What Tax Law Changes Would I Make

As the election gets closer we will continue to analyze any specific tax proposals laid out by the candidates. I know it's easy to criticize, so I thought it would be a good idea to lay out some of the changes I would propose if I were running for President.

1. ELIMINATE OR MINIMIZE ESTATE TAXES
There's something that strikes me as patently unfair about taking a large chunk of someone's estate upon death. It also strikes me as unfair that the estate tax can be minimized or eliminated if a taxpayer has the foresight to pay a bunch of money to get their estate in order well in advance of their death and have the good fortune of living long enough to enact that plan.

Life never goes exactly as planned and there are too many cases where a person dies before they can put forth or execute an estate plan. Put it this way, no one wants to think of their mortality and that is especially so for persons under 50 years of age and often times no one thinks about the estate tax until it's too late.

My suggestion would be to elimininate the tax or at least make some major modifications to it. One modification I would want to make is to exempt privately held businesses from the estate tax as well as family homesteads provided those assets stay in the family for at least 5 years. At minimum, no one should have to sell a family home or business just to pay the estate taxes.

2. ELIMINATE THE ALTERNATIVE MINIMUM TAX (AMT)
This tax is getting more and more attention as more taxpayers become subject to it. In short, the AMT is an alternate tax system that eliminates deductions for children and deductions for state taxes paid among other things. If this calculation results in a higher tax than the ordinary system the taxpayer pays the higher tax. Just so you have this straight it means that you could potentially pay more in Federal taxes by having a few kids and by living in a high tax state like Wisconsin. Does that make any sense at all? Nope, and that's why it should be gone.

3. ELIMINATE OR DRASTICALLY REDUCE CORPORATE INCOME TAXES
Right now the top corporate tax rate in the United States is 35%. The only industrialized country with a higher rate is Japan. Part of my reasoning to lower the rate is to make us more competitive with the rest of the world. The second aspect of this is that we should all know that corporate taxes are essentially paid by us as individuals. Let me explain this. We either are shareholders in these companies that pay taxes and thereby have the amount of return we get reduced or we pay for it as Companies raise their prices to cover the tax. We are the corporations and higher taxes on them means higher taxes on us.

4. ALLOW GAY/LESBIAN COUPLES TO FILE AS MARRIED FILING JOINTLY OR SOMETHING SIMILAR TO IT
Regardless of one's position on gay marriage it strikes me as equitable to allow people who own a home together the option to be granted this tax status. We could have a "household" option or something of that nature. It would make the compliance on tax returns much easier as the preparer no longer has to split such deductions as mortage interest and real estate taxes.

5. ELIMINATE PHASEOUTS FOR DEDUCTIONS
If it's ok for one person to get a credit on educational costs because their income is under $80,000 it should be ok for anyone regardless of their income. To me, that's fair.