A Defense Of The Break
Republicans Snuck Into
The Cares Act
Republicans Snuck Into
The Cares Act
That’s the title of an article by Peter Reilly, a CPA, published online at Forbes. The article discusses IRC 461(l) which, for most of us, is an obscure provision of the incomprehensible INFERNAL-Revenue-Code which doesn’t apply to us.
However, it does apply to all of us if we want to encourage entrepreneurs to create American companies and employ American workers.
This section limits the ability of certain taxpayers to off-set gains against losses from other activities to $250,000 for a single taxpayer and $500,000 for taxpayers filing joint returns. A provision of "The CARES Act" delayed the tax year in which this restriction was to take effect, and allows taxpayers to deduct the full amount of losses at least for their 2020 tax returns.
Mr. Reilly made the following points:
- Much of tax legislation since at least 1969 has been a war against tax sheltering
- The positive side of this legislation is it gives people work
- For this reason, a lot of people who are not really trying to get away with anything dastardly end up stepping on mines meant for the scoundrels
- 461(l) was inserted into the 2017 tax act to save $135 billion being deducted by taxpayers
- Over 80% of the benefit from the massive "CARES Act" applies to 43,000 returns showing income over a million dollars
He gives an example of Charley, a software engineer, who developed a program he sold to a public company in exchange for $3 million in stock.
Charley sells the stock for a taxable gain of $1.5 million to help him finance a new venture. He uses this money to start a new business and has $1.5 million in losses in the first year. Before "The CARES Act" delay, Charley would have been allowed to deduct only $500,000 of his $1.5 million loss and would have had to pay income tax on $1 million of the stock gain.
Mr. Reilly made a statement most people will agree with, “I sometimes think the whole system (INFERNAL-Revenue-Code) is a sort of white-collar jobs program for college graduates who are not quite smart enough to be engineers”.
Favoring One Group Over
Another Less Wealthy Group
Another Less Wealthy Group
It’s interesting people who don’t start businesses but who own company stock weren’t similarly penalized. If this group of investors sells stock at a large loss, they can use all the loss against gains on other stocks they sell.
Why do the Ruling Class and their minions in D.C. and the media allow this? As Willie Sutton once famously said about why he robbed banks, “Because that is where the money is”.
While many of the Ruling Class are very wealthy themselves, they know this group of wealthy investors can be controlled by threatening to change their favored status. However, they also know they have to tread lightly because the holders of great wealth can also fund attacks against them. It’s an uneasy stalemate between the 2 groups.
Using the INFERNAL-Revenue-Code to reward their friends at everyone else’s expense is a key tool the Ruling Class and their minions use regularly. They know the mere mention of the INFERNAL-Revenue-Code causes most people’s eyes to glaze over and they just stop listening.
Conclusion
It’s time NOW to replace the present income/payroll tax system with The FAIRtax! It’s obvious to everyone except the Ruling Class, their minions in D.C., the media and those who Mr. Reilly calls, “…college graduates who are not quite smart enough to be engineers”.
Why should a government policy favor one group of Americans over another, particularly if the policy isn’t debated in the open, but instead is hidden in the Infernal Revenue Code?
Why punish our fellow Americans who earned their money through hard work and not inheritance?
No one is naïve enough to believe simply replacing the income/payroll tax system with The FAIRtax will stop the Ruling Class and their minions from seeking to reward their friends. That’s been going on in governments ever since governments were invented.
Mayor Richard J. Daley was the mayor of Chicago from 1955 until he died in 1976. When the press discovered a firm with close connections to him had provided him with a lucrative insurance package for one of his sons, Mayor Daley freely admitted it.
He said, "If I can’t help my sons, then they can kiss my....''.
While the people of Chicago didn’t rise up in outrage and demand the mayor’s resignation, the “favoritism” was at least easy to see. Wouldn’t it be in all of our best interests if we made these “rewards” more visible and not buried in the INFERNAL-Revenue-Code?
If we could see the actual “pay-offs” the Ruling Class and their minions make to their friends using our money, we would have 2 choices. Sit quietly and watch, or rise up and demand an end to it.
The kind of transparency The FAIRtax brings might not stop it entirely, but at least we would know what was going on. If we had The FAIRtax, the Ruling Class could no longer bury their hidden “pay-offs” in the INFERNAL-Revenue-Code.
If you are ready to take a very significant step toward wresting control of your government back from a small group of corrupt people to make it possible for all of us to prosper, Go to our Homepage NOW, sign up to "Get-Updates", join with us to TAKE BACK CONTROL!
Demand Congress to pass The FAIRtax—the only “Fair tax”!
The author George Bernard Shaw said these words in a play he wrote, You see things; and you say “Why?” But I dream things that never were; and I say “Why not?”
Isn’t it time for us to ask, “Why not?”
President Trump, “Embrace The FAIRtax, the only real tax reform! Stand up to the Swamp. They will oppose you anyway because they see you as a threat. What have you got to lose?”
The truth is the truth! Remember, if we don't continue to tell the truth and demand a change, then George Orwell's "1984" quote may foretell our children's future: “If you want a picture of the future, imagine a boot stamping on a human face, forever"
Thank you for staying FAIRtax strong!
Yours In Liberty! Yours In Freedom!
Steve Hayes
Chairman, Americans For Fair Taxation
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