I’d prefer to not intentionally penalize or reward any behavior in the tax code.
Almost any tax system creates some incentives. Taxing workers generates an incentive to not work. (I’m married to a person who followed that incentive.) But, that’s an unfortunate side effect - a “con” on my pros/cons list. I’m not trying to “penalize” people who work, just getting them to pay some reasonable share of the cost of running gov’t.
I’m fine with an extra standard deduction for children, but that’s because I think we shouldn’t tax income needed to pay for the necessities of life. If some people find that an incentive to have children, that’s an unintended side effect. In my mind, it’s a positive in some cases and a negative in others.
We both think the FIT code should be much simpler. I’m apparently more radical than you, I’m not looking for a happy medium.
Not sure whether I should be starting a new thread for this or not. More details from ProPublica review of tax return data. I think I heard about these super-charged Roth IRA accounts first when Mitt Romney was running for president and had over $100 million in one, and that didn’t inspire any reform. Now here’s Peter Thiel with 50 times that amount.
I had a skim of that. To be fair, seems like anyone with a bit of crypto could be doing the same thing. Assuming that it’s possible to hold crypto in a roth ira (no idea on that).
IRAs get wonderful tax treatments. This is supposed to help/encourage ordinary workers to save for their own retirements (so they don’t become burdens on the taxpayers).
The contribution cap meant that. They are not supposed to hide the gambling winnings (the most charitable assumption) of the ultrarich from taxes.
This problem has been common knowledge at least since 2008 and Romney. The fix is obvious. IRA investments should be limited to asset classes widely available to middle income people - mostly mutual funds buying publicly traded securities.
Twelve years later, congress has not made that obvious correction. No surprise on that.