TAX POLITIX
The Politics of Taxes
The Golden Opportunity Time Between 65-80
Everyone thinks they can retire at age 65. It’s an American ideal born in the last century with the rise of unions, the defined benefit plan, and generous pension systems. In reality, especially due to advances in health, medicine, and nutrition, many people have great capability to continue to work and contribute to society and themselves until 80. And they should -- because they need to. There is a crisis of affordability looming. Besides the enormously wealthy, for the most part no average...
The IRS’s Growing Role as “Rules Interpreter”
A recent article by the National Review brought to light how the IRS has taken on the role of “rules interpretation” in recent years, which is beyond its scope as the nation’s tax collecting agency. The most notorious example of this new role is highlighted in the King vs Burwell case before the Supreme Court -- where the IRS interpreted the language of Obamacare other than what was expressly written down as law. However, as the National Review discusses, the IRS has grown accustomed to...
TIGTA to IRS: You Got (More) Mail!
The Treasury Inspector General for Tax Administration (TIGTA) found even more missing emails from Lois Lerner among the recycled back-up tapes, which has provided now about 35,000 emails that were deemed lost and destroyed. This new batch of roughly 6,400 emails is particularly interesting, because it spans 2004- 2013, so it covers the time frame both before and after Lerner's hard drive crashed in 2011. About 650 emails appear to be from 2010-2011, which is the crucial time during which...
The Great Wealth Switch: How the Public Sector Became Wealthy
People have traditionally measured wealth by the amount of tangible assets they have. Viewed from this perspective, many people who have saved substantially for their retirement through an IRA, a 401K, or other profit sharing plans, (all in the category known as defined contribution plans) are well up in the highest percentile of people with wealth. Other people have retirement plans that provide only income streams for their (and often their spouse’s) lives. These are known as defined benefit...
How Much Each Taxpayer Owes Toward the Federal Debt
Forbes recently had a very good article which explores the US Federal Debt and how it affects economic growth. It also reviews government debt for the future, and its affect on the private sector and the debt-to-GDP ratio. Unfortunately, it doesn't cover the entirety of US debt, which includes substantial entitlement obligations, but that's probably fodder for another article entirely. If you want a decent primer on our federal debt -- which translates into $154,161 each taxpayer owes towards...
Today is Tax Freedom Day
Each year, the Tax Foundation releases its annual report measuring Tax Freedom Day, "the day when the nation as a whole has earned enough money to pay its total tax bill for the year." Tax Freedom Day is today. April 24th. It takes 114 days of working to pay the country's tax bill. Some important findings: "Americans will pay $3.3 trillion in federal taxes and $1.5 trillion in state and local taxes, for a total bill of more than $4.8 trillion, or 31 percent of the nation’s income. Tax Freedom...
IRS Complains About Budget Cuts, But It Cut Its Own Customer Service Budget
Earlier this year, John Koskinen, the IRS Commissioner, complained about the IRS budget given to him by Congress. It was reduced by nearly $350 million for this fiscal year. Commissioner Koskinen claimed the “agency’s $10.9 billion budget is its lowest since 2008. When adjusted for inflation, the budget hasn’t been this low since 1998.” Due to budget cuts, the IRS warned that customer service would be reduced. The Taxpayer Advocate, (the IRS watchdog of sorts) recently gave her semi-annual...
Loretta Lynch Vote is Drawing Near
The vote to confirm Loretta Lynch might happen as early as this week. The process has been stretched out under the auspices of being contingent on passing a human trafficking bill in the Senate, but it is just as likely that the vote was put quietly on hold in a "logjam" until 51 votes were clinched for certain. It has been a struggle to get enough votes throughout the process, with the 51 vote only been secured at the beginning of April. 5 Senate Republicans that were needed are: Sens. Orrin...
Fiorina on Small Business
I have no particular favorite right now in the GOP nomination fight. As a CPA, I pay close attention to the economic policies of the various candidates. Carly Fiorina spoke to New Hampshire Republican Party’s First in the Nation leadership summit in Nashua, N.H on the subject of small business. Being the former CEO of Former Hewlett-Packard, Fiorina offered a decent perspective, which hasn't really been discussed at length so far by many of the other candidates. “The heroes of the American...
Quote of the Day: Bastiat
"Life, liberty, and property do not exist because men have made laws. On the contrary, it was the fact that life, liberty, and property existed beforehand that caused men to make laws in the first place" -- Frédéric Bastiat in "The Law." If you haven't read "The Law" yet, you can download it here for free. It is one of the most marvelous works of economics and philosophy.
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