Everyone complains about the complexity of the IRS Tax Code but as soon as someone tries to simplify it, the special interest groups and lobbyists show up to protect their piece of the pie. In my opinion the IRS Tax Code should be written in a manner of equal benefit and responsibility for all taxpayers. Below are some examples of how the current code benefits some at the expense of others.
The current GOP proposal calls for elimination of the mortgage interest deduction for mortgages over $500,000. In most of the country this deduction would provide adequate benefit for the average taxpayer. However, the National Association of Home Builders is opposed to this because it would eliminate a subsidy to the high-end market. Why should the average taxpayer be required to subsidize the home builders and their high-end clients? I would surmise most clients in the over-$500,000 market are not buying their first home and do not need the deduction to convince them to buy a home.
Next is the proposal to eliminate deduction of state and local tax payments after the first $10,000. Again, this is a situation where residents of some states with high tax rates such as California, New York and New Jersey are being subsidized by lower tax states without receipt of benefit. If residents of these high-tax states elect state representatives or pass levies in favor of these high taxes, they should bear the burden of these high taxes and they should not be subsidized by the IRS taxpayer as occurs today.
These are just a few examples of how perverted the IRS tax system has become during its lifetime. I am all in favor of simplification of the tax code and elimination of special interest groups receiving any benefit because of the tax code.
Lake Forest Park