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Show HN: Calculator for US individual income tax, from 1970-present

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Re: Show HN: Calculator for US individual income tax, from 1970-present

#41

Post by lotsofpulp »

divbzero wrote: post #29
KerrAvon wrote: post #19

I wish this would get written up in mainstream media. Hypothesis being that if more people knew this existed, it would put additional pressure on Congress to simplify tax filing.

The number of possible inputs for Income is stunning: 15 types of income in total. There are “only” 5 possible inputs under Deductions & Credits but 3 of them are categories with several subitems: Itemized Deductions • Home mortgage interest • Deductible medical expenses • Motor Vehicle registration fees • Charitable contributions • Casulty or Theft losses Other Itemized Deductions • Other state and local taxes • Ded…

Because standard deduction is so high now, 90% of US tax filers do not have to worry about itemizing. According to IRS stats website, which I do not have handy on my phone.

Re: Show HN: Calculator for US individual income tax, from 1970-present

#42

Post by standardUser »

sgjohnson wrote: post #20
nicoburns wrote: post #16

Earlier quoted context omitted.

A quick google shows that yes, there was a 70% marginal tax rate (applying to income over $108,300 - not inflation adjusted - for a single filer) as recently as 1981 https://taxfoundation.org/historical-income-tax-rates-bracke...

But nobody ever paid it as there were millions of loopholes.

You have to be actually wealthy for most "loopholes" come into play. Just like today, non-wealthy high earners take the biggest hit in taxes. And there are way more of those than actually wealthy people. Back then, the hit was even bigger, but the group being hit the hardest was smaller.

Politically, this setup seems to help keep those high-earners voting for lower taxes, which makes sense to them since they're the ones paying the highest overall rate.

Re: Show HN: Calculator for US individual income tax, from 1970-present

#43

Post by PopAlongKid »

analog31 wrote: post #33
FullyFunctional wrote: post #3

That's brilliant work, thanks! Imagine if IRS would produce something like this (open sourced) and we could file our returns like this.

Imagine if the tax code itself were written in Python. def computeTax(**kwargs): .. blah blah .. return how_much_you_owe Of course we all know what comes next... from scipy.optimize import minimize

It has been proposed in professional tax forums that this is in fact how tax code should be legislated, using some kind of pseudo-code. Even just using symbols for things such as >=, <, and so on would eliminate a lot of the garbage in the verbal version.

Re: Show HN: Calculator for US individual income tax, from 1970-present

#44

Post by PopAlongKid »

pessimizer wrote: post #28
FullyFunctional wrote: post #17

Earlier quoted context omitted.

I didn't point that out: I originate from a country in which I used to get a postcard summarizing what they thought I owed with a "Yes, I agree" checkbox and a field to sign. You could always file an extensive return if desired, but unless you had complicated (notably international) transactions, the return was basically accurate. This only works because there's a high level of trust in the government and low corrupt…

The US demands extremely detailed tracking of your income. We just get nothing in return for it.

>We just get nothing in return for it.

Maybe you don't, but a lot of wealthy people who can afford to hire tax professionals do. For example, how certain famous billionaires[0] have received billions of tax free income because they took the position that it could be classified as a certain type of income.

[0]https://www.bloomberg.com/news/articles/2021-06-24/peter-thi...

Re: Show HN: Calculator for US individual income tax, from 1970-present

#45

Post by ideamotor »

This is amazing. Would there be a way to estimate future year taxes? For example, knowing past years inflation numbers could you run possible scenarios of future tax brackets?

The adjustment process seems to be opaque[1] but perhaps you could use a regression to estimate it. Then you would only need the ability to make those adjustments in this program to run future year scenarios.

1: https://www.irs.gov/newsroom/irs-provides-tax-inflation-adju... (I’m uncertain whether this is based on some predetermined formula)

Re: Show HN: Calculator for US individual income tax, from 1970-present

#46

Post by PopAlongKid »

ideamotor wrote: post #45

This is amazing. Would there be a way to estimate future year taxes? For example, knowing past years inflation numbers could you run possible scenarios of future tax brackets? The adjustment process seems to be opaque[1] but perhaps you could use a regression to estimate it. Then you would only need the ability to make those adjustments in this program to run future year scenarios. 1: https://www.irs.gov/newsroom/irs…

>Would there be a way to estimate future year taxes?

You can't even always estimate current year taxes, since Congress has lately taken to making retroactive changes to the tax code even after the end of the tax year (just extending their long-term habit of making changes in late December of the current year).

Re: Show HN: Calculator for US individual income tax, from 1970-present

#47

Post by ren_engineer »

keehun wrote: post #12

Are all the dollar amounts in the simulated tax output at the top of the page inflation adjusted? For example, I inputted married, with no dependents with $500,000 salary and in 1977, the federal amount was $299,864 and in 2020 was $133,947. I assume these amounts can be compared without further adjusting for inflation? Tangentially, did federal taxes really come down that much?

as others stated there were a lot more loopholes

the other thing people don't mention is that companies got around higher tax rates by giving benefits like company cars and other things to entice employees when giving a higher salary would be stupid due to high tax rates. This is how things like health insurance ended up getting tied to employment, always unintended consequences

Re: Show HN: Calculator for US individual income tax, from 1970-present

#48

Post by runlevel1 »

tmm1 wrote: post #38
analog31 wrote: post #33

Earlier quoted context omitted.

Imagine if the tax code itself were written in Python. def computeTax(**kwargs): .. blah blah .. return how_much_you_owe Of course we all know what comes next... from scipy.optimize import minimize

In 2014, the Policy Simulation Library [1] added a model called Tax-Simulator [2], which is a Python reimplementation of TAXSIM [3][4]. It is available as open-source [5], and designed to let researchers both change existing policy variables and implement new tax reforms in Python. [1] https://pslmodels.org/ [2] https://taxcalc.pslmodels.org/ [3] https://taxcalc.pslmodels.org/about/history.html [4] https://github.com…

`policy_current_law.json` is really interesting:

https://github.com/PSLmodels/Tax-Calculator/blob/master/taxc...

Looks like the data in there goes back to 2013/2014. I'd love to see older historical policy data.

Re: Show HN: Calculator for US individual income tax, from 1970-present

#50

Post by sharkmerry »

ren_engineer wrote: post #47
keehun wrote: post #12

Are all the dollar amounts in the simulated tax output at the top of the page inflation adjusted? For example, I inputted married, with no dependents with $500,000 salary and in 1977, the federal amount was $299,864 and in 2020 was $133,947. I assume these amounts can be compared without further adjusting for inflation? Tangentially, did federal taxes really come down that much?

as others stated there were a lot more loopholes the other thing people don't mention is that companies got around higher tax rates by giving benefits like company cars and other things to entice employees when giving a higher salary would be stupid due to high tax rates. This is how things like health insurance ended up getting tied to employment, always unintended consequences

It actually wasnt taxes with health insurance. They froze wages during ww2 but exempted health insurance from the cap.

Same result. different cause (in this case)

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