The Insanity of the Federal Tax Code
After the horror of yesterday’s tax filing and the corresponding drop in my net worth, I decided to do a little research. In 1913 the federal tax code was about 400 pages long. Today it is around 70,000. Americans spend 7.6 billion hours a year preparing taxes, which equates to about 3.8 million skilled workers, making the tax compliance industry SIX TIMES the size of the U.S. auto industry, (source National Taxpayer Advocate). Imagine what growth could be achieved in our country if those resources were directed towards productive endeavors rather than filling out forms and trying to decipher vague and conflicting rules.
82% of Americans need help preparing their taxes, 60% hire a professional tax preparer and 22% use software. The federal government requires funding for those powers it is to exercise under the Constitution, but I cannot for the life of me understand why a nation that was founded on the rule of law has a tax code that is impossible to follow accurately with any degree of confidence and requires such outrageous expenditures by individuals and businesses.
