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Thx to Forbes:

It’s Tax Day, and many of you are probably rushing to complete your returns before the filing deadline. At Slate, Matt Yglesias points out that this process doesn’t have to be so difficult. The IRS has much of the information they need to fill out your tax return, so why don’t they just send you a partly or fully completed return for your review? Indeed, such a system has been proposed federally and adopted in at least one state (in California, it’s called ReadyReturn) but Congress has refused to move forward.

 

Yglesias focuses on a public choice problem—tax filers are made a little bit better off by this policy, but tax preparers are made a lot worse off, so they lobby to block ReadyReturn and similar programs. He also notes that some conservatives oppose pre-filled returns on the grounds that they might reduce public opposition to income taxes.

But I have a separate concern about ReadyReturn—what if it undermines tax compliance?

The key feature of the income tax that encourages compliance is two-party reporting. You send the IRS a Form 1040, and the people who paid you during the year send Forms 1099, W-2 and the like. If you lie about your income, the figures reported by your employers and clients will expose you.

But what if, when filing your return, you already know that one of your clients has failed to report what he paid you? In a ReadyReturn system, the government has to lay its cards on the table—before the taxpayer files, he knows exactly what the government knows about his earnings, and what it doesn’t know.

Today, if a taxpayer doesn’t get a 1099 form that he’s expecting, he probably asks his client where it is—he doesn’t want the IRS to get a copy of a form that he doesn’t have.  But with the knowledge that the IRS never got a copy, either, he might just go ahead and underreport his income. An “oopsie” defense would likely work just fine for omitted 1099s that later came to light, so long as they did not amount to a substantial underreporting of income (that is, 10 percent or $5,000, whichever is less). After all, you didn’t prepare your taxes—the IRS did.

It’s a lot like when you check out of a hotel and review your bill. If you notice the hotel charged you for an extra night of parking, you’ll complain and get the charge taken off. But let’s say you notice that they’ve accidentally omitted to charge you for one night of parking. Do you call the clerk’s attention and ask for a parking charge to be added? Be honest.

Maybe this wouldn’t be that big a problem because there aren’t that many payer-side reporting errors. Or maybe the reduction in tax compliance costs from ReadyReturn would outweigh any increase in tax evasion. But I do worry that ReadyReturn would, at least to some degree, undermine the advantages of two-party reporting and increase the tax gap.

According to dailymail.co.uk

Google executive chairman Eric Schmidtt is said to be heading for a divorce costing up to $1.5billion – the second most expensive in history.

According to the New York Post the Google executive chairman is planning to sell 2.4million of his shares in the company to help pay for his split with wife Wendy as he continues a year and half long liaison with Manhattan beauty Lisa Shields.

 Costly split: Chairman of Google Eric Schmidt and his wife Wendy Schmidt are set to have the second most expensive divorce in history

Schmidt is looking towards a ‘transition and an amicable separation and settlement’ with the mother of his two children, but needs the extra cash to pay for it according to the New York Post.

If it all goes to his wife it would mean Schmidt, the 136th richest man in the world, would be giving away a quarter of his $6.2billion fortune to Wendy, to whom he has been married for 13 years.

During that time, Schmidt has overseen Google as it has become one of the biggest companies on Earth with annual profits of $9.7billion.

Filings last week showed that the 56-year-old intends to diversify his investments by selling the  Google stocks.

A source said: ‘There are many reasons why he’s selling shares, mostly business reasons, but he’s also working towards a transition and an amicable separation and settlement with his wife.

‘They are both very private, so they’re quietly dividing up assets without drawing attention.

‘There’s been no paperwork filed.’

 Mistress: Schmidt and Lisa Shields, 46, who is the Council on Foreign Relations executive, have been dating for a year-and-a-half though are rarely seen together

If the divorce goes through then Schmidt’s property empire would be among the assets up for division including his $20million mansion with four acres of land in Montecito, California he bought from U.S. TV show host Ellen Degeneres in 2007.

The site has landscaped gardens, a tennis court, a swimming pool and spa, a 5,000 square foot main house with four bedrooms and six bathrooms.

Millions of viewers were treated to an inside look at the Montecito property when Kim Kardashian rented it for her wedding last year.

Schmidt also has a mansion home in Nantucket in Massachusetts where he and his wife used to spend their summers in addition to a home in Atherton, near Google’s Silicon Valley headquarters.

Schmidt’s home in Atherton is worth $3.7million and has five bedrooms and three-and-a-half bathrooms covering a total of 4,840 sq ft. The neighbours include actress Shirley Temple and Grateful Dead singer Bob Weir.

Schmidt also owns the 195-foot super yacht Oasis which he bought for $72.3million.

The boat its said to be one of the ‘highest spec yachts ever built’ with its own pool and gym that can be converted into a disco.

An aerial view of Schmidt’s $20million Montecito mansion last August as it was being set up for Kim Kardashian’s wedding

 Schmidt paid a reported $72million for the 195-foot megayacht Oasis, pictured here

The divorce would also shed a light on the exact nature of Schmidt’s marriage, which has been the subject of speculation for years.

 Schmidt’s current girlfriend is Council on Foreign Relations executive Lisa Shields, 46, who he has been seeing for a year-and-a-half.

The two were seen together last summer in the Hamptons and he has bought her a Dutch Warmblood show-jumping horse as a token of his affection.

Schmidt and Shields were seen cruising on Oasis in the Caribbean and the South of France last summer.

Shields, a divorced mother, used to be a producer at ABC News and was linked to Andrew Cuomo shortly before he began dating Sandra Lee.

Read more: http://www.dailymail.co.uk/news/article-2105394/Is-Google-chief-Eric-Schmidt-selling-1-5billion-shares-fund-divorce.html#ixzz1naUbUU81