That’s just funny. I guess maybe they assume that you can live in the streets for free and rent out your house, so you can get taxed upon what you should have made.
Kind of along the lines of we could all be Fortune 500 CEO’s, so we should get taxed on the income that we should have made.
There are many people who think this way. Everything we get to keep of what we earned is a subsidy.
It seems there are some countries that actually tax imputed rent - Netherlands, Iceland, Slovenia, Luxembourg, and Switzerland.
“It’s unusual for employers to charge employees different amounts based on their age. COBRA doesn’t do it either, typically.”
I checked our insurance booklet and I was mistaken - it isn’t different due to age, only grade level and bargaining unit depending on which union you are in (if you are in a union.)
“Tax expenditures” simply means that instead of the government spending money to subsidize something it favors, it gives a special tax deduction, credit, or treatment for it (e.g. the lower tax rates for capital gains and dividends is a favor to those who own capital over those who labor for their income). That also makes it politically harder to remove, since people and lobbyists will complain harder about “raising taxes” compared to “cutting unnecessary wasteful spending”. That also means that getting to a tax system with minimal or no deductions, credits, or other special treatment is probably politically impossible as each interest defends its own deductions, credits, or special treatment.
Regarding the specific case of imputed rental income (or domestic work), that would probably be both politically impossible and administratively very difficult (how does one determine how much imputed income there would be?).
Maybe they could create another government agency, to come over to your house and take a look at how much housework is being done. In that case, I’d come out pretty good, because it is obvious nobody is doing housework in my home. 
Imputed rent is really at its heart an asset tax.
So rather than trying to figure out the actual rent every individual piece of property would get (which would be nearly impossible and lead to all kinds of shenanigans), and allow deductions for expenses and depreciation (a la schedule E, only an accountant could love this idea) you base the tax on a certain percentage of the asset value.
The asset value could be the purchase price or the assessed value for property tax (assuming that value is a market value).
For example, the imputed rent could be 5% of the assessed value, or 5% of the purchase price times an inflation factor.
There are problems with this method as well, but it would be a heck of a lot easier to implement.
Well, that would basically just be a national property tax, added onto the state property tax. Lovely.
" That’s just funny. I guess maybe they assume that you can live in the streets for free and rent out your house, so you can get taxed upon what you should have made."
They assume you can rent, as many other people do. The current tax system favors homeowners over renters. As notrichenough points out, it wouldn’t, technically, be difficult to tax imputed rent. I’m not saying it should be done, merely saying that it could easily be done.
There are other methods that could be used.
For example, every year HUD calculates the market rate for over 2500 different areas of the country, using surveys of what things actually rented for, in order to establish how much they will pay for section 8 housing. You could use this data to set a per-square-foot price for your zipcode, and use that to calculate the imputed rent.
For example, the FMR (Fair Market Rent) of a 4 bedroom rental in my town is around $2300/month. You can look up your area here:
https://www.huduser.gov/portal/datasets/fmr/fmrs/FY2018_code/select_Geography.odn
What about imputed income from renting out my car? I’m not driving it 24 hours a day, so…
This is really crazy.
^ The funniest comment I saw somewhere was someone wondering if their spouse (and themselves as well) have imputed income every time they had sex with each other instead of hiring a sex worker.
Of course my evil mind thought about that too!
I wouldn’t call it an asset tax or a wealth tax. The tax code already taxes plenty of imputed income, without it being an asset tax. The tax wouldn’t be on what you own, but what you use.
Interesting how something that’s not on the table (and as far as I can tell, never has been in this country) becomes a chance for some to take a swipe at taxation generally…
I could rent my house, space in my yard, my garage, my cars, my boat, my garden. I could work a lot more, but choose not to. Anyone thinking that the government should tax you on things you could do, but don’t, is looney. But I wouldn’t put it past some of them.
From wikipedia:
Interesting.
Imputed rent is not the rent that you could get if you rented out your spare bedroom. It’s the rent you would pay if you didn’t own your house and you had to rent it from the person who did own it. It’s the same kind of reasoning that taxes you on childcare if your employer gives you free childcare.
It’s nothing about what you “could do, but don’t.” It’s about what you do do. Under the imputed rent regime, everyone who lives in their own house is simultaneously a renter, paying rent, and a landlord, able to deduct depreciation and so forth, and having to declare rent as income.
An imputed rent regime would look a lot more attractive to homeowners if the GOP got rid of the deductibility of property tax-- because under imputed rent, property tax would of course be deductible as business expense.
Actually, that could work out nicely. To declare all the money and time my husband spends on his massive projects…landscaping, roof repair, painting the house, he works at it all day. We could come out ahead. But then he’d probably be charged as receiving income, and taxed at a high rate.
This stuff could make your head spin.
@ucbalumnus Difficult to discuss the issues involved with the “tax expenditure” label within this site’s rules. Though I agree we aren’t likely to see a flat tax (and if one were ever enacted it wouldn’t last long as deductions/exemptions would be added at some point). In terms of efficient revenue raising, a flat tax makes the most sense. Unfortunately the US tax code is used for much more than revenue raising. And the current tax proposals are great examples of the issues: propose a reduced rate structure with fewer deductions/exemptions and those who benefit by the deductions/exemptions lobby to keep them.
Who has done that here?