Tax accounting is not limited to the United States. Accounting is a vast field, and tax accounting is no different. Tax accounting is associated most with government. This is because everyone from corporations to citizens must file tax returns if any money is handled in the United States. The IRS only inspects a select few returns: Federal 1040s, 1065s, 1041s, etc. Tax accounting is not limited to the federal level. States and cities may also require returns. The government spends taxes on many things, including education, police, firefighters and other community forces.
Recent years we’ve seen the biggest change in tax policies since Reagan. In the two years following that major tax policy change, growth of the tax revenue has declined significantly. Although the 4.2% growth in 2019 is stronger than the 0.4% increase in the fourth-quarter of 2018, the rate of growth remains significantly lower than that of the first two quarters of 2018. The decrease in personal, corporate, property, and sales taxes is to blame. Lucy Dadayan writes in State Tax and Economic Review about the different growth rates among the main revenue sources. The second quarter saw a decrease in personal income taxes, which was due to the rise in December 2017 and in January 2018 as a result the Tax Cuts and Jobs Act. The 4.2% rise was due to state sales taxes growing continuously since 2010. Dadayan believes that the state’s sales tax revenue will continue to increase. Michael Desmond, Chief Counsel of the IRS, discusses this in a Bloomberg Tax podcast. The tax law has been changed and the tax code is changing. This means that both individuals and companies must be careful when filing their taxes. Taxes, the backbone to America’s economy, are how the government funds many of our services. The IRS, however, has been slow in changing the code. Desmond explained, “”…we’re trying to keep our trains running.” It is important to note that tax accountants are required to keep up with the changes in tax codes. This can be a challenge because all tax accountants have to learn new things with each individual and corporate return.
To me, changing the code of taxation can be important for anyone who is affected. Since there are many ways to avoid tax codes, they are always changing. To ensure that everyone can receive the services they need, receiving money from the government is essential. In light of the fact that money is constantly changing, so are tax codes. On the flip side, I believe that taxing people excessively can cause problems. The people may become less interested in government policies and try to circumvent the new tax code to pay less to the government. IRS refunds taxes they do not use. However, these are often much smaller than expected. Tax refunds are always awaited after filing returns. But if the refund is less than expected, it can be a problem in daily life. They can, for instance, use their refunds to pay off their bills. The refund amount can be less than anticipated, so the bills may become overdue or late. This will cause problems for both the customer and the service provider.
Taxes are important to the economy, but they can cause a lot of pain to the people due to the higher taxes. This can affect many aspects of life, such as the economy and banking services. Taxes are a necessary part of life, but it’s not easy to imagine a society without them.
