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Message
re: The Flat Tax
Posted on 4/8/15 at 9:28 am to Jabstep
Posted on 4/8/15 at 9:28 am to Jabstep
Responding while waiting for 968 pages of tax return to print...
Here is what you have to think about.
1) The tax code as currently written curries favor. It favors some industries and penalizes others. This provides congress with a large base of power. To go to a flat tax would require congress giving up that power. When is the last time you have seen a politician willingly give up power? This is why I think the flat tax will go nowhere.
But even if we got some new congressmen in who voted to pass it...
2) It doesn't do anything for entity returns. A flat tax would mean the end of passthrough taxation, so all businesses would have to be taxed as a C corporation (or something new created that is similar). If there is hardly any chance of a flat tax for individuals, there is no chance at all for a flat tax for businesses.
3) You still have a large majority of states who tax income. Just because the feds go to a flat tax doesn't mean the states will.
4) You still have international taxation.
Most CPAs who work in taxation would not be affected much at all. H&R Block and the like would go out of business, but they are not really employing CPAs.
Most tax CPAs provide value by helping businesses decide what is and what is not taxable income, and what is and what is not a deductible expense. If individual taxation went away, I would not miss it one bit.
Here is what you have to think about.
1) The tax code as currently written curries favor. It favors some industries and penalizes others. This provides congress with a large base of power. To go to a flat tax would require congress giving up that power. When is the last time you have seen a politician willingly give up power? This is why I think the flat tax will go nowhere.
But even if we got some new congressmen in who voted to pass it...
2) It doesn't do anything for entity returns. A flat tax would mean the end of passthrough taxation, so all businesses would have to be taxed as a C corporation (or something new created that is similar). If there is hardly any chance of a flat tax for individuals, there is no chance at all for a flat tax for businesses.
3) You still have a large majority of states who tax income. Just because the feds go to a flat tax doesn't mean the states will.
4) You still have international taxation.
Most CPAs who work in taxation would not be affected much at all. H&R Block and the like would go out of business, but they are not really employing CPAs.
Most tax CPAs provide value by helping businesses decide what is and what is not taxable income, and what is and what is not a deductible expense. If individual taxation went away, I would not miss it one bit.
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