W. Marc Gilfillan, CPA, NC, individual and business CPA and Tax expert, shares about the history of taxes…

So the question remains, what happened with taxes in the United States?

US tax makers have been collecting what they have sown for a long time. Our honor system has been trumped by a system in which every tax payer is under surveillance because of the strong threat of evading their taxes. In other words, consent has been replaced with compulsion. Honor has been replaced with spying on citizens. If you are feeling the pressure with today’s taxes, call a Cary NC CPA for all your tax-related needs!

In the 1950s, there wasn’t a bank in the US that told the IRS about customer affairs, interest rates went unreported, withdrawals of money were not reported, and nothing that went through accounts were photographed. Also, real estate transactions weren’t reported, stock transactions were not reported, dividends were not reported, income from other sources (Form 1099) was not reported, and US Customs did not require a declaration of the amount of money carried. Go here if you want help from a modern-day Tax Preparation in Cary, NC.

It was an honor system, and it worked. The erosion that happened over the previous fifty years to the present is that anything of any fiscal significance is now reported.

Adam Smith said that taxes will be evaded and tax laws shown no credence when there is a general suspicion of much unnecessary expense and a lot of misspending of tax revenue. In other words, $500 toliet seats, huge grants to study the sex lives of ants, etc.

For the sake of catching a few tax resisters and evaders in the 1950s Congress made a tax monster of the US tax system that more and more taxpayers attempt to evade. As a general rule, widespread tax evasion is a sure sign that a government’s tax system is bad. People will pay taxes, even income taxes, if the rates are reasonable.

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