Tuesday, Dec. 4, 2012 | 2 a.m.
It appears that nearly everyone has an opinion about the approaching “fiscal cliff” and what to do about taxes and deficits. So do I. One common-sense approach to changing federal income tax law is to simply cap the total combined amount of federal income tax a taxpayer can deduct.
For example, if the allowable non-itemized “standard” deduction for a particular family is $15,000, cap their itemized deductions at two times the allowable standard deduction — in this case $30,000. This formula would apply to every taxpayer and would include items such as home mortgage interest, property taxes and charitable deductions.
Under current tax code, why should a wealthy person receive a 36 percent deduction for their charitable contribution (subsidized by nearly all other taxpayers) and the lower-income person only 15 percent? Maybe some taxpayers don’t care to support any of their chosen charities. Is the reason for giving the tax deduction, establishing a tax shelter, the need to give?
Level the playing field for all taxpayers and just cap the aggregate deduction amount. This way, everyone gets to pick and choose but within limits.