Singing the Tax Code Simplification Blues

The Treasury Department report says it all: Americans spend roughly 7 billion hours a year to comply with the tax code. Individual taxpayers spend an estimated 3.55 billion hours working on taxes. Individuals spend about $27 billion on tax software or outside tax preparation services. 90% of American households use some sort of professional tax preparation service. The instruction booklet for Form 1040 is now 155 pages in length. And they wonder why President Obama’s Treasury Secretary nominee, Timothy F. Geithner, had problems filing his taxes! The Case for Tax Simplification Consider the amount of time and money the American people would save, year in and year out, by reducing the US Tax Code to something that your grandmother could understand. That ought to be the standard: If granny doesn’t get it, go back and do it again. True, this would be a blow to the burgeoning tax preparation i... [Read Full Article]

Avoiding Taxes

Now that we are a little over a month away from Tax Day and that awful black hole is opening up in Washington again, thoughts are turning to the greatest question an American taxpayer can ask: “How can I keep the tax man from picking me clean?” In a previous post, we discussed the legal way to handle your deductions. Now we’ll go over some of the other ways folks try to avoid being sucked in and crushed to a financial singularity. Understand this: These tactics will not save you and the least you will get for your trouble is a hefty fine. According to our friends at H&R Block, these are some of the more common frivolous arguments that the IRS and the Federal Tax Courts look down upon. Each relies on misinterpretations, to put it politely, of the Constitution, the Tax Code or both.  Filing a tax return is voluntary . Wrong. Filing a tax retur... [Read Full Article]