Tax Code

Nearly half of taxpayers have yet to file their federal tax returns, although the deadline is just about two weeks away. Many of them are holding off to the last minute because they owe taxes, of course. But some likely are waiting for answers. The U.S. tax code grows more complicated each year, often leaving taxpayers uncertain about whether they qualify for deductions or not. And a bumpy economy has left many taxpayers yearning for bigger refunds. So this year tax professionals say they are fielding more questions than ever about debt, the homebuyer credit, Roth IRA conversions and any obscure deductions filers could be overlooking.

As a taxpayer for more for more than 50 years, I agree with your editorial "The Buffett Rule backlash" (April 13) in which you conclude that "taxing the wealthy at rates others already face is a matter of fairness. " However, the other major issue with reform of the tax code is the sheer complexity of the code itself. Of note, today's tax code is 5,296 pages long. By comparison, the initial tax code in 1913 was 27 pages long. Leon Reinstein, Baltimore

WASHINGTON -- Junk the current tax code. Eliminate the Internal Revenue Service. Create a tax system that is fair to everyone and encourages investment, saving and entrepreneurial capitalism.Such is the plan of the National Commission on Economic Growth and Tax Reform, created with private funds at the behest of Senate Majority Leader Bob Dole and House Speaker Newt Gingrich.For more than 50 years we have been subsidizing behaviors we once discouraged, such as sloth and indolence, irresponsibility, unaccountability and sexual promiscuity.

Critics of the so-called "Buffett Rule," President Barack Obama's proposal to impose a minimum income tax on the wealthy, would like to have their gilded cake and eat it, too. On the one hand, they contend that the proposal would have a minimal impact on closing the deficit, and on the other, they claim that it would greatly discourage investment. Clearly, it can't be so small as to have a negligible effect on tax revenue while simultaneously so big as to have a ruinous impact on the economy.

The midterm elections that gave control of Congress to the Democrats also brought widespread predictions of paralysis in Washington. But is divided government a recipe for inaction? Not necessarily. Divided government can produce good policy, especially on the budget, while one-party rule does not guarantee positive results. We learned these lessons firsthand while working inside the budget machinery of the White House under two different administrations. During the Clinton years, a Democratic president and a Republican-led Congress exchanged frequent rhetorical fire but ultimately produced some of the best federal fiscal policies in decades - balancing the budget, limiting spending, and still investing more in education, research and other priorities.

ATLANTA -- As they devote the precious weekends of early spring to searching for tax records and filling out forms, millions of Americans share a single sentiment about our tax code: There must be an easier way. A flat income tax or a national sales tax are much-discussed alternatives to our annual filing agony. But while those options may sound attractive, especially around April 15, millions of taxpayers would be furious if Congress were to make the one change essential to implementing either plan: elimination of the home mortgage tax deduction.

MANCHESTER, N.H. - Sen. Joseph I. Lieberman proposed an overhaul of the federal tax code yesterday that would lower tax rates on middle-class families while raising taxes, sometimes substantially, on wealthier Americans. Speaking to about 250 supporters and onlookers at a presidential campaign rally, the Connecticut Democratic said his plan would "restore integrity and fairness" to the code by shifting more of the burden to wealthy individuals and corporations. The plan calls for lower tax rates on individuals earning less than about $70,000 and families earning less than $115,000.

The Philadelphia Inquirer said in an editorial Thursday:THE dumbing down of American politics continues apace.Now we have "Kill the code," not just as a slogan sneered at the tax system, but as an empty-headed bill that might actually pass Congress this election year.The bill would kill the current federal tax system by 2001. It is silent on what ought to replace it.The supposed rationale is that national leaders won't reform the system unless they have a deadline.In fact, what really appeals to congressional leaders about this time bomb against the status quo is that it makes them look like bold reformers in time for the election -- without forcing them to decide on a new system.

WASHINGTON -- In his campaign for the Republican presidential nomination in 1996, publisher Steve Forbes always evoked enthusiastic applause when he promised to abolish the tax code.But shooting off your mouth on the campaign trail is one thing and simply abolishing the code with a single stroke is quite another -- although that is precisely what the Republicans who control the House of Representatives have pledged themselves to accomplish. They have passed, 219-209, a mind-boggling bill that would require Congress to write a new tax system by July 4, 2002, then scrap the current code at the end of the same year.

If you are thinking about buying a second home this spring - or you bought one in the last couple of years - you are part of a major transformation under way in the real estate market. The annual number of second homes purchased in the United States doubled between 2000 and 2004, according to new research. The boom is being driven in part by demographics - mainly a flood tide of equity-laden baby boomers - and in part by a largely unexpected ricochet effect of tax law changes in the late 1990s.

Americans could scarcely be blamed for viewing any proposal to "simplify" taxes with skepticism. From Steve Forbes' flat tax of 1996 to Herman Cain's recent 9-9-9 proposal, efforts to make taxes simpler have usually meant - at least when held up to closer scrutiny - shifting the budgetary burden from the rich to the working class. But what President Barack Obama revealed today appears to be a far more reasonable attempt to reduce the nation's corporate tax rate from 35 percent to 28 percent (and allowing manufacturers an even lower 25 percent)

It is unbelievable how much fuss there has been over Mitt Romney's taxes (Romney tax returns: A wealth of insight," Jan. 25). He paid what the tax code required, and it is not illegal to be rich. To put this in context, I have 343 acres in West Virginia, and my property tax bill is $174. In Maryland I have six acres and my tax bill is 20 times what West Virginia charges me, plus I get better service in West Virginia. I also sit on the Marcellus Shale Run, and I am in negotiations to sell drilling rights.

Editor:  This is a response to the Open Forum article "Being Uncompromising …," which was a response to an editorial "Just like sausage. "   Pat [Patrick McGrady], I read both the Dec. 28 editorial and your response to the editorial and I have to say when I read your response all I heard in my head was "blah, blah, blah. " It really had no relationship to what was in the editorial, and was more a rant on how the Republican representatives in Annapolis can't get any of their pork barrel legislation passed because of the mean old Democrats.  But I suspect there was an ulterior motive to your article, and here is what I suspect it was. An encrypted cipher within the text which relayed the following message to your Republican cronies… "Hey guys, I tried to get those bills passed that would cut your taxes and put more loopholes in the tax code so you all can make more money on the backs of the middle class, so you all can get that larger yacht and the fourth home in Costa Rica. But those dog-gone Democrats messed it up.  Well I'll try again next year!

I am troubled by the assumption of PlanMaryland opponents that they have an inalienable and eternal right to our tax dollars to support their high maintenance and energy consumption lifestyle. The purpose of the PlanMaryland legislation, like smart growth before it, is to withhold state funding for bad choices about how and where to live made by local government. If they persist in turning cornfields into vinyl McMansions, they shouldn't do it on my tax dollars. It's bad enough that any corporate functionary should get a mortgage interest deduction for living in a house with a profligate carbon footprint and commute on roads newly built on some of the best farmland on the planet.

Earlier this month, the president's jobs bill failed in the Senate. Now the White House intends to break up the bill and gin up sufficient Republican support to pass key pieces. "We will now work with Senator Reid to make sure that the individual proposals in this jobs bill get a vote as soon as possible," said President Barack Obama in a statement released shortly after the Senate vote. This piecemeal approach might be politically expedient, but the provisions the White House is pushing are still a whiff policywise.

The United States tax code is so backward that billionaire investor Warren Buffett pays only 17 percent in income taxes, a rate even lower than that of his secretary. Or so he claims. While I have great respect for Mr. Buffett, and while I agree that our tax code could benefit from major adjustments, Mr. Buffett's statement is misleading. And he knows it. Even worse, when Mr. Buffett implies that wealthier Americans are under-taxed, it gives public officials cover to pursue disastrous policies such as Maryland's failed millionaire's tax, and the pending sales tax on interstate Internet purchases known as the "Amazon tax. " Taxing the rich and protectionism may poll well, but these policies demonstrably hurt the same middle class and lower-income citizens they purport to protect.

* First in a seriesUnless you filed a short form, you may -- at this time of year -- be finding income tax regulations confusing. Don't be dismayed. So do most of the nation's accountants and tax lawyers. Even agents of the Internal Revenue Service can be baffled.The tax code has become so complex that hardly anyone has anything good to say about it -- or about Congress, which passes tax laws, and the IRS, which enforces them. It's time for an overhaul, but no one believes it will happen soon.

CONGRESS HAS been making noises about rewriting the federal tax code. Republicans sent President Clinton a letter last month asking him to develop sweeping changes by May 1. It's unlikely they will get what they say they want. For one thing, it is difficult to take seriously the Republicans' call for "no loopholes or special treatment for favored interests." True tax reform would have both parties screaming over gored oxen.More palatable politically would be yet another so-called Taxpayers Bill of Rights to make the Internal Revenue Service operate more efficiently and fairly.

Regarding your editorial "Cut, cap and empty gesture" (July 20), your view is perplexing considering the facts. Prior to President Obama's takeover of the government, both Democrats and Republicans drove the increase in federal spending. Since President Obama was elected, federal spending, not counting war spending, has exploded. Republicans have gotten the message that the spending cannot be sustained and will eventually lead to ruin, and they at least have a plan. The Democrats have not. Instead they use scare tactics and class warfare.