The Problem with the U.S. Tax System

Here's a comment I received to my post titled Many Taxpayers Get Burned by Inept or Crooked Preparers that I thought was worth sharing with everyone:

This topic really gets me miffed! I think the media and the people ought to be all over this more than they are.

1. We have a tax system by our government that is so complicated that we need to have "Professionals" do them.

2. Then our government doesn't oversee the "Professionals" who do our complicated taxes.

3. Then we can get severely penalized by our government for handing our taxes over to "Professionals" who either can't figure it out right because the tax code is so obfuscated or the preparer is crooked.

I am sure there are no politicians lobbying out there for us or they would see what a major problem this tax code is.

Generally, I'm in agreement with this opinion. Our tax code is waaaaaaaaaaaaay too complicated. Isn't there some sort of way that it can be simplified and at the same time be made fair? I'm doubtful about it given the special interests that swarm around D.C. In my opinion, anything representing a fair and easy tax code will be very difficult to develop because of too many people with too much money influencing politics and laws in their own favor.

What do you think?

Comments

[Financial Freedumb]

Yes! I'm a huge fan of tax code simplification...It should be a simple, straightforward process...

[qw]

I have been hearing about flat tax, fair tax, consumption tax, tax simplification, removal of loop holes, excising corporate welfare, etc, etc, etc for as long as I have been paying taxes (about 15 years).

When I was younger and more naive I thought it was just a matter of time until they "fixed" the tax system to some degree.

I now believe that 15 years from now it will be more complicated with more special rules than it has now. No flat tax, no fair tax, and certainly no consumption tax will have replaced our current system.

In fact in 15 years from now enough problems are going to be going on with SS & Medicare that tax rates will be forced to go up and its unlikely that is going to happen through tax simplification, likely there will just be more brackets and faster rate increases on the tax rates.

I hope I am wrong but if I was betting on it, my money would definately not be riding on a simpler and cheaper tax system in the future. I suspect we are looking at a long term low in tax rates and taxes paid right now. I think it almost certainly goes up from here.

[Duane Gran]

The answer is simple: We need a sarbanes-oxeley style legislation for taxes which would require every member of congress to do his or her own taxes and attest, under penalty of perjury, that it is accurate. If such a thing happened, the tax code would simplify rapidly.

But then again, such a thing won't happen.

[Emily]

Just an idea, but the govt. is probably keeping it so complicated, so more money will come in. It were simplified we would know how to write off more & save more money. Of course the govt. wants it complicated too so we we'll never know every trick to save.

[dino]

A simpler tax system will never happen. There is an entire industry based on it and its a big one. You simplify the system and there will be millions of accountants looking for jobs. No politician is going to send that many people to the unemployment line.