Primary Principle – Taxes should be used primarily to fund government operations and not for economic incentives. Too often breaks have unintended consequences and fail to stimulate the economy.

Personal Income Tax

Eliminate AMT and all tax credit. Tax credits while those for race horses benefit the few at the expense for this many.

Eliminate deductions of charitable contributions. Need to one tax payer subsidize another’s favorite charity?

Reduce a kid deduction to be able to max of three of their own kids. The country is full, encouraging large families is pass.

Keep the deduction of home mortgage interest. Proudly owning strengthens and adds resilience to the economy. If your mortgage deduction is eliminated, as the President’s council suggests, the will see another round of foreclosures and interrupt the recovery of market industry.

Allow deductions for expenses and interest on student loan. Online IT Return Filing India is advantageous for federal government to encourage education.

Allow 100% deduction of medical costs and health insurance. In business one deducts the price producing materials. The cost of labor is in part the repair of ones nicely.

Increase the tax rate to 1950-60s confiscatory levels, but allow liberal deductions for “investments in America”. Prior to the 1980s revenue tax code was investment oriented. Today it is consumption focused. A consumption oriented economy degrades domestic economic health while subsidizing US trading collaborators. The stagnating economy and the ballooning trade deficit are symptoms of consumption tax policies.

Eliminate 401K and IRA programs. All investment in stocks and bonds in order to be deductable merely taxed when money is withdrawn using the investment niches. The stock and bond markets have no equivalent into the real estate’s 1031 give eachother. The 1031 real estate exemption adds stability for the real estate market allowing accumulated equity to be taken for further investment.

(Notes)

GDP and Taxes. Taxes can only be levied as being a percentage of GDP. Quicker GDP grows the more government’s chance to tax. Because of stagnate economy and the exporting of jobs coupled with the massive increase in difficulty there isn’t really way the states will survive economically with massive take up tax earnings. The only way you can to increase taxes would be to encourage a massive increase in GDP.

Encouraging Domestic Investment. Through the 1950-60s taxes rates approached 90% to find income earners. The tax code literally forced financial security earners to “Invest in America”. Such policies of deductions for pre paid interest, funding limited partnerships and other investments against earned income had the dual impact of accelerating GDP while providing jobs for the growing middle class. As jobs were developed the tax revenue from the very center class far offset the deductions by high income earners.

Today plenty of the freed income from the upper income earner has left the country for investments in China and the EU in the expense with the US method. Consumption tax polices beginning in the 1980s produced a massive increase planet demand for brand name items. Unfortunately those high luxury goods were constantly manufactured off shore. Today capital is fleeing to China and India blighting the manufacturing sector of the US and reducing the tax base at a period of time when debt and an ageing population requires greater tax revenues.

The changes above significantly simplify personal income in taxes. Except for comprising investment profits which are taxed from a capital gains rate which reduces annually based on the length of your capital is invested the number of forms can be reduced using a couple of pages.