Tax day and the stress that comes along with it has come and gone at last. The annual drill of gathering all those necessary income documents, navigating complicated instructions, completing numerous tax forms and finally filing our taxes is over--at least for now.
In 1913, the Sixteenth Amendment was made to the United States Constitution in order to establish our nation's modern income tax system, but it looked differently back then. During that time, the instructions for the 1040 form could fit on one page and the actual code on 400 pages. Now a century later, the instructions for that same 1040 form cover 189 pages, and our current tax code has climbed to nearly four million words. To put this in perspective, neither the complete works of Shakespeare (884,647 words) nor the King James Bible (788,258 words) come close to even one million words. The code is now so complex that guidance papers simply for interpreting the tax code, when printed, stand more than one foot tall.
Understandably, American taxpayers struggle with navigating the tax system year after year. It has turned into such a nuisance that many put it off, request extensions, pay someone else to prepare or nervously brave completion independently. This is not how it should be, and with each year, we hope that surely next year will be different. Rather than a streamlined process, however, filing taxes continues to become more complicated, more burdensome and more expensive for hardworking American families.
The growth of the tax code has resulted in increased compliance costs for taxpayers as well. Only about 30 percent of Americans attempt to prepare and file their own taxes while the majority (roughly 60 percent) rely on paid professionals to file on their behalf. Estimates reveal that at least 6.1 billion hours and $431.1 billion were spent by taxpayers to ensure proper compliance. With the tax rate already at 29.4 percent of total income, requiring taxpayers to incur additional costs just to comply is unreasonable and irresponsible in an already-struggling economy.
Furthermore, increasing the length and complexity of the tax code has led to expansion of the Internal Revenue Service (IRS) and higher administrative costs just to process collected taxpayer dollars. In essence, this means that taxpayers are paying the IRS to convert their hard earned money to actual services funded by the government. Because the code is nearly impossible to understand, each dollar ends up funding far less of the government services for which that dollar was intended.
American families long for a fair, simple tax code that puts their minds at ease. Instead, our current system is complicating rather than streamlining the process; wasting rather than efficiently using hard earned dollars; and penalizing hard working taxpayers rather than creating a fair process that rewards success.