Posted: Oct 21, 2005 By: Steve Frieler

Subject: Federal Tax Reform

Comment: Here's a copy from an artical I read today. Please tell me if this looks even remotely simple:

Under both plans, three out of four taxpayers would fall into the lowest, 15 percent, tax bracket. Under one plan, individuals would pay no tax on dividends paid by U.S. companies and 75 percent of their capital gains would be excluded from taxation. Under the second plan, all investment income would be taxed at 15 percent.

Both proposals would abolish federal deductions and credits for mortgage interest, state and local taxes and education, among others.

The nine tax advisers would replace those withdrawn tax breaks with new, simpler benefits, including three savings plans that supplant dozens currently available for retirement, medical expenses and education.

Individuals could continue to save for retirement by setting aside part of their untaxed salary in a work account. Taxpayers also could stash up to $10,000 each, for a total of $20,000, into a retirement savings account and a family savings account, used for health expenses, education or buying a home.

Two of the biggest tax breaks now available would be limited and redesigned to spread the benefits to more moderate- and low-income taxpayers. The home mortgage interest deduction would be converted to a credit worth 15 percent of interest paid during the year, with a cap on the size of a mortgage eligible for the benefit.

The unlimited tax breaks for health benefits would be limited to total value of health insurance provided to members of Congress, $11,500 in premiums for family coverage and $5,000 for individuals.

---

It reminds me of the old tax code we are trying eliminate. I firmly agree with Leo Linbeck. "Fraudulent political theater designed to protect the corrupt tax code and those who profit from its manipulation". In other words, greedy. Stop thinking about your wallets and start thinking about this counrty and how we can benefit.

Sincerely,

Steve Frieler