a larger percentage from the income of low-income people than the income of high-income people." "A tax that takes a higher percentage of low incomes than high ones. Sales taxes, especially on food, clothing, medicine, and other basic necessities are widely cited as examples of regressive taxes." "A regressive tax is a tax which takes a larger percentage of income from people whose income is low."
Therefore the FairTax is not regressive, because there is a prebate to cover the sales tax on those basic necessities.
This just shifts the portion of the curve over which the tax is regressive to the right a little bit. Sales tax is still regressive by any standard definition, because it "takes a larger percentage from the income of low-income people than the income of high-income people".
On average, people that have more money spend more money.
Yes, this is true, on average.
They therefore pay more in taxes.
On average (that is, if the sales tax were based on all spending, which no sales tax I know of is).
That is a fair way of doing things which doesn't penalize success or hard work, nor unfairly benefit sloth and laziness (or treachery and fraud).
I disagree that it is fair. In fact, I'd go so far as to say that any tax is unfair unless it can be proven that it funds a service which is absolutely necessary for a functioning society and that it does so in proportion to the amount of that service which is provided. Taxing someone more because they spend more makes no sense. There is nothing wrong with spending, and it should not be discouraged by the government.
Those hated rich people that have earned a lot of money (yes, EARNED it) benefit everyone in our economy when they are able to invest it, rather than having to fork it over to the government.
What about those hated rich people that haven't earned a lot of money? In any case, I'm not saying we should tax intangible property, such as investments, so apparently you misunderstood me. I'm talking about taxing tangible property, in fact, mainly real property (land, houses, buildings).
And that is ignoring the complexity of taxing "a percentage of what you own." Can you imagine the loopholes?
No, I can't, that's actually one of the benefits of a tangible property tax, especially with regard to titled property.
The lobbyists would have an orgy over something like that. The FairTax does not give lobbyists any footholds. It is fair and transparent.
Why? Because you say so? You don't think there are any loopholes in a sales tax? I'll get back to this.
Taxing what people "own" is even more egregious than taxing their income. It would punish people who are successful, who save, who invest, and it would favor those who are lazy, who don't make much, who don't save anything, who spend it all.
Again, you must think I'm talking about intangible property.
Honestly, I don't think you've thought this through at all. Conversely, the people studying the FairTax proposal have been studying it for a decade. It has had hundreds of economists studying it for many years.
So why don't you explain it to me, then. Forget the rest of the arguments, and just explain to me why "FairTax" is fair, and how it's going to close the loopholes. Because when I go to the site, I see a bunch of hot air and contradictory claims.
I'm arguing that a tax should be based on the actual utility a person gains in life, not merely the *potential* for utility gain.
Well, personally i think a tax should be based on the services provided, but let's go with the utility gained.
When someone creates an inheritance and passes it on to his heirs, isn't there utility derived from that?
That means taxing expenditures instead of income.
You can't have income without having an expenditure.
This is more than a semantic argument, which is all your comments seem to be addressing.
Fine, I'm going to ignore the question of whether or not the tax would be regressive.
This is about fundamentally changing what the federal government considers to be a measure of a person's worth, from potential utility gain (or money) to actual utility gain (goods and services purchased with that money).
I would think the measure of a person's worth would be to measure that person's worth (assets minus liabilities). That has nothing to do with income or expenditures.
The example of the traditional IRA was meant to indicate that the concept of not taxing potential utility gain was already present in our economy.
I don't think that was the purpose of the institution of the traditional IRA. If you have some evidence that it was, feel free to point it out.
Actually, a better argument on your part would have been that Roth IRAs are generally more popular these days *because* they are taxed up front while leaving the gains on investment tax-free.
Roth IRAs are more popular? I've seen hundred of taxes this year and not a single person who was eligible for a traditional IRA deduction chose to contribute to a Roth instead. Between those who contributed to a traditional and those who contributed to a Roth it was about 50/50, but all of those who contributed to a Roth IRA were either ineligible for a deductible traditional IRA or had no tax liability and therefore would not have received a deduction.
In any case, as I said, I don't think the purpose of a traditional IRA is to tax people more fairly because of some notion of taxing only utility. If that were the case, the limit would be a lot more than $3000, and it wouldn't be phased out for high income tax payers. The traditional IRA was set up to try to encourage people to save for their retirement (at least on its face, in reality it was more likely set up to appease certain segments of the population to try to win their vote).
Limited Liability Corporations and private Corporations both get special protection status from the government.
But neither are "public corporations".
No. Because someone that works at Wal-Mart or Brown & Co. might find out your SSN, bank account # (if you sign up for direct deposit), date of birth, etc. and open up multiple credit card and/or checking accounts in your name.
And I care about this because?
(That is, if the tax company would actually sell SSNs and bank account numbers, which I seriously doubt.
He who would give up Essential Liberty to save 37 cents, is one cheap-ass bastard! -- Ben Franklin (sort of ;-) )
Telling someone who I'm doing business with my SSN and bank account info isn't giving up Essential Liberty.
Like I said, if you have a need for such a variable it's generally better coding practice to break the block out into its own function.
Right, because the fact that it's technically possible to do something which they don't actually do is a bad thing. RTFA, and the actual quote in context, if you don't know what I'm talking about.
Ummm... No. I used TaxAct this year (and last). It's free to create your return, but you have to print it and mail it in.
No, you got ripped off. I filed my return through TaxAct and my girlfriend filed her return through them, and both of them were free.
You must have gone directly to the site. If you do that, you have to pay. But if you enter the site from the IRS's free file page, it's free. Free to print, and free to e-file. You gotta pay for the state, though, that is, if your state has an income tax (mine doesn't).
Sorry, but your grandfather was wrong.
Investments create growth, provide jobs, bolster the economy, etc., and the government *will* get its share when those people (or their heirs) spend the money.
Maybe, maybe not. Depends what they spend it on.
I'm sorry, I don't understand what you're saying. Property tax would cause feudalism? Just the opposite is true. No property taxes would cause feudalism.
I don't e-file because I'm cheap.
I e-file because I'm cheap.
A stamp costs $.37, and I drive by the Post office anyway to get the weight. e-file costs me more than that.
E-file is free. That's less than $.37.
Yes, but most of them have income restrictions.
Wow, I just looked at the page, and apparently most of them don't have income restrictions. I believe this has changed since I filed back in Februrary. I remember TaxAct being the only one which had no restrictions back then.
Well, I don't know much about TaxAct, but if they are offering software to the public for free, then how do they make their own living?
Many ways. For one thing, the only way to get to the free version of TaxAct is to go through the government website. They also charge for state returns, for special deluxe features, and for a professional tax preparer to look over your return.
Could there be a motivation inside there to capture and use peoples information in a similar way to what this article is complaining about?
I highly doubt that would be in their best interests, and depending what information it was it would probably be illegal.
A direct federal tax entry system would bypass that issue.
All I can say is, give it time. In ten years, I bet there will be open source software out there which enables you to e-file for less than the cost of a stamp.
But wouldn't the expense of creating a secure cross-platform e-filing system, be more than offset by the efficiency savings resulting from more people e-filing?
Well, the government is trying to get it both ways. They're trying to get more people e-filing without building the e-filing system themselves. It'll take longer, perhaps, but in the long run I think it's the smart thing to do. In ten years, e-filing will likely cost less than a stamp, and I'm talking about a full open source software package. You can already e-file for free if you can find the right place to go (hint, it's linked to from the government's list of Free File Alliance Companies. I e-filed for free, and my girlfriend e-filed for free. Everyone is eligible to e-file for free through TaxAct.com. The only problem is that "free file" isn't very highly publicised.
Well, that and the fact that the US tax code is too complicated for most people to file on their own anyway. But even here, the federal government might go the same way as California, and start mandating that paid preparers who use software packages e-file all returns that are eligible.
Here in the UK, we don't view privacy as purely a contractual issue.
I know, it's one of the things I don't like about the UK.
Our Data Protection legislation (privacy legislation) applies to all data collection, whether governed by a contract or not.
Fortunately, here in the US, we have this thing called free speech.
It saves the government heaps in terms of manually checking paper-work and entering figures.
If this were done in the US, it'd probably affect government revenues the most just from the fact that so many people would fill out their taxes incorrectly as a result of not going to a professional. But I don't know how complicated the UK tax system is. And I'm not sure if it would increase or decrease revenues here. But I do know that most people don't know how to properly fill out their tax returns.