I started preparing my 2025 Income Taxes yesterday. Still doing it today but I have to take a break because my anger makes it difficult for me to concentrate. As I have said many times, I do my own taxes because I want to know how those mfers in Washington are screwing me - and you, and everyone else.
But here are my issues with Trump. During his first term he claimed he would simplify the tax system. He even got a bill passed and for me it is a terrible bill. The limitations on deductions for state and local taxes are a killer. I get it. If we disallow those deductions people will move out of the state and pressure the state to lower those taxes. Except it is not working, and it never will work. You have to understand why. The money we are taxed is used to buy votes. As long as buying votes continues, with promises of more this or better that, taxes will remain high an the majority with continue to pay them.
Trump never ended the Obamacare tax surcharges on income and investment income. That's another 2.6% and 3.8% on top of the tax rates that are advertised. We are still paying for Obamacare. When politicians claim our top tax rate is low, they exclude the Obama care taxes which are added on top of the top tax rates. In reality or top tax rate is closer to 43% than 37%. When you add state taxes on top of that, the majority of Americans are paying a top tax rate that exceeds 52%, and this does not include Social Security and Medicare payroll taxes.
This year we were supposed to get "no tax on social security". This too is false. Some seniors qualify for a social security income exclusion up to $5000. For many it will be $0. In my case it is zero. Half of my social security payments go to taxes and Medicare - if you didn't know. Medicare Part B is not free and the more you makes, the more you pay for it - and most seniors buy additional coverage to pay for what Medicare does not cover.
The tax laws are more complicated than ever now. Every time they try to fix something they make it more complicated. The system is unfair, deceptive, and overly complex.
Why the F doe a first time home buyer in Washington DC get a tax credit? Why isn't this available everywhere? or Nowhere? In fact, the list of tax credits available to taxpayers reads like a Democratic Party Wish List. EV? You get a credit. Energy efficiency improvements to your home? You get a credit. Adopts a kids, instead of having your own? You get a credit. Contribute to an ABLE account (A Better Life Experience), you get a credit too. There is even a credit for mortgage interest if you get a certificate from a government offices allowing it. I wonder how much fraud is in that? But I can't deduct money I paid to my state in taxes, money I never had in my pocket because it is taken before I am paid?
Why are medical expenses not deductible unless they exceed 7.5% of your annual income? Why not make all medical expenses tax deductible instead of allowing Health Spending Accounts funded with pre-tax income?
I could write a book on all the idiocy, dishonesty, and unfairness in our tax system. But what good would it do. Most people just don't give a shit. Life goes on.
If I had 3 wishes from a genie, today 1 would be a VAT tax system with the tax rate tied directly to the budget.