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Probably the most popular of the write-offs are limited partnerships, which have proliferated as tax shelters since the late 1970s and early '80s. An orthodontist investing in a real estate venture, for example, can deduct from his taxable income a share of the venture's losses based on the amount of his investment. Yet his actual liability is limited--hence the name of the arrangement--to the cash value of his initial in vestment. Thus if a partner invests $10,000, or 10% of a partnership's total investment, and the venture loses $700,000, he will be able...

Author: /time Magazine | Title: High Earners, Low Payers | 4/18/2005 | See Source »

...more than half the partnerships in the real estate and oil-and gas-drilling industries were losing propositions, a sure sign that they were being used as tax shelters. States the Treasury report: "The rapid growth in the number of partnerships reporting losses would lack a sound business rationale if it were not for the ability of many taxpayers to use the tax losses ... to shelter other income from taxation." Pickle is now asking the Treasury for another study that will pinpoint the sections of the current tax code that are being abused. "No law has been violated," he says...

Author: /time Magazine | Title: High Earners, Low Payers | 4/18/2005 | See Source »

...three-fourths of those polled said they had "only a little confidence" or "none at all" that he could reduce the deficit. Only one in four had "a lot of confidence" that he could. The figures were similar when people were asked about Reagan's ability to reform the tax code or negotiate arms-control agreements with the Soviets...

Author: /time Magazine | Title: More Popular Than Ever | 4/18/2005 | See Source »

...more vexing question was what can be done to reduce it. Virtually no one in the poll was for a tax increase. Some 56% called for cuts in Government spending, and 36% supported a combination of budget cuts and tax hikes. More than seven out of ten believe that the poor and the elderly have suffered from program slashes, and 56% think that cuts have adversely affected blacks and the middle class. On the issue of American military strength, the survey indicated that there has been a large jump in the percentage of people who feel that military spending should...

Author: /time Magazine | Title: More Popular Than Ever | 4/18/2005 | See Source »

...response to Reagan's tax-reform plan was tepid. A mere 27% said they were either "very familiar" or "fairly familiar" with it. Those who knew of the plan favored it 51% to 36%, even though only 16% say they support it strongly; 52% thought they would personally pay more taxes if it were passed. Republicans were more than twice as likely as Democrats to favor the plan. One somewhat contradictory albeit understandable finding was that though Americans tend to favor the plan in general, they clearly oppose its major specific provisions. When asked about eliminating the deductions for state...

Author: /time Magazine | Title: More Popular Than Ever | 4/18/2005 | See Source »

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