Too bad you did not get a job as a hedge fund manager. If you had, you would not owe any taxes come April 15 on your share of the hedge fund's profits.
Hedge funds are unregulated investment pools open only to rich individuals and big institutions. They operate offshore. And for their managers, some of whom earned a half-billion dollars last year, taxes are deferred as long as they keep the hedge fund open and the profits offshore, while you get taxes deducted from your paycheck. And, thanks to our government, their tax avoidance is perfectly legal.
...For more than a decade, Congress has steadily eroded the capacity of the IRS to enforce the tax laws, with one exception. Since 1997, Congress has approved more than $1 billion in extra funds to audit the working poor. In recent years, parents who work full time at the minimum wage have been as much as eight times more likely to be audited than millionaire investors in partnerships.
The wealthy who mine the tax system face little risk of getting caught. Only 1 partnership in 400 gets audited, and agents say many audits are superficial and closed quickly to make statistical reports create the appearance of toughening enforcement.
...Bush says he wants a new tax system that will lower taxes on savings and investments and on "risk takers." He said a new system must be revenue neutral, meaning it will bring in the same amount as the old system.
If those with significant assets are going to pay less, there are only two ways to make up that revenue. One would be tremendous economic growth. The other would be to subtly shift more of the tax burden onto those Congress already watches closely: wage earners.