Tax Rascal

Why Drivers Should Love a Mileage Tax

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A proposed gas tax led to some red faces at the White House earlier this week. Ray LaHood — the only Republican in the Obama administration — suggested it, perhaps in an effort to put the ‘tax’ back in ‘tax-and-spend’.

To the average driver, paying for something you used to get for free sounds like a bad deal. Five reasons it’s actually a great bargain instead:

1) The ‘fringe benefits’ are fantastic: part of the mileage-tax plan requires installing a global network of GPS-based car-tracking systems. There are privacy concerns, of course, and those will need to be addressed. But this plan also makes it possible to do some amazing things. From dynamic traffic maps criminal detection, this would … Read more...

Audit Them All?

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Via TaxProf, I found this article suggesting that we audit all high-ranking politicians political figures. Not to be vindictive — or not just, anyway — but because people take cues from politicians on how to behave, and incidents like the Daschle tax affair make people less likely to take taxes seriously.

This doesn’t just have the obvious effect of streamlining the nomination process by digging dirt in advance. And it’s also not just a way to keep politicians honest about the favors they’re getting from — and doing for — their friends.

Nope, it’s actually based on a legitimate study, which showed that people cheat less on their taxes when they think others cheat less, too.

The great … Read more...

Swamped: An Unstable Tax Code is Worse Than High Taxes

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MauledAgain has a great article on how just one set of tax rules for small business — section 179 — has changed during the last few decades. He points out that the level of expenses small businesses can easily write off has fluctuated from $5000 (1983) to $125,000 (2007-11) except for when it’s $250,000 (2008), and may be kept at the same $250,000 level in the future.

There are good and sensible reasons to think that an easy deduction like this would do some good. The paperwork (and plain vanilla work) on depreciating $25,000 worth of expenses is a nightmare compared to that of figuring out $25,000 more on a $500,000 budget, so this does reduce the bureaucratic load on … Read more...

Obama’s Shocking Tax-Cut Plan

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It’s startling to hear about a giant, $300 billion tax cut from the tax-and-spend party (which beat the spend-and-spend-and-spend party in a hotly contested election). Incredibly, after months of childish bickering on both sides, this new tax plan treats the average taxpayer like an adult. How?

It’s a cut in withholdings, rather than a refund check. If you get $300 back in one lump-sum, you can spend it all on something really fantastic — and at the end of your evening, you’ll feel like you got dinner and a concert on Obama’s dime. But turn that $300 into weekly payments of $6, and what do you get? An extra Obama-tizer at TGIF? Paying this money out in a small … Read more...

What to Expect in 2009

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Online and off, there’s a lot of hope and fear about the next year. Will we see our tax system revamped with new tax breaks and incentives that make things easier for the middle class? Will new social programs make the existing tax burden much heavier?

Predicting policy is notoriously tricky, but here are a few best guesses:

  • How much will the tax code change? Less than you’d think. When politicians run for office or pose for the camera, they have every incentive to exaggerate their plans and abilities. Once it’s actually time to come up with a law, though, those exaggerated claims bump into each other and lead to some long, drawn-out compromises. Usually, these compromises are solved with
Read more...

A Shearer in Sheep’s Clothing?

Categories: Uncategorized

Today’s taxosphere focused on some pretty surprising political developments. After a landslide Presidential victory and a strong showing in Congressional elections, Democrats are considering — cuts on income taxes and corporate taxes. Or are they?

Read more...

Joe the Plumber: Taxes and Swing Votes

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Joe Wurzelbacher might think twice about getting involved in politics again. A week ago, Joe the Plumber was just another plumber. Now he is the Joe the Plumber, a more important political topic than the War in Iraq, and a more sensitive debate subject than abortion or gay marriage.

How did Joe the Plumber find his way into the spotlight? First, he happened to be named ‘Joe’: every candidate wants a less insulting, more family-friendly replacement for “Joe Sixpack,” and Joe the Plumber is definitely it. But more importantly, he touched on a crucial issue: what are the long-term effects of the Obama and McCain tax plans?

In the video that made him famous, Joe sounds like his mind … Read more...

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