[_2z1p]

A simple tax code is a simple one for a computer to calculate.

1. Input the taxpayers's income from all taxable sources.

2. Lookup what tax bracket you're in based on that income.

3. Calculate the appropriate tax bill based on that percentage.

4. Subtract that from whatever has already been taxed out of their payroll for the year.

5. Bill them or refund them appropriately.

No humans would need to be part of the process if it were that simple, saving money and making errors less likely. Also, the simpler the tax code is the less computing hours it will require to complete the entire country's taxes, meaning faster refunds and less energy usage. Simpler taxes are even better for the environment!

[landemva]

A simple tax code is to eliminate the federal personal income tax. No federal personal income tax would eliminate W-2 paycheck wiithholding, giving every W-2 employee an effective take home pay increase.

People not filing personal federal income tax is green.

Banks not sending people yearly interest statement is green.

Companies not withholding personal federal income tax from paychecks uses less CPU and fewer papers so it is green.

Keep or tweak corporate taxes and fees as deemed necessary. And each State can do whatever.

[lockhouse]

That sounds even better.

[gamblor956]

It sounds so simple when some random guy on the internet says it! The professionals who have worked on this for decades clearly have no idea what they're doing!

1) People have lots of taxable sources, and many of them aren't digitized. This is especially true for people whose primary source of income is not W2 employment.

2) Computers can figure out the inner workings of stars, the alignment of molecules in proteins, and all sorts of other things that requires massive amounts of computing. If you're going to use a computer to calculate taxes, you don't need a simple tax code. Indeed, the tax code should be as complicated as possible to efficiently and fairly calculate taxes for each individual and corporation. But on that note, the calculation of income taxes is relatively straightforward. (The IRS is able to verify the calculations of the tens of millions of returns that are filed digitally within minutes.) The issue is, and has always been, data entry.

3) See #2.

4) Ignores all the other types of tax payments made during the year...

5) This is literally how it already works once you send in your tax return.

[lockhouse]

The tax code is excessively complex to provide loopholes for the wealthy to use to lower their tax burden.

[gamblor956]

No, it is "excessively" complex because it recognizes that what is fair to one industry or group of individuals isn't necessarily fair to a different group of individuals. What many people think of as "loopholes" are grounded in decades or centuries or pre-income tax financial structures, especially the loopholes related to agriculture.

For example, one of the biggest loopholes in the tax code is the carried interest exception. It created modern Silicon Valley; YCombinator exists solely because of this loophole. Most of the nation regards it as the most blatant subsidy in the tax code, but it is essential to startup financing. How would you feel if they got rid of it?

And the "flat rate" tax rate you propose is a huge subsidy to the wealthy, who derive the most benefit from a stable government and therefore should pay the most to continue it. Conversely, any rate high enough to fairly tax the wealthy would excessively tax the poor and middle-class. This is why we have a progressiv (i.e., complicated) rate structure.

[ToucanLoucan]

> For example, one of the biggest loopholes in the tax code is the carried interest exception. It created modern Silicon Valley; YCombinator exists solely because of this loophole. Most of the nation regards it as the most blatant subsidy in the tax code, but it is essential to startup financing. How would you feel if they got rid of it?

Aside from the fact that we might lose HN? I'm completely for that. Most startups are just re-imaginings of existing businesses but worse. Silicon Valley gave us the gig economy and commercial-surveillance-as-business, and has flattened the Internet into like 6 websites all of which copy-cat the hell out of one another to the detriment of all the features that made each of them notable in the first place.

And you know, crazy thought here, but if I don't make enough money to offset my living expenses, I go broke and go into bankruptcy and lose everything I have. Maybe if a business can't exist without ludicrous subsidies and serves no purpose outside of that, maybe we don't need it?

[moregrist]

You are describing a typical 1040EZ filing.

I’m glad we’re in agreement that most people shouldn’t have to file this.

[ghaff]

There's no 1040EZ any longer I believe. But, yes, anything that simple should be able to default filed as a very simple 1040.