Mortgage interest deduction on the table

[spearheadersarge]

There is no way to get this problem solved without pain. Our govt spends more than it robs from its citizens. No amount of revenue will solve this problem without passing a budget and or balancing the budget. The Obama administration has ratched up spending exponentially. The Senate has refused to pass any budget in almost 4 years. Runaway spending, borrowing, and printing have led us to this position. It is both parties fault and both need to fix it. Let the tax cuts expire, pledge the revenue raised to debt reduction, and cut spending. All three are needed to get this done. It will suck in the short term, but will allow the country to prosper in the long term. Stop talking, whining, and CAMPAINGING, and just get it done!!!

 

[poptab]

The very nature of taxation is that it presumes the government has a higher claim on our property than we do.

If the government can rightly take 40% of my income every year why cant it take 90% of my income every year? Why not 100%?

The fact that people even think it is right for the government to take your property at all is amazing. Public school is doing a great job of producing docile slaves.

 

[steveh_131]

I dunno. My accountant is doing pretty well for himself.

uh oh. Someone doesn't know the difference between redistribution of currency and the creation of wealth. Tsk tsk.

 

[pjcalla]

A business spends 90 cents to make a widget and I buy it for a dollar. For my dollar, I have something tangible in my hand. What tangible good do I get for each dollar I pay my tax attorney? What tangible good do I get for every dollar in tax I pay that goes to IRS salaries?

So, since I'm not in manufacturing, I don't contribute to the economy? I make money, so I can buy your widgets that you manufacture, and you will continue to have a job, so you can pay your tax attorney, etc. The economy could not exist with only manufacturers.

I'm a CPA, but do NOT do tax. I am all for tax reform, but don't think it'll ever happen. I agree, the financial burden for tax compliance is ridiculous.

What really pisses me off, is the Earned Income Credit. People actually have a net tax GAIN, yes the Fed pays them every year. I would be happy if everyone had to throw something in the pot, so to speak.

 

[hooky]

So, since I'm not in manufacturing, I don't contribute to the economy? I make money, so I can buy your widgets that you manufacture, and you will continue to have a job, so you can pay your tax attorney, etc. The economy could not exist with only manufacturers.

I'm a CPA, but do NOT do tax. I am all for tax reform, but don't think it'll ever happen. I agree, the financial burden for tax compliance is ridiculous.

What really pisses me off, is the Earned Income Credit. People actually have a net tax GAIN, yes the Fed pays them every year. I would be happy if everyone had to throw something in the pot, so to speak.

I think he was speaking to money paid so you can assure you're compliant with tax regulations. There is no tangible benefit that creates any wealth for him either directly or indirectly.

 

[pjcalla]

I think he was speaking to money paid so you can assure you're compliant with tax regulations. There is no tangible benefit that creates any wealth for him either directly or indirectly.

I guess you could argue that the extra money he saves from hiring a professional to ensure he's utilizing the tax code to his benefit could be a tangible item. Yes, it is definitely backassward that you have to spend money for a tax accountant, to try and save some of your money from the government.

I would argue that the income tax form should only be three lines...ahh that would be bliss.

 

[steveh_131]

I guess you could argue that the extra money he saves from hiring a professional to ensure he's utilizing the tax code to his benefit could be a tangible item.

No, you can't argue that. You can't argue that at all. It's not a tangible item.

 

[pjcalla]

No, you can't argue that. You can't argue that at all. It's not a tangible item.

Cash isn't tangible?

 

[hornadylnl]

So, since I'm not in manufacturing, I don't contribute to the economy? I make money, so I can buy your widgets that you manufacture, and you will continue to have a job, so you can pay your tax attorney, etc. The economy could not exist with only manufacturers.

I'm a CPA, but do NOT do tax. I am all for tax reform, but don't think it'll ever happen. I agree, the financial burden for tax compliance is ridiculous.

What really pisses me off, is the Earned Income Credit. People actually have a net tax GAIN, yes the Fed pays them every year. I would be happy if everyone had to throw something in the pot, so to speak.

Here's what I mean by tangible. I pay a tax attorney to perform a service I don't want or need but have to if I want to maintain compliance. That's intangible. I consider services of any kind to be an intangible item. IE, a vacation, seeing a movie, or fancy dinners. A tangible item is something that I can trade dollars for and touch it.

Things like vacations or other services are nice but I don't value them as much as something that I can hold on to and keep. Vacations are expensive memories and not much more.

I have $50 in my hand. I can choose between a back massage, a steak dinner, or a wrench. Well, I am hungry and the massage is $50. So I go buy a $4 combo meal at McD's leaving me with $46 to spend on tangible goods. I never saw the point in spending $50 on a meal that I will pass through in 24 hours. Some people place more value on that $50 dinner than they will a wrench. In a free market, they're allowed to choose which provides more value to them but we're both stuck with paying to maintain compliance with the tax code.

 

[jamil]

A business spends 90 cents to make a widget and I buy it for a dollar. For my dollar, I have something tangible in my hand. What tangible good do I get for each dollar I pay my tax attorney? What tangible good do I get for every dollar in tax I pay that goes to IRS salaries?

If it's not worth it to you, don't pay them to do it. But it's still creating wealth.

Sometimes laws create wealth indirectly. Because there are local ordinances, I have to mow my lawn (I would anyway). I can mow it myself or I can pay the kid across the street $50 to do it. Either the time I would spend mowing is worth the 50 bucks for me or not. If so, I get to spend the time doing something else, and he gets the 50 bucks.

Because I have to pay taxes and it's complicated, I'd rather pay someone to do it for me. That time and the confidence I have that I'm not paying more tax than I legally owe is worth what I pay what I pay him. Enough people pay him to do their taxes that he lives well.

Neither my tax guy nor Intuit wants a simple tax system in the US because there would be no problem for a multi-billion dollar industry to solve.

 

[jamil]

No, you can't argue that. You can't argue that at all. It's not a tangible item.

He can argue that because the real argument is whether or not it creates wealth. And it does for tax accountants and companies like Intuit. You pay for what you get, and if you're lucky you get what you paid for.

 

[pjcalla]

Here's what I mean by tangible. I pay a tax attorney to perform a service I don't want or need but have to if I want to maintain compliance. That's intangible. I consider services of any kind to be an intangible item. IE, a vacation, seeing a movie, or fancy dinners. A tangible item is something that I can trade dollars for and touch it.

Things like vacations or other services are nice but I don't value them as much as something that I can hold on to and keep. Vacations are expensive memories and not much more.

I have $50 in my hand. I can choose between a back massage, a steak dinner, or a wrench. Well, I am hungry and the massage is $50. So I go buy a $4 combo meal at McD's leaving me with $46 to spend on tangible goods. I never saw the point in spending $50 on a meal that I will pass through in 24 hours. Some people place more value on that $50 dinner than they will a wrench. In a free market, they're allowed to choose which provides more value to them but we're both stuck with paying to maintain compliance with the tax code.

Fair enough. You could take on the compliance burden by yourself, but it would take away your time actually making money, or spending time with the family, shooting, etc.

I learned long ago that it is best to pay the professionals to do the job. I guess I could learn to make your widgets, but that would take away my time (money), and the end result wouldn't be as nice as yours, considering that you have much more experience producing said widget. Same goes for tax compliance.

Hell, I pay a tax accountant to do my taxes, and I agree the cost of compliance is absurd. The big companies just pass that on to us (consumers), so basically, we are getting hit with it from multiple fronts.

 

[hornadylnl]

Fair enough. You could take on the compliance burden by yourself, but it would take away your time actually making money, or spending time with the family, shooting, etc.

I learned long ago that it is best to pay the professionals to do the job. I guess I could learn to make your widgets, but that would take away my time (money), and the end result wouldn't be as nice as yours, considering that you have much more experience producing said widget. Same goes for tax compliance.

Hell, I pay a tax accountant to do my taxes, and I agree the cost of compliance is absurd. The big companies just pass that on to us (consumers), so basically, we are getting hit with it from multiple fronts.

All companies pass the cost of compliance and the tax onto the consumer. That's why it's absurd to tax corporations.

If I didn't have to pay a tax attorney or do them myself, that's time and money that I could have spent on something else.

I could break your window and hire a glass company to fix it. Did the glass company create wealth? Had I not broke your window, there was no need for his service. You don't create wealth in the glass industry by going around breaking windows. You create wealth in the glass industry by making new ones.

 

[steveh_131]

He can argue that because the real argument is whether or not it creates wealth. And it does for tax accountants and companies like Intuit. You pay for what you get, and if you're lucky you get what you paid for.

The Broken Window Fallacy

The creation of tangible wealth is entirely different than the transfer of currency or goods from one person to another.

When a company hires a person to build a gadget, for example, a gadget is created. Wealth has been created where it previously did not exist. Human effort, a finite resource, has been turned into a tangible good.

When a company hires a tax accountant to deal with government bureaucracy, nothing is created. Human effort is expended with no product to show for it.

The first example is beneficial to society. The second is detrimental.

 

[Classic]

Goods and services are the same thing in economics terms and both have value in an economic system. That value is set by the consumer.

 

[steveh_131]

Goods and services are the same thing in economics terms and both have value in an economic system. That value is set by the consumer.

I'm not differentiating between goods and services.

I'm differentiating between goods and services that create wealth and those that do not.

 

[steveh_131]

Alright, here's a more clear example for those who don't understand the difference.

A manufacturer hires an IT consultant to keep the computers running smoothly. They transfer money to the consultant in exchange for his services. His services result in greater productivity for the manufacturer and therefore more of their product being produced. Net wealth is increased.

A manufacturer hires a tax accountant to handle their taxes. They transfer money to the accountant in exchange for his services. His services do not result in greater productivity and net wealth is not increased because nothing tangible is created as a result of the effort that he expends.

This is not an argument against accountants. They serve a purpose that is of value to the people who hire them. It's a very legitimate type of employment. This is an argument of economics. The fact that a person's services are valuable to someone does not mean that it creates wealth overall. It transfers wealth from one person to the next.

 

[CarmelHP]

National Sales Tax: no deductions or credits

I figured it was time to take this discussion there

Want to see out of control spending, wait until taxes are hidden in the price of goods and services. The proponents of national sales taxes have not thought this through. We have to starve the beast not find new ways to feed it.

 

[Armchair Operator]

2 employees, all pay and benefits being equal. One pays more tax than the other because he has fewer children or less mortgage interest. Lets penalize those who choose to minimize their expenses.

This right here, well put. I pay more taxes than my friend just because he has three kids and a big house. I just don't see the fairness in this. Other couple that I know got divorced recently and they always negotiate who will claim their kid on their taxes in order to get a bigger return. That's just does not seem right to me.

 

[hooky]

Want to see out of control spending, wait until taxes are hidden in the price of goods and services. The proponents of national sales taxes have not thought this through. We have to starve the beast not find new ways to feed it.

Taxes already are hidden in the cost of goods and services.