Taxation Without Representation Was Bad. Do You Think Taxation With Representation Is Not So Bad?
Getting back to Congressional Fixes...Many times Congress fixes things and then we find out that the things they "fixed" remained broken after the fix or the fix caused new problems.
At Happy Hour Congress refers to these as, “Imitation Fixes”.
I hear you talking to yourself again. You just said to yourself, There you go again. You are can’t prove what you just said. To what you just said I say, Read All About It.
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A good example is the current (never ending) contention that the rich people in this country need to pay their “Fair Share”. Many are saying we should have fixed this problem long before now. Actually, long before now...in 1969, Congress "fixed" this problem when they passed the Alternative Minimum Tax (AMT) which was created to make the rich pay their fair share.
However, it did not make the rich pay their fair share because Congress had made another bad bill. Instead the Middle Class has had the potential of being hammered every year by the AMT.
Congress has been trying to fix their mistake...Or have they? Instead they have been passing wavers to the problem they caused instead of fixing the problem they caused.
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Eventually Congress got busy with other things they wanted to fix (or Happy Hour got in the way) and they started not getting around to passing the waivers. This meant the Middle Class was about to be Tax Hammered by the bad law Congress passed to fix the problem of the rich not paying their fair share.
The Middle Class is about to be forced to pay their Unfair Share and Congress is nervous. The reason they are nervous is the money brought in by the ATM has now become a Revenue Stream that they have become accustomed to spending.
Congress is very good at creating...Creating Confusion, Spending Revenue Streams, Kicking Cans Down the Road and Creating Problems.
Would I kid u?
Smartfella
Lagniappe: Below are the first 5 paragraphs of what Wikipedia has to say about the Alternative Minimum Tax. Your contract with Foolishness...Or Is It? does not require you to read these 5 paragraphs. If you do read them and if you do understand them, you are smarter than Fella...
The alternative minimum tax (AMT) is a
tax imposed by the United States federal
government in addition to the regular income tax for
certain individuals, estates,
and trusts. As of tax year 2018, the AMT raises about $5.2 billion, or
0.4% of all federal income tax revenue, affecting 0.1% of taxpayers, mostly in
the upper income ranges.[1][2]
An alternative minimum taxable income (AMTI)
is calculated by taking the ordinary income and adding
disallowed items and credits such as state and local tax deductions, interest
on private-activity municipal bonds, the bargain element of incentive stock
options, foreign tax credits, and home equity loan interest deductions. This
broadens the base of taxable items. Many deductions, such as mortgage home loan
interest and charitable deductions, are still allowed under AMT. The AMT is
then imposed on this AMTI at a rate of 26% or 28%, with a much higher exemption
than the regular income tax.
The Tax Cuts and Jobs Act of 2017 (TCJA)
reduced the fraction of taxpayers who owed the AMT from 3% in 2017 to 0.1% in
2018, including from 27% to 0.4% of those earning $200,000 to $500,000, from
61.9% to 2% of those earning $500,000 and $1,000,000.
The major reasons for the reduction of AMT taxpayers after TCJA
include the capping of the state and local tax deduction (SALT) by the TCJA at
$10,000, and a large increase in the exemption amount and phaseout threshold. A
married couple earning $200,000 now requires over $50,000 of AMT adjustments to
begin paying the AMT. The AMT previously applied in 2017 and earlier to many
taxpayers earning from $200,000 to $500,000 because state and local taxes were
fully deductible under the regular tax code but not at all under AMT. Despite
the cap of the SALT deduction, the vast majority of AMT taxpayers paid less
under the 2018 rules.[3][4][5]
The AMT was originally designed to tax high-income taxpayers who
used the regular tax system to pay little or no tax. Due to inflation and cuts
in ordinary tax rates, many middle income taxpayers began to pay the AMT. The
number of households owing AMT rose from 200,000 in 1982 to 5.2 million in
2017, but was reduced back to 200,000 in 2018 by the TCJA.[6] After
the expiry of the TCJA in 2025, the number of AMT taxpayers is expected to rise
to 7 million in 2026.[7][8]
Fella Commentary: Anything this complicated ought to be against
the law.
Lagniappe #2: If we need more clarification, Wikipedia has 8,678 more words, charts and graphs to help us understand and enjoy the Alternative Minimum Taxes...https://en.wikipedia.org/wiki/Alternative_minimum_tax
