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Comment by SoftTalker | Hacker News Reader

How does Norway handle self-employment? There are a lot of people with self-employment income in the USA, including a lot of tradespeople, freelancers, and contractors. The IRS knows nothing about this until you tell them.

In the simple case of working for one employer all year, no complicated investments or other income, standard deductions, your tax filing in the USA is equally simple and you can complete it in 15 minutes on paper for the cost of a postage stamp.

There are many reasons the US tax situation is complicated. Among them are that it's used to incentivize behavior (tax credits or deductions for various things), there are people invested in it being complicated (tax prep industry), but a big one is that if your situation is complicated, the IRS simply does not have the information it needs until you report it.

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A Norwegian "ENK" ("enkeltmannsforetak"; self-employment) deals with a more integrated state reporting environment, stricter cash-sale controls, more emphasis on formal bookkeeping and VAT/cash-register infrastructure, and a more pre-filled tax ecosystem.

You can get a long way cheating the system if you deal with cash only, as banks etc. are required to report everything about everyone to the government, but these days it can only take you so far.

My understand is that the US is much more depending on self-reporting.

But given that the US has its own industry involving tax reporting, and having lived there myself, I don't believe you when you say it's "simple." ;)

If you have only W2 income ("W2" is the name of the form the employer reports your income and tax witholding on) and no unusual other credits or deductions, then US tax filing is very simple. It is not much more than:

Taxable income = Total income - Standard deduction

Look up tax due in a table.

Subtract taxes already witheld, pay (or refund) the difference.

In most states you also have to file, but this is normally just transcribing a few totals from your federal filing and then computing the state tax due, normally just a simple percentage multiple.

If it's that simple, how come it's so complicated that the US have an entire business line profiting from tax filing?

Most people never look into how simple their situation might be. They just pay TurboTax $50 and move on with their day.

But also, taxes can get complicated, I'm just suggesting that for many people, with typical incomes and employment, they are not.

When I was in middle school (1970s) we learned how to file a tax return. For some reason this is no longer taught today.

> When I was in middle school (1970s) we learned how to file a tax return. For some reason this is no longer taught today.

We have the same problem in Norway; youngsters aren't taught proper private economy at school, just the "normal maths." Which leads to people getting into financial trouble because of stupid stuff. :/

Thanks for updating me on the US tax system! Hope all is well over there! :)

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