Simplifying the Tax Code
With the new year upon us, I think it is time to talk about something frustrating for millions of Americans a year, tax law. Laws are different everywhere, so I am going to just stick with the United States on this one simply because that is where I live. Despite what you think of taxes, most of us still have to pay them in some way and file with the government yearly. If you have ever done it before, you know it is usually a living hell, EVEN if you hire someone to do it for you. You basically send in your paperwork and cross your fingers hoping you don't get audited.
In a country with hundreds of millions of people, the tax code is so complex that many times even the professionals mess it up. There are hundreds of pages of new code implemented or changed a year making it almost impossible for everyone to catch up. To make things even more difficult, multiple organizations within the government disagree on how to tax certain things. For example bitcoin is still seen as a different thing in many parts of the government, meaning it would have to be taxed differently.
With a word of technology getting infinitely better, why cant we simplify our tax code so the average person can do it? I mean, the government knows roughly what we owe anyway in taxes, if they didnt , people who fudge numbers wouldn't get audited. There are many reasons why the tax code isnt simplified and many of them are actually because it goes against the best interests of others. Companies who make a living filing taxes for individuals and other companies lobby every year to make sure the tax code stays complex.
In addition, taxes are mostly a bipartisan issue when it comes to actually deciding what is taxed and by how much. Often a simple change in the tax code comes down to a massive debate, even if that change is a loop hole. There are still hundreds of loopholes in the tax code that people acknowledge are there, but unless both sides can agree to work together, things never end up getting changed. Those hurt the most in these situations are the middle class, those who pay enough in taxes, but cant hire multiple tax professionals to help them legally evade taxes.
If the loophole exists in the tax code, it isnt illegal, which is why we didnt see many Americans tied to illegally avoiding taxes in the Panama Papers, because we have legal ways of doing it. Unless both sides work together, our tax code will only become more and more complex, creating more of a gap between what the average person can afford to save and what the mega rich can. If we are forced to pay taxes, I personally want to be on a level playing field when it comes to figuring out what we have to pay.
-Calaber24p
Exactly. Sometimes it's tempting to see the government as this inherently fair referee type of an entity who is at least attempting to do whatever makes the most sense. But in practice it's just an apparatus that those with the most money/influence will pull at for their own gains.
And so as long as you have a large beast of a government, it's probably unlikely that it would issue a tax code that's simple and accessible to the average person.
If they're going to tax us, the least they could do is automate it somehow (sales tax and import tax etc. is at least simple to deal with). It's crazy that on top of being taxed, you also have to do a bunch of busy work to figure out how much you're supposed to be taxed and then you face a penalty if you do it wrong lol.
(If you have to be a weird busy body as the only mechanism to getting the money, it's probably an indication that collecting this money is not for our collective best.)
Very well written I agree.
I've made tens of thousands of dollars in crypto over the past six months starting with only $1300, most of which came through Virwox as I was using that to exploit my paypal credit for the purposes of investing in an ICO off which I generated 25x the amount I began with! Since then, well, things are really soaring shall we say. So, now that i've become aware of this tax fiasco, I need to figure out what exactly they CAN find out, IF they'll go looking for it, and what exactly is due on my part; is it only money deposited into my bank account from coinbase the money that needs to be reported? Cause I haven't worked in six months and will never work again. I'm not sure what exactly to report. Can they gain access to my bank account transaction history and try and claim tax on all these incoming transactions over the past 6 months? Is coinbase liable to surrender all this information on what transaction went outbound to my bank account? What the hell am i supposed to do is the question. Obviously I'm not telling anyone how much "value" I currently have in cryptos. There is no way anyone could trace through this infinite sea of data that is quickly populating to figure out where i started out with $1300 six months ago and how much i owe in tax on that money, specifically money that is incoming to my bank account. I want to stay out of trouble for peace of mind, however, on the other hand, I am not paying fucking taxes if you get my drift.
I enjoyed reading your blog, but all of us are now ready to welcome the new year
There is a simple reason the tax code is so complex.
Its so that "they - the governing elites" can carve out loopholes for themselves while at the same time confusing "us - the people" so that we don't figure it all out.
If "we - the people" ever opened our eyes and united together, then all things like fixing the tax code would be possible.
Happy holidays and cheers :)
I cant imagine living in the US and dealing with tax, everyone I hear talk about it seems to dread it, I see people on the TV with stacks of receipts, whats that all about!
Im not saying the UK government is good at tax, but for most people its just taken directly from their pay packet or as they spend money, or as you earn interest. No forms to complete, nothing to evidence, simple.
Its only if you start to do unusual stuff like foreign currency/shares that it gets more complex. Even with crypto, unless you are a day trader, its only when you sell back to pounds that you need to consider if you exceeded an annual capital gains threshold. Convert less to £ than the threshold, no worries. And lets be honest, who wants fiat anyway :)
Good information.
Good post sir did wish to follow some one like you be glad if you followback
Flat tax eliminates tax loop holes due to big special interest lobbying, and government social engineering. With all of that out of the picture what fun is to govern?
Nice info but its time to prepare for new year....we have time and the best community steemit to have discussion on it afterward....
Interesting points, whether the tax reform changes are beneficial to an individual personally or a detriment to them, tax reform didn't make things simpler as advertised.
It is even more challenging for crypto enthusiasts with multiple transactions (since exchanges aren't really issuing 1099's nor is steemit). I spend most of my time here writing about this topic.
Steem on!