It is the time of year again when people start to pay tribute to their master in the form of the Income Tax. Not only do people have to pay the government, but they spend valuable time telling the government how much they have to pay. The average person spends 8 hours to prepare their tax return. The IRS gets this free labor out of people because it tricks most into paying too much throughout the year. Then people have to justify getting their own money back.
This year will probably take more time. Why? Because the rules have changed. The 2018 Tax Reform changed what is deductible, what isn't and what is but not like it used to be. As usual, the IRS has printed a publication IRS Publication 5307 Tax Reform Basics for Individuals and Families . With its typical simplicity, the basic publication is twelve pages long and contains phrases like: "federal law controls the characterization of the payments for federal income tax purposes regardless of the characterization of the payments under state law."
The Republicans blew their chance as usual. They could have greatly simplified the tax code when they controlled both chambers of Congress and the presidency. Instead, they bowed to the usual suspects and used the tax code to reward friends and punish enemies. They made the code more complicated, not less. So now people will be spending more of their valuable time learning new rules and filing to get money back that belongs to them in the first place. It is time for real tax reform. Let's start the debate with a flat income tax rate for everyone of 0%.
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