If you are like many of us, you have turned to the services of a CPA or other professional tax preparer to prepare your tax return every year. Many of us do this because we simply do not know if we can do it correctly ourselves, or it is so frustrating to try that it is simply not worth the agony. In fact it is nearly impossible to know if you are doing taxes correctly because there are 71,684 pages of tax code (as of this writing) and even the IRS and its individual agents do not agree on the code, what it means and what is allowed. This struck me as I was talking to my CPA the other day about a return because she asked me the simple question "is this right?" The fact is, we have to hire someone to hopefully, do it right, and then are asked to sign off on the fact that it is done correctly. Many times we don't understand the tax code well enough to be able to do this. But we have no choice. We have to, by law, pay taxes and fill out a tax return in order to do so.
Can you imagine a life with no IRS? Can you imagine not having to stress and worry each spring about paying your taxes, whether you are going to owe even more money than you have paid in already all year long? Some people seem to look forward to tax time eagerly, thinking they are getting a "bonus" when they get a refund. I guess they do not realize that this was their money all along that the government has taken as an interest-free loan and now they are simply giving it back.
I love to imagine no IRS and this could become reality in the form of the bills before congress named HR25 and S296 and known more commonly as The FairTax. The FairTax bill has been around for quite some time already but despite its deep and growing non-partisan, grassroots support, is having a hard time getting a hearing before congress. Why, you might reasonably ask, is this the case? The answer lies in the fact that the current tax system allows politicians to buy favors in the form of special tax treatment to special interest groups. The tax system gives politicians far more power than the US constitution ever intended for them to have and they don't want to give it up.
Here are some facts about the FairTax:
The FairTax replaces all federal income and payroll based taxes and replaces them with a progressive national retail sales tax. Included in the plan is "prebate" paid monthly to every household to ensure no American pays federal taxes on spending up to the poverty level.
It abolishes all federal personal and corporate income taxes, gift, estate, capital gains, alternative minimum, Social Security, Medicare, and self-employment taxes and replaces them with one simple, visible, federal retail sales tax administered primarily by existing state sales tax authorities in the same way they currently collect sales tax.
Eighty economists have written to Congress and the White House that the FairTax, with $22 million of peer-reviewed research behind it, is the best federal tax system to create economic growth. The FairTax taxes us only on what we choose to spend on new goods (used goods will not be taxed) or services, not on what we earn. The FairTax is fair, efficient, and transparent.
By taxing what comes out of the economy - consumption - instead of what makes the economy grow - work, savings and investment - the tax base is dramatically expanded and every worker takes home paychecks free of all federal withholding and payroll taxes.
The FairTax will provide incentive worldwide for businesses to move to the USA where they would not be punished by the tax code. This will create many much-needed jobs. The FairTax will bring underground economies and illegal immigrants not currently paying taxes into tax payer status.
There are so many great reasons to enact the FairTax. Do yourself, your family and your community a favor and become more educated on all the FairTax has to offer. There are several good books that explain The FairTax in an interesting and entertaining way, including, The FairTaxby Neal Boortz and John Linder. FairTax:The Truth: Answering the Critics by Neal Boortz, John Linder and RobWoodall. And The FairTax SolutionBy Ken Hoagland.
As the FairTax awareness and support grows, so does the reach of supporters. On July 4th, 2010 a TV show about the FairTax will air for the first time. Watch it and get excited about what the future could have to offer!
