According to ABC News, Mitt floated an elegantly simple idea for cleaning up the tax code:
Cut every bracket’s marginal rates and limit deductions to $17,000.
Specifically, Romney said:
“As an option you could say everybody’s going to get up to a $17,000 deduction; and you could use your charitable deduction, your home mortgage deduction, your healthcare deduction… to fill that bucket, if you will, that $17,000 bucket that way
And higher income people might have a lower number.”
For the record, the idea would hurt me personally since I carry a couple of jumbo mortgages and make charitable donations.
Still, I think the idea is GREAT.
It simplifies the tax code … and levels the field, say, between renters and home owners.
I’ll continue to give to charities … so will Mitt … so will most current donors.
If charities don’t have powerful enough value propositions to raise money, that’s their problem.
I really like that the change would screw folks in high tax Blue states – e.g. NY, CA – since the deduction for state & local taxes would fall under the cap.
There’s less of an impact on folks in well run states (like VA) … that’ll give tax & spend states more motivation to clean up their own acts.
Sure, there are plenty of details to be worked out (e.g. how to handle child credits) … but, I think this simple plan might be a game-changer.
Tags: $17, 000 deduction bucket
The Homa Files 
October 3, 2012 at 10:01 am |
My first reaction is to like Mitt’s plan. But should I be worried by the words, ‘as an option’? Is the other option to continue calculating at today’s rates (with loop holes intact)?
October 3, 2012 at 4:16 pm |
Do not forget that Virginia is a blue state too!