12 June 2011

The Tax Code

In the 1999 revolutionary block buster The Matrix computer hacker turned ninja warrior Cypher told new recruite Neo that even though the ship's computers could easily decipher the code of the Matrix the total amount of code in the Matrix was so vast that deciphering the whole thing is impossible. The United States tax code is the same.

Well, not exactly. Unlike the Matrix there is no easy way to decipher the tax code. It is written in the thickest, most unintelligible legal language imaginable, making it the bane of millions of American's existence.

I got to thinking "just how long is the US tax code?"

According to ReasonTV (part of the Reason Foundation), Americans paid $27.7 billion to comply with their taxes (these are 2008 statistics).

Also in 2008 the bottom 50% of taxpayers paid just 2.99% of total income tax collected by the federal government. In contrast the top 1% (the evil rich) paid 39.89%! Over 13 times more! The top 5% paid 60.14% of all taxes, and the top 10% paid 70.79%. Anyone who is not mentally challenged and is not blatantly lying to themself can see that there is absolutely no way the rich are not being taxed enough and that taxing the rich more won't make things better.

That's all very nice. No, it's all very disturbing, but it doesn't answer the question. How long is the tax code?

From what I can gather the US tax code is written by the IRS and Congress. The IRS writes Title 26 of the United States Code of Federal Regulations (known affectionately as "26 CFR"). Congress writes its own regulations under the name Title 26 of the United States Code. When you put these together you get the tax code.

The part written by Congress can easily be found online at the US Government Printing Office website. It consists of a single 18MB PDF with all of 3,728 pages for 2009 (the most recent digitized year). Researching 7 Days involved reading over 2,000 pages, to provide a comparison.

Finding the IRS portion of the code was much more difficult. They had split it up among 20 to 100+ individual PDF files. I did find a print copy of some or all of the IRS code for sale for just over $1200 (shipping included), but I am not going to purchase this entire library of text to find out how many pages it is
. After searching I discovered that CCH Incorporated had solved the problem for me. They put the grand total of pages of the US tax code for 2010 at 71,684 pages. I have not discovered the missing 67,956 pages so I cannot confirm this number. According to their statistics the tax code has grown by almost 2,000 pages since 2009, and it is revised and enlarged every year.

My top speed reading seems to be around 40 pages/hour, and it goes down with boring or difficult text. To finish reading the entire tax code would take me 1,791 hours 6 minutes, or just over 74 1/2 days of continuous reading. Reading for a more realistic 10 hours, with breaks every 90 minutes to use the facility (est. 10 minutes/break, or 9 hours reading 1 hour peeing total) reading the entire tax code will take 200 days at top speed. In reality reading the whole thing would be impossible. That's why companies hire thousands of lawyers to study the tax code.

That's the answer, so what's the solution? Back when The Urban Mystic was on AOL instead of Google I proposed an alternative income tax scheme. Instead of 71 thousand pages let's simplify things to less than ten. The first page is simple, if you make more than $24,000 a year (2010 estimate of the minimum a single person must make in America just to survive) you pay 10%, no more, no less. It doesn't matter if you make $30 thousand or $30 million, you pay 10%. That means the minimum you pay, on an income of $24,000.01 you pay $2,400.00 in taxes. Donald Trump, who made $50 million in 2009, would pay $5 million in taxes, 2,083 times what someone on minimum wage would pay. There are no loop holes, no deductions, no fancy tricks. If you make more than the minimum you must pay 10%, full stop. The remaining 9 pages of my tax code would include penalties and whatever else is needed to determine how this works. It's not important. What really matters is the first page. Encapsulated in that first page is the solution to the tax problem. Economically speaking it is the red pill to get us out of this 71 thousand page Matrix.

3 comments:

Anonymous said...

CCH Incorporated did not determine that the tax code is 71,684 pages. CCH Incorporated makes a research product called the Standard Federal Tax Reporter. It contains the full text of the code, plus the text of proposed changes, CCH's analysis of current code and proposed changes, highlights of IRS case rulings, and a bunch of other research and analysis. It is the Standard Federal Tax Reporter (their own product) that is 71,684 pages long. Not the tax code itself.

SenorDee said...

Since you are anonymous and cite no references I don't believe you.

SenorDee said...

Ron Paul in his farewell address to Congress in November 2012 said the US tax code is 72,000 pages, which is pretty close to the estimate I got.