Complicated laws and government interference . . .
A good number of years ago, my oldest son started a small computer repair business specializing in network problems.
By the first year they were doing pretty good except for one small fact. Internal Revenue Service said they owned over 10,000 dollars in back taxes. How they figured that is beyond me. He is careful. I think my son actually got it paid off in a short period of time. He was the exception if he did.
My son is brilliant. Much more so than I ever was. He has genius level IQ. He found he needed a front business to keep the books straight. So he partnered with a good businessman and they eventually had a successful business with about 16 network engineers. They are still the best in this area at what they do, repair and maintain networks. They also have a complete office staff taking care of the books to keep it all completely legal and above board.
Another case I have recently heard of was a mistake of about $500. By the time IRS got through with these poor people they owned close to 13,000 dollars in back taxes. Seems to me, with no knowledge of the IRS laws, that this is loan sharking of the worst criminal kind. It is only possible because these are poor people with no recourse to a battery of tax accounts and lawyers. I always have professionals do my tax work when it is necessary. I simply do not want to take the chance of rubbing the IRS the wrong way. It is worth the couple of hundred to me to make sure I have it completely right.
Where did we go wrong ? ? ?
Well to start with we went wrong by putting lawyers in charge of our Congress. After law school, lawyers are trained for 3 years in making problems. 1 year is devoted to solving problems. Guess which training is most likely to come forward? Yes, you guessed it.
The IRS has a battery of regulations so complicated that it takes a college degree and years of practice to understand just exactly what is going on. The average person is best to fill out the short form and escape with most of their financial life if possible. Keep It Simple Stupid, never occurred to the people writing this complicated piece of garbage. Keep It Constitutional never seems to have occurred to them either. I think if an honest judge(if there is such a thing) ever sat down and went through the rules, one statute at a time, the entire thing would be ruled unconstitutional. Never going to happen because of the chaos that would happen if the judges ever got to that point.
One vulnerable point is currency. Since the regulations were written, the value of our currency has devolved so that one dollar has lost almost 99% of its original value. So instead of a few rich individuals paying for the government, we now have everyone paying IRS taxes. This was not always the case. Years ago, IRS was designed to capture money from the rich, not the poor. I use name IRS as the law vs the agency.
Even then in was discrimination against one class of people. A respected and honest court system would have thrown the law out as unconstitutional years ago. These judges in all fairness are afraid of what would happen if they did just that.
One person started paying salaries in gold coins. These coins were average denominations of legal currency. But he was paying cents on the dollar. The gold coins were worth many times the value of paper currency of the same amount. So he skirted the law as the actual face value was different than the paper value. The actual coins value kept them under the legal amount to pay taxes. IRS went berserk. I think it is still in the court system but a dishonest judge probably has taken them to the cleaners by now.
What is really true, is our rulers have skirted the IRS laws by devaluing the currency in such a way so that we are all paying when we shouldn’t have to. There is no currency valuation built into the law. So the more counterfeit paper you earn the more money you pay on that paper. That is the true value of devaluing our currency to the point where it takes literally thousands vs hundreds to make a living. The value of thousands is yesterday’s hundreds. No law changes necessary to bring everyone over the amount where they have to pay taxes.
So what we now have is a complicated piece of law, that only the IRS can interpret. This situation gives them unlimited power over all of our lives. It makes the KGB look like angels in comparison.
An author I know of, writes Christian finance books. He recently requested all the laws concerning EPA from the agency. He had a heads up when they wanted to charge him for the rules. When he got the rules, it was delivered in 3 semi-trucks. When he started going over the rules, he found about one third of the rules directly conflicted with one another. This is law as written by our Congress. The IRS has been around a lot longer than the EPA.
The only way we are going to see a change in any of this, is we are going to have to scrap both agencies. We have no choice. The IRS is beginning to resemble a MAFIA loan shark. I think that has to change first. Surprise of surprises, the rich and powerful seem to pay less taxes than an average person after their companies of lawyers and accountants get through with things. We need to get back to Simple. That means a complete rewrite of our tax laws to give the average person the leeway needed to not be smothered by the system.
We need to recognize the contribution to our economy that businesses make. That means both small businesses and large businesses have to pay their equal share of things. But it also means that the law has to be simple enough so that an average person can understand it in plain ordinary English. We need to get out of the business of giving exemptions to anyone or any legal entity such as corporations. We need to get out of the business of supplementing organizations and businesses to stay in business. Let the marketplace take its toll.
We do not need stacks of regulations. We do not need a law that does not take inflation into account. That tax law currently on the books is no good. The original intent is gone. Oppressive taxation on the middle and lower classses and no taxation on the upper classes has to stop somewhere if we are going to make our economy work.
The original intent of the IRS rules was to recirculate wealth back into the ordinary average people’s pockets. As such, I find that law to be discriminatory against successful people. What exactly is the reward for being successful if you are excluded from many benefits given to welfare poor people? My parents worked their entire lives to provide a good life in retirement. That was destroyed by medical problems. So who pays when you are broke. Why the government does. Where does the money come from? Why from our Income Taxes. So the reward for hard work and success is for everything you ever earned will be given to medical care. When you are bankrupt, then Medicaid will kick in. So why bother to work at all? Or if you do work, why work long hours and hard to earn money?
To my way of thinking, my parents were somewhat foolish. I loved them dearly while they were alive. They left me money when they died. But all that money is at risk under the current game rules. I do not have a lot of savings. I spend as fast as I have earned it over my life with no shame. Why? Simply because the game rules favor the bankrupt people over those who were industrious. For every dollar my parents earned in the 50s, they have ten cents worth of money in 2012. This is because the rules are set by lawyers. Lawyers rule the houses of Congress. These people are really good at negotiating rules for themselves. They are really poor about representing us. The “inflation” factor kills anything they might have saved over the years.
In order for all of us to save money and succeed later in life, the financial game rules are going to have to change. We are going to have to get the lawyers to realize that the current system just does not really work. We are going to have to have a complete rewrite on how we do business. That is probably going to include a complete rewrite on how we finance our currency. That is going to be one big mess of a job. But it is going to have to happen if we want to continue being top dog in this world.
The penalty for not doing so, is going to be stiff in both lives and living conditions. I can see a World War brewing. It will occur if we do not straighten out the financial side of things. That means everyone, everywhere, throughout the entire planet. It means setting things up so everyone has the same burden of making sure everyone has food, shelter, transportation, medical care, and adequate clothing to live. The penalty for not doing so, is a World Wide War with the four horsemen of doom riding high on all of us.
Part of that problem is changing the way we tax everyone. The laws do not fit the reality of today’s world. It has to change to something simple and fair to everyone.