Federal Tax System

The federal tax code has a level of complexity so great, that reforming it should be the one thing Republicans and Democrats can agree on. Instead, proposal after proposal calling for reform die in Congress. And there have been a lot of proposals. Arlen Specter (D-PA) put some form of a flat tax/tax reform proposal into Congress’s hands every year from 1995-2010. This is because, for the most part, the fight for reform always comes down to a two sided debate. One side wants to keep the current complex structure and the other sees no other alternative than blowing this current structure up and moving to a flat rate system. All of this brings me to the arguments for/against the flat rate tax system.

However, raising taxes on the rich and corporations is not as helpful to our economy as most people think. Although raising taxes on the top percent of people and companies appears to create more income for the government, the result will make it harder for middle class and lower class citizens to grow. Some argue that by combining several key changes, including the simplification of the tax code to avoid loopholes and the decrease of taxes on the rich and corporations, there will be an improvement in the national economy. Although this may seem a bit counterintuitive, it makes more sense when looked at closely. By lower taxes and remove all loopholes, smaller businesses are given further opportunities to grow instead of facing financial roadblocks and government

An individual taxpayer can avoid the penalty for underpayment if the payments of the estimated tax is at least as large as any one of the following:

America’s first income tax was executed as a way to help finance the overwhelming costs of the Civil War. Even though the income tax in 1862 was commonly a personal income tax, it added a tax on corporations, including withholding and taxing certain corporate interest and dividends but pursued to avoid double taxation. “An 1885 pamphlet wrote ‘‘[double corporate taxation] violate[s] the principles at the foundation of all systems of taxation’’ (Bloomfield 2011 p. 179). This attempt to raise money was not successful and public debt continued to rise. In response, the 1864 tax act reduced income ceilings and specifically included partnerships and corporations as taxable individuals. Afterwards, the Revenue Act of 1913 formally distinguished personal

Ever since the ratification of the 16th amendment to the United States Constitution, Americans have faced the burden of federal income taxes. Income taxes were first proposed as a better way of gathering revenue, as well as an effective measure to manipulate economic spending. However, the current tax code bears very little resemblance to the relatively simple codes that were originally written into law. Today’s tax laws have grown astonishingly complex and unequally distributes the burden of tax liabilities. Our country should confront the issues derived from the increasing complexity of the tax laws and equally distribute the obligations to each taxpayer.

The United States is facing a structural budget deficit in recent years. The fiscal situation has an increasingly dire and unsustainable outlook over the next 10 years and beyond. However, looking back ten years before, when George Bush took office at the beginning of 2001, the federal government was running a substantial budget surplus and projected rising surpluses. Here comes to a question: how did federal government get into this fiscal mess. My paper dedicates to examine the federal budget balance and government policies over last ten years and analyzes the reasons for this dramatic change from substantial surpluses to massive deficits. Furthermore, I will also shed a light on the dilemma

The Republican parties seem to favor lower tax rates with less movement of the rates of taxation across the tax bracket. The Democratic parties are leaning more towards raising taxes on those in higher tax brackets on the basis that the government should obtain more revenue from those who can afford it more easily. However, as the Amendment is written, maybe the 16th Amendment wouldn’t be fare to those households with higher income being taxed at a heavier rate than those of lower income households. The 16th Amendment is written to contain such elements to ensure it being constitutional, however these same elements could do just the opposite. In regards to the abilities of the 16th Amendment, Erik Jenson shows that is possible, “ A simple example makes the point: suppose states A and B have equal populations, but state A’s citizens have double the income of those in state B. With apportionment, the total collected from the two states would have to be equal. On average, the citizens of state B would have to pay tax at double the rates applicable to citizens in state A”. (Jenson, 109:799(2014)) This would be the part where we show thanks that the government doesn’t weigh heavier taxes on those who of higher income homes because the pendulum swings both ways. The New Deal of the 1930’s may also be constitutional; as well at it may also be apportioned. With the Presidents passed being concerned with the freedom and equality of all the inhabitants of

Taxes play a huge party in the United States of America. Taxes are peoples and entities contribution to society to pay for all the things society provides us with. Money moves from consumers to business when people buy goods and services. When the economy is increasing and growing consumers earn more and make more purchases. Through all the purchases the government collects sales tax. The government collects money from the market purchases but provides goods and services. “The tax budget is divided into both mandatory and discretionary spending, depending on how it is allocated each year”(Reference/Government). The first time the government initiated tax was for the civil war in the 1860’s but then it was repealed in 1872. In 1913 Congress

“In 1913, Congress levied a 1% tax on net personal incomes above $3,000, with a six percent surtax on incomes above $500,000. As the nation sought greater revenue to finance the World War I effort, the top rate of income tax rose considerably.

Responsibility for complying with the mandatory, annual task of filing a tax return falls on the individual. Hence, the tax system in the United States is a voluntary compliance system (IRS, 1974). Penalties for lack of compliance, through error or contrivance, may result in financial sanctions, criminal prosecution, and jail time (Pub. 17, 2015). Nonetheless, lack of taxpayer

Once again, the onset of war generated a necessity of greater revenue, and in 1862, during the civil war, the nation’s first income tax was enacted. This income tax was the foundation to

This leads us to taxing, and the only other way to make money, as a government is to tax the people of that government. This includes raising taxes on gas, alcohol, tobacco, and the overall tax rate. In the last 10 years our tax rate has grown from 28 % to an astonishing 39.6%.

The tax system is unfair because those who are wealthy pay more than those that are not.

department of Treasury emphasizes the importance of consistently having a constant limit on the national debt. “Since 1960, Congress has acted 78 separate times to permanently raise, temporarily extend, or revise the definition of the debt limit – 49 times under Republican presidents and 29 times under Democratic presidents.” None of which have been successful. The national budget allows for financial growth within the US and ensures that the debt does not get too out of control. Similar to credit cards having limits on how much can be spent for individuals the government must do the same. The pros outweigh the cons and the only rational conclusion to affirm is that the national debt must be limited and contained. Thus, the solution to this national debt problem is through increasing taxes, real spending cuts, accountability, efficiency, jobs, economic growth, financial stability and cut personal debt. Increasing taxes may seem problematic in the short term but looking at cost benefit analysis the simple way to solve the on going issue. The long term effects are much greater than the temporary issues that may

The United States tax system is a vastly complicated, with almost six thousand pages and a little over three million words, the federal tax code can impede anyone trying to comprehend it. With annual changes and jurisdictional complications, even with some understanding of the federal tax code, its complexity grows. American’s spend enormous amounts of time filling out and filing taxes every year but, many citizens have no idea what their taxes are actually contributing to. Is the current tax system benefitting the United States economy and if not, in what ways are the system failing and how can it be improved?