Not all though. I developed admin-phobia since I moved back to France. Being a contractor here is such a FUCKING nightmare compared to UK and US. Sure the US could do without turbotax. BUT AT LEAST YOU GUYS HAVE TURBOTAX
The spherical cow of the accounting world
A lot of things are ‘legal’ as long as you don’t get audited.
But of course, the dynamics of our current system are such that the people least likely to be able to defend themselves legally are the ones which are frequently targeted for tax dodges. How many years do the extremely wealthy have to dodge taxes before the IRS finally comes down on them? Meanwhile, a friend of mine got dinged for a $500 deduction for unreimbursed work travel and not having receipts (a $2000 fine which she had to borrow money to pay).
A government has a monopoly on taxation by definition or else it can’t be a government so calling it a public monopoly doesn’t make a lot of sense.
Right now, the IRS is forced to establish some sort of data interchange format and adjudicate incoming tax filings equally, because they're required to work with TurboTax et al. (even if only required from a practical standpoint).
If they also provided the only filing solution, that pressure would be gone.
IMHO, the best possible outcome is definitely IRS-supplied free file + private options, if users would like. Keeps everyone honest and on their toes.
It’s literally data entry.
Tax prep/accounting (what to put where for cases where there is ambiguity) can always be different.
That doesn’t apply to W2 earners though (in 99% of cases)
Ergo, imagine there's a checkbox option that would apply to 25% of free filers to save them money. How would the IRS free file handle that from a UX perspective? What are their incentives?
Alternatively, suppose a feature used by 10% of filers is broken for the current tax year. How long does it take to get fixed?
Current private solutions are incentivized to optimize those ("We save you the most money!") and fix them ("Our software isn't broken").
And because only the data transfers over to the IRS, all the prep optimization can be done independent of the IRS.
Some of the incentive concerns would be alleviated by (as this did) building this from a different branch of government (e.g. US-DS).
But at the end of the day, it's still the government telling you how much to pay the government. Or as the joke went about the 1040-EZ: "How much money did you make? Good. Give it to us."
Dozens of companies sell online products to file, and thousands of individual providers are available too.
Apparently TurboTax has ~70% market share for tax preparation software, and TurboTax + H&R Block have ~95% market share. [0]
But even that's still a heck of a lot more competitive and responsive than if the IRS shipped the only tax prep solution.
[0] https://secondmeasure.com/datapoints/tax-prep-2021-turbotax-...
It's a competitive market on a stupid game. The market solutions (maybe mostly just intuit) fight to keep the game near impossible for the lay person to play. They generate "GDP" by making it more grievous than it need be.
At least part of this is a symptom of a broken political system (the current process of voting encourages 2 party system which are incentivized to not experiment)
The federal gov’t has enough power to make either of these groups miserable; and so each is using it to fight out who gets to do so.
Picking one to win isn’t going to stop the conflict, but it could turn it into a shooting war.
They all suck, and in a better society, that number for normal people would be close to 'zero', because the IRS could just send me a bill to attest to and sign.