If there remains any doubt that the U.S. tax code is too complex, Floyd Norris’s column in today’s New York Times should quash it.
Tax lawyers and accountants are now patenting their strategies. Discover and use a strategy that’s already been patented, and you might have to pay royalties or face a lawsuit.
A tax task force of the American Bar Association is meeting today in Denver to discuss the issue.
“Could I get a patent on a taking a deduction for dependents, so that every parent in America would have to pay a royalty to me to take advantage of the tax law passed by Congress?”Mr. Norris muses. Well, probably not, he acknowledges. But for more complicated strategies, it’s happening already. Forty-nine such patents have already been granted, and 81 more are pending.
It’s bad enough when the law is so incomprehensible that honest citizens have to pay professionals to figure it out for them. But when strategies for staying within it are patentable, it’s just plain ridiculous.