Alright fine I'll give in! Ultimately though it depends upon whether or not we are supposed to pick them based upon similar spending levels to what they are currently or what we would have them at.
Personal(individual)
1) 0-20k = 0%
2) 20-40k = 10%
3) 40k+ = 25%
(married)
1) 0-30k = 0%
2) 30-60k = 10%
3) 60k+ = 25%
+5% (capped at $100k) mandatory contribution to SSA(Social Security Account-Untouchable til age 60)
+5% (capped at $100k) mandatory contribution to MSA(Medical Savings Account untouchable for non insurance premiums. Option of liquidation or transfer to heirs accounts at death. And different from HSA because that can be used on non premium health expenses, can be withdrawn with penalty before 60, and can withdrawn without penalty after 60)
NIT = $8k and drops $1 for every $2 in income(phasing out completely at $16k). (most additional lower income benefits for married and kids would be paid out in voucher format some explanation provided here:
https://uselectionatlas.org/FORUM/index.php?topic=141747.15 )
Limitless charitable deduction
All of these remain deductible: HSA boosted to $10k, ESA boosted to $5k and becomes deductible(529 gets killed and folded into ESA), 401k/403b/TSP/SEP/Simple rolled into 1 type that gets mostly boosted to $20/$40 instead of $16.5K/$49k. tIRA stays exactly where it is and income phaseout for deductibility ends. Catch up is marked at 20% of retirement account limit from here on out.
Roth officially loses its income phaseout(since today the phaseout is unofficially gone). Municipal interest no longer tax free.
All remaining exemptions, standard deductions, itemized deductions, state tax deductions, etc. killed across the board.
Corporate$0+ = 20%
Change to 100% expensing, the only 4 forms of employee compensation that are deductible are cash, stock, stock options, and qualified account matching. Ends the deduction for corporate health insurance and kills the defined benefit plan. Obviously expense accounts(which can be a grey area) can stay.
Capital GainsShort term(less than 1 year)
$0+ = 20%
Long term(1 year +)
0 - 50k = 0%
$50k+ = 10%
Re-imposition of capital gains on primary home sale, end of "in kind transfers" such as 1035, 1031, etc., and a step
down in basis to 0 at asset transfer or death (instead of step up) which would result in a capital gains tax levied against all inherited assets whenever the heirs decide to sell(I realize that it would encourage people to sell property and pay taxes only on the gains before death, but I also think that little illiquid and not easily dividable assets at death is a good thing). That applies to life insurance as well and is triggered immediately at payout.
Dividend taxes = same as capital gains
Held for less than 1 year = 20%
Held for longer than 1 year = 0% or 10%
Irrevocable Trust$0+ = 25% on income producing assets
$0+ = 10% on long term capital gains
Payroll and SE taxes = scrapped
AMT = scrapped
Death tax = scrapped(step down will result in future 10% against all or 10% on part early)
Generation Skipping tax = scrapped
Gift Tax = scrapped
Gasoline tax = scrapped
I'm kind of curious if I'm missing any behavioral effects here from our tax accountant. I'll avoid the ones that are even remotely disputed like cutting corporate taxes will reduce prices, growth will increase, etc.
-corporations would cease providing health benefits and disability benefits(people would instead get them on their own)
-permanent life insurance would lose its corporate and trust appeal
-municipal interest rates would come more in line with corporate ones over the long term and municipalities and states wouldn't be able to issue as much debt
-people would try to liquidate assets before death or transfer
-people would gift much more unneeded assets to heirs earlier in life
-obviously loss of mortgage deduction wouldn't be good for long term home ownership
-corporate capital equipment purchasing would increase
-corporations wouldn't be as inclined to 0 out as much and would instead maintain higher retained earnings making companies more stable(caused by 25% personal vs. 20% corporate)
-personal tax accountants like Ice Hockey lose work
-the estate planning and business consulting parts of my business get hit pretty hard!
P.S. under a system like this I could scrap unemployment and welfare benefits and the unemployed would enjoy the same standard of living. I could phase out both Social Security and Medicare for all of those between the ages of 40 and 50 and replace it with a $1-2k each annual government contribution to lowest of earners and people would have better insurance and retirement incomes(and achieve universal coverage). I could offer low income young folks a voucher to buy health insurance(because they are very cheap relative to older folks) and scrap Medicaid. And I could even scrap the minimum wage since it wouldn't have any affect on low earners standard of living(better to pay some benefits out to a low wage worker than all benefits to someone unemployed).