Warren’s 7% Solution: Privatization Of Corporate Tax Measurement
There is a very interesting proposal kind of buried in the Real Corporate Profits Tax. The notion is that at least with respect to RCPT, the definition of income would be significantly insulated from the political process. I did not see anything in the Warren material that indicated that it is FASB that should determine the measure of taxable income, but that is the effect.
I actually think that a case might be made for a system that worked like that. It could shrink the Internal Revenue Code substantially. It would preclude using the Tax Code as an instrument of social policy, which I think many of us think would be a good thing.
Cautionary Tax Tale For Consultants With Long Term Gigs
It does make me reflect on how he might have done better. Overall, I think he should have boosted the substance of his overall business. In principle, it should not matter, but I suspect he would have done better as an S corporation. Saving some money on the SE tax, might have offset any additional cost. The 1120S would have been small potatoes and his individual return would have been more mundane.
Filing three Schedule Cs was probably a bad idea, as I noted. And he should have made a stronger case that his home near Atlanta was actually the hub of his business. Since his agreement with AFR was terminable on short notice, it is hard to see what purpose it served him, but it might have been meant to address concerns about him being treated as an employee.
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Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.