Thank you Chairman Boustany and Ranking Member Neal for the opportunity to talk with you today about the need for taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. reform.
There are many reasons to reform our tax code, but the cost of tax complexity to our nation’s economy should be near the top of that list.
Over the last century, the federal tax code has expanded dramatically in size and scope. In 1955, the Internal Revenue Code stood at 409,000 words in length. Since then, it has grown to a total of 2.4 million words: almost six times as long as it was in 1955 and almost twice as long as in 1985.
However, the tax statutes passed by Congress are only the tip of the iceberg when it comes to tax complexity. There are roughly 7.7 million words of tax regulations, promulgated by the IRS over the last century, which clarify how the U.S. tax statutes work in practice. On top of that, there are almost 60,000 pages of tax-related case law, which are indispensable for accountants and tax lawyers trying to figure out how much their clients actually owe.
Tax complexity creates real costs for American households and businesses, starting with just the time it takes us to comply with the tax code. According to the latest estimates on Reginfo.gov, Americans spend over 8.9 billion hours complying with IRS tax filing requirements, equal to nearly 4.3 million full-time workers doing nothing but tax return paperwork. To put that in perspective, 4.3 million is greater than the populations of 24 U.S. states.
Put in dollar terms, those 8.9 billion hours add up to more than $400 billion each year in lost productivity, or greater than the gross state product of 36 states.
Tax complexity, and the fear of making mistakes, motivates about 62 percent of all taxpayers to use tax return preparers, but the percentage climbs to about 73 percent for the poorest Americans claiming the EITC.
But tax complexity creates other costs besides our lost time. Many of the most complex features of the tax code distort individual and business behavior in numerous ways that leads to long-run economic harm. And we can measure that economic harm using the Tax Foundation’s Taxes and Growth (TAG) Macroeconomic Tax Model.
To illustrate the tax code’s harmful economic effects, I’ve selected a number of examples from the Tax Foundation’s forthcoming Options for Reforming America’s Tax Code. The Options book will contain nearly 100 specific policy changes to the individual and corporate tax code that have been scored with the TAG model. Each “Option” will include an estimate of the policy’s economic effects (such as on GDP, wages, and jobs), revenue effects (measured conventionally and dynamically), and the distributional effects (also measured conventionally and dynamically).
The Individual Income TaxAn individual income tax (or personal income tax) is levied on the wages, salaries, investments, or other forms of income an individual or household earns. The U.S. imposes a progressive income tax where rates increase with income. The Federal Income Tax was established in 1913 with the ratification of the 16th Amendment. Though barely 100 years old, individual income taxes are the largest source of tax revenue in the U.S.
I’ll begin with the individual income tax code, which is filled with dozens of credits, deductions, limitations, and other special provisions that make life more complex for American taxpayers.
Much of the complexity in our individual tax code results from our attempts to make the system progressive, ensuring that as taxpayers’ income rise, so too does their tax liability. Over the decades, lawmakers have attempted numerous ways of making the tax system progressive, either overtly with graduated tax brackets, or more subtlety through phaseouts and claw-backs. As we will see, there is a real tradeoff between progressivity and economic growth.
Graduated Tax Rates
Before the 1986 Tax Reform Act, a married couple was faced with 15 separate tax brackets as high as 50 percent. During the 1970s, those couples faced as many as 26 brackets as high as 70 percent. A taxpayer claiming Head of Household status faced 34 brackets as high as 70 percent.
Today, the tax code has seven brackets, with rates of 10, 15, 25, 28, 33, 35, and 39.6 percent. In many ways, multiple graduated tax rates make no sense because progressivity can be accomplished with as few as two rates—zero and, say, 10 percent, for example. Obviously, those paying at the 10 percent rate would pay a greater share of their income in taxes than those paying at the zero rate.
Adding rates and brackets beyond the first one simply becomes punitive because we know that marginal tax rates matter. When the “tax price” of earning the next dollar of income gets too high, people will stop working to earn that extra dollar or begin to engage in unproductive tax avoidance measures. Economists have referred to these high progressive taxA progressive tax is one where the average tax burden increases with income. High-income families pay a disproportionate share of the tax burden, while low- and middle-income taxpayers shoulder a relatively small tax burden. rates as “success taxes.”
To illustrate the economic harm caused by the current progressive tax bracketA tax bracket is the range of incomes taxed at given rates, which typically differ depending on filing status. In a progressive individual or corporate income tax system, rates rise as income increases. There are seven federal individual income tax brackets; the federal corporate income tax system is flat. structure, we used the TAG model to simulate the economic effects of an income tax with three brackets of 10, 25, and 35 percent. When we compare the economic performance of the new bracket structure to the baseline economic levels, the model estimates that the current bracket structure is effectively reducing GDP by 1.4 percent, incomes by 3 percent, and eliminating the equivalent of more than 1.1 million full-time jobs.
PEP and Pease
Recognizing that statutory marginal tax rates matter, lawmakers have often turned instead to backdoor efforts to raise additional taxes from higher-income households. Two particular tax code provisions stand out as overly complex attempts to increase taxes on the wealthy: the Pease limitation on itemized deductions and the personal exemption phaseout (PEP).
The Pease limitation on itemized deductions reduces the value of a taxpayer’s itemized deductions by three cents for every additional dollar of income earned. While the Pease limitation is framed as a limit on itemized deductions, it actually resembles a marginal surtaxA surtax is an additional tax levied on top of an already existing business or individual tax and can have a flat or progressive rate structure. Surtaxes are typically enacted to fund a specific program or initiative, whereas revenue from broader-based taxes, like the individual income tax, typically cover a multitude of programs and services. on high-income taxpayers, with a top rate of 1.188 percent. The TAG model indicates that maintaining the Pease limitation reduces long-run GDP by 0.3 percent and costs the equivalent of 187,000 full-time jobs.
Similarly, PEP reduces the value of the personal exemption for upper-middle income households. Because each additional dollar that these households earn leads to a smaller personal exemption, PEP is essentially equivalent to a marginal surtax of at least 1 percent. The TAG model simulation indicates that PEP reduces long-run GDP by 0.1 percent, and costs the economy the equivalent of 87,000 full-time jobs.
The Earned Income Tax CreditA tax credit is a provision that reduces a taxpayer’s final tax bill, dollar-for-dollar. A tax credit differs from deductions and exemptions, which reduce taxable income, rather than the taxpayer’s tax bill directly.
At the other end of the spectrum, lawmakers’ well-intended attempts to use tax policy to help the working poor has not only added vast complexity, but unintentionally added features that can discourage poor people from working more as their incomes rise. A good example is the way in which the Earned Income Tax Credit phases out as a worker’s income increases. Consider this another hidden success tax.
The EITC calculation formula includes four phase-in rates, four phase-out rates, and different calculations based on filing status and number of children. It is no surprise that Americans made 219,122 math errors when calculating the EITC in 2014, or that the credit had an improper payment rate of between 22 and 26 percent in 2013.
The complex structure of the EITC has the ironic effect of encouraging more work as the subsidy phases in, but then it discourages work effort as the subsidy phases out by levying high marginal tax rates on households just over the poverty line. When a married household with two children begins to earn more than $23,630, the EITC starts to phase out at a rate of 21.06 percent. This high phase-out rate has the perverse effect of penalizing a worker for every dollar they earn above the poverty line, thus discouraging that extra work effort.
We can measure the macroeconomic cost of this phase-out penalty by substituting a different phase-out rate. For example, substituting a uniform 10 percent phase-out rate for the current 21.06 percent phase-out rate reduces the penalizing marginal tax rateThe marginal tax rate is the amount of additional tax paid for every additional dollar earned as income. The average tax rate is the total tax paid divided by total income earned. A 10 percent marginal tax rate means that 10 cents of every next dollar earned would be taken as tax. effect on working households. When we compare the economic effects of these two systems, the TAG model finds that the current system reduces long-run GDP by 0.1 percent, lowers the after-tax incomes of the working poor by more than 1 percent, and costs the equivalent of 164,000 full-time jobs.
For middle-income households, one of the most complex areas of the tax code is itemized deductions. Only 30 percent of taxpayers choose to itemize their deductions, but it is likely that many other households devote significant time and energy determining whether it would be advantageous or not to itemize.
Deductions also narrow the tax baseThe tax base is the total amount of income, property, assets, consumption, transactions, or other economic activity subject to taxation by a tax authority. A narrow tax base is non-neutral and inefficient. A broad tax base reduces tax administration costs and allows more revenue to be raised at lower rates. which, in turn, often requires higher tax rates to raise a comparable amount of revenues as would a broader base with lower rates.
Certainly, one way to simplify the tax code and broaden the tax base is to simply eliminate many of these itemized deductions. However, eliminating itemized deductions alone could actually produce harmful macroeconomic effects, as this would bump some taxpayers into higher brackets, increasing their marginal tax rates, and discouraging work and investment.
For example, the TAG model indicates that the marginal rate effects of simply eliminating all itemized deductions except for the charitable and mortgage interest deductions would lead to a long-term reduction in GDP of 0.4 percent and the loss of 290,000 full-time equivalent jobs.
Swap itemized deductions for lower rates. However, there are significant economic benefits to lowering tax rates while broadening the tax base. For example, if the additional revenue from eliminating those same itemized deductions were then used to cut every income tax rate by 10 percent, this would increase long-run GDP by 0.6 percent and create 577,000 full-time equivalent jobs. These gains represent the true cost of our current narrow tax base combined with high tax rates.
Double the standard deductionThe standard deduction reduces a taxpayer’s taxable income by a set amount determined by the government. It was nearly doubled for all classes of filers by the 2017 Tax Cuts and Jobs Act (TCJA) as an incentive for taxpayers not to itemize deductions when filing their federal income taxes. . Another way of simplifying the tax code while reducing reliance on itemized deductions is to expand the standard deduction. A larger standard deduction would mean that fewer taxpayers would feel the need to keep detailed records of their expenses and fill out Schedule A.
A larger standard deduction could be economically beneficial, by bumping many households into lower marginal rates. The TAG model shows that doubling the standard deduction for all households would increase long-run GDP by 0.5 percent and create 463,000 full-time equivalent jobs.
Estate and Gift Taxes
Another unduly complicated area of the tax code aimed at stemming income inequality is the federal estate and gift taxA gift tax is a tax on the transfer of property by a living individual, without payment or a valuable exchange in return. The donor, not the recipient of the gift, is typically liable for the tax. . Albeit a minor source of federal revenues—it collected $19 billion in 2014, just 0.6 percent of federal receipts—it has outsized economic effects because it strongly depresses capital formation relative to the modest amount it collects. We estimated that just the costs associated with complying with the estate taxAn estate tax is imposed on the net value of an individual’s taxable estate, after any exclusions or credits, at the time of death. The tax is paid by the estate itself before assets are distributed to heirs. now exceed the revenue it generates.
Advocates say that it impacts very few estates since the first $5.45 million of gifts and bequests is excluded from tax, and the amount is indexed for inflationInflation is when the general price of goods and services increases across the economy, reducing the purchasing power of a currency and the value of certain assets. The same paycheck covers less goods, services, and bills. It is sometimes referred to as a “hidden tax,” as it leaves taxpayers less well-off due to higher costs and “bracket creep,” while increasing the government’s spending power. . Thus, they say, it has minimal economic effect. However, many economists say that by making it harder to pass family businesses and farms to the next generation, the estate tax is yet another “success tax.”
The TAG model finds that the federal estate and gift tax depresses the long-run level of GDP by 0.8 percent, lowers wages by 0.7 percent, and costs 159,000 full-time equivalent jobs.
Business Income Taxes
It is now well known that the U.S. has the highest corporate income taxA corporate income tax (CIT) is levied by federal and state governments on business profits. Many companies are not subject to the CIT because they are taxed as pass-through businesses, with income reportable under the individual income tax. among the leading industrialized nations. Indeed, Tax Foundation economists determined that the U.S. has the third highest corporate income tax among the 165 nations we surveyed. Only Chad and the United Arab Emirates levied a higher corporate tax rate than the U.S.
Economists at the OECD determined that the corporate income tax is the most harmful tax a nation can impose because capital is the most mobile factor in the economy and, thus, the most sensitive to taxation. Individual income taxes were found to be second-most harmful, followed by sales taxes, and then property taxes.
One way of measuring the economic costs of our high corporate tax rate is simply to lower the rate in our TAG model. For example, the model shows that cutting the corporate tax rate to 25 percent from 35 percent (with no offsets) would boost the long-term level of GDP by 2.3 percent, increase wages by 1.9 percent, and create 443,000 full-time equivalent jobs. These potential gains represent the economic cost of our uncompetitive corporate tax rate.
Aside from our uncompetitive corporate tax rate, there are many complex elements of the corporate code that have harmful effects too. We can estimate those costs as well.
Cost RecoveryCost recovery is the ability of businesses to recover (deduct) the costs of their investments. It plays an important role in defining a business’ tax base and can impact investment decisions. When businesses cannot fully deduct capital expenditures, they spend less on capital, which reduces worker’s productivity and wages.
Under the current tax code, when a business makes a capital investment, it is required to deduct the cost of that asset over time, following one of more than a dozen depreciationDepreciation is a measurement of the “useful life” of a business asset, such as machinery or a factory, to determine the multiyear period over which the cost of that asset can be deducted from taxable income. Instead of allowing businesses to deduct the cost of investments immediately (i.e., full expensing), depreciation requires deductions to be taken over time, reducing their value and discouraging investment. schedules. These schedules are essentially arbitrary, and the process of determining how to properly depreciate an asset is complex.
One tax code change that could make the tax code both less complex and more favorable to investment is moving to full expensingFull expensing allows businesses to immediately deduct the full cost of certain investments in new or improved technology, equipment, or buildings. It alleviates a bias in the tax code and incentivizes companies to invest more, which, in the long run, raises worker productivity, boosts wages, and creates more jobs. of capital investment. Allowing businesses to deduct the full cost of their investments immediately would encourage significantly higher investment levels and make hundreds of pages of tax code unnecessary.
According to the TAG model, full expensing would increase the long-run level of GDP by 5.4 percent, by growing the nation’s capital stock by 16 percent, increasing wages by 4.5 percent, and creating more than 1 million full-time equivalent jobs. Again, these potential gains illustrate the economic costs of our current depreciation schedule.
Dollar-for-dollar, full expensing is one of the most pro-growth tax simplifications that Congress could enact.
Another complex feature of the business tax code is that firms face significantly different tax regimes depending on their legal form. For instance, traditional C-corporations typically face a much higher marginal tax burden than partnerships because corporate income is taxed twice, first at the entity level at 35 percent, and then at the shareholder level when capital gains and dividends are taxed at rates as high as 24 percent. Partnership and S-corporation income is taxed only once when the profits are distributed to the owner.
Over the past few decades, there have been several notable proposals to equalize the tax treatment of all businesses, regardless of their legal form or financing method. This approach is known as corporate integration, and it would vastly simplify the taxation of U.S. businesses. Under corporate integration, companies would no longer have to spend time and resources determining what legal form to adopt or planning tax-efficient financing strategies.
Recently, the Tax Foundation modeled a version of corporate integration that would allow corporations to deduct dividends paid and would tax dividends received by individuals at ordinary income rates. By eliminating one layer of corporate tax, and greatly simplifying the business tax code, such a proposal would increase U.S. GDP by 2.9 percent over the long run, boost wages by 2.5 percent, and create 535,000 full-time equivalent jobs.
Business Tax Expenditures
There are roughly 80 so-called tax expenditures in the corporate tax code, with an annual budgetary value of more than $120 billion. It’s often thought that businesses and the economy would be better off if all of those tax breaks were eliminated in exchange for a lower corporate tax rate. However, our research indicates that lawmakers must be very selective if they chose to eliminate business tax expenditures in exchange for a lower tax rate, or they risk negating the economic benefits anticipated from the rate cut itself.
The reason for this is that a number of corporate tax provisions—such as accelerated depreciation and the expensing of research and development costs—help move the tax code towards a more neutral treatment of capital investment. Eliminating these cost-recovery provisions raises the cost of capital and, thus, neutralizes any of the economic benefits of a lower tax rate.
However, there are many other tax preferences—such as energy credits, or interest exclusions on bonds—that could be eliminated with minimal economic harm and provide revenue for overall rate cuts.
For instance, eliminating all business tax expenditures that are not connected to cost recovery would raise enough revenue to cut the overall corporate tax rate to 28 percent. This combination of rate cuts and base broadeningBase broadening is the expansion of the amount of economic activity subject to tax, usually by eliminating exemptions, exclusions, deductions, credits, and other preferences. Narrow tax bases are non-neutral, favoring one product or industry over another, and can undermine revenue stability. would increase the size of the U.S. economy by 1.4 percent in the long run and create 275,000 full-time equivalent jobs. Moreover, the new economic growth would actually increase federal revenues by more than $550 billion over a decade.
Perhaps the most complex aspect of the U.S. tax code is the treatment of income earned overseas. Under current law, U.S. multinational corporations are required to pay tax on their worldwide income. If a corporation earns profits in England, it is required to pay a 20 percent tax rate on those profits to Her Majesty’s Revenue and Customs. As long as that company keeps any residual profits overseas, it can defer the additional payment of U.S. tax. Once that corporation decides to bring those profits back to the United States, it is required to pay tax again to the U.S. government at 35 percent, minus a tax credit for the 20 percent paid to the U.K.
Major complexities arise for multinational corporations operating abroad. The foreign tax credit, which is intended to prevent double-taxation of foreign profits, is littered with rules and exceptions that can limit which taxes that businesses pay overseas can be credited against U.S. tax liability. In the past, the IRS has used these rules to deny foreign tax credits to multinational corporations. This leads businesses to go to court against the IRS, costing time and resources.
Most nations do not require this level of complexity. Instead, they have territorial tax systems, which only require domestic multinationals to pay tax to the countries in which they conduct their business. These systems make the foreign tax credit rules unnecessary and eliminate much of the complexities of our worldwide system.
Tax Foundation economists are currently developing an extension of our TAG model to measure the economic and revenue effects of moving to a territorial tax systemA territorial tax system for corporations, as opposed to a worldwide tax system, excludes profits multinational companies earn in foreign countries from their domestic tax base. As part of the 2017 Tax Cuts and Jobs Act (TCJA), the United States shifted from worldwide taxation towards territorial taxation. .
Lessons from Modeling Tax Reform Plans
Over the past year, Tax Foundation economists have gained special insights into what kind of tax policies boost investment, wages, jobs, and economic growth, and which policies lead to a reduction in those indicators.
Using our Taxes and Growth (TAG) Macroeconomic Tax Model, we have scored the tax plans of every presidential candidate, as well as numerous tax plans developed by members of the House and Senate. During this experience, we have modeled every conceivable tax reform plan, including the Flat TaxAn income tax is referred to as a “flat tax” when all taxable income is subject to the same tax rate, regardless of income level or assets. , FairTax, Bradford X-Tax, Value Added Tax (VAT), and numerous others that incorporate features of each of these.
To one degree or another, the more pro-growth of these plans incorporate many of the lessons that I’ve outlined in the first portion of this testimony: they reduce marginal tax rates; reduce taxes on capital; reduce or eliminate the double-taxation of savings and investment; and, move toward a neutral or consumption taxA consumption tax is typically levied on the purchase of goods or services and is paid directly or indirectly by the consumer in the form of retail sales taxes, excise taxes, tariffs, value-added taxes (VAT), or an income tax where all savings is tax-deductible. base.
Here are four examples:
Senator Ben Cardin’s Progressive Consumption Tax 
Senator Ben Cardin’s proposal would dramatically scale back the individual and corporate income taxes. Because the plan would exempt a couple’s first $100,000 of wages from the income tax, most people would no longer owe the individual income tax. Incomes above that amount would be subject to rates of 15, 25, and 28 percent. The corporate income tax rate would be cut to 17 percent.
The Cardin plan is intended to be revenue neutral. He would finance this with a value added tax, which he calls the Progressive Consumption Tax (PCT). Large rebates would make the overall package progressive.
At a PCT tax rate of 10 percent, the TAG model estimates that in the long run the plan would raise the level of GDP by 4.4 percent, increase the stock of capital used in production by 15.2 percent, and boost the number of full-time equivalent jobs by 1.1 million.
Ben Carson’s Flat Tax
During his presidential bid, Dr. Ben Carson proposed to replace the current federal income tax (both individual and corporate) with a Hall-Rabushka-style flat tax. The plan would tax all wage income and business income at 14.9 percent, but exempt taxes on capital gains, dividends, and interest income at the individual level.
Businesses would be allowed to fully expense capital investment, but would no longer be able to deduct interest expenses. The plan would also eliminate all itemized deductions and all tax credits except for the foreign tax credit. The plan would further expand the tax base by including fringe benefits, such as employer-provided health insurance.
Our analysis found that the plan would reduce federal revenues by $2.5 trillion over the next decade. However, it also would improve incentives to work and invest, which would increase GDP by 16 percent over the long term if the tax cuts were appropriately financed. This increase in GDP would translate into 10.9 percent higher wages and 5.2 million new full-time equivalent jobs.
The Lee-Rubio Tax Reform Plan
In March 2014, Senators Mike Lee and Marco Rubio introduced a comprehensive tax reform plan. While the plan has attracted a great deal of attention for its generous child tax credits, the structure of the plan incorporates the core planks of David Bradford’s “X-Tax,” or progressive consumption tax. The Lee-Rubio plan achieves this by cutting both corporate and pass-through businessA pass-through business is a sole proprietorship, partnership, or S corporation that is not subject to the corporate income tax; instead, this business reports its income on the individual income tax returns of the owners and is taxed at individual income tax rates. tax rates to 25 percent, moving to full expensing for all capital investment, eliminating the second layer of corporate taxation by repealing taxes on dividends and capital gains, and moving to a full territorial tax system. For individuals, the plan taxes wages at rates of 15 and 35 percent.
According to the Tax Policy Center, these measures reduce the marginal effective tax rate on new investment to zero. The Tax Foundation’s model estimates that the Rubio plan would boost the long-term level of GDP by roughly 15 percent, and the capital stock by 49 percent, which, in turn, would raise wages by 12.5 percent and create 2.7 million new full-time equivalent jobs. We also found that the plan would reduce federal tax revenues by $2.4 trillion over a decade.
The plan proposed by Senator Ted Cruz takes a different approach to get to nearly the same place as these other tax reform plans. The plan would replace the corporate income tax and all payroll taxes with a 16 percent “Business Flat Tax,” or VAT. This allows for the full expensing of all capital investment, but shifts the tax burden away from capital to labor. Cruz compensates workers for this shift by creating a single individual tax rate of 10 percent and expanding the EITC.
The Tax Foundation’s model estimates that the Cruz plan would boost the long-term level of GDP by 14 percent. This is slightly less growth than the Lee-Rubio plan because it does not eliminate the second layer of tax on corporate income. Still, the plan would increase the capital stock by 44 percent and wages by 12 percent. And because the 10 percent individual flat tax rate would encourage more people to enter the workforce, Cruz’s plan would create nearly 5 million full-time equivalent jobs. We also estimate the plan would reduce federal revenues by $758 billion over a decade.
A few years ago, the National Taxpayer Advocate named tax complexity the number one issue facing American taxpayers. In addition to robbing us of 8.9 billion hours of our lives complying with its Byzantine rules, our complex tax system punishes success and hard work, thus, robbing the economy of its ability to create jobs and better living standards.
Using the Tax Foundation’s Taxes and Growth (TAG) Macroeconomic Tax Model, we are able to measure and quantify the cost of complex tax provisions on GDP, investment, and jobs. We find that the complexity caused by measures designed to make the tax code more progressive shrink the economy and kill jobs. We find that the complexity caused by tax policies to help the poor can discourage work and shrink wages. We find that the extremely complex corporate income tax—from its high rate, badly designed cost recovery systems, and twin layers of taxation—leads to less investment, fewer jobs, and a smaller economy.
Finally, by scoring a wide variety of tax reform plans with our TAG model, we learned that there are many valid ways of ridding the tax code of its worst parts and creating a tax system that boosts economic growth, creates jobs, and lifts living standards.
I hope that the members of this committee, as well as your fellow lawmakers, take these lessons to heart and start us down the road to fundamental tax reform soon.
Thank you for your time. I welcome any questions that you may have.
 Authors calculations: See the appendix for details.
 National Taxpayer Advocate, Report to Congress: Fiscal 2010 Objectives, June 30, 2009, p. xxii. http://www.irs.gov/pub/irs-utl/fy2010_objectivesreport.pdf
 Gentry, William H. & R. Glenn Hubbard (2004). Success Taxes, Entrepreneurial Entry and Innovation, NBER Working Paper No. w10551.
 Internal Revenue Service, Data Book, 2015, https://www.irs.gov/pub/irs-soi/15databk.pdf; Treasury Inspector General for Tax Administration, The Internal Revenue Service Fiscal Year 2013 Improper Payment Reporting Continues to Not Comply With the Improper Payments Elimination and Recovery Act, 2014, https://www.treasury.gov/tigta/auditreports/2014reports/201440027fr.pdf
 For this example, it was necessary to eliminate the AMT because the loss of so many itemized deductions threw many taxpayers into the AMT.
 Scott A. Hodge, “The Challenges of Corporate-Only Revenue Neutral Tax Reform,” Tax Foundation Fiscal Fact No. 471, June 18, 2015.
 These scores can be found at: https://taxfoundation.org/blog/comparison-presidential-tax-plans-and-their-economic-effects
 Michael Schuyler, “An Analysis of Senator Cardin’s Progressive Consumption Tax,” Tax Foundation Fiscal Fact No. 473, July 8, 2015. https://taxfoundation.org/article/analysis-senator-cardin-s-progressive-consumption-tax
 Kyle Pomerleau, “Details and Analysis of Dr. Ben Carson’s Tax Plan,” Tax Foundation Fiscal Fact No. 493, January 6, 2016. https://taxfoundation.org/article/details-and-analysis-dr-ben-carson-s-tax-plan
 Michael Schuyler and Will McBride, “The Economic Effects of the Rubio-Lee Tax Reform Plan,” Tax Foundation Fiscal Fact No. 457, March 9, 2015. https://taxfoundation.org/article/economic-effects-rubio-lee-tax-reform-plan
 The corporate side of the Lee-Rubio plan shares many similar components to the Nunes tax plan. https://taxfoundation.org/article/updated-details-and-analysis-nunes-plan-reform-business-taxation
 Kyle Pomerleau and Michael Schuyler, “Details and Analysis of Senator Ted Cruz’s Tax Plan,” Tax Foundation Fiscal Fact No. 489, October 29, 2015. https://taxfoundation.org/article/details-and-analysis-senator-ted-cruz-s-tax-plan
 Rand Paul’s tax plan was very similar to Cruz’s plan. See: Andrew Lundeen and Michael Schuyler, “The Economic Effects of Rand Paul’s Tax Reform Plan, Tax Foundation Blog, June 18, 2015. https://taxfoundation.org/blog/economic-effects-rand-paul-s-tax-reform-plan