Grandparents Lose Tax Benefits To Daughter’s Common-Law Marriage
A lot of the complexity of the income tax is inherent in trying to tax income, but that sort of complexity does not really impact regular people all that much. You are probably not running a bank or a life insurance company, maintaining inventories or mining. Some of the complexity introduced by using the income tax as the Swiss utility knife of social policy also does not create complexity that regular people have to deal with. You are probably not developing affordable housing, preserving historic buildings or building golf courses, because you feel so strongly about conservation as seems to be the case with President Trump.
The complexity introduced by using the income tax code to subsidize the working poor, or perhaps their low-wage employers, does impact ordinary people who end up having to pay to have income tax returns prepared that really could otherwise be on a postcard. And it sucks up a good bit of scarce compliance resources and involves the IRS in sorting out matters that would be better handled by social workers rather than accountants.
Billion Dollars In Losses From EY Tax Shelter Knocked Out By Tax Court
There is an old accounting joke about a fellow who came to work every day, opened his desk drawer, looked at a slip of paper, closed the drawer, and went to work. Everybody was curious about the mysterious piece of paper, but they respected his privacy. Finally, though, somebody broke down and took a peek. On the paper was written “Debit by the window. Credit by the Door”.
Debits have to equal credits. Assets have to equal the claims against assets (i.e. liabilities and equity). It has to balance. Accountants get so fanatical about this, that they sometimes confuse things being balanced with things being right. You can be in balance and things can still be wrong, but it can never just be one thing. The discipline of double-entry means that a mistake in one area will also crop up someplace else as long as you are in balance. Scoundrels hate the discipline of double entry.
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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.