We Really Don't Have to Worry About Fairness for Pass-Through Businesses

Neil Irwin seems to get a bit lost in his concerns about treating owners of pass-through businesses fairly. His NYT Upshot column argues that there is a problem where we are left a choice between large-scale evasion, treating them unfairly, and micro-monitoring their behavior. The story is actually far simpler than he presents it.

The basic story is that the tax rate on a pass-through business is zero. The business itself pays no taxes, all its income is passed on to its owner(s) to be taxed...