US moving closer to letting Americans file taxes free online | Hacker News Reader

US moving closer to letting Americans file taxes free online

businessinsider.com

40 pointsjoeyespo21 comments

How about instead of allowing Americans file free online, we don't have anyone file but rather send out a pre-filled form that just needs sign off by citizens (the government already knows most of the stuff the average person fills in on their tax forms).

If those crazy conspiracists thought mass ballot harvesting was bad, imagine doing that with pre-determined tax forms that only requires a signature.

Shall we continue giving our government ideas to incentivize the gaming of their system?

Such a system would have to include a provision that lets you reject the government's computations and submit the usual tax forms instead. I imagine the crazies would just do that.

Getting money earmarked to "study a free federal tax-filing website" doesn't seem like "moving closer to...free online" filing.

Intuit spends millions every year "lobbying" congress to make sure our tax system sucks and people feel the need to pay for their (arguably deceptive) product offering.

> Intuit has spent more than $41 million on lobbying since 1998 with nearly $3.3 million in 2021 and about $3.4 million in 2020, OpenSecrets’ analysis of lobbying data shows.

https://www.opensecrets.org/news/2022/03/intuit-spends-milli...

> Using lobbying, the revolving door and “dark pattern” customer tricks, Intuit fended off the government’s attempts to make tax filing free and easy, and created its multi-billion-dollar franchise.

https://www.propublica.org/article/inside-turbotax-20-year-f...

Is there any meat to this ? These types of headlines make their way into the press all the time. From the article, "$15 million was set aside for the Treasury Department to study a free federal tax-filing website". This just studies the situation. No concrete steps are mentioned, nor is any actual money set aside. Considering government inefficiency of 10x, the actual money needed for the IRS to implement this would be to the tune of tens to hundreds of millions, optimistically. And that's without considering the pushback from the tax lobby. I am not optimistic that Congress will approve massive funding for the IRS.

Come on people, we need this!!

I find it surreal you even need to file taxes.

I mean, companies already tell the government how much they pay you and how much tax they withheld. Unless you need to claim back taxes because of, say, medical expenses or charitable donations, there should be no need for us to even be concerned with such things.

Yeah, but that would unfairly punish the citizens who are better able to optimize our intentionally byzantine code of deductions and write offs!

And even for the deduction case, the standard deduction is now large enough that I'd be surprised if the percentage of those itemizing deductions vs. taking the standard deduction to be quite low double digits. In fact, I wouldn't be shocked if it were single digits.

IOW, send me my Norwegian-style postcard with the amount I owe, and quit catering to corner cases. (Oh, wait, Intuit's profits probably aren't a corner case, eh?)

Yup. Having to take the time to manually file the taxes is itself a tax.

A system where you have to guess how much tax you have to pay so the government who already knows how much tax you have to pay tells you if you paid the right amount of tax

And if you get the answer wrong, you potentially pay penalties (another tax)

Quite a bit of US economic activity is middleman busywork. Tax prep, private insurers, excessive financialization of various forms, etc.

That means USA has a worker surplus.

Surplus of useless roles but a shortage of workers for useful roles (healthcare workers, teachers, trades, rail and truck transportation, etc). Labor ain’t fungible.

QQ: how much information does the IRS need from the average American?

Brits like me mostly don't need to do a tax return. But that's because taxes are quite simple for most people here. You earned money? You pay <rate> on <amount>.

It does not matter how many kids I have or what my mortgage payments are.

I get the impression American taxes require 1001 answers and sums and receipts...

> Filing your taxes could soon be free and relatively painless.

Is the alternative cost a stamp and a paper form? Or is there actually a fee to pay tax in the US?

> "Tax filing should be simple: I recently came across a statistic it takes an average American 13 hours to file a tax return"

... oh dear. I am sorry. I feel your pain but I can't stop laughing.

A lot of that is caused by American income being separated into different streams. Your base income, your health-care insurance payments, your FSA or HSA contributions, your 401k matching, your stock grants (ha!), interest on savings accounts, etc, etc, etc.

Some of these secondary income sources send you tax forms in the mail, randomly, that look like junk mail.

So whereas a normal person earning 90k in the UK just gets paid, a person earning 90k in the US has to do the same level of paperwork you'd expect from a rich and enthusiastic investor with a thriving portfolio.

At the end of the form it says that you affirm that you believe everything is correct, under penalty of perjury, which can really knock you for a loop.

So the tax-prep firms charge you to do all this paperwork and offer you upsold insurance that covers you against accidental perjury.

It's wonderful.

How about we remove the federal payroll tax entirely? It's a pretty sensible solution, especially with the gross ineptitude Congress has shown with the purse strings of the country.

It is already the case in France. Tax declaration is costlezz

I find it mind boggling that it is not the case already.

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