Taxing Weekend Ahead
By Renu Zaretsky :: April 11th, 2014
“Simple” is in the eye of the beholder: Maybe “fairness” has universal appeal. A new poll shows most people think filing tax returns is “easy” and TPC’s Howard Gleckman wonders if anybody really cares about a simple revenue code in his latest post. Few of us file by hand anymore so doing taxes feels simple, in spite of the law’s incredible complexity. Still, complexity has a price: “People who don’t understand the tax code often believe it is unfair.” Tax reformers might do well to focus not only on simplicity, but fairness.
For fairness’ sake: Some states are tackling international tax rules. They’re starting to track multinational profits overseas, reports Bloomberg. First-movers include Alaska, Maine, Minnesota, Montana, Oregon, Rhode Island, West Virginia and the District of Columbia. The Congressional Research Service estimates the federal government loses between $30 billion and $90 billion annually when firms shift profits to low-tax countries; the U.S. Public Interest Group estimates that states lose $20 billion annually.
April 15 is around the corner: Who’s feeling the most taxed? According to Gallup, residents of New York, New Jersey, and Connecticut are the most likely of any state's residents (three out of four adults) to say the amount they pay in state taxes is "too high.” Maybe they’re right: According to this TPC ranking of state and local general revenue per capita, New York is ranked third, Connecticut is sixth, and New Jersey is seventh.
Illinois millionaires can breathe a little easier. Illinois Speaker Mike Madigan (D) was unable to secure the votes he needed to advance a state constitutional amendment that would have added 3 percentage points to the state rate on income in excess of $1 million. The money would have been used to fund schools.
Are you feeling pressed for time? The IRS reports that it has received 100 million returns and expects 35 million more by April 15. But 12 million filers have requested extensions past the April 15 filing deadline. The IRS also assures electronic filers that it has not been compromised by the latest online security breach, Heartbleed.
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