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Strategies & Market Trends : Income Taxes and Record Keeping ( tax ) -- Ignore unavailable to you. Want to Upgrade?

To: Shawn Donahue who wrote (1038)	4/16/1998 11:55:00 AM
From: Colin Cody	Respond to of 5810

Shawn, I'll break up my reply into more than one message, due to the length! Hope to continue the debate! <<TAXES on INDIVIDUAL INCOME are NOT COMPLICATED AT ALL for the MAJORITY of TAXPAYERS.>> The current seven million word Internal Revenue Code is so complicated that half of all Americans now need professional tax preparers to fill out their returns. I am not saying there is NOT a VERY COMPLICATED IRS CODE. What I DID SAY WAS Taking the SAME example as the Flat tax proponents do: Middle Class America with a JOB, Form W-2 and a HOME and a SAVINGS ACOOUNT paying interest, all that will fit "on a postcard" they say. AND I SAY that all can be filed RIGHT NOW using e.file, tele-file or form 1040EZ / 1040A for the MAJORITY OF AMERICANS. It takes no great "brain" to say "how much did you make?" Send us XX% of it. The 1040EZ does it real well RIGHT NOW. Tax preperation and compliance costs the economy $140 Billion per year, an average of more than $1,000 for every taxpayer. Most of this is paid by business. What, are you NUTS? (g) And EVEN if you are correct, what would the Flat Tax RATE have to do with it? Tax Compliance Costs are for the COMPUTATION OF TAXABLE INCOME. Whether you apply several RATES or one RATE to that figure does not make it ALL THAT much more difficult. Most of this is paid by business, and passed along as higher prices and lower wages. The tax code's biggest victims are middle- class taxpayers, as average Americans cannot afford to hire high-priced lawyers and accountants to navigate the incomprehensible rules and regulations enforced by the IRS. HUH? You just said it was BUSINESS that had the bulk of the COSTS, and then in the same sentence you say it is the MIDDLE CLASS who are the biggest victims because they don't have accountants! YOU ARE USING DOUBLE SPEAK, Typical of people arguing without any facts. You can't have it BOTH WAYS. Colin

To: Shawn Donahue who wrote (1038)	4/16/1998 12:12:00 PM
From: Colin Cody	Respond to of 5810

part II... <<CLINTON HAD NOTHING TO DO WITH THE ORIGINATION OF, DRAFTING OF, OR DISCUSSION OF THE 18 MONTH RULE.>> Nicely chosen words...are you one of his press secret- aries? Actually, President Clinton did approve the increase of time that one must hold stock or investments from 12 months to 18 months, not to mention the 39.6% retroactive tax increase back in his first term, but I guess you are correct in stating that he didn't originate, draft, as another Democrat(s) did! Who cares if another Democrat drafted it...Bill Clinton is a liberal and he made it tougher for us to get long term capital gains rates for our stock investments, as we now have to hold onto a stock for 18 Months, even if the stock dips for good! THE LOWER TAX RATES WERE NOT CHAMPIONED BY CLINTON or the Democrats IN ANY WAY SHAPE OR FORM. THE REPUBLICAN'S HAVE BEEN THE PROPONENTS OF A REDUCED CAP GAINS TAX RATE FOR YEARS AND YEARS AND ONLY RECENTLY, WHEN THE DEMOCRATS WERE IN THE MINORITY, WAS THIS ABLE TO PASS THE HOUSE & SENATE. <<H&R BLOCK DOES IN FACT GET MUCH INCOME FROM DOING 1040-EZ WORK FOR PEOPLE WHO ARE TOO STUPID TO TIE THEIR OWN SHOES & DOING 1040 WORK FOR PEOPLE WITH MORE COMPLICATED SITUATIONS, LIKE THE WELFARE DISTRIBUTION SYSTEM CALLED "EARNED INCOME CREDIT" ETC ETC>> So now you are not only smarter than anyone stupid enough to need your advice on taxes here, but you are smarter than anyone else in the tax filing industry! HUH? Get a copy of some H&R Block annual or quarterly reports and read for yourself in THEIR OWN WORDS that they get increased business from the ever increasingly complicated tax code, and their CUSTOMERS? are Joe Six-Pac with a W-2 and some Mutual Funds, maybe a rental property... <<BUT MENTIONING CPAs IN THE SAME SENTENCE??!! What are your qualifications for telling us what CPAs do? How many CPAs have you employed in the past 10 years? I'd guess ZERO? right? (g)>> IF YOU TOOK THIS AN "AN INSULT" I AM SORRY - YOU ARE OVERLY SENSITIVE. YOU DO KNOW WHAT (g) MEANS, RIGHT? <<CPAs will have MORE work to do if there are major changes in the tax collection systems, not LESS. How could you suggest that CPAs would have LESS TO DO?>> Again, you manipulate what I stated to fit your agenda, which if everyone hasn't discovered yet..is to ensure that we taxpayers will always need your services to file our taxes! CPAs do NOT need nor do they service to any great extent the Joe SixPac crowd that frequent the offices of H&R Block. CPAs service the BUSINESS COMMUNITY. The BUSINESS COMMUNITY THAT WILL NOT BE SAVED ANY WORK BY THE "FLAT TAX". Under a Flat Tax CPA's will not have more work in helping people to file their personal returns, in fact and you know it...they will have none!PERIOD! YES, Basically just as it is NOW. EXCEPT for COMPLICATED BUSINESS RETURNS, of course, and that WON'T CHANGE under Flat Tax. Why do you think it might? Be specific. Colin

To: Shawn Donahue who wrote (1038)	4/16/1998 12:43:00 PM
From: Colin Cody	Respond to of 5810

part III... <<Maybe you might list a few things CPAs will NOT be doing with tax reform???>> My personal taxes and everyone else that can write! The Flat Tax form has only 10 lines Period. And with a 17% Flat rate who needs you to fill one out? SHAWN, YOU MENTIONED THAT YOU HAVE RENTAL PROPERTIES AND CURRENTLY UTILIZE A CPA TO ASSIST YOU IN COMPUTING i presume TAXABLE INCOME, HUD REPORTS, BANK LOAN APPLICATION AND ANNUAL COMPLIANCE AS WELL AS PERHAPS PROFIT PROJECTIONS AND OTHER FINANCIAL TAX AND INVESTMENT RELATED SERVICES. So what suddenly don't you want him around any longer for? I doubt he spent very much time computing WHICH RATES were applicable to use. The COMPUTATION of taxable income will STILL NEED TO BE MADE, and LIKELY it will be EVEN MORE complicated than today. My personal taxes and everyone else that can write! Again, MOST people "who can write" DO NOT USE A CPA, Never have and NEVER WILL! the free professional advice that you are providing here on this public forum, may entitle a reasonable person to expect you to represent them in an audit, even if you didn't sign their tax return, in my opinion! Shawn, Now we know that you really do not use a CPA. Statements like this one show you for the "fake" you are. No offense, but that's what a statement like yours here shows you to be. <<HUH? ISN'T THAT EXACTLY WHAT CPAs DO RIGHT NOW?!!>> No, unfortunately most CPA's are only trained in tax compliance and filing, unless they seek outside training and certification to become a real financial planner You are incorrect. And if you eliminate BUSINESS tax compliance and filing you are even MORE incorrect. CPAs are too expensive and specialized to use for tax compliance and filing to the extent you portray. FOR EXAMPLE: ADP has grown to a multi-billion tax compliance service for a large part because CPAs 15 years ago started shifting that compliance work away to them. "How much in taxes did you pay last year?" as if a tax preparer can't help himself pay less tax, how can you expect that he will be able to help you with all your legal deductions? Also, a major red flag is a CPA that constantly states "I wouldn't take that deduction, as it might send up a red flag". Sound familiar :O) CUTE, but other than funny reading it is meaningless. What's the "right answer" $1,000 in tax? $50,000 in tax or $100,000 in tax? If "too low" he might be not very busy (on income) or a tax cheat, or a very aggressive individual. And THOSE may be DESIRABLE or NOT-DESIRABLE to a client. If "too high" the CPA might be very expensive, (and he may or may not be "worth it"). Why do you suggest that a "CPA" constantly states "I wouldn't take that deduction, as it might send up a red flag". Why do you imply that H&R Block doesn't do this? That EAs or other paid preparers don't do this? That CPAs are saying this? CPAs do NOT constantly tell clients - that is a "red flag", I would SUGGEST that you are referring to your own personal experience, and frankly if you approach CPAs and are consistently told that you have a problem, MAYBE it is YOUR "red flag idea" that is the problem, and not the CPAs who CONSISTENTS tell you the same thing. EVEN UNDER THE FLAT TAX some cockamamie tax scam will be "a red flag". Colin