H&R Block Advisors Agrees To Making The Tax Code Less Complicated

H&R Block At Home is profitable because most people don’t like to do their own taxes.  So, it seems weird that the company is all in favor of making the 74,000 page tax code easier to understand.  The CEO of H&R Block Advisors, Bill Cobb, supports deliberations that are underway to make this happen.

He spoke on CNBC’s “Squawk Box” and said that there are things that can be done to simply the code.  But he also said that it doesn’t make sense splitting up the code just because it is too hard to understand.

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But on the other hand, the Republican Presidential candidate, Donald Trump, says that he wants to make H&R Block go out of business by streamlining the whole tax system via neutral revenue options.

But Cobb thinks that before going for something that drastic, the government has to determine how social programs are going to be administered.  He says that every social program under the sun is linked to the tax code.  He claims that the rates are not the problem.  Refundable credits are what make the code so complicated.

Cobb stressed that the amount of money taxpayers receive from the government is all that matters for a majority of the population.  The average refund in the United States is around $3,000, and this is very important to the average person.  It is considered a reward for working so hard during the year.  Cobb says that there are two busy seasons in the United States.  The first is during April when everyone is scrambling to file their taxes.  The second is during the end of January when the refund period begins.

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Recently Cobb rung the opening bell on Wall Street.  He was also there to get exposure for H&R Block’s new service called Block Advisors.  This branch of the company deals with tax prep for small companies, difficult tax returns and financial planning.

Why Taxes Are So Complex

One of the reasons that the tax system is complex is that it’s also versatile. Congress uses it to provide benefits for specific groups. It is also in place to maintain a level of efficiency and integrity. Some people ask, “Why are taxes so complicated?” The answer is that they need to be.

As the years progress, the tax system seems to change and get more complex than it was the year before. Do you wonder why that is? Why does it never seem to get easier? Everything else gets easier with time.

A head tax would be a simple tax, but it would not be a respecter of persons.

Many citizens believe in and desire a fair tax system. They want it simple, but the simplicity may  bring loss.

Most countries have taxes that change according to the characteristics of individual tax payers. The system seems fair and just.

Sales Tax Rules And Prepared Foods

Sales taxes are a fact of American life, and they are really noticeable in the area of fast food. Lets review some Sales Tax Rules to make sure you are following the law.

For instance, when a hungry consumer drives through his favorite drive-thru, he should expect to pay the price of his burger plus additional coinage to cover sales tax. Most states, counties and municipalities feed their coffers by charging a local sales tax on most every kind of purchase imaginable. Local law regulates what purchases are taxable and at what rate.

Sales Tax Rules
English: Picture of an authentic Neapolitan Pizza Margherita taken by Valerio Capello on September 6th 2005 in a pizzeria (“I Decumani”) located on the Via dei Tribunali in Naples. Italiano: Fotografia di un’autentica pizza Margherita napoletana scattata da Valerio Capello il 6 settembre 2005 nella pizzeria “I Decumani” situata in Via dei Tribunali a Napoli. (Photo credit: Wikipedia)

Application of sales tax regulations is not always straightforward, though. “Prepared food” sales tax rules are different from sales tax rules on single items such as milk or bread. For example, a take and bake pizza at your local eatery incurs sales tax, but some people, and states, are confused and upset about that. Is a cold pizza that the customer has to take home and bake actually prepared food?

Amazingly, the states of South Dakota and Arkansas wrote and published rules which say that pizza which is put together in a store and the baked at home is actually a prepared, and taxable, food because the restaurant had to assemble two or more ingredients to put the product together.

The Streamlined Sales and Use Tax Governing Board says a take and bake pizza is prepared food and therefore, taxable. The state of Wisconsin has a flow chart that its Department of Revenue employs to apply sales tax regulations to pizza and everything else.

Recently, an amendment to the Streamlined Sales and Use Tax Agreement says all states can make their own decisions on which pizzas are subject to sales tax. Yes, even pizza can get complicated when it comes to the tax man.

H&R Block specializes in navigating the muddiest of tax waters for the American taxpayer.