God Told Me To:

By JIM WEIKAR
Published: September 14, 2004

As a tax guy, I found myself chuckling quietly when President Bush said in his speech at the Republican National Convention that he would "lead a bipartisan effort to reform and simplify the federal tax code." Before long, I was howling with laughter. Sorry, folks, but efforts to "simplify" the code always bring clients streaming through my door. And the president quickly went on to show why: he wasn't able to offer simplification without adding two levels of complication within the next two minutes.

O.K., the president said, I'm going to lead an effort to simplify. But I'm also going to "create American opportunity zones" in which "we will provide tax relief." Thank you, sir, and please add Form AOZ to Forms 1116, 2106, 6251 and all the others we now have. Next came a "tax credit to encourage small businesses and their employees to set up health savings accounts." Please add Form TC-HSA.

I did get a little nervous, however, when Mr. Bush directed listeners to his Web site for more details. Would it explain how he planned to reconcile these new exceptions and credits with his promise of simplification? I needn't have worried: regarding simplification, it said only that "President Bush will work to make the tax code simpler for taxpayers, encourage saving and investment, and improve the economy's ability to create jobs and raise wages."

As a bonus, the site included some proposals not mentioned in the speech. One was for an "above-the-line tax deduction that individuals could claim for long-term-care insurance premiums" (add Form LTC). Another was an "additional tax exemption for home caregivers of family members" (add Form TEHCFM).

And, trust me, should the president really "simplify" things, an avalanche of other deductions and exemptions would be sure to follow.

Form M: Let's get serious. Somebody making $100,000 a year and spending half of it on round-the-clock care for a seriously ill spouse says, "Hey, how come I pay the same tax under simplification as the guy who makes a $100,000 and doesn't spend anything on medical care?" Let's make an exception for catastrophic medical problems.

Form DTUUC: The United States was founded on a revolt against unfair taxation. You can't have a guy in New York City paying about $10,000 in state and local taxes on his $100,000 income and also paying federal taxes on the same income. Shouldn't he at least be able to deduct the taxes he paid to New York to get closer to a level playing field with people in no-tax states like Florida, New Hampshire and Texas? (The DTUUC stands for double taxation unfair under the Constitution.)

Form M (No, make that Form I, we've already used M for medical): A man's/woman's home is his/her castle. And that castle was built with a mortgage. Don't pull the rug out from under the indebted baby boomers just as they reach retirement age and are worrying that Social Security won't be around (see budget deficits). The mortgage-interest deduction stays.

Form C: For charity, so people can give money to the groups running those faith-based initiatives that are filling in for the social-service programs the administration is so intent on cutting.

Form E: For the expenses of the self-employed and others who, unlike salaried workers, need to spend a lot of money to make their money.

Of course, it's not that simple. We would need to put some limits on the exceptions. For example, catastrophic medical deductions could be limited to expenses over 7.5 percent of income; mortgage interest could be limited to two personal properties and to the first $1 million of mortgage debt plus $100,000 home equity debt; gifts to certain charities could be no more than 50 percent of income, while others would have 30 percent or 20 percent limitations. Looking forward to that paperwork?

Well, the president has one thing right: doing away with the old forms and having a lot of new ones would at least give the appearance of change. So if he wins in November, you can make your appointment with my office at any time. Thanks to his plan to "simplify," you're going to need the help.

Jim Weikart is a partner in a tax preparation firm and the author of "Harry's Last Tax Cut," a novel.