Americans for Tax Reform

The following chain-email seems to be doing the rounds quite a bit today. And I think it sums the situation up perfectly: A message to the Administration: The U.S. Postal Service was established in 1775 - you’ve had 234 years to get it right; it’s broke. Social Security was established in 1935 - you’ve had 74 years to get it right; it’s broke. Fannie Mae was established in 1938 - you’ve had 71 years to get it right; it’s broke. The “War on Poverty” started in 1964 - you’ve had 45 years to get it right. $1 trillion of our money is confiscated each year and transferred to “the poor”; it hasn’t worked and our entire country is broke. Medicare and Medicaid were established in 1965 - you’ve had 44 years to get it right; they’re both broke. Freddie Mac was established in 1970 - you’ve had 39 years to get it right; it’s broke. Trillions of dollars were spent in the massive political payoffs called TARP, the “Stimulus,” the Omnibus Appropriations Act of 2009…. none show any signs of working, although ACORN appears to have found a new source: the American taxpayer. And finally, to set a new record: “Cash for Clunkers” was established in 2009 and went broke in 2009! It took cars (that were the best some people could afford) and replaced them with high-priced and less-affordable cars, mostly Japanese. A good percentage of the profits went out of the country. And the American taxpayers take the hit for Congress’s generosity in burning three billion more of our dollars on failed experiments. So, with a perfect 100% failure rate and a record that proves that “services” you shove down our throats are failing faster and deeper, you want Americans to believe you can be trusted with a government-run health care system-  20% of our entire economy??? With all due respect,  Are you crazy? Or do you think the American people are? (H/T Think Free)

A taste of things to come if the Administration's plans to radically hike taxes is implemented comes from the high-taxing United Kingdom, where a financial services consulting firm in London has just released a survey with the stunning finding that one-fifth of entrepreneurs are thinking of escaping the county because of punitive taxes — particularly the new top tax rate of 50 percent. Tax-news.com reported: The results of a new survey suggest that one-fifth of UK-based entrepreneurs earning more than GBP150,000 are planning to flee Britain in search of countries with more favorable tax rates. The poll of more than 300 entrepreneurs by business advisors Tenon also found that many more may follow in an attempt to escape the 50% rate of income tax, due to be introduced from next April on annual incomes above GBP150,000, with nearly half of the respondents (48%) still deciding what action to take. …Tenon points out that in the last month, high profile names such as the actor Sir Michael Caine and the artist Tracey Emin have threatened to change their tax residency to countries with more favorable tax rates. Popular locations for redomiciling include Monte Carlo, Guernsey, Liechtenstein, and the Cayman Islands. Andy Raynor, Chief Executive of Tenon Group, noted that entrepreneurs are showing their disapproval of the tax measures by “letting their feet do the talking.” (H/T Cato@Liberty)

There are 18 separate tax hikes in the Reid-Obama healthcare bill.  One of them caps the amount that can be deferred in Flexible Spending Accounts (FSAs) at $2500 per year (a similar provision was included in the Pelosi-Obama health bill and written about by Congressman Cathy McMorris-Rogers, R-Was., for National Review Online).  There is currently no limit to how much can be saved, though all monies must be used by the end of the year.  Employers may put a cap in place for their employees, but this would put a cap in federal tax law for the first time.  According to the Employee Benefit Research Institute (EBRI), 30 million American families use an FSA.  For most people, the $2500 cap won’t be noticed.  FSAs tend to be used for things like small deductibles, co-payments, eyeglasses, over-the-counter medicines, and laser eye surgery.  The amount deferred in the typical FSA is probably much less than $2500 today  There is one group of FSA owners for whom this new cap will be particularly-cruel and onerous: parents of special needs children.  There are thousands of families with special needs children in the United States, and many of them use FSAs to pay for special needs education.  Tuition rates at one leading school that teaches special needs children in Washington, D.C. (National Child Research Center) can easily exceed $14,000 per year.  Under tax rules, FSA dollars can be used to pay for this type of special needs education.  According to IRS Publication 502, Medical Expenses: You can include in medical expenses fees you pay on a doctor's recommendation for a child's tutoring by a teacher who is specially trained and qualified to work with children who have learning disabilities caused by mental or physical impairments, including nervous system disorders. You can include in medical expenses the cost (tuition, meals, and lodging) of attending a school that furnishes special education to help a child to overcome learning disabilities. A doctor must recommend that the child attend the school. Overcoming the learning disabilities must be a principal reason for attending the school, and any ordinary education received must be incidental to the special education provided. Special education include teaching Braille to a visually impaired person; teaching lip reading to a hearing-impaired person, or giving remedial language training to correct a condition caused by a birth defect. PDF Version