This issue is precedence. Part of investing is knowing the tax laws because income can be generated from earning extra, or decreasing our costs. Taxes are costs.
There is precedence for other large changes in the tax code, eg, eliminating
accelerated depreciation, changing the capital gains recapture rule.
But my point again is that someone in North Dakota won't be penalized at
all compared as someone from California for living the same relative wealth.
There will be different effects in different states for any change.
But change makes things better enuf to be worth it.
I see your points. And if I had to start over, I would agree that a simplified tax plan with less specific deductions would be better for everyone. But many of us have committed to a strategy that is basically locked in for decades. So it's not easy to change because of the precedence set. The government cannot change these tax plans so drastically every year. Businesses will flounder because they can't commit to a long term strategy.
We all commit to tax strategies which sometimes bite us,
& other times benefit us. But change is beneficial.
And lower tax rates mitigate loss of deductions.
You own commercial properties so you're used to your deductions too just in the form of operating expenses. The question is, if the government changes its deductions on businesses, will you still get the same amount in return?
Government already does change things in ways which make life difficult.
Not all losses or expenses are deductable.
I have carry forward capital losses which I'll never be able to use.
And then what would be the difference? But then let's say we have two plumbers in different areas that is basically doing the same job, but then one pays more taxes overall and proportionally then the other... Wouldn't that be seen as unfair?
It would depend upon the reason one pays more tax.
