Congress Swears It Wants to Simplify the Tax Laws

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However bitterly divided Congress continues to be on hot-button issues like immigration, voter registration and abortion, it’s a given that our lawmakers always unite in support of proposals to make it much easier to fill out 1040 forms and to simplify our byzantine Internal Revenue Code. As you’d expect, hardly any of these proposals become law.

These efforts end up tangled up in politics — just as this current administration attempts to make a move on tax reform. As for the ones that are enacted, most of them don’t reduce complexity. They tend to add to it.

Proponents of simplification include Senator Lauch Faircloth of North Carolina: In 1997, he observed that “Our tax code is incomprehensible to all but a few tax attorneys who make their living off the current chaos created by our tax laws.”

And this one also in 1997 from Senator John Breaux of Louisiana on receiving an award from the Tax Foundation, a Washington-based research outfit that scrutinizes IRS statistics. Breaux recalled that after finishing law school, he filled out his first tax form and “it got returned as being filled out inaccurately.” Now, he said, “I’m writing the tax laws of this country. That’s a frightening prospect, isn’t it?”

Senator Daniel Patrick Moynihan of New York, a former chairman of the tax-writing Senate Finance Committee, assessed prospects in 2000 for simplification: “It is something everyone is for but no one will do anything about.” When asked whether he prepared his own 1040 form, Moynihan answered: “No, I wouldn’t dare, wouldn’t dream of it. I would surely make mistakes.”

Add to the simplification advocates Robert Packwood of Oregon, also a former chairman of the Senate Finance Committee, as well as a politician with a flair for a wide range of activities, not all of them admirable. Packwood made this 1993 entry in his infamous diary, after discovering he was due a $50,000 income tax refund: “The thing that irritated me... is that I didn't know I was entitled to this... People think I know the tax law. I know the philosophy of the tax law. I don't know the details.”

Although renowned for his legislative savvy, he proved to be spectacularly incompetent at concealing from the media the embarrassing details of his transgressions toward women. The romantically reckless legislator lost his job after it emerged that at least 29 women, including staffers and constituents, accused him of sexual abuse and assault. Unlike another salacious politico-sexual scandal involving an intern, this one ended, after the inevitable twisting in the wind, with his forced resignation.

Like many former officials, Packwood became part of Washington’s lobbying industry, known colloquially as “K Street,” after the downtown thoroughfare inhabited by trade associations and corporate offices. He prowls the corridors primarily for well-heeled clients with tax issues.

I’ve reserved the final words for The Wall Street Journal. Its July 28, 1982 publication somehow managed to find a rose in all the thorns: “Figuring out your income tax has become so complicated it's created a whole industry that provides work for thousands of people — high-powered tax lawyers and accountants and thriving businesses such as H&R Block. In times when unemployment is so high that could be considered a boon to the economy.”

Additional articles. A reminder for accountants who would welcome advice on how to alert clients to tactics that trim taxes for this year and even give a head start for next year: Delve into the archive of my articles (more than 200 and counting).

About Julian Block

Julian Block

Attorney and author Julian Block is frequently quoted in the New York Times, Wall Street Journal, and the Washington Post. He has been cited as “a leading tax professional” (New York Times), an “accomplished writer on taxes” (Wall Street Journal), and “an authority on tax planning” (Financial Planning magazine). More information about his books can be found at julianblocktaxexpert.com

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