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Comment by mydriasis | Hacker News Reader

> Intuit spent at least $25.6 million since 2006 on lobbying, H&R Block about $9.6 million and the conservative Americans for Tax Reform roughly $3 million.

> In contrast, the NAACP has spent $140,000 lobbying on “free-file” since 2006 and Public Citizen has spent $110,000 in the same time frame.

With two orders of magnitude of lobbying dollars difference on either side, I'm surprised this is going anywhere.

> “An IRS direct-to-e-file system is redundant and will not be free – not free to build, not free to operate, and not free for taxpayers,” Plummer (a spokesman for Intuit) said, adding that it “will unnecessarily cost taxpayers billions of dollars.”

Oh, like the system your company built and lobbies for? How do you say stuff like this out loud without your pants bursting into flames on the spot?

View on HN

It's tricky.

I can definitely foresee a future, based on governmental record in publicly-facing IT systems, where every single word of that statement is technically 100% true.

First part is all but tautological - Of course it won't s not free to build or operate; and thus it wouldn't be "free for taxpayers" in the most technical sense (this doesn't mean it wouldn't be excellent value or save money overall or even cost more money but save it where it counts).

It's the last sentence (unnecessarily cost taxpayers billions) that could go either way. This could in principle end up an efficient and effective, easy to use and helpful well performing system that's a brilliant investment of public money.

I hate to say it though, but it's also extremely possible it would cost a lot of money with nobody using it because it sucks.

Besides, it feels like in the USA, IT systems are only a part of issue with tax system. Actual tax code and submission options are the bigger part.

We've had the last few years of one party demonizing the IRS, insisting they're "coming after" the little guy. I suspect trust in something like this is already starting on shaky ground before it's even rolled out, which may contribute to "it's such a waste - no one uses it!". Even if a substantial of people that need this the most (people least able to afford any filing fees), this will continue to be fought. :/

Just because it's true doesn't fireproof their pants. They already operate a service that is not free to build operate, and we know beyond a shadow of a doubt costs taxpayers needless additional billions of dollars.

So then why would the taxpayers not want to invest an alternative that could spend "needless billions" to save additional needless billions?

Classic political rhetoric. Who cares about “free”? I’m already paying for TurboTax. This only needs to be cheaper.

The government could always nationalize intuit.

USGov hasn't nationalized a company like that since WW1 when they seized Merck, and even then they just sold it back after the war. We'll nationalize utilities, transportation and transport-adjacent industries like airport security. Also finance companies will drift into and out of state control, as finance companies do.

But USGov would far sooner regulate the tax prep industry more heavily than simply take it over. We ain't no China.

Nationalization without representation doesn’t have quite the same ring to it.

Takings clause means the government would have to pay full market value which is currently 137 billion dollars.

A few more news stories suggesting Intuit is going to see a huge drop in revenues from this free IRS offering should bring that number down significantly.

Honestly I don't see how it would impact them significantly. Intuit already offers free file for the cases that would likely be covered by this tool from the IRS.

That’s no big deal, they could immediately turn around and sell the half of the business (QuickBooks, etc) to recoup a good portion of that.

I’m immediately reminded of the healthcare.gov project, starting out with a budget of ~$90 million (which is already suspiciously high) and subsequently costing ~$2 billion, before launching with so many issues that it was initially unusable.

To be fair, that's how most private sector outsourced corporate projects go as well. :)

Running over budget? Sure. But I’ve worked on much more complicated outsourced corporate projects for companies whose total revenue is only a fraction of $2 billion. Public sector inefficiency is in a league of its own.

To be clear I’m not saying it’s a bad idea either, or not worth the money. But I would be surprised if it didn’t cost billions to implement.

> To be clear I’m not saying it’s a bad idea either, or not worth the money. But I would be surprised if it didn’t cost billions to implement.

How much is Intuit’s revenue? Is it “billions”? If so, they provide their service at a higher cost.

Still a bargain next to the private sector.

It didn't cost billions and it was a key incident that led to a huge revolution in how federal websites and projects get built, e.g. 18f and the US Digital Service.

https://www.theatlantic.com/technology/archive/2015/07/the-s...

In fact the IRS partnered with the US Digital Service to make this prototype in 9 months.

It's fair to be cynical, but also give credit where it's due.

Yes, and what came out of that? Some of the people who rescued that project with modern software development practices went on to found Nava, a public benefit corporation, to help the government do better work:

https://www.navapbc.com

I also have a friend who left Google to join numerous other high performers at 18F and know for a fact that they have done good work benefiting taxpayers:

https://18f.gsa.gov

I believe the U.S. Digital Service is better than it once was, and while it's not all rainbows and unicorns and super efficient everywhere (no doubt there are tons of huge problems with money being wasted), I do think there is improvement, and hopefully some people reading this will go help out.

I'd much rather ATTEMPT to have an efficient free-file system than not try at all.

That was a much more technically difficult project than an IRS tax filing site will be.

It involved systems from multiple agencies and jurisdictions that had been developed separately and not been designed to exchange data with systems outside their own agency.

The IRS systems already talk to everything they need to talk to.

forget a "free filing" system.

Why can't the IRS just send me a statement with my obligations and if I don't want to contest it I pay and I am done?

Because that's how it works in other countries, and that means people get less riled up culturally about tax

paying taxes is not a voluntary thing for 90% of America. It gets taken out on your paycheck before you get it, which is your only form of income.

I think GP is suggesting that some interests want the process of filing your taxes to be annoying/frustrating/degrading/disruptive to increase anti-tax sentiment.

(I.e., most people have already been deprived of the funds for some fraction of the year; what interest is served by making them waste time finding records and jumping through hoops and potentially paying a third party to help them provide the IRS with information that it mostly already has?)

I think there's another group of people who want to more closely tie the notion that "government is funded by taxes" to "government spending programs are largely choices in the short-term and entirely choices in the long-term".

To that end, I would like taxes to be due about 4 Tuesdays before the Election Day Tuesday. If you want to vote for politicians who are campaigning on spending a lot of taxpayer money for good programs, so be it, but do it with recent memory of having paid your taxes (assuming you are in the slight majority* who pay federal taxes on net). If you want to campaign on spending a given amount of taxpayer money, whether more, the same, or less than today, your campaign should be interpreted close to taxpaying time.

I don't want it to be more onerous or annoying to pay taxes. I do want people to recognize that taxes and spending are linked (and frankly, ought to be more closely linked than they are today, IMO).

* - which until very recently was a slight minority of households who paid federal taxes on net.

Some interesting points here:

>I would like taxes to be due about 4 Tuesdays before the Election Day Tuesday.

Most people pay taxes in small increments every 2 weeks then get a refund around tax day, so your plan may not do what you think.

>I do want people to recognize that taxes and spending are linked

To your own point, they really aren't. [0]

>But do it with recent memory of having paid your taxes (assuming you are in the slight majority* who pay federal taxes on net)

To add some color on this [1]:

But, for the most part, people don’t pay income tax because they have little income. About 60 percent of non-payers make less than $30,000 and another 28 percent make between $30,000 and about $60,000.

Of the 72 million households that will pay no federal income tax this year, about 24 million, or roughly one-third, are age 65 or older.

[0]https://fred.stlouisfed.org/graph/?g=17dyP [1]https://www.taxpolicycenter.org/taxvox/tpc-number-those-who-...

Oh, right. I did skip stating an important step in the plan [so, upvoted]. I would do away with the withholding scheme (perhaps creating a parallel savings mechanism) and force income earners to write a check/do an ACH for their taxes.

Under that system, I'm totally fine if people get a $1K refund after writing a check for $15K in taxes withheld. That would still demonstrate the linkage sufficiently to inform their voting choices.

Sure, but again to your own point, the share of voting Americans who don't earn income (and therefore pay no taxes) because they are over 65 is already 1/3 and only going to increase.[0]

[0]https://www.kff.org/other/state-indicator/number-of-individu...

There will always be zero tax payers with the right to vote.

That's OK, especially since most of those who are now over 65 and retired worked and voted on reps/platforms/policies from 18-65 and earned income/paid taxes for probably ~40 of those years.

Is the status quo not fairly neutral in terms of which aspect of government spending is more fresh in peoples’ minds—the benefits vs the cost? Otherwise this just seems like it’s about biasing people in a particular direction.

Would you feel the same if you paid each restaurant bill six months after the meal, one week after the meal, or as you leave the restaurant?

I think you need to ask a more precise question, because I honestly don’t know how to answer that.

I think what you really want is a receipt of how your tax money was spent for say, anything above $1.

The problem is that would only apply to federal taxes. Not state or local income taxes, nor real estate taxes, or retail tax, or tax on gas or other things you might buy or use.

I'm not sure if you're describing something else, but tax withholding is voluntary. You can opt out and choose to pay your estimated taxes as a lump sum, but that also requires a level of budgeting that I'd argue most people don't have the financial literacy/self-control to do effectively.

You get penalties and an angry letter from the IRS if you are over a certain dollar amount and don't pay quarterlies.

I did this as a 1099-contractor, since that’s about the only way to do it as a contractor.

Paying estimated quarterly taxes four times a year wasn’t bad. I calculated my withholdings, remitted my tax payment through EFTPS, and was never surprised at tax time. I don’t think I ever got a refund or owed when I was doing it myself.

I learned that many people who have never contracted before are shocked they have to do this, lost on how it works, and had (then) no good place to go for actionable advice. I found that surprising and kind of sad in a way. We could be doing so much better with financial literacy.

This brings something up which I don't understand about US tax code. Why can't I be taxed on income which I've already earned instead of having to estimate to within ~5% (IIRC) what I should earn? I'm sure there are reasons for this, but this seems broken.

I think this is largely do to having a progressive and conplicated tax system. If work one job, earn salary, don't receive a variable bonus, and work the whole year at the same rate, it's easy enough to calculate.

But, get a raise, take a pay cut, find a new job, start or stop a second job, or a third, or fourth, get paid hourly, get sick, take time off to care for a sick family member, have a kid, go back to school, graduate, get married, get divorced, get a mortgage, pay down your mortgage, ... There are all sorts of scenarios that could change your tax situation on both the federal and state level, making it difficult to calculate how much you would owe up front.

What it really boils down to is our tax codes suck, and too many rich folk are keen on keeping it that way.

Please explain in detail the legal process that allows you to opt out of paying your payroll taxes as you go and instead pay after the tax year has completed.

To dispense with the unnecessary snark, you can claim exemption from withholding, but only if you had no tax liability in the previous tax year and you expect the same to be true of the current tax year.

An individual can't ever opt out of payroll taxes, that's an employer's responsibility. Income tax withholding, however, can be adjusted with a W-4. As others have mentioned, though, anyone making a reasonable income is going to have to pay estimated quarterly installments or get angry letters.

Setting aside the 90% thing, to your original point, paying taxes is not a voluntary thing. There is, however, at least some flexibility in how you pay them.

The flip side of this is: who cares, withholding is actually fine. For a vast majority of people, estimated withholdings is pretty close, and the few percentage points one might earn on a $1k refund in the meantime just isn't worth it.

In my opinion, the best easy tax situation would be that at the end of the year we can skip (most of) the filing step and I either get a check or a bill.

Edit/delete window is past, so mea culpa for anyone else in this thread: sibling comment from bandyaboot is right on the limited path to exemption. I was mistaken on how much withholding flexibility there was for employees (aside from increasing it), and how much W-4 allowances could realistically (or, rather, legally) have an impact. https://www.irs.gov/publications/p505

I don’t think being sent a statement of account is what causes other nations’ countries to not get riled up culturally about tax. To the extent that a nation’s populace doesn’t get riled up about the taxes they pay, I think it is from a feeling of (a) representation and (b) the tax dollars being spent effectively.

In the US there is a feeling of lacking representation on both sides, which I suspect is due to corporate lobbying and the culture wars, and I think a feeling of ineffective spending, again I think due to lobbying, and also pork barrel projects.

I think the answer is to remove corporate lobbying and limit campaign spending.

Agree, as an American now living/working overseas, it is mind blowing how easy it has been to deal with taxes in my foreign country - I don't have to do anything. Taxes are withheld out of my paycheck, and this foreign government sends me a letter at the end of the year telling me how much I paid. I don't have to submit anything. So much easier. Except I have to still have to spend $ to Turbotax efile an American IRS return to tell the IRS I owe no taxes. How dumb is that.

Yep, exact same here. It's ridiculous.

My spouse has the same issue.

Except that a lot of tax filing companies require a bank account with an American address, so it's always an even bigger hassle.

Our tax system covers a lot more types of 'income' than most other countries. The USA taxes you on all earning worldwide, but they don't see anything out side of the US. Now since 1993 you are supposed to declare any foreign bank accounts too. And there are many still cash based businesses that they can't easily estimate your earnings for. It is crappy, and it is also part of lobbying to keep in complex. Both accountants, lawyers and for the lower classes the tax preparation companies all want complexity.

That kinda doesn't matter. Those things account for a single-digit (at most) percent of all taxpayers. People with complicated tax situations will have to do more work to pay taxes. But well over 50% of US taxpayers could make use of a simpler, IRS-provided system wherein they just get sent a bill and can choose to pay or contest.

This doesn't impact most people in the USA. A simple system offered for free by the IRS is good enough for 99% of folks. If you have a complex situation then that's your problem to pay for. Not mine.

Because increasing the friction around paying taxes makes people angrier about having to pay taxes and plays into larger political narratives around whether the government is effective or not.

It’s a huge, political dark pattern designed to keep people angry at the government to lower public sentiment towards the government.

Think about all the information (marital status, dependents, residence, childcare spending, healthcare spending, education spending, charitable contributions, …) you need to correctly calculate your taxes owed. Now imagine that the IRS is tasked with maintaining all of this information in a single database so they can send you your “statement”.

Folks argue that most of this information is available to some level of government already, but that’s a far cry from centralizing all of it in what by definition must be an easily accessible form.

Dramatically simplify the tax code and this approach becomes feasible without being a security and privacy nightmare.

> Think about all the information (marital status, dependents, residence, childcare spending, healthcare spending, education spending, charitable contributions, …) you need to correctly calculate your taxes owed. Now imagine that the IRS is tasked with maintaining all of this information in a single database so they can send you your “statement”.

There's nothing hard about updating a few values with these then you're done in five minutes. State governments already do simple walkthrough forms and federal is really no different. If you have a complex tax situation then that's your problem to deal with. Don't burden 99.9% of the population with something that should be free, should be simple, and should be fast.

OK, but now we’re back to “free tax filing”, not “send me a statement”.

Reviewing and editing if needed (often not) is dramatically easier than filling out from scratch, regardless of what you call "free tax filing".

It’s actually not. I lived in a country that filled out the forms.

I actually had to dig up pay statements, etc to confirm the information. I’m glad I did because my employer made a mistake on a retirement contribution.

So what did it save me? Maybe typing in some numbers, which is probably 5% of the total effort.

The issue is the complexity of the tax code. It would be great if the IRS pre-filled forms, but the forms aren’t going away.

Many people won’t review the dozen or so pages of forms to make sure they’re correct. No doubt that will favor the IRS, not the tax payer.

This is a bad take in my opinion. First of all, we already have W-4 forms today, where you report your intentions to the government, vis-à-vis married, single, etc — they just need to be updated so that you send it in to the government (a joint one for couples) when you make a change (birth, marriage, divorce, deaths). Most people are not eligible for child care deductions, nor healthcare deductions, other than the ones that come through an employer program which can already be reported to the government without your interaction. Education tax credits are based on 1098(?) forms the government should already have their copy of. Also most people don’t give enough charity to bother with those either.

You could log into a website occasionally and upload charity receipts or click through a wizard to apply for a deduction for one of those deductions most people don’t use, but the flow for basically 80% of taxpayers, and essentially 100% of the bottom 70% of earners, should be a quick form update when life changes happen, and a yearly EITC-funded refund check that just shows up.

This is a lot like the argument that Microsoft’s Office products could be so much simpler: 80% of users use only 20% of the features.

But of course everyone in that 80% uses a different 20%. When you consolidate the overlapping deductions, credits, exceptions, exemptions, … you end up with a staggering amount of data required to accurately “pre-compute” income tax bills for even 80% of taxpayers.

“Quick form update when life changes happen” is, I think, an overly sanguine way to express a requirement that grieving parents file paperwork with the revenue service when a child has passed. That’s a bit melodramatic, but my point is that centralizing the execution of a complex tax code inside a state bureaucracy creates a perverse relationship with the folks who are supposedly in charge.

Once all the calculations are taking place in an opaque, voracious IRS database, what constraint is there on even more complex taxes and exemptions? Your doctor knows you’re a smoker. Should you pay a Medicare surcharge? ACA plan purchasers already do, in contrast with most private employer plan members.

> everyone in that 80% uses a different 20%.

No, no they don’t. Because we already have determined what most people use and made a special form for them called 1040EZ. It only offers simple things but is enough for most people. Then there’s the 1040A which goes a few steps further but is still simple. Millions and millions of returns are submitted on these short forms every year. These filers are proving that they don’t need complicated deductions and stuff because they already don’t use them.

> grieving parents file paperwork with the revenue service when a child has passed.

What are you talking about, in our current system you’d be filing next April and omitting the deceased person from the list of dependents. Your grieving strawmen would be able to take many months to go update the info before the cutoff when they print your check/bill (likely it would be minimum 4 months after year end like it is today).

> Once all the calculations are taking place in an opaque, voracious IRS database, what constraint is there on even more complex taxes and exemptions?

I don’t really want to talk politics on here, but I think this is a separate battle to fight. The tax system is already ridiculously complex because it’s trying to use the tax system to incentivize/punish behavior and at least two parties/factions have engineered it, so it’s quite confused. All politicians will continue to use this to scam the people who they like less, for the benefit of whoever they like more (campaign contributors) and they obviously don’t mind complexity even when it’s on taxpayers to compute. All things equal I’d rather force a computer to compute it and know that I can’t be audited for not understanding tax code.

What's going to happen is Intuit will end up building and running the service like Booz Allen did with recreation.gov and get to skim off the top.

It could completely suck and still be incredibly useful if they would just tell me what 1099's (or other) they have on me. They're going to eventually if I don't file it appropriately.

For instance, I just received some mail that I owe tax based on my Uber and Lyft earnings. One problem, I never worked for either. So now I'm expected a big slog through paperwork to remedy this problem that happened a couple years ago. Oh, and it may continue on to the next two years. I have no way of knowing what they think they know about me.

I thought you could get your tax transcripts from the IRS any time off the website, unless you make over a certain amount of money (to be fair, I think most HackerNews readers do exceed that limit..)

That's really interesting. I've never been able to see anything like this on their site before.

Also interesting is my account balance is currently $0, and I know that's not true even if they 100% believe the last mailing denying my 1099's from Uber and Doordash (not Lyft as I said above).

Incidentally, Neither Uber, nor Lyft can help through customer service. I was thinking of taking them to small claims court since I'm not bound by any forced arbitration.

The IRS says you owe money from past earnings but irs.gov says your balance is zero? Are you sure this isn't a scam for money or personal information?

It was 17 pages of mail with SSN, all my tax info, accounts, etc... Even if it were sent to someone scamming me (and I know it was sent to the IRS), I would have been sending back less info than they sent me.

The mail I was sent does match the the 1099's in irs.gov. So maybe the mail I sent back was believed and they just zeroed out everything as the only dispute left would have been around $13.

I'm sure it will play out over time. I've had a couple interactions with the IRS over the years and it's always been a fair experience. I'm sure Uber and Doordash will have a hard time providing any valid identification to the IRS.

> I hate to say it though, but it's also extremely possible it would cost a lot of money with nobody using it because it sucks.

IMO The government should directly be hiring the best and the brightest with the pay to match. I would be more than happy to pay more taxes at my pay grade (or would support higher capital taxes) for free e-filing that's easy, fast, and multiplatform. However my taxes are raised would surely be cheaper than what I pay my accountant annually to file for me.

It's ridiculous to me that government contracting is always expected to cheapen out for "efficiency". Governments should have excellent software and product minds on staff at all times to manage communication and data internally and externally, imo.

This is pretty simple to explain: Governments respond to a completely different incentive structure than private companies. It shouldn’t be surprising that their outcomes differ, even (especially?) when the government spends more.

Yet most US constituents, of all parties and socioeconomic status, seethe at the thought of a government worker of any level making “too much” money.

It doesn’t matter that someone working for the government has the potential to have a much higher impact on a nationwide level than some rank and file worker who works at some blue chip auto insurance company, the moment increased pay for government workers is even brought up, that person imagines it as coming directly out of their paycheck.

See teachers, urban planners, sanitary workers, NASA scientists, etc…

It’s a shame, because I have the unpopular opinion that _more_ government, filled with talented people who actually want to _fix_ the issues they’re passionate about, is the answer to almost all of the USs domestic problems. Right now the highest paid government workers are those on the brink of retirement in administrative positions so far removed from any real work. A bureaucracy of gerontocracy, if you will. I really wish the government (not the political world, but the civil staff) was seen as as a place for passionate young people to aspire to, with the pay to match.

The highest paid state government workers are typically coaches. Go figure.

Here's the thing, though. Tax filing should not be a thing nearly anyone actually does. The IRS already knows what you made. I should be able to log into a website and verify that it's correct, or receive a letter, or both, and sign off on it. If my tax situation is complicated then I should be able to log into that same platform and tell them that I will be filing proper documentation.

I agree with the rest of your statement but while Conservatives exist with their two Santa Claus nonsense then it won't matter.

> cost a lot of money with nobody using it because it sucks.

For sure it could. Haven’t dug into the details yet but the #1 cause I’d expect if that does happen is if the government contracts the actual implementation out to…surprise, one of those same shitty firms, Intuit and H&RBlock. And they would build it to suck basically on purpose. I hope existing players in the paid tax return space will be excluded from being part of building whatever this is, as it would be a huge conflict of interest.

>With two orders of magnitude of lobbying dollars difference on either side, I'm surprised this is going anywhere.

I think everyone should use this to update their priors on the impact of lobbying. Government action is not contingent on a dollar vs dollar comparison. Citizens United did not result in a raft of unpopular legislation being passed. (Not saying it was the right decision, just that its impact was overstated.)

We should all feel heartened that our government is responding to good arguments over lobbying dollars.

Another one we should keep fighting on is Right to Repair. John Deere and the like can put as much money into the fight as they want - as long as we have people like Rossman being gadflies, sanity will win. Eventually.

Frankly, by far the biggest impact of lobbying happens when one side has anything at all, and the other side doesn't. Most lobbying isn't bribery, as much as it is spending money to get create a situation where the politician will listen to you explain your case. When the politician has heard both sides in such a manner, they'll basically vote with their conscience. When only one side has explained their argument, it's a lot easier for the politician to vote with that one.

We'd be happy to put lots of money into your reelection campaign if you'll hear us out. e.g. Bribery.

im glad these shoe-in clowns are finally having to hopefully complete w fed direct free efiling

It's not a crazy statement. I expect the IRS's system to be worse and more costly than TurboTax on the technical side, at least initially. But it's a step in the eventual right direction; I shouldn't need a third party to pay taxes.

If I were Intuit, I would be spending that on making sure the IRS selected us as the sole provider of their free tax software. Then make sure it's slightly more annoying than using TurboTax so I could get paid twice for the same job.

It would be an epic failure if the government issued a tax collection software contract out and didn’t put in some sort of clause preventing intuit from providing a competing service. I have a hard time seeing them do something like that.

Imagine if they spent that money on, you know, making a better product.

But lobbying has such better ROI!! .. We also need lawys from the federal level that all these "known" things must be pushed to the IRS and the state and local use that as their source of information .. Then this software just needs to deal with federal deductions that aren't digital or optional like charity .. We have such a dumb system

Alas, free would still win enough marketshare for it to make sense to spend on lobbyists to delay this. :-(

They seem to spend all of their money adding fake slow progress bars that advertise their premium version to you.

They would have a better product, but they'd be out of business since without lobbying against it, the government product would actually be built.

The product is fine. It doesn't really need radical improvements. That money should have been returned to shareholders.

What it needs is to not exist. The product does a fine job of doing an unnecessary thing. For the vast majority of users it should be a tax bill or refund check that arrives with no user intervention at all.

The remaining use cases should be handled differently -- perhaps by a professional. That professional may themselves want such software, but it's likely a different interaction than software also aimed at users with much simpler use cases.

Are the NAACP/public citizen the highest value lobbyists for this? I would not have guessed, but makes sense reading it.

> “will unnecessarily cost taxpayers billions of dollars.”

This is undisputably true. H&R Block n Intuit are taxpayers, n free-file will cost them billions of dollars.

Being real, online taxes through the SII work great in Chile.

I'm not arguing one way or another but one point the tax software companies do have is who pays the cost. In the commercial product arena, the products are bought by people who make over median wage. The lower income folks have simpler taxes usually. The free products cover them generally. I may be wrong but that's how I see it. I didn't feel the need to pay for any software until I was making a lot of money (relative to median) and managing a lot of assets.

And you pointed out exactly what the problem with the current system is.

The rich can pay someone to do the work for them. This saves them time, stress, energy, etc. The poor cannot. They have to do all this themselves and then they’re open to the risk of actually getting something wrong. And the impact of getting something wrong is highly imbalanced. If they get something wrong and end up paying more tax than they need to there will never be a second thought given to it. But if they mess up and pay less taxes than they should they will be hit with a penalty, interest, and even maybe an audit.

And the idea that everyone should be reasonably competent in taxes seems a little ridiculous to be honest especially when no one is taught how to do taxes in any point in their lives.

An alternative might be to teach how to do taxes in school, but at that point the cost of teaching taxation would far exceed the cost of developing this software, never mind the human hours that are wasted.

> If they get something wrong and end up paying more tax than they need to there will never be a second thought given to it.

Anecdotally, I messed up copying tax owed from the table a couple years back, and the IRS sent me a letter telling me I made a mistake and overpaid, along with a check for the difference.

In any case, a lot of the complication in the tax code comes down to the government incentivizing certain behaviors, so it makes sense that we should put more focus on teaching people to read the rules and find out what those incentives are. Of course a free calculation tool to run simulations could help people to understand those rules, and we ought to make the actual filing more convenient for everyone.

True, the IRS is generally really good about fixing and refunding basic math errors. Had you missed taking a tax credit you were eligible for, there’s approximately zero chance you would have received a similar letter.

Another alternate is to eliminate the federal personal income tax. W-2 employees would get immediate increase to their take home pay and employers would get out of tax withholding chores. Feds can just increase the already large deficit spending to cover the tax reduction or reduce spending.

Deficit spending is already the highest it can be without jeopardizing the Dollar. Sometimes I think about them reducing spending instead, but then my alarm clock wakes me up.

More war will increase deficit spending, regardless of our income tax contributions. Why contribute further?

They don't need a war to increase deficit spending. They'd have done it already if they could.

Minus all the profits the companies take…

https://www.reuters.com/legal/government/intuit-reaches-141-...

If you are self-employed, you have to pay for TurboTax regardless of your income level. We had to pay for TurboTax when I was a student and my wife was making $20k a year teaching music lessons.

You don't have to, you could try to do the paperwork yourself and severely screw it up like I did as a contractor right after college. Or really roll the dice with a pirated TurboTax.

I mean, fair. I meant that in order to use the TurboTax we had to pay for it.

That might be true in theory, but in practice companies like Intuit and HR Block use dark patterns to trick users into paying when they should qualify for free filing.

You can read about the settlement from ProPublica: https://www.propublica.org/article/intuit-will-pay-millions-...

> who pays the cost. In the commercial product arena, the products are bought by people who make over median wage

~40% of households pay no federal income tax today. They'd literally pay nothing for this service.

But do 40% of households not file tax returns, because that is what we are talking about here, and I'm pretty sure a large portion of that 40% do file because they get refunds/rebates, and I'm pretty sure a large portion of that portion use a service because they can get their refund/rebate quicker (though as a loan at payday loan advance rates).

I'm not disputing that many of them file a return. I'm saying that they wouldn't possibly be paying for this system, which is paid for by federal taxes.

> The lower income folks have simpler taxes usually. The free products cover them generally. I may be wrong but that's how I see it.

Sure, but that's also how taxes generally work as well. People making less money will be paying less for the IRS service just as much as they would be paying less for the TurboTax system, as it currently is.

Many of the lower income folks I know are too nervous/not comfortable with their own ability to file their own taxes and use tax preparer services. Some also do this in the hopes of getting their return quicker, so they not only pay to file but then get hit with the equivalent of a payday loan on their return.

> The lower income folks have simpler taxes usually

Not sure about that. They qualify for a lot of complex rebates and stuff. When you make a certain level that they consider middle-class, suddenly your taxes become a lot easier (in a bad way).

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