Point of View August 6, 2026 – Hour 2 : The Trump Presidency and Taxes

[00:00:04] Across America, live, this is Point of View. Now, Dr. Merrill Matthews. And welcome back to Point of View. I'm Merrill Matthews, sitting in for Kirby Anderson today. And now we're going to turn to taxes. And we're going to go to a long-time friend of Point of View, going back, I think, probably nearly 40 years.

[00:00:34] Dan Pilla, tax expert extraordinaire. Dan's the person we always go to to find out what's happening with the IRS, with taxes, tax proposals out there. He has written a number of books. He has written especially a book on small business and their tax issues. He's also worked on taxpayers' rights. For those of you who are facing the IRS and so forth, he has the ability for you to contact him. And he can tell you whether or not he can help you. Dan, thank you for joining us.

[00:01:03] Oh, it's my pleasure, Merrill. Thanks for having me. Okay, you had a piece recently, I think, in National Review on the IRS. What's happening with the IRS now? Because there's been changes. What's happening there? Well, the piece that I talk about in National Review is the audit that the Treasury Inspector General for Tax Administration did on two elements of the IRS, Merrill.

[00:01:27] Now, the first element was how the IRS's chatbots and AI systems are working to help taxpayers answer their questions. That was the first one. The second one was how does the IRS's live telephone assisters perform in terms of answering questions of taxpayers that call in? And the IRS gets basically an F in both areas. As far as I'm concerned. That seems a little high to me.

[00:01:54] No, TIGDA didn't give them a grade point average, and they didn't even give them a one to ten average. But here's the thing with the chatbots. The chatbots and the IRS's AI systems are designed to allow people to go onto their website, plug their question in to the chatbot, and get an AI-driven answer to their question.

[00:02:14] All right, so what TIGDA found is the IRS, before launching this program, did not do any systematic testing of the program and had no independent verification that this thing was providing accurate information. All right, so right off the bat, we don't have any standards, any objective guidelines to ascertain whether the IRS knew what it was doing when it put this system online.

[00:02:39] The other thing that the TIGDA audit found is that there was a couple of hundred, like 200 and some change, number of standard words, right, search terms, and basic queries that the average taxpayer might put into the system, like what are the rules for deducting charitable contributions, what are the rules for claiming dependent exemptions, these types of things, right?

[00:03:08] And the chat system couldn't answer or didn't even recognize as many as upwards of 200 of these very common words and phrases. And so the system, Merrill, was not even functioning at a very basic level to help taxpayers get answers to their questions. And who's surprised?

[00:03:30] Listen, if I remember correctly, people oftentimes called into the IRS and they had people who answered the phone and they would answer your tax questions if you were able to get through to a person. But you sometimes got the wrong answer from the IRS tax person, and that didn't give you an immunity if you made a mistake on your tax form. Well, you're correct about that.

[00:03:54] Now, that is, as a matter of fact, was the subject of the second TIGDA audit that was released just a few days after the AI audit was released. And we're talking about just a couple of weeks ago here, okay? We're talking about mid or late June these two audits were released.

[00:04:10] And so the second audit, what they did, Merrill, is they took a representative sample, a statistically valid sample of phone calls that went into the IRS out of 3.8 million phone calls that went into the IRS during one three-month period of time that were directed to just two call centers. The IRS operates about eight of them.

[00:04:33] So they took a small window of time and they called out a representative sample of calls, and TIGDA determined that 14% of what we're talking about, 3.8 million calls here. So this is 14% is a heck of a lot of people, Merrill, that are affected by this.

[00:04:52] And what TIGDA found is that 14% of those calls of the taxpayers were getting either incomplete or inaccurate information answers to their questions. And this goes back to – this goes all the way back to the early part of this decade. I'm talking about tax year 2000, right, 25, 26 years ago. So then Commissioner Charles Rosati made the statement.

[00:05:21] He was responding to a study that was done at the time that showed a very high error rate with IRS telephone assisters. And the comment that he made at the time – and this is eye-opening. This is stunning to me. He said, fundamentally, we are attempting the impossible, all right? He says that we are expecting the employees and managers of the IRS to be trained in areas that are far too broad to ever succeed,

[00:05:49] and our manuals and training courses are therefore unmanageable in scope and complexity. Now, this statement was made 26 years ago. Since that time, there have been more than 6,000 changes to the Internal Revenue Code. We are now up over 4 million words in the Internal Revenue Code. And so if what Rosati was saying then was true, and it certainly was, how much worse is the problem today?

[00:06:16] Well, tell us, President Biden threw a lot of money at the IRS. I remember, right, $60, $80 billion or something of that nature. I think Republicans were trying to scale that back some. What are the changes that have happened at the IRS in the last two or three years? Is it getting any better? Is it getting worse? Well, first of all, you're exactly right. The Biden administration threw almost $80 billion at the IRS that was supposed to be spread over 10 years, okay? So it wasn't an influx of $80 billion in one year.

[00:06:46] It was spread over 10 years. Republicans basically clawed all of that back except for the front-end appropriation. So they might have had, let's say, $15 or $20 billion that they actually received out of that $80 billion appropriation. Now, remember, that was a supplemental appropriation. The IRS's normal annual appropriation is roughly $12 billion.

[00:07:11] Now, Republicans pared that back considerably in the last budget cycle as well. And so the IRS's budget this last cycle was about $11 billion down. And what they did, buddy, is they targeted – what the Biden administration did is they wanted to take the lion's share of that $80 billion and point it at enforcement with very, very little increase in taxpayer assistance.

[00:07:37] What the Republicans did is they forced the IRS to reevaluate their budget priorities and to put taxpayer assistance at the top. So what we've got here is a heavy emphasis now on taxpayer assistance, taxpayer education, and problems resolution, and a significant smaller emphasis on enforcement, which I believe is the right focus. And the reason for that – and a lot of people say, well, Dan, you want people to get away with cheating on their taxes? Of course not.

[00:08:07] But the fact of the matter is the overwhelming majority of people don't cheat on their taxes to begin with. The overwhelming majority of the people in this country screw themselves into the ground to try to be honest and accurate with their tax information. They just don't know how to do it. And so this is what we learned from the phone calls into the IRS. Every year, over 70 million, between 70 and 80 million people call the IRS looking for help.

[00:08:35] They're not looking for ways to cheat. They're looking for answers on how to do it right. My guest for this hour is Dan Pella, tax expert. We'll be back with him in just a minute. This is Viewpoints with Kirby Anderson.

[00:09:06] We know that college students are using AI tools to help them research projects and write papers, but the problem apparently is much worse than we might imagine. For 34 years, Robert Serrano has taught economics at Brown University. In one of his classes, he typically draws 30 students that produce midterm averages between 65 and 80 percent. When there was a tragic shooting on campus, he decided to give the students a take-home exam. Enrollment nearly tripled to 86. Then the grades came back.

[00:09:35] Nearly half scored perfect or near-perfect scores. He and his assistants noticed the students' responses matched Chad's UBT phraseology. He told the class that the final would be in-person and closed book. If the scores were similar, he would count both. If not, the midterm grade would be dropped. More than two dozen students dropped the course immediately. Among the ones who stayed, the final exam average dropped to 48 percent. Many of the students failed. He had proved his point, but there's more.

[00:10:04] The professor submitted the evidence to Brown's Standing Committee on Academic Code. He heard nothing. Therefore, he went public with his findings. The press picked up the story, and it went viral. I realize this is only one story, but I suspect it could be repeated hundreds of times in the classes of the thousands of universities in this country. Now that AI tools are available, students are letting these computers do the thinking for them. They aren't learning. They are punching numbers into their laptops and asking questions of chatbots.

[00:10:34] I am encouraged that this professor did what he could to stem the tide of AI cheating. We need professors and colleges to deal with this problem. I'm Kirby Anderson, and that's my point of view. Go deeper on topics like you just heard by visiting pointofview.net. That's pointofview.net.

[00:11:00] You're listening to Point of View, your listener-supported source for truth. My guest for this hour is Dan Pilla, tax expert. We go to him frequently to find out what's happening in the tax world. And, Dan, you know, I'm not a fan of tax increases, and tariffs are taxes. So when President Trump imposes tariffs, he is imposing taxes.

[00:11:27] And the Reason Foundation estimated that, I guess this is the 2025 tariffs that he imposed, was the largest tax increase on Americans since 1993. So let's get your take. What do you think about tariffs and how they're working? Well, I'm 100% in your camp, Merrill, on this. Tariffs are taxes, and they are not taxes on foreign countries, right? Foreign countries, foreign producers do not pay the tariffs.

[00:11:57] The tariffs are paid by American consumers. And so it most certainly, unequivocally, is a tax on American consumers. That's number one. Number two, for the president to claim that he's going to replace all internal taxes, quote-unquote internal taxes, to use his phrase, internal taxes, with foreign tariff revenue, is wrong on two fronts. First of all, we know it's not raised by foreign countries. We know that U.S. consumers pay the tax. So it's wrong there.

[00:12:26] Secondly, there's only about 1.5%, maybe 2%, of federal revenue that's raised through tariffs. Now, we got roughly $5.5 trillion that's raised in revenue. That'll be the case this year. That was the case last year, about 5.3% last year. So that's a heck of a lot of money. 1.5%, say 2%, of that money is raised through tariffs. Where's the rest of it coming from?

[00:12:53] All right, 60% of the money is coming from the personal income tax and payroll taxes, Medicare, Medicaid, Social Security. All right, so that's 60% of the money. It is impossible, impossible to replace that revenue with tariffs, even if you could collect the money from foreign countries, which you can't. But even if you could, there's no way that you're going to replace that revenue.

[00:13:15] So it's just simply disingenuous of the president to make the argument that tariffs are beneficial to the American people and to American businesses because they just aren't. You know, it has been a mystery to me why the president keeps claiming that he's collecting this money from other countries. Ford claimed earlier this year, I think in February, that they had paid $2 billion in tariffs last year and expected $2 billion this year. GM said they paid $2 billion in tariffs last year.

[00:13:44] And you have over 1,000 companies that sued the federal government to try to get their tariffs back if the Supreme Court found that they were illegal, which the Supreme Court did. And so now those countries, those companies are getting some of those tariffs back. And I noticed here recently an article saying they feel like this is sort of a windfall because so much money is coming back to U.S. companies. Yeah, there's no doubt about that. You're 100 percent right.

[00:14:10] The Supreme Court did find that the president's tariffs were overbroad, that were not supported by the law. These companies are paying tariffs. There's no question about it. And they're going to be getting their money back. Now, here's the other thing. You know, I looked at the numbers, and I don't have the numbers right in front of me at the moment. But there's only about $350, $400 billion in tariffs collected total. And, again, we're talking about $5.5 trillion in total revenue to the government this year.

[00:14:37] It's just so foreign to me to understand how they keep claiming, the administration keeps claiming, that they're collecting trillions of dollars in tariff revenue. They just aren't. You know, an awful lot of individuals and companies go to tax professionals like you to find out how they can minimize their taxes so that they're paying their legal amount but the least they have to pay. Do companies do that with tariffs also? Oh, sure. Absolutely. Yeah, no question about it.

[00:15:04] Now, you know, tariffs certainly have the impact of encouraging domestic production. But the problem is that tariffs increase prices to consumers, right? And so this is the difficulty with tariffs. And so companies will say, yeah, okay, we've got these giant tariffs on foreign imported goods. Maybe it would be beneficial for us to build a production plant here in the United States and produce them.

[00:15:32] And we can produce them here and we can save the tariff revenue. And so that thought process goes on, Merrill. You know this stuff better than I do. That's, you know, it's fundamental economics that when you increase the price of something, you encourage other people to produce at a lesser price, right? And so that's fine. But that is what we call protectionism. And protectionism can help certain industries, but it always hurts consumers because prices go up under that protectionist philosophy.

[00:16:01] You know, one of the things that's happening is a number of liberal states, blue states, are looking at tax increases. And New York City has passed, I think it's pied-à-terre, is that how you pronounce that, tax for those who have a second home in New York City? Well, yeah. And Minnesota is doing the same thing and not the second home so much. But now the Minnesota leftist Minnesota legislature back in the spring introduced a wealth tax.

[00:16:28] And so they want to take states of $10 million and impose a 1% wealth tax on that. And this is just one more tool that the left uses, Merrill, to confiscate the wealth of the public. That's really what they want to do is take the wealth of the producers and transfer it to the state.

[00:16:53] Explain how the wealth tax works because a lot of Democrats and progressives are promoting a wealth tax. Does that mean that it's just, you know, like my home and my bank account? Or does it mean my stock? Or if I have some collectible cars or, you know, vintage cars or art or something like that? What does the wealth tax affect? Well, just think of it this way. It's an estate tax that's imposed by the government without the patience of waiting until you're dead.

[00:17:23] So that's exactly what it is. It's an annual assessment of your total net worth, your house, your stocks, your business, your cars, your coins, whatever you have, unless it's specifically deemed exempt under the law, which most of these proposals don't exempt anything, right? So it's all of these things that are added in. And then you pay the percentage value of those assets at the end of the year every single year.

[00:17:51] So it's massively complicated in the sense that the vast majority of people, Merrill, to the extent that they have a small business, well, there's no way to effectively value that business if it's not publicly traded stock, how do you value it? If it's not an asset that's been sold, how do you value it, right? And so people think they know what their houses are worth, okay, fine. Put your house on the market and see what you actually get for it, right? That's the difference between the asking price and the sale price.

[00:18:21] Those are always two different things in the marketplace, no matter what kind of asset we're talking about. So that adds massive complication and, of course, administrative cost. Because right now, one of the most litigated issues in the United States as far as federal tax is concerned is the value of assets for estate tax purposes. Because the IRS looks at an asset. They look at your house, Merrill, and they say, well, gee, we think your house is worth $25 million. And you say, well, wait a minute.

[00:18:50] The county has got my house valued at $550,000. You think it's worth $25 million? All right, and so there's the debate, right? That's the dispute. The IRS says one thing. You say another. And these are fights that are going on all the time. And I'll tell you, when these wealth taxes are imposed, if these wealth taxes are imposed, the courts are going to be flooded with these kind of cases. And, you know, if I have a stock that's worth $1,000, let's say, at the end of the year,

[00:19:16] but by the middle of the year it's down to $500, which can happen, are they taxing me on the $1,000 at the end of the year? Are they taking into consideration I lost half the value of that? How does that work? Well, you just put your finger on the problem. You've got massive fluctuations in the marketplace, not just stocks but businesses and homes as well. And homes don't fluctuate like stocks do. That's true. But in certain areas of the country, you can see that radical fluctuation.

[00:19:47] And we most certainly saw that fluctuation during the residential real estate crisis in 2010, 2011, 2012, those, you know, what are we talking, 15 years ago here now. We all experienced that. Texas got hit hard. Florida got hit hard. Minnesota got hit hard. Some states not as hard as others. But all of them saw that significant decline in real estate values. And what happens under the estate tax is you've got to value your assets as of the end of the year. So you might have a stock just like you said.

[00:20:16] You might have a stock that's worth $1,000 a share on December 31st, and by January 5th it's worth half that. Well, guess what? You don't get to go back and amend your estate tax or your wealth tax return and claim the adjustment that the market imposed on your stock five days later. My guest for this hour is Dan Pilla. He is a tax expert. Been providing information to point-of-view listeners now, I think, for nearly 40 years.

[00:20:45] Dan, you go back a ways on that. He also does consultation, does tax litigation, and specializes in small business as well. And, Dan, have you still got your small business book available? Oh, yeah, absolutely. Dan Pilla's Small Business Tax Guide is available on my website, TaxHelpOnline.com. When we come back, we're going to ask him some more questions about some of the taxes that are coming up and what's being proposed. And also, we'll take your calls.

[00:21:11] If you'd like to give us a call and ask Dan a question, 1-800-351-1212. 1-800-351-1212. If you have a question about taxes, Dan is the man to come to to give you that answer. Stay with us. We'll be right back. It almost seems like we live in a different world from many people in positions of authority.

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[00:22:54] You are listening to point of view. The opinions expressed on point of view do not necessarily reflect the views of the management or staff of this station. And now, here again, Dr. Merrill Matthews. And the call is 1-800-351-1212.

[00:23:21] If you have questions for tax expert Dan Pilla, 1-800-351-1212. And, Dan, are there other tax increase proposals out there at the state or federal level that you're looking at that have you concerned? Well, the Bernie Sanders plan, he's calling that a tax increase proposal. What that is is actual outright confiscation of private property. Oh, yeah.

[00:23:46] That's his proposal, Bernie, to confiscate the stock, 50% of the stock of AI companies in the United States. And so his plan would – his plan, Merrill, would require AI companies to transfer to the United States government

[00:24:07] 50% of the outstanding shares of its company so that the United States government became owners and voting right shareholders in AI companies so that the United States government would be siphoning off 50% of the profits of the AI companies in America. He's calling that a tax. Now, President Trump is touting that he's got some companies that are going to give the federal government,

[00:24:37] I think, like a 10% share of their revenue or their profits or something of that nature. Are those sort of in the same – even though the magnitude is different, are they kind of the same thing? Well, the end result is the same. The federal government becomes direct owners of private enterprise, which I think is just fundamentally illegal and unconstitutional. The means is different. President Trump is not proposing to confiscate the stock of these various companies,

[00:25:05] whereas Bernie Sanders' plan is a plan to outright confiscate the stock. The law would impose a tax that is equal to 50% of the outstanding shares of the company, and the only way the company can satisfy the payment of that liability is not by writing a check. They've got to turn over the stock. And so that's the difference. But there are no circumstances. And, Merrill, I'd like your response to this, too.

[00:25:30] From an economic standpoint, what that does is create socialism, right, where the capacity – the productive capacity of enterprise is transferred to the state. That's just a classic socialist model. All right? And so we can't have any of that. I don't care how the state gets control of it, whether they go out there and purchase it with taxpayer money,

[00:25:55] or they confiscate it like Bernie Sanders wants to do, or they are persuaded to contribute it to the government like apparently Trump is trying to persuade them to do. One way or the other, transfer of production is put into the hands of the government, which is exactly the wrong move. You know, the Chinese have what we call state-owned enterprises, and the Chinese don't necessarily own all of those enterprises,

[00:26:22] but they have a big stake in an awful lot of businesses there in China. And we've been fairly critical of it, so I'm reluctant to move in that direction. Well, yeah, I think it's a fundamental mistake because – I mean, let's just look at the AI plan here for just a second. You know, the proposal is supported by Sanders because he says, well, these AI companies have become so economically significant in the marketplace

[00:26:50] that the government should have ownership interest through them. Well, okay, fine. So artificial intelligence has become economically important, systematically or systemically significant. What prevents the next Congress and president from applying the same reasoning to, let's say, pharmaceutical companies or energy producers or home builders or financial institutions or insurance providers or food producers or biotech firms?

[00:27:16] I mean, all of these have systemic significance in our economy. You know, imagine auto production, for example. If that just went away tomorrow, what a crushing blow that would be on the economy of the United States. And what is more important than food and medical care, Merrill, in terms of economic importance? Why shouldn't, under Sanders' theory, why shouldn't the government own and control all of those enterprises? And, of course, he would answer the question by saying they should.

[00:27:44] The government should control all of those. What are your thoughts about the Department of Justice agreement to drop any pending tax claims against the Trump family? There's been virtually every Democrat pushback against that, some Republicans as well. On the other hand, there's been a while back, there was somebody at the IRS released the Trump tax forms that they were not supposed to release. What are your thoughts about what's happening there?

[00:28:12] Well, first of all, I did not like the idea of the president suing the IRS because of this irreconcilable conflict of interest. All right, you've got the president of the United States who is responsible to oversee the Justice Department and the Department of Treasury. And then this president, in his individual capacity, along with his family and business, sues the United States government. Right?

[00:28:36] And the agencies of government that are responsible to defend that lawsuit are the agencies over which he has complete supervisory control. That is an irreconcilable conflict of interest. There's no way to balance that out. And so the lawsuit never should have been brought. It should have been dismissed probably because of that conflict of interest, but they never got to that point.

[00:28:59] And this settlement, you know, I don't know how you can have a settlement like this that's not court approved, for one thing. And here's the other thing, though. On the other side of the coin, all right, I'm going to speak out of both sides of my mouth here for just a second. On the other side of the coin, Merrill, all of the claims connected with the lawsuit were – well, the claims were related to the unauthorized disclosure of his private information.

[00:29:27] Connected with tax years that are very old years. And I got three words for that. Statute of limitations. And so I'm not sure what significance the so-called immunity deal has because all of these years are so old anyway. They would all be – there's only a six-year statute of limitations on criminal. There's a three-year statute of limitations on civil. In some cases, the civil statute of limitations can go from three years to six years.

[00:29:57] But in every situation, we're long past those as far as those tax years that were disclosed. So I'm not sure – I really am not sure what the significance is of the deal anyway. It doesn't look good, I can tell you that. It certainly didn't play well with anybody, especially the Democrats. But the Democrats don't like anything the president does, you know that. It would make a bit of difference what the settlement was. They would not have liked it. But there's an awful lot of things to wrinkle your nose at about that for sure.

[00:30:25] Is there anything that could have been done that would be appropriate and sort of – would pass the smell test, let's say? Well, what passed the smell test is the fact that the guy, Charles Littlejohn, that deliberately leaked all of the president's confidential information, he was prosecuted and put in jail, Merrill. That's the solution to the problem. That should have been the end of it.

[00:30:51] We are a little over halfway through this year, and we've got the tax time coming up at the end of the year. So what should families be thinking about as they're moving through this tax system or this tax season about what they should be prepared for and what they should be considering? Well, we don't have anything on the horizon here that's going to come anywhere close to the One Big Beautiful Bill Act that was passed here

[00:31:18] took effect in, what, January of 2025, which was basically the rewriting and reinstituting the Trump's initial tax proposal – or tax law, I should say, the Tax Cuts and Jobs Act that took effect in, I believe it was 2018. So we're not going to see anything like that. But I'll tell you what's going on in Congress right now that has me very excited, quite frankly, and that is the Taxpayer Assistance and Service Act.

[00:31:45] The Taxpayer Assistance and Service Act is a massive administrative reform system that's moving through, and it is not going to raise taxes by a nickel, all right, or it's not going to cut taxes by a nickel. It's not about that. It's about leveling the playing field between the IRS and the citizen when it comes to enforcement. So there are 10 different titles to this bill that relate to claims for refund in tax court jurisdiction and the ability to use collection due process appeals in collection situations.

[00:32:15] All of these things are going to relate directly to the individual's ability to do business with the IRS at an administrative level on a more solid and a more balanced playing field. And I'm really excited about that. And not only am I excited about the bill, it has got very, very broad bipartisan support. The Senate Finance Committee voted that bill out of committee last week, Merrill, get this, by a vote of 26 to 1.

[00:32:42] Can you imagine a tax bill coming out of Congress with that kind of bipartisan support? There was a provision of the Taxpayer Assistance and Service Act that came out of the House Committee on Ways and Means, and that was a unanimous vote, unanimous. And so, you know, you've got a lot of leftist Democrats on these committees. They all voted in favor of the bill. The only senator who voted against it was Elizabeth Warren.

[00:33:12] And, of course, she's as bad as they get when it comes to individual rights and private property and all the rest of that, as you well know. So, look, I'm excited about that. I've been writing about that. This thing has been in the hopper for about a year and a half, and it's now picking up speed, and I'm looking forward to that becoming law, in which case I will be doing an extensive amount of writing about it once it is. Good. Stay with us. We'll be back with our final segment with Dan Pilla.

[00:33:41] You're listening to Point of View, your listener-supported source for truth. Back with our final segment with Dan Pilla, tax expert.

[00:34:08] And, Dan, ten years ago, Republicans were all about tax simplification. I mean, I got behind this. Lots of people did. We wanted to have that tax simplification out there so that – and the notion was you will be able to fill out your taxes on a card and mail it in. And the Tax Cuts and Jobs Act was supposed to sort of do that. It didn't, but it was – they made a little progress that way.

[00:34:33] But it seems to me the – some of the things were making the tax system more complicated, not simpler for people to be able to fill out. Yeah, exactly right. And, you know, I spoke out against that so-called postcard system. You know, the Tax Cuts and Jobs Act is going to make the tax code like a postcard. And it simply did – and not only did it not make it like a postcard, Merrill, but because of the way it was structured,

[00:35:00] it actually added more forms to the tax return that people had to file in order to comply. And I just thought, my goodness, who's kidding who? This is not tax simplification. It's making it worse. The best measure of this, in my opinion, is what has happened with the sheer size of the tax code. In 2000, at the turn of the century, the tax code consisted of about 1.3 million words.

[00:35:26] Right now, 26 years later, we have over 4 million words, and the tax code was changed more than 6,000 times during that 25-year period of time. There is no possible way that anybody is ever going to convince me that the tax code has become simpler as a result of, quote-unquote, tax simplification. What they're doing is tinkering around the edges. They're making it more and more difficult to understand, more and more difficult to comply with.

[00:35:53] And that complexity allows for misperception about who is bearing the burden of taxation. When people see this confusing law, they easily buy the leftist nonsense that says rich people pay no taxes, that rich people are getting away with something, that rich people are using the loopholes and the hidden traps in the tax code to get away with something that Jane and Joe America can't get away with. And it's just simply not true.

[00:36:22] But people have no way to assimilate the truth and argue the truth. And the media, of course, never bothers to look at the truth. The fact of the matter is that high-income people, about top 10% of income earners in the United States, pay about 72% of all the income taxes. So it's not just that high-income people are paying most of the tax. They're paying darn near all the tax, Merrill. The bottom half pay just 3% of the federal income tax.

[00:36:49] The bottom half of workers in the country pay a total of about 3% of the federal income tax. Yep, that's exactly correct. And when any leftist politician or any politician, middle-of-the-road politician, makes the claim that rich people pay no taxes or they don't pay their fair share, nobody has the capacity to challenge that.

[00:37:13] And yet the data is so clear and so easy to find that it's amazing that more journalists don't dig this stuff up, but they don't bother. And, Dan, my concern about this is that the more complicated you make the tax forms, the tax system, the easier it is to cheat, the more loopholes you have to be able to slip around, and the more you force average people to say, I can't figure this out. I've got to go to a tax preparer like you.

[00:37:42] But you have to go and have somebody do that for you because it is so complicated. Yeah, that's exactly right. And there's another problem, too. And this is related to what you said, that it encourages people to cheat. And even people that are not inherently cheaters, and most Americans, of course, are not inherently cheaters. But what it does is it creates a lack of willingness to comply.

[00:38:08] Why should I comply with this law when there's other people out there that are taking advantage of loopholes that I can't find or I don't understand or I can't afford to have some hotshot lawyer figure it out for me? You know what? Forget it. I'm just not going to do this. And that is exactly the wrong message we need to send with any body of legislation, whether it's the tax code or the corporate governance or just go down the list.

[00:38:35] We have to have a willingness to comply in the minds of the citizens because, you know what? There's not enough police force out there, Merrill. There's not enough IRS people out there to force everyone to file their tax returns and pay their taxes. And if they don't do it because of a recognition of a responsibility, then it's not going to get done. And so we've got to have a system that's easy to comply with, easy to understand,

[00:39:03] because that sends the message that everybody is, in fact, paying their fair share when it's simple to do it. Dan, you specialize in small business. Tell us what's happening in the small business tax world. Well, the small business tax world is much the same as it's been for the last six or eight years. Well, more like ten years now, given the Tax Cuts and Jobs Act that took effect in 2018.

[00:39:26] And so small businesses need to understand, Merrill, that they are now and have been a target of enforcement for the IRS because the IRS believes that small businesses cheat on their tax returns virtually across the board, not by overstating deductions necessarily, but by underreporting income. But even at that, small businesses have a plethora of deductions that they're able to claim.

[00:39:53] Any expense that's incurred for the purposes of earning income is deductible on a small business tax return. And so that means mileage, advertising, you know, your Internet costs, all these various things that are necessary for businesses to function effectively in our marketplace today. These are deductible expenses, and you have to have the proper records. And that's where my book, Dan Peele's Small Business Tax Guide, becomes so important

[00:40:18] because it helps you understand all of the nuances of these laws with respect to small business. Now, if I remember right, you have a special for people who contact you about that and want to know more about their taxes. Yeah, that's exactly right, Merrill. You buy any book off my website at any price point, and this includes especially the Small Business Tax Guide, you get a free 15-minute consultation directly and personally with me. And how do they find that book online? Taxhelponline.com.

[00:40:47] It's all one word. Taxhelponline.com takes you right to my website. Dan, we don't have much time left, but give me your sense of are new taxes going to be coming down the road here soon? Well, there always are, Merrill, and it just remains to be seen as to exactly what they would be. But I would very strongly encourage point-of-view listeners to contact your senator and your representatives and ask them to support the Taxpayer Assistance and Service Act.

[00:41:17] It's a very important piece of legislation that's going to help every American taxpayer. You've said it is passed through two committees, the Senate and the House. Is that right? And it goes to the floor now? Yeah, it's passed through the Senate Finance Committee and is going to the floor to the Senate. A version of it has gone through the House. That needs to be redone. But it is moving forward. The Taxpayer Assistance and Service Act. Contact your senators and your representative and ask them to support it. Do you have anything about that on your website?

[00:41:47] Yeah, my newsletters for the last probably, well, the last 16 months have been covering this. So I talk about it in detail in my newsletter, which is available on my website. Do you have a new book coming out soon? I am not working on a book at the moment, Merrill, but I will be rewriting some things here shortly. I'll tell you what I'm going to be doing as soon as this Taxpayer Assistance and Service Act passes. I'm going to do a detailed analysis that is going to be pretty thorough. Oh, good. We'll be looking forward to that.

[00:42:17] I'd encourage our listeners to reach out to Dan Pilla. If you have tax questions, you can reach out to him. Dan, thank you so much for joining us. My pleasure, Merrill. Thanks for having me. We've had Dan on many times over the years, and he is a fount of knowledge on tax information. You can't ask him something he doesn't know out there. So I'd encourage you to take a look at his website. You can also find two of his latest articles on our website, pointofview.net.

[00:42:44] If you go there, I encourage you to hit that donate button and give a donation to Point of View because we exist on your funds. We want to thank Megan for joining us, doing the engineering. Derek for doing the producing. Liberty McCarter is back with Weekend Edition with me along with Aaron Smith from First Liberty. So come back and join us again tomorrow on Point of View.

[00:43:14] In 19th century London, two towering historical figures did battle, not with guns and bombs, but words and ideas. London was home to Karl Marx, the father of communism, and legendary Baptist preacher Charles Spurgeon. London was in many ways the center of the world, economically, militarily, and intellectually. Marx sought to destroy religion, the family, and everything the Bible supports.

[00:43:43] Spurgeon stood against him, warning of socialism's dangers. Spurgeon understood Christianity is not just religious truth. It is truth for all of life. Where do you find men with that kind of wisdom to stand against darkness today? Get the light you need on today's most pressing issues delivered to your inbox when you sign up for the Viewpoints commentary at pointofview.net slash signup.

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