Can Flat Tax Abate IRS Problems?

There are three ideas floating around regarding our income tax system. The first is the idea of the wise, the balanced, those who have it all together. Follow these people and remain stagnate forever. 

The second idea is that of a flat tax. It is of those that we can call the daring timid. They will indeed make a change, mind you. Their change is good. But it does not eliminate our tax problem and does not provide the tax resolution that this country needs and the tax help that its citizens deserve. 

The advocate of the total elimination of the income tax is the third group. They are the rash, the fools, the anarchists, and the revolutionary reformers. They have the key to the city gate. You can cross with them to the other side of the hill. But they are not solemn; they lack the dignity of silence, of frowning and serenity, of the wisdom of the idle. They are raucous and scorned. They dream and can do. 

Keeping the tax system as it is, is not acceptable. The tax system comes along with an IRS which administers the collections, besides being not responsive to the needs of this country: the poor, the rich and the lost ones in the middle. The system is fraught with loopholes reflecting the power centers in the land. 

In addition, the IRS, armed with the powers it possesses, has massively altered the balance in favor of another system that is free of IRS collection actions such as IRS Audits, Audit Appeals, IRS levy, Tax Lien, Wage Garnishment and Tax Courts. So, keeping the tax system as it is, is untenable. 

The second group calls for a flat tax. The basic premise hopefully would be one rate paid by all. Again, hopefully eliminating all the benefits in the tax code for different groups such as mortgage interest and elimination of some gains that accrue to some folks. 

This is a step forward. One assumes a flat tax would just about eliminate the need for IRS audits except on one item on the tax return which is the income. If that item can be confirmed by the 1099 and other information the IRS has, then the need for verifying the income is also eliminated. 

There will still remain the IRS problems of collection actions for those who don't pay the flat rate. So we will live with IRS levy and tax lien as well as the other IRS collection actions.

 Finally, we have the forum of the daring folks, the ones who go for broke, the ones who call for the elimination of the income tax and the IRS along with it. They would propose a national sales tax. With such tax, the state would collect instead of the IRS and deliver the money to Washington. 

The citizens will never owe taxes because they pay the tax when they go to the grocery store or when they pump their gas. So, no collection actions because there is no filing of tax returns. All the taxes are paid at the pump. On April 15, the taxpayers will be busy playing with their thumbs. Beautiful? Let us pray for the raucous, for the non elegant, for the dreamers.