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Dave's Simplified Income Tax Form

I hate paying income tax. Who doesn't? But it would be so much less painful if it were easier to prepare one's income tax. A simpler tax form would also restore fairness, as the current tax code is so full of loopholes, anyone with a good attorney and/or accountant can avoid paying any income tax at all. And a simpler form would probably significantly reduce the estimated 6 billion hours that Americans spend dealing with income tax matters each year.

The same form could be used by states by simply changing the percentage of the net income. Obviously the federal government and state government cannot each demand more than 50% of one's net income. I would say 50% is reasonable for the federal government and 5% for the state. Using this form the tax on my middle class income is about the same as with the extraordinarily complex current form. But a wealthy person's or a corporation's income tax would undoubtedly be considerably higher with my form than with the current form, a concept that doesn't cause me to lose any sleep.

So here's my idea for a simplified income tax form for individuals. I would propose a similarly simplified form for companies so that all companies pay their fair share of the income tax burden.

To use this form, fill in lines 1 through 9 (enter zero in lines that do not apply to you) and click on the "Calculate" button.


Dave's Simplified Income Tax Form (Federal)

Income

Line 1

Gross income from all sources (wages, tax-deferred retirement account disbursements, interest, capital gains, gambling winnings, gifts, transfers)

Expenses

Line 2

Housing (mortgage, rent, property tax, utilities, insurance, HOA fees, maintenance, repairs, cleaning, buying/selling fees, loan acquisition fees). If multiple houses are maintained, cost for each must prorated according to percentage of use it represents.

Line 3

Food (groceries, dining out)

Line 4

Clothing (excluding jewelery)

Line 5

Transportation (vehicle purchases, loans, or leases, insurance, public transit, taxi, bus, train, boat, or air travel, parking fees and fines). If multiple vehicles are maintained, cost for each must prorated according to percentage of use it represents.

Line 6

Medical (doctors, dentists, hospitals, medications, insurance, HMO fees)

Line 7

Education (tuition, continuing education, training, license fees, examination fees, books, video, computer software, supplies)

Line 8

Finance (interest payments, late fees, annual credit card fees, bank fees, broker fees)

Line 9

Transfers (gifts, alimony payments)

Tax Calculation

Line 10

Net income (total lines 2-9 and subtract from line 1)

Line 11

Tax due (if amount on line 10 is positive, multiply by 50% and enter here; if amount on line 10 is zero or negative, enter zero here)