The US tax system is really screwed up. I technically work for an accountant (computer biz I work for is a side company of his), but I am quite far from an expert in such things to be upfront about it. Still...
A business gets to right off any kind of operating expenses when doing their taxes, this can be anything from paying employees and the power bill, to advertising and "business meetings" at fancy restaurants. However, you don't get such liberties with your personal filing (as far as I'm aware). In theory, I should in all fairness you would think, be able to write off all my rent, food, power bills, gas, clothing, etc...as they are all operating expenses of my daily life.
I'm curious if I could get away with creating a small LLC called Derick's Life or something, and have it registered as the owner/operator of all my personal expenses. I could even go so far as to contract myself so that I am employed by Derick's Life, LLC and then my real employer pays a contractors fee equivalent to my current pay rate. Then DL corp could pay me officially only what's left of my paychecks after all my bills and living expenses are paid for and budgeted out. Now, at the end of the year Derick's Life, LLC could list my rent, doctors bills, phone bills, car note, etc as expenses (even my sub-paycheck I receive from the LLC ..aka.. spending money/disposable income) and a gross profit of whatever my real employer paid for me to work there.
In theory the company should have to only pay a very small pittance in taxes, compared to what I might have to. Now of course this rant is all silliness in the end as I'm actually getting a refund this year, but still...if I were to actually make the average middle-class wages (which are double what my wife and I both made combined in 2008) I wonder if one could be better off in such a scenario. To sum up my sentiment here if you haven't already inferred it on your own...it seems like the US government give businesses and organizations a better deal than individuals when it comes to taxes...and I just think that's totally backwards of the way it should be ;)
Addendum: Yes, I know you can itemize your deductions for personal taxes, but I'm pretty sure things like food, rent and insurance don't count....otherwise why would politicians have even been talking about tax credits for insurance in this past fall's election?
PPS: I'm an odd Libertarian....I guess you could call me a left-leaning, moderate libertarian, as I'm not against taxes completely...I just think they should be minimal and fair ...aka... the poor to lower-middle class shouldn't have to pay any, and the same goes for very small business ;)
I may post my theory on what I consider to be a fair "Dynamic Tax Graduation" in a future web log...