Oct 23
Via TaxProf: The Rich Cheat on Their Taxes
The previously unreported study estimates that taxpayers whose true income was between $500,000 and $1 million a year understated their adjusted gross incomes by 21% overall in 2001, compared to an 8% underreporting rate for those earning $50,000 to $100,000 and even lower rates for those earning less. (The "net misreporting rate" as the IRS calls it, includes both underreported income and inflated deductions.)
He then includes this chart from Portfolio.com:
Avoiding confiscatory rates or “spreading” as The One calls it is cheating I guess, but understandable.
I’m dubious, however, of what the IRS would call misreporting. Isn’t that basically anything less than ALL OF IT?
November 2nd, 2008 at 12:06 pm
The difference between perfectly legal tax avoidance and illegal tax evasion lies in the accurate reporting your facts. After you report the facts, you are entitled to use every provision of the law to minimize your tax. But IRS will not consider whether or not you agree with the law. And whether or not you consider you have a moral obligation to pay the required taxes, you definitely have a legal obligation. While your God might judge any moral slip, the government will punish any intentional falsification slip. Since I’m not a lawyer, I won’t speculate on who has what burden of proof in case you make a “mistake.”
November 2nd, 2008 at 7:14 pm
Keep it fair and they will make more money.
I know “fair” can’t be determined. That may be true, but unfair certainly can be and we have it right now.
An impressive majority of people say that 25% is the highest that is “fair” for all levels of taxation combined. The rate now is set more to keep it just below rebellion than any attempt to be “fair”.