How should the U.S. deal with tax cheats? Simplifying the tax code may help

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  • Furry1993 Ogden, UT
    March 9, 2013 9:45 a.m.

    Start by taxing things as they really are -- for example, carried interest is really earned income and not a capital gain. The income in off-shore accounts is real income, not anything else, which in a lot of cases totally escapes taxaction thanks to the entities created by Mitt Romney and those like him.

    Prosecute and impose penalties on companies and indiviuals who try to promote tax evasion schemes like the "Son of Boss" scheme, and prosecute to the fullest any company official who promotes or advocate the scheme.

    Fully tax "job creators" if they don't actually create jobs -- give them tax credits for jobs actualy created and penalties if they just put amounts gained from tax reductions in their pockets and don't create any jobs.

    Reward companies that bring jobs back to the United States, and severely penalize those companies (and their officers and influential investors) that off-shore jobs. Take away any tax deduction for costs involved with off-shoring jobs, and impose an immmediate penalty equal to the costs of off-shoring for doing so.

    That would do a lot to eliminate the tax cheating scheme and tax cheats, or at least make them pay.

  • JoeBlow Far East USA, SC
    March 4, 2013 6:49 p.m.

    "a family with 2 parents and 5 kids would still be paying state income taxes at that income level."

    Cmon Red. Quit moving the bar and follow the conversation

    The whole thread is about FEDERAL INCOME TAX.


    Romneys 47% statement had absolutely nothing to do with state income tax.


    Anyway, so, It would appear that by Romneys definition of takers, that my mythical family fits that bill.

    You are too much.

  • Ultra Bob Cottonwood Heights, UT
    March 4, 2013 5:05 p.m.

    Ultra tax to the rescue.

    One overall tax to be collected by the federal government and apportioned to states, counties, towns according to population. Simplicity is the key to honesty in this case.

    A flat rate income tax to be collected as a percentage of the payout from business operations. All outgoing payments of a business operation are income to somebody. Old, young, rich, poor, American, foreign, male or female pay the same flat rate, only they don’t know it. They never see it, what they see in their pay, whether earnings or dividends is their own pay to do with as they please.

    Zero tax on business profits retained in the business. Special local taxes for local services peculiar to the local might be necessary. But the best part is the elimination of the cost to process individual forms, which are the tools of tax cheats.

  • merich39 Salt Lake City, UT
    March 4, 2013 5:03 p.m.

    Simplifying the tax code is a hugely laudable endeavor. It's going to be incredibly difficult to accomplish, however, because there are so many vested interests who will fight with every ounce of their being and every dollar of their resources to protect their own slice of the tax code pie. Just watch the outrage if and when the POTUS or congress make proposals in this area. Vested interests will take out full page ads in all the major newspapers and buy ad time on all the major T.V. channels trying to scare people into opposing tax code simplification that affects themselves. The tax codes are as complicated as they are because vested interests have paid huge sums in donations to get the code the way it is.

    That being said, we really need to pressure our own representatives to go against their campaign contributors and support simplifying the tax code.

  • Dart-02 SLC, UT
    March 4, 2013 4:41 p.m.

    @Joe Blow
    Did you miss the part where I said that there should be some way for both sides to compromise on a graduated income tax. That means the wealthy will pay a higher percentage. To solve our problems both sides will have to compromise. All I am saying is that everyone would have to pay some federal taxes. Benefits cost money and is it entirely unreasonable for those to whom the benefits mostly go help to pay for some of them. The left always complains about everyone paying their fair share, but those paying $0 aren't paying any share let alone their fair share. With the mess our federal government is in, we will probably have to raise taxes on everybody to not only balance our budget but actually start paying off some of the national debt.

  • The Real Maverick Orem, UT
    March 4, 2013 3:52 p.m.

    Oh joy.

    Another tax plan that would hike taxes for the middle and lower classes while lowering them on the rich.

    And the right wonders why most Americans find them out of touch?

  • Redshirt1701 Deep Space 9, Ut
    March 4, 2013 3:36 p.m.

    To "JoeBlow" I hate to break it to you, but if you use one of the various tax estimators, a family with 2 parents and 5 kids would still be paying state income taxes at that income level.

    Apparently Utah does their best at keeping everybody's "skin in the game."

  • JoeBlow Far East USA, SC
    March 4, 2013 2:43 p.m.

    "Perhaps if the poor had some skin in the game, "


    I am too lazy to do the calculation, but I wonder how many in Utah with large families pay ZERO federal income tax.

    This year the personal exemption is $3800

    I think a married couple whose adjusted income is under $18,700 pay no income tax. I very well could be wrong.

    But if you have 5 kids plus 2 adults that is 26,600 in deductions.
    Add a mortgage deduction- $6000
    Add some charitable giving - $5000

    Probably have to make over $60,000 before paying income tax. I am guessing the number is higher but I'm no accountant.

    There are certainly a lot of people with large families that work their tails off and pay ZERO income taxes.

    Think about who technically has no "skin in the game" and then determine how much MORE they should pay while we cut taxes to the wealthy.

  • Dart-02 SLC, UT
    March 4, 2013 1:05 p.m.

    Sadly, almost everyone agrees that the tax code should be simplified, but getting Congress to do it is next to impossible. Ideologically, I support a flat tax for everyone, with no deductions for anything. But, realistically, that will never happen. It should still be possible to create a graduated tax system that will make neither party happy but satisfy everyone. It would have to tax everyone and that includes the poor who currently get back all their income tax at the end of the year. No one gets back, no returns. Perhaps if the poor had some skin in the game, they would also pressure Congress and the President to be more responsible with OUR money. Right now too many people just want more benefits, more free stuff, because in the end they don't pay anything for it. The tax code would also have to tax the wealthy as much as possible without being vicious and punishing them for being successful. Politicians have made an art now of making all people who make over X amount of dollars into a villain who only cares about their own money. The system shouldn't punish success.

  • JoeBlow Far East USA, SC
    March 4, 2013 1:03 p.m.

    "and the IRS can come after us for not having insurance or anything related to that?"

    You mean like the Heritage foundation proposed in the 90's?

    From Fox news (google insurance mandate)

    The mandate, requiring every American to purchase health insurance, appeared in a 1989 published proposal by Stuart M. Butler of the conservative Heritage Foundation called "Assuring Affordable Health Care for All Americans," which included a provision to "mandate all households to obtain adequate insurance."

    And there absolutely was a tax penalty for not getting insurance.

    My how GOP ideas get panned when a Dem takes them up.

  • RedShirt USS Enterprise, UT
    March 4, 2013 12:01 p.m.

    Can you imagine what it will be like once Obamacare is fully implemented and the IRS can come after us for not having insurance or anything related to that?

  • Fitness Freak Salt Lake City, UT
    March 4, 2013 9:43 a.m.

    How about eliminating the tax cheats AT the IRS.

    Year after year I diligently pd. my taxes to the best of my understanding of a (complicated) tax code.

    I was audited for a tax yr. 4 yrs. previous. I believed, and still do, that I had done everything correct. The IRS thought differently.

    Without going into a lot of boring details my problem came down to two different readings of the tax code. Two sentences. She (the IRS examiner)didn't agree with me so I could either hire an attorney at a cost very near the amount they said I owed, or pay the amount plus interest.

    The audit was a HUGE wake-up call as to how they work. The examiner was constantly making snarky comments about Utah and its large families (not my problem in this case), she was entirely unprofessional. She had direct access to my checking/banking accounts.

    I can see why so many Americans fear them.

    BTW - I "borrowed" someone else's DN login to post this. I have no doubt they can/will come after anyone who complains too loud.

    Very inefficient way to collect revenue.

  • Roland Kayser Cottonwood Heights, UT
    March 4, 2013 8:53 a.m.

    While I agree with this editorial, it ignores one ting: many of our great corporations and hyper-rich citizens have spent a great deal of money on congressional "donations" to make the tax code as complicated as it is. They will spend an equal amount to ensure that it stays that complicated, because they benefit greatly in excess of what they "donate".

  • Ultra Bob Cottonwood Heights, UT
    March 4, 2013 8:24 a.m.

    I am an American. While I may strive to pay only the taxes ask of me, I feel that the very best use of my money of all my expenditures is by my federal government. The benefits ascribed to me by being an American, far outdistance the benefits received from any of my other governments, public or private. Both in actual quantity and quality for the dollar spent.

    I believe the profusion of confusion of the tax law is the main reason for the tax cheating. And that the purpose of the confusion is a deliberate action on the part of some Americans who don’t want to pay their fair share and the parasites who use the confusion to make an unnecessary need for their services.

    Support for our government should be automatic, not require individual tax, easy to understand, easy to enforce, and spread the cost fairly to all.

  • JoeBlow Far East USA, SC
    March 4, 2013 6:53 a.m.

    Yes, we need to simplify the tax code. And it would not be that difficult to do.

    Unfortunately, our politicians will use that concept to further their ideology. They will not attempt to simply "simplify" it. They will make changes to change the tax structure to further their political ideology.

    How about this.

    Determine tax brackets. Lower the tax rates per bracket. Get rid of Any and Every deduction.

    And have the goal to be that everyone pays roughly the same tax that they do today.

    For that lower rate?

    No mortgage deduction. Not child tax credit. No charity deduction. No tax credits of any kind.
    No Farm Subsidies.

    If you make $100K. Your tax is X. Makes no difference how or where you made your money.

    It aint that tough to do if our elected officials did not get campaign contributions to give breaks to those who bribe, er, I mean "contribute" to campaigns.

    Can you imagine how the Accounting/Tax prep lobby would kick into high gear?

  • Timj South Jordan, UT
    March 4, 2013 6:25 a.m.

    Part of the problem is that so many people pay for things with cash, which is easy for small business owners to hide from the government.

    The other part of the problem is that enforcement of tax law is so minimal. The guy who cleans your carpets or drives your taxi, gets paid in cash, and doesn't include those cash payments on his taxes has very little chance of getting caught.

    As more and more people use credit cards instead of cash, and as credit card companies start reporting their info to the IRS (which happened for the first time this year) tax evasion will decrease.