THE CAL SIMPLE TAX PLAN

         About Us

         Proposed 540-Simple
         Economic Impact

                   Single Filers

                   Married Filers

                   California Impact

         Endorsements & Press
         Sign Our Petition
         Contribute
         Contact Us
  
 
       
   
 
 

UNITED CALIFORNIANS  

FOR TAX REFORM  

info@CalSimpleTax.org   

 

THE CALIFORNIA SIMPLE TAX

Economic Impact on Married Taxpayers

The Franchise Tax Board reports that 73 percent of California Married Taxpayers (filing jointly) earn less than our $100,000 income limit and would therefore qualify to use our optional plan.  So how would our plan affect their taxes?

During the 1996 presidential primary election the Orange County Register examined the taxes paid under current law by five families and contrasted this with what they would have paid under the various Flat Tax plans. We have created similar but fictitious families to demonstrate the financial impact the CAL Simple Tax plan might have on you or someone you know.

A married couple whose joint income is $49,347

Our married couple are in their early 60's. Their mortgage is paid off, they have no dependent children, and they claim the standard deduction. They would pay $902 under the present Tax Code and $883 under our plan. Professional tax preparers would typically charge them $150 or more to file their Federal and State tax returns. Our married couple might save up to $50 in these fees by filing themselves using our 540-Simple tax form.

| BACK TO TOP |

A married couple with one dependent, whose joint income is $78,000

Our family of three owns their home and has one teen-age daughter. Their itemized tax deductions consist of mortgage interest and property tax which total $15,000. Under the present Tax Code they would owe $1826, while under our plan they would only owe $1598 and save $228 in state taxes. Professional tax preparers would typically charge this family $300 or more to file their Federal and State tax returns. They might save an additional $100 in these fees by filing themselves using our 540-Simple tax form.

| BACK TO TOP |

A married couple with two dependents, whose joint income is $98,695

Our second family of four own their own home, have a teen-age son and college age daughter, and claim $26,113 in itemized deductions. Under the current Tax Code they would pay a state tax of $2390, while under our plan they would owe $2116. The California Simple Tax would save this family $274. Professional tax preparers would typically charge them $300 to file their Federal and State tax returns. Our family might save an additional $100 in these fees by filing themselves using our 540-Simple tax form.

In summary, our plan distributes the tax burden evenly and fairly based on total income, not how that income is spent or the age of the taxpayer or how many children are in the family.

  • Under our plan, the tax burden in the examples above as a percentage of income was 1.79%, 2.05%, and 2.14%.

  • Under the present California tax code, the tax burden in the examples above as a percentage of income was 1.83%, 2.34%, and 2.42%.

  • The marginal tax rate under our plan is a constant 2.5% while in the examples above the current tax code imposed marginal tax rates of 4, 6, and 8 percent.

The IRS estimates that the time required by taxpayers to collect the necessary records, study, prepare, and submit a 1040 Form at 15 to 25 hours. The California 540 Form is not a lot simpler. We expect, however, that you will find the time it takes you to prepare our Form 540-Simple will be measured in minutes rather than hours.

We hope that you will be pleased with the tax savings you may expect from our plan as well as the savings both in time and record keeping. You may also save money you have previously given to a professional tax preparer as well.

TRY THIS!   

Once you've computed your new "Simple Tax" with our proposed Form 540-Simple, compare the result to what you paid in state taxes in 2002. Be sure to include the cost of a professional tax preparer if you used one.

 

 

NEXT PAGE  |

 

Privacy Policy  |  Website Terms of Use

Copyright 2003 United Californians for Tax Reform.  All rights reserved.

Please direct technical comments regarding this website to webmaster@CalSimpleTax.org