Written by: Theodore M. David, Chair, Tax Law Committee
Current Items:
- Debt Be Gone
- IRS Rates
- Turbo Tax Terror
- Make More Taxpayers
- The old joke goes: I can’t be overdrawn at the bank… I still have checks. I was all prepared to write a long narrative about how bad things were going to be when the United States actually defaulted on its debts. Janet Yellen convinced me that China would end up owning at least Rhode Island and Delaware as soon as we skipped a single payment on any of our debts. Interest rates would rise like an ugly tsunami swallowing up the entire real estate industry, and taxpayers would be on the street once again selling apples like they did in the Great Depression. But these damn politicians ruined everything by coming up with some kind of agreement. Let’s be clear on one thing. If you did what the US government does, you would probably get a minimum 10-year sentence vacationing in New England, as low-risk criminals refer to their low-security prisons. But all is well with the United States getting deeper in debt with the rest of the world. We have been around for about 247 years so far. We will have to survive at least another 800 to pay off the massive debt we have accumulated. The British in the War of 1812, I think, actually burned the White House. If they waited until we got deeper in debt, they could have just bought it instead. Sort of a fire sale without the fire. It seems that that is the way we are headed. Down deep, no one really seems to be all that concerned. Personally, I’m more upset by having this bar bulletin later than usual because of all the governmental hijinks. I should have known that only a madman would take on a woman as smart and powerful as Janet Yellen. So, for the time being, the government will just continue writing more checks and printing more money. And those people living in Rhode Island and Delaware can rest easy.
- You may have terrible credit with creditors chasing you down. Even your brother-in-law has denied you even the smallest loan. What to do? The Internal Revenue Service is still open as a reasonably available creditor willing to lend without any financial documentation of any kind. That is the beauty of our self-assessment tax system of voluntarily filing tax returns like Johnny Carson did with Karnac the Magnificent. Find the number that you need, and you and your accountant fill in whatever figures are necessary to get to that number. The tax savings that result is the document-free loan from Uncle Sam. Now, of course, in the age of computers, IRS may eventually wise up and track you down. So understand that in addition to other penalties for things like negligence and perhaps fraud, both of the civil and criminal nature IRS charges a measly 7% annually these days on tax underpayments with no points or vig like the mob. Still better than your local bank or any of your relatives.
- Intuit is the company that puts out TurboTax. It is an ingenious computer AI.and although the tax law keeps changing, it’s not very hard to change the program once you get it running. Besides, there are lots of folks overseas who charge virtually nothing for their computer skills. Intuit has been making a lot of money with Turbo Tax. I don’t own any Intuit stock. But it did send a chill down my back to learn that IRS is intending to give Intuit a run for its money. What I understand is that IRS has a goal of allowing most taxpayers to use an IRS program to file all types of tax returns at no cost. So this may be a good time if you happen to be an Intuit stockholder to rethink your investment position. But certainly, don’t take my advice. I thought Microsoft was a flash in the pan.
- Avoid listening to NPR radio. The stuff they broadcast can really shake you to the core. They all sound so incredibly smart. I confess I like it. Recently a spot on one of their shows talked about the scientific potential of creating artificial sperm and artificial eggs. They said we are no more than maybe a decade away from being able to make babies outside of the womb, if necessary. Now I was driving at the time and frankly didn’t pay attention to all the details, but one scientist was convinced that no matter government policy here in the United States, the world would work toward this result. Now with taxes as the angle for this bulletin, it dawned on me that this could be the biggest boon to tax collection ever. Simply make more taxpayers. All those folks who have not had children for whatever reason will someday be able to purchase a version of themselves containing their own DNA with fake sperm and fake eggs. Designer taxpayers who like paying taxes could be next. If you are science-minded, the process is called IVG…look it up.
Questions or Comments should be sent to:
Theodore M. David, e-mail: [email protected]