If you read the article carefully you'll notice that Congress tried to repeal this tax last year, so current public outcry had nothing to do with it. I see the IRS rules changes earlier as their way of trying to enforce an unenforceable law that they knew should have been repealed earlier.
If they were stuck with trying to enforce this dog, then they had the responsibility to at least try to make it work.
Even though I am currently having my own problems with the IRS, I don't see them as evil. These guys are just trying to do a job whether they think the law is right or not.
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I never claimed to know everything... I'm just right about the things I know!
One more reason that trying to tax income and benefits is ridiculous! We tax income but millionaires like John Kerry and Ted Kennedy don't have huge income, they have huge wealth, which isn't taxed. Let's do away with the income tax and tax all non-essential (food, clothing, medical) purchases at 30% and call it a day.
One more reason that trying to tax income and benefits is ridiculous! We tax income but millionaires like John Kerry and Ted Kennedy don't have huge income, they have huge wealth, which isn't taxed.
Well, that wealth does generate income (though they are probably careful to have much if invested in tax free municipal bonds and such) and also invested in securities and real estate that generate capital gains when sold, which are taxed (though, thanks to the last few tax bills, they are taxed at a much lower rate than salaried income will be.)
But actually wealth used to be taxed quite heavily when people with large estates died through estate taxes. They are due to come back in 2011 without new legislation, but (not that I would wish this on him or anything) if Ted Kennedy dies next year, there will be an awful lot of wealth that would have been taxed through estate taxes in the past that will pass on to the next generation tax-free (or with very minimal taxes).
(And, to be honest, Senators are actually paid quite well. I'm sure that most people would love to be paid what they are for the few hours of actual work that they do.)
But actually wealth used to be taxed quite heavily when people with large estates died through estate taxes. They are due to come back in 2011 without new legislation, but (not that I would wish this on him or anything) if Ted Kennedy dies next year, there will be an awful lot of wealth that would have been taxed through estate taxes in the past that will pass on to the next generation tax-free (or with very minimal taxes).
All the more reason to do away with income tax, not every family is in the stratosphere of the Kennedy's where a few million in taxes is just a drop in the bucket. Some families don't have the liquidity to pay a huge tax when a family member dies, and with a large estate tax end up having to sell assets just to pay a tax. Not positive for the family or if it's productive business, for the economy. A consumption tax is much more logical and fair, it can also be adjusted annually to reflect the budgetary needs of the country.
For the record, US Senators make $174,000/year. It sounds like a lot, but hardly an amount that would make someone "rich" in the terms of Rockefeller, Kennedy, Kerry, Gates, etc. I would not classify someone making this kind of money as rich, nor should that income be taxed as someone who is rich.
All the more reason to do away with income tax, not every family is in the stratosphere of the Kennedy's where a few million in taxes is just a drop in the bucket. Some families don't have the liquidity to pay a huge tax when a family member dies, and with a large estate tax end up having to sell assets just to pay a tax. Not positive for the family or if it's productive business, for the economy. A consumption tax is much more logical and fair, it can also be adjusted annually to reflect the budgetary needs of the country.
I really do not mean to turn this into a political discussion, and this is my last post about taxes, but when discussions were first made about repealing estate taxes opponents asked to give examples of families that were forced to sell assets in order to pay taxes, and there were very, very few ever discovered. (In fact, there may have been none.) All along estates that had highly illiquid assets - stock in privately held companies, family farms, etc. - were able to discount the amount of that asset by a substantial amount (so, for example, back when the exclusion was $1 million, family farms and privately held companies - defined where the descendants of a single person two generations deep owned more than [I believe] 40% of the asset value of the company in question - were able to exclude over $4 million from estate taxes.) And, trust me - as somebody who knows from experience - there are various things that families can do to pass on estate wealth with a minimal estate tax being owed at the time of death of both spouses. For example, you can make a gift of $1 million estate tax free to your children once in your life, plus $12,000 or so per year to any person estate or gift tax free. That gift does not need to be cash - it can be a percentage of the value of those privately held businesses or family farms.
The problem with a consumption tax is that you are shifting the burden of taxation from the wealthy to the poor. By eliminating the estate tax we have already lost something close to $20 to $30 billion in tax collections annually from very wealthy people (who are inheriting estates worth more than $3.5 million this year), which means either that the regular income tax is raised, which also tends to tax the wealthy much more, so it's even steven - however, taxes, you will recall, have been cut, disproportionately to the wealthy - or services are cut, and those tend to affect the poor and middle class more than the wealthy. (Or we increase the federal debt, which, again will mean those two things will happen further on down the road, in a far more painful manner.) A consumption tax has no income exclusion, so the very poor have the same tax burden - but probably pay a higher percentage of their wealth and income in taxes than they do now, and than the wealthy will do, as the poor are far more likely to spend all that they have and save very little. All of that Kennedy ad Kerry wealth you were complaining about does not get taxed at all - it just sits in investment accounts, generating income that is not being taxed, earning capital gains that are not being taxed, until the money is actually spent. And my guess is that in both cases those families spend a far lower percentage of their family wealth and income in a given year than the average American does.
The problem with a consumption tax is that you are shifting the burden of taxation from the wealthy to the poor.... A consumption tax has no income exclusion, so the very poor have the same tax burden - but probably pay a higher percentage of their wealth and income in taxes than they do now, and than the wealthy will do, as the poor are far more likely to spend all that they have and save very little. ...
I apologize for the digression . . .
I had a nice long rebuttal written, but you're right, we don't need to turn this political. I still think a consumption tax is MORE fair, particularly if you consider essentials such as food and clothing are exempt from the tax. If you aren't so poor that you can afford beyond this, shouldn't you contribute something? You're still using services, correct? While spending 1,000,000 bucks on a vacation home would net the government a cool 300,000 when our rich friends decided that place in Aspen was nice.
Anyway, perhaps we can enjoy a more meaningful debate somewhere over a cold one in a pub sometime.
Except...
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