What Is Your Ideal Income Tax Bracket For The United States?

Zero. Yes, you read that right. 0%. Income tax is done. Put a fork in it - it’s toast. Here’s why: Despite the fact that Mercantilism, as a theory, has been fully discredited, politically, it still holds sway. In fact, it’s just about the only universal in political economy. Politicians get elected to get their constituents jobs. Not much else matters. As a result, in the international realm, corporate tax is essentially voluntary. Without a “one-world government”, which ain’t gonna happen, each country has an incentive to beggar its neighbor. That means dropping taxes until they don’t matter. Taxes can fall in a number of ways. Of course, it can lower them directly. But voters don’t like that, because it exposes the rot in the system. A country can subsidize investment, by providing “training assistance” or whatever to companies. It can create complex incentives, such as accelerated depreciation. Tax people understand how this works, but most people don’t. It can allow companies to create complex structures like a Double Irish arrangement. And so on. I think this stuff is grrreat, because I do tax for a living. But it’s a really stupid way to run the system. At least it maintains the fiction that corporations pay taxes. In reality, corporations are fictions themselves. Only people pay taxes. And most of the taxes nominally paid by corporations are in substance paid by their employees. At least that is the economists’ consensus. Tax incidence Now to individuals. Very high-net worth individuals can access many of the tax gimmicks that large corporations get, because their wealth is generally tied up in those international businesses. Those of us who have more modest means can’t do the same things. But as the world gets flatter, and the friction costs of tax arbitrage drop, more people will be able to. And when a sufficient number of rich people can avoid, defer (or evade) a tax, it’s dead. Taxes have lives. We have taxed bridges, intersections, Salt, Windows, land, sales, income… you name it, we’ve taxed it. So now what? The best thing going now is the Value-added tax (VAT). It’s really hard to avoid or evade in any meaningful way. Yes, your residential plumber will say “cash, no tax”, but that’s a really small number. It’s regressive with respect to income, but frankly, progressivity has always been a bit of a shibboleth. It’s possible to design a somewhat progressive VAT, and it’s frankly impossible for a tax to be both effective and super-progressive, without seriously adversely affecting the economy. Just about everyone has moved towards a VAT. The United States should, too.

Most wanted tax and legal web forms

Choosen an appropriate tax year, your filing status, and annual taxable income to know your estimated tax rate and fill out the required form right now.