Reuters, Is This the Tax Reform Obama and the New Congress Can Agree On?, by James Pethokoukis:
President Barack Obama’s bipartisan deficit commission has a mandate to cut the U.S. budget gap. But the White House panel may surprise in another area: tax reform. Democrats and Republicans are taking a hard look at a plan that would simplify the code and cut corporate taxes. Although not perfect, it would be a big improvement.
The Bipartisan Tax Fairness and Simplification Act of 2010 introduced by Senators Ron Wyden (D-OR) and Judd Gregg (R-NH) has three individual rates (15%, 25%, 35%) and a single lower corporate rate (24%):
5 responses to “Post-Election Tax Reform”
Congress has behaved so deceptively with the tax law that they have lost any credibility for tax reform. The public will be deeply suspicious that any proposal is just another sneaky trick.
People who pay no attention to taxes may benefit from tax reform, but their inattention means that they will not rally to support tax reform.
People who care about taxes have arranged their financial lives in response to current tax incentives. These people will definitely lose when longstanding incentives are suddenly revoked. They will object loudly to any change imposed without sufficient warning or even retroactively, as Congress is wont to do.
For these reasons, pre-crisis tax reform will fail. During and after the government bond market crash, radical changes that were impossible will become likely.
The election: what do they mean by that?
Now that the balance of power in D.C. and Des Moines has shifted somewhat to red, whither tax policy? At…
The election: what do they mean by that?
Now that the balance of power in D.C. and Des Moines has shifted somewhat to red, whither tax policy? At…
The election: what do they mean by that?
Now that the balance of power in D.C. and Des Moines has shifted somewhat to red, whither tax policy? At…
The election: what do they mean by that?
Now that the balance of power in D.C. and Des Moines has shifted somewhat to red, whither tax policy? At…
The election: what do they mean by that?
Now that the balance of power in D.C. and Des Moines has shifted somewhat to red, whither tax policy? At…
The election: what do they mean by that?
Now that the balance of power in D.C. and Des Moines has shifted somewhat to red, whither tax policy? At…
The election: what do they mean by that?
Now that the balance of power in D.C. and Des Moines has shifted somewhat to red, whither tax policy? At…
The election: what do they mean by that?
Now that the balance of power in D.C. and Des Moines has shifted somewhat to red, whither tax policy? At…
The election: what do they mean by that?
Now that the balance of power in D.C. and Des Moines has shifted somewhat to red, whither tax policy? At…
I agree. I cannot see how this reform is going to be paid for. Reading the Heritage Foundation’s promotional materials it seems like more supply side voodoo economic analysis. Bottom line: if people pay less in taxes and the government does not cut spending deficits will result. They did when Reagan cut taxes, they did when Bush cut taxes and they will again.
And how is it simpler? because they fit it on one page instead of two? I have a client with 2 schedule C’s, four rental properties, a vacation home, 3 kids, one in school, three trusts for the kids,a multitude of investments and capital loss carryforwards. How is this going to make his taxes simpler? Maybe repeal the passive activity rules? Since capital gains will now be taxed at OI levels, with a 35 % exclusion does that mean that all capital losses will now be allowed against OI? The devil is in the details and I think this simplification will be like most simplifications, create more time and work for accountants and lawyers and more cost to taxpayers.
But anything that gets rid of the AMT is a step in the right direction.