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A recent essay in the New York Times raises the question as to whether individual tax payments should be considered public information. It has been suggested that public disclosure of tax payments would create pressure to correct inequalities and loopholes in the current tax system. Surprisingly, strict secrecy regarding tax records is a relatively modern aspect of the system.
In the first half of the 20th century, Congress twice required tax disclosure. In 1923 and 1924, individual and corporate taxpayers had to make public their tax payments but not entire returns. Proponents of disclosure said the measure would encourage tax compliance and reduce improper business conduct…
In the wake of accounting scandals and corporate earnings frauds of recent years, not to mention aggressive tax avoidance schemes, some experts say we should bring back corporate tax disclosure…
“If people could see how terrible the system is,” Professor Kotlikoff said, “perhaps then the appeal of a simple, straightforward and fair tax system might rise.”
Presidential candidates do release abbreviated tax records for public inspection. Should individuals be expected to do the same?
Link, via The Cap Times (whence the image).
People have deducted swimming pools, breast implants, and body oil from their income for tax purposes -and the IRS allowed it! You can deduct anything if you can justify it as a legitimate business expense. Eleven people did just that in this article from Kiplinger.
1. Pet food. A couple who owned a junkyard were allowed to write off the cost of cat food they set out to attract wild cats. The feral felines did more than just eat. They also took care of snakes and rats on the property, making the place safer for customers. When the case reached the Tax Court, IRS lawyers conceded that the cost was deductible.
(image credit: Flickr user play4smee)
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