the federal income tax system

the federal income tax system

1. Did you discover any revelations, surprises or concerns about our tax system?

After reading the Federal Tax System Overview in 2020, I have learned that President Trump signed P.L. 115-97. The act substantively changes the federal income tax system for businesses, pass through the entities experience a reduction in effective tax rate a new deduction, which is temporary and will be expired in 2025. However, many of the alternatives that have changed from P.L. 115-97 will become permanently effecting.

Moreover, in 2020, the special tax deduction for a charitable contribution is $300, which it’s 100% whereas 60% previous year. Besides the information I have found from the Money Taxes website, Married Filing Jointly could claim $300 each, for a total of $600, in 2021 (Waggoner, 2021).

2. Do you believe that our tax system is fair? Why or why not?

I think the tax system is unfair. The tax system’s unfairness is that the national tax burden is not adequately educated based on income levels between individuals and businesses, especially corporate companies. The news report about the big corporation does not pay income taxes. For instance, President Trump paid no more than decades of minimum income taxes.

In contrast, many people oppose a system that often requires middle-income and lower-income individuals a higher effective income tax rate. That would apply to many higher-income people and allow higher-income taxpayers to avoid all taxes.

 

References

Waggoner, J. (2021, January 5). Get $300 tax deduction for cash donations in 2020, 2021. AARP. https://www.aarp.org/money/taxes/info-2020/how-to-deduct-2020-charity-donations.html

tax system

tax system