A Flawed Legal Information System: The U.S. Tax Code

The National Taxpayer Advocate's 2008 Annual Report to Congress characterizes the "complexity of the Internal Revenue Code" as "[t]he most serious problem facing taxpayers."  The report asserts that the Tax Code now contains 3.7 million words, that Congress amends the code at a rate of more than 1 amendment per day,  and that filing takes 7.6 billion hours per year.  The report estimates compliance costs for 2006 at $193 billion, or "14 percent of aggregate income tax receipts," and claims that "[i]f tax compliance were an industry, it would be one of the largest in the United States."  The solution, according to the report, "is to simplify the tax code enormously."  Among several specific proposed remedies, the report recommends eliminating the alternative minimum tax for individuals and simplifying family status provisions and and education and retirement savings tax incentives. [Robert C. Richards, Jr.]