The Readers Digest version of the Fair Tax Act of 2023 is that it replaces the income tax, payroll taxes that fund Social Security and Medicare and transfer (estate and gift) taxes with a very broad sales tax. For 2025 the tax inclusive rate is 23% which translates to an add on rate, as sales tax is usually expressed, of 29.87% and change. After 2025 the tax inclusive rate is 14.91% plus what Social Security Administration actuaries determine the rate to be that will yield what the repealed payroll taxes would have collected.
The Fair Tax enthusiasts paint a "What A Wonderful World" picture of what it will be like as we go from 70,000 pages to 131 and abolish the IRS. I've been through the bill numerous times now and will here try to lay out how I think it might work in practice for different sorts of taxpayers when we ring in the jubilee in 2025.
If your state gets wise and adopts a "Conforming State Sales Tax" in place of any income tax it has you will get the maximum simplification. If your state keeps it income tax not so much. A lot of state returns fall relatively seamlessly out of the federal income tax return. So it may be possible that you will still have close to the same amount of tsoris, agita and aggravation that you have had every tax season. You can't blame the Fair Tax enthusiasts for that. They gave your state the opportunity to enact a conforming state sales tax and repeal its income tax.
Now let's look at how it goes for those in...
Kuehn Law is investigating Fractyl Health for allegedly misleading shareholders about the effectiveness of its outpatient therapy, Revita. The lawsuit claims the company overstated Revita's clinic...