Just tell me what I owe, and if I feel like it I can dispute it. If they can validate a tax return they obviously know what would be correct.
So they had done my taxes and knew they owed me money and, basically, stole my money. If I owed them money they would have immediately hit me with a bill or an audit. And on top of it they wanted me to refile my taxes “correctly” after they had already done my taxes.
This “do your thing and we’ll do it, too, and we’ll see if you got it wrong” is one of the most stressful aspects of American bureaucracy.
There is one major party that thinks government doesn’t and can’t work well, so it’s no wonder that lots of the stakeholders design systems that frustrate users.
https://www.propublica.org/article/inside-turbotax-20-year-f...
Option (c) will probably never get audited and we all know it. I won't be taking it.
People wanting to deduct their charitable contributions should have to work harder to do that. I shouldn’t be inconvenienced because of that.
Of course if they did that you wouldn’t need 80K new feds, and since they tend to vote lockstep for more endless government, well it’s quite convenient isn’t it?
The truth is closer to yes. Yes, there could be (and is in civilized countries) a web based form that lists everything the government expects to apply this year. And it could be quite accurate. Then you spend fifteen minutes (typically) entering in your deductions or any missing data. Does the math. Reduces the manual process from a week to under an hour.
(I understand that third-party software does reduce that time as well, but shouldn't need to exist.)
So yes, it can be done, because I've done it when I had a contract in another country.
https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu...
* flat-tax-rate as the default,itemized if you prefer:
* charge less for regular food, educational and medical expenses
* charge a little more for travel and non-essential leisure expenses
* charge even more for luxury expenses
* charge nothing before your spend reach a certain point, e.g. $5000
There are a few states did well with no income tax(just sales tax and property tax), the nation could do the same, don't forget to short Intuit if this happens.
I'm all for simplifying the tax code (e.g. eliminating many deductions) as long as we also eliminate loopholes that rich people often use to avoid paying taxes on their income.
Also, how do you report how much you've spent to the IRS? That seems even harder. Some people have suggested a "prebate" of a payment that people get that helps with their first part of the sales tax, but that breaks down after a while.
There are also the same problems of "under the table" behavior.
I always hear this said about national sales taxes, but it just doesn’t really jive with me as valid. It really seems to make the assumption that consumption doesn’t actually increase based upon how wealthy you are. When it obviously does. I don’t know many poor folks buying super cars, yachts, airplanes, and multimillion dollar homes. Yet I know a few wealthy folks with multiple of each.
Best example I'm personally familiar with is the carpenter whose Corvette was a company car.
I agree that taxes shouldn't be punitive, but that's another discussion.
If you implement a nationwide sales tax of 10-15% which of these have you just put into poverty?
Take the poor family living paycheck to paycheck - they spend practically every cent they earn on the basic necessities. Whereas I find it highly doubtful that your wealthy friends are spending every single dollar they earn every year (surely they save/invest a large percentage of their earnings, right?)
The middle three quintiles would see their tax burden increase significantly. Consider that taxes are only 10 or 15% after your deduction until you get into the third quintile. The proposed sales tax would have to be 22% to be revenue neutral. If there is some sort of offset to disadvantaged households, you would need a 34% tax to sustain revenue.
So their tax burden would go up.
We don't really internalize how much more the top income brackets make and don't spend. The top 1% of Americans have about 16 times more wealth than the bottom 50%. https://www.cnbc.com/2021/06/23/how-much-wealth-top-1percent... - Their effective tax rate is going to be above 22% today, so even if they spent every last dime their taxes would go down, and as we know the wealthy are able to save more, so their tax burden will go down further still.
Most of us would need to do very little filing-related work every year if anti-tax politicians who think their crusade is worth wasting hundreds of person-lifetimes of hours every single year, and tax prep companies' lobbyists (probably with, ah, some overlap between these two causes) would stop standing in the way, no major overhaul of the tax code required.
As long as we have taxes we will need a tax collector (i.e. the IRS) to handle all the filings and to make sure people are paying their taxes.
The IRS absolutely could be doing more. They could let you log-in to a portal with your tax return prefilled out based on all the filings done by your employer. But the tax preparation industry has lobbied against this, and the IRS is underfunded (they still haven't processed all of last year's paper returns).
Also a lot of states that don't have income tax, receive lots of federal funding.... Which comes from income taxes.