Panel To Recommend Major Tax Law Changes

Discussion in 'Up to the Minute' started by Buzz Mills, Nov 1, 2005.

  1. Buzz Mills

    Buzz Mills New Member

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    Panel to Recommend Major Tax Law Changes

    WASHINGTON - Chosen to find a simpler way to tax the nation, a presidential panel is set to recommend two designs that would rewrite virtually every tax law for individuals and businesses. Under the plan, most deductions, credits and other tax breaks would be eliminated along with much of the paperwork and equations that baffle taxpayers under a drastically simplified income tax.

    But many, including the nine members of the presidential commission, have said key recommendations will be unpopular. "The effort to reform the tax code is noble in its purpose, but it requires political willpower," the group said Tuesday in a letter to Treasury Secretary John Snow. "Many stand waiting to defend their breaks, deductions and loopholes, and to defeat our efforts."

    http://tinyurl.com/7zrbz
     
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  3. Marthatex

    Marthatex New Member

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    This is my first "gut" reaction to this - it does need to be simplified.

    However, a "deduction" is different from a "loophole".

    I do NOT think the average American should lose the mortgage interest deduction; there has to be some advantage of a home over apartment. Homes are expensive to maintain and you have to pay property taxes.

    I don't know how the average young people will buy homes if they don't get some deductions. Or poor people trying to move up.

    Now "loopholes"- ways that the super-rich or corporations save gobs of money, I'm for closing those up.

    Bush says "no new taxes", what a joke. Just take away the deductions. Who does he think he's fooling. They're going to go after our inheritances also.
     
  4. PaperDoll

    PaperDoll When I'm Silent, I make the most sense

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  5. Details

    Details Former Member

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    Yeah, I want to see what they mean about getting rid of the loopholes and deductions, etc. There are good and bad deductions, and I want to see that business loopholes are closed before I'm willing to take all the individual deductions closed.


    Although there are some good deductions around - the deductions that encourage a business to be a good business - health insurance deduction, etc. Right now it's one of the ways that the government encourages socially beneficial behaviors - like having children, being married, owning a home, operating in an impoverished neighborhood, etc. I want taxes simplified too, but I think there are some elements that maybe should be maintained. OTOH - these deductions are all misused as well, so it's hard to say what to do there.
     
  6. lilpony

    lilpony New Member

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    Gosh, I pray that we don't lose our Home Interest deduction. We need this deduction, its the only thing my husband and I have left to deduct. When I think about losing this, I feel ill. I pray this doesn't happen. I don't know where we will get the money to pay the IRS more money. I am really ticked off about this, it better not happen. Screw all these polititions, doesn't seem like you can trust any of them anymore. I may never vote again, I am so ourtraged. It seems who ever you vote for its not good. This will hurt the middle class big time. Unbelievable!!!
     
  7. Details

    Details Former Member

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    I think that depends. If getting rid of all the deductions lowered your tax bill enough that it was the same or lower than with the house deduction - that'd work, right? And it'd mean that the billionaires and corporations who hide their money in all the tax shelters and loopholes would be paying their fair share - that's how your tax bill would go down.

    So I'm not quite automatically against that deduction going away - depends on how much the new tax program lowers our taxes. Could be by quite a bit - I understand a lot of corporations and billionaires don't pay much in taxes...
     
  8. Buzz Mills

    Buzz Mills New Member

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    Panel delivers 'bold recommendations' for tax law changes

    WASHINGTON (AP) -- Chosen to find a simpler way to tax the nation, a presidential panel on Tuesday recommended two designs that would rewrite virtually every tax law for individuals and businesses. Treasury Secretary John Snow called the proposals "bold recommendations" but he did not indicate what ideas the administration would embrace.

    "Now it's up to us," Snow said. The Treasury Department will "take the report, review it carefully, understand the implications and use the report as a starting point for recommendations that we will make to the president," he said. Under the panel's plan, most deductions, credits and other tax breaks would be eliminated along with much of the paperwork and equations that baffle taxpayers under a drastically simplified income tax.

    http://tinyurl.com/98l47


    1. The panel would convert the home mortgage interest deduction into a credit equal to 15 percent of mortgage interest paid. The $1 million limit on mortgages eligible for the tax break would shrink to the average regional price of housing, ranging from $227,000 to $412,000..

    2. In another major change, taxpayers could purchase health insurance using untaxed money up to the amount of the average premium, about $5,000 for an individual and $11,500 for a family, a change that caps currently unlimited breaks but would create a new tax break for those who do not get health insurance through work.

    From what I heard on the news, businesses are going to benefit immensely from the suggested tax code changes.

    Edited to add: In addition to the limits on write-offs of mortgage interest payments, the main elements of the proposals would abolish the alternative minimum tax, erase the deduction for state and local income and property taxes, restrict tax-free employer-paid health insurance and reduce the deductions many taxpayers can claim for charitable donations.

     
  9. Marthatex

    Marthatex New Member

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    "erase the deduction for state and local income and property taxes...."

    Now I have a hard time believing that this would go over because it's DOUBLE TAXATION, right? I don't believe in that all. The tax free health plans should not be eliminated either, those have been a GREAT idea. Charitable deductions should not be excluded either - can you imagine what that would do to the charities?

    Obviously expert financial people, economists or accountants are not coming up with these ideas. It sounds like some ideas they just "threw out".

    well, I said months ago that we would have to see higher taxes sooner or later. "Change the tax code is "Bush Lingo" for higher taxes (fewer deductions).

    Hopefully, this Mr. Snow will know what he's doing and tell them what is reasonable and what is not. Also I don't think the Dems will go for much of that.
     

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