Fourteen and a Half Percent

A number of years ago, I grabbed the IRS tax information for the most recently available three year period, and did a little math.  Based on that 3-year average (2005-2007?), based on the rate of taxes paid vs total income of any type (income, alternate minimum, capital gains, etc), the overall rate was 14.5%.  That is, if we had all paid 14.5% of our income, with no deductions, the government would have made the same amount. Whether this rate is too high or too low is the subject of an entirely different type of post, but suffice it to say: the IRS, and all the convoluted-ass tax code under which it operates, could be eliminated in its entirety with a 1-page act of Congress eliminating all previous tax code, and setting up the flat-tax system.  I’d bet they could even allow for a minimum income per taxpayer tax-free (i.e. no taxes on the 1st $25K of everyone’s income, and 15% on everything above that, with NO other deductions), and still keep it under a page.

But that would make sense, which is probably in direct violation of 10-U.S. Code-§ something-or-other, and therefore Not Allowed™.  It would also put a LOT of tax ‘professionals’ out of business overnight, with 2nd and 3rd order effects like making the IBM Watson offerings with H&R Block irrelevant.  And then people would be able to actually SEE what they’re paying in taxes, instead of thinking the interest-free loan they’ve given the .gov coming back to them every spring is some sort of windfall.  Nope hoss, that’s YOUR money that Uncle Stickyfingers has been ‘withholding’ from YOUR paycheck and using for whatever he wants for the better part of a year.  With NO compensation to you for it.

And God forbid you have to file a paper copy due to having had a child die before being issued a Social Security Number (can’t e-file with missing SSNs!), and then fight the IRS to correct the ‘Math Error’ they say you made.

“Every normal man must be tempted, at times, to spit on his hands, hoist the black flag, and begin slitting throats.” -H. L. Mencken

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