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FRENZY OF FOOLISHNESS

December 17, 2007

As the Congressional year winds down, our elected representatives are working feverishly to do as much damage as possible in the short time allowed. The Senate did its part with a typically awful farm bill and a bill for the benefit of mortgage deadbeats.

Both bills have to be reconciled with differing House bills, so I won't wade into the details right now. Still, having recently ranted about the foolish policy generated by the "pay-as-you-go" budget rules, I can't help noting this from the Tax Analysts coverage of the deadbeat bill ($link):

To comply with five-year "pay as you go" budget rules, the legislation would increase by 1.5 percentage points the corporate estimated tax payments due for corporations with assets of at least $1 billion for payments due in July, August, and September of 2012.

So the provision is "paid for" by accelerating estimated taxes from the first three months after the end of the current "budget window," as if it were real new revenue. And these people criticize private-sector accounting practices.

I think I'm going to adopt a personal 5-week pay-as-you-go budget window. That means anything I don't have to pay in the next five weeks doesn't count as an expense. Time to buy that Ferrari! Hey, it's just what Congress does, only with a smaller window.

The TaxProf has rounded up coverage of the mortgage bill.

Tags: tax policy.TaxProf.