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Stanford Professor Loses Political Battle To Simplify Tax Filing Process

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Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#171

Post by [deleted] »

bingomad123 wrote: post #167
avar wrote: post #110

This whole thread is full of comments from people who obviously haven't read the article / listened to the podcast in question[1]. Joseph Bankman proposed ReadyReturn in California, which is the kind of tax return pretty much the entirety of the rest of the western world uses. I.e. instead of an empty return, it's pre-filled in with the details the government knows anyway. This vastly simplifies things for most peopl…

> taxes already on the books that they might have previously unintentionally evaded. I agree with Grover Norquist. It might be counter intuitive but I would rather leave it to Turbo-tax to figure out the details than signing the form sent to me by IRS. Let IRS do the extra work of catching me if they think I am filing fraudulent taxes. Grover Norquist's view might be counter-intuitive but I a agree with him.

[deleted]

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#172

Post by lobster_johnson »

keithnz wrote: post #26
gamblor956 wrote: post #14

Correction: this proposal would not have simplified taxes (i.e., the California tax code). It would merely have simplified the filing of tax returns for the most common case, salaried workers receiving all of their income from a single source. Very big difference. HRBlock and Intuit are heavily vested in maintaining the current tax filing system. They are not, however, meaningful players in the attempts to rewrite th…

In new zealand, we got rid of having to do tax returns for salaried/wage earners a number of years ago. Makes life easy for a vast majority of people. You can still do a return if you want to though. For the tax department it cuts down on how much infrastructure they need.

Similar in Norway. You receive a pre-filled-out tax return in your digital inbox (Altinn.no). All the fields are filled out from wages, bank accounts, charities etc., numbers which have been reported to the government. You don't need to do anything with the tax return unless you want to make changes or attach additional forms. If you do nothing at all, it will be automatically submitted.

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#173

Post by thomastjeffery »

dingaling wrote: post #73
hnal943 wrote: post #48

Earlier quoted context omitted.

I think that's optimizing the wrong thing; people should be aware of the amount they are paying in taxes.

In the UK each pay-as-you-earn taxpayer ( I.e. tax calculated automatically and deducted from net income ) receives an annual statement of their tax and figuratively how it was spent e.g. £800 on health, £105 on defence etc

Whereas in the US most people don't pay any attention to where their tax dollars go. Meanwhile, President Trump raised our already ludicrous defense budget another $50 billion.

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#174

Post by MBCook »

slg wrote: post #150
avar wrote: post #110

This whole thread is full of comments from people who obviously haven't read the article / listened to the podcast in question[1]. Joseph Bankman proposed ReadyReturn in California, which is the kind of tax return pretty much the entirety of the rest of the western world uses. I.e. instead of an empty return, it's pre-filled in with the details the government knows anyway. This vastly simplifies things for most peopl…

If this system is so popular, why can't it be introduced as a proposition in California? Take the lobbyist and politicians out of the equation and it should win easily.

According to the story it's still available in California as an option for paying your state taxes, it's simply never became the default/only option. If you're in California and want to go find it and use it, it seems you can.

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#175

Post by wutbrodo »

rayiner wrote: post #61
anigbrowl wrote: post #41

Earlier quoted context omitted.

What's preposterous about it? You can buy a lot of influence for a couple million a year. Are you saying they're wasting their money and might as well just redistribute it to shareholders? If not, then presumably they think it a worthwhile expense or they wouldn't spend it.

The Chamber of Commerce has been lobbying for a simpler tax code (including flat taxes) for decades. They can direct vastly more lobbying dollars to the problem than can Intuit or H&R Block. If it was just a matter of lobbying dollars, the 0.5% of the economy that benefits from more complicated taxes could not possibly out-lobby the 99.5% of the economy that benefits from simpler taxes (all else being equal).

> If it was just a matter of lobbying dollars, the 0.5% of the economy that benefits from more complicated taxes could not possibly out-lobby the 99.5% of the economy that benefits from simpler taxes (all else being equal).

This is a laughably oversimplified way to think about, so much so that there's even a term for how wrong this is: diffuse benefits, concentrated costs (and its inverse, obviously).

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#176

Post by thomastjeffery »

moomin wrote: post #78
chiefofgxbxl wrote: post #24

Just for thought: suppose the tax system became so simplified that only goods X, Y,and Z were taxed at rates a,b,c. You pay aX+bY+cZ in taxes per year. It would be easy for voters to campaign their politicians to lower tax rates and easily verify. Obviously in the real world there aren't 3 levers to adjust: there are probably thousands or tens of thousands. Apart from the lobbying, politicians may themselves desire t…

I'm going to argue something a bit different: the overall tax revenue is roughly equal to government spending. The complexity of the tax code is to some extent a distraction. It's complex, and has winners and losers, but ultimately you'd need to raise the same amount whatever you did. If you really want lower taxes, you need to be honest: you'll be taking that money from someone else. Even then, it's amazing how many…

> If you really want lower taxes, you need to be honest: you'll be taking that money from someone else.

s/lower/raise

Taxation is theft.

> Take a look at defense spending. And don't pretend it won't cost some people dearly if you cut it.

I grew up on a US Army base. I can honestly tell you from firsthand experience that an absurd amount of that money goes to waste. 550 billion dollars is an insane amount of money.

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#177

Post by Thrymr »

ams6110 wrote: post #163
cestith wrote: post #129

Earlier quoted context omitted.

The 1040EZ doesn't allow one to deduct home mortgage interest. You need a 1098 and a Schedule A and the long-form 1040. That has nothing to do with whether you're filing from a single W2 or multiple 1099 forms. IIRC you can't deduct relocation expenses, wardrobe for work, books and training materials, or a whole bunch of other stuff on a 1040 EZ. So sure, as long as you want to overpay your taxes you can file in abou…

The original article was talking about simple tax returns. In fact, the 1040EZ is relatively new. Much newer than the existence of H&R Block. So evidently their efforts to keep taxes complicated aren't entirely successful. Even a 1040 "long form" (2 pages) with itemized deductions for mortgage interest isn't that complicated. I file about a 10 page return, 1040 with schedule A, schedule C, self-employment and various…

Of course, you also need to pay one of the tax prep companies just to file your return online (if you're above an income threshold), because you can't do that directly as an individual, either. Also due to their lobbying.

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#178

Post by eli_gottlieb »

bingomad123 wrote: post #167
avar wrote: post #110

This whole thread is full of comments from people who obviously haven't read the article / listened to the podcast in question[1]. Joseph Bankman proposed ReadyReturn in California, which is the kind of tax return pretty much the entirety of the rest of the western world uses. I.e. instead of an empty return, it's pre-filled in with the details the government knows anyway. This vastly simplifies things for most peopl…

> taxes already on the books that they might have previously unintentionally evaded. I agree with Grover Norquist. It might be counter intuitive but I would rather leave it to Turbo-tax to figure out the details than signing the form sent to me by IRS. Let IRS do the extra work of catching me if they think I am filing fraudulent taxes. Grover Norquist's view might be counter-intuitive but I a agree with him.

You can refer to TurboTax all you like, but you just basically admitted that you're committing tax fraud and challenging society to catch you.

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#179

Post by ceejayoz »

smt88 wrote: post #83
narag wrote: post #71

Earlier quoted context omitted.

They prefer regressive taxes, like sales tax I don't buy that. Yes, I know it seems logical, but in practice it's not so clear cut. With deductions, rich people end up paying very little for income tax. With sales tax (or VAT) the person spending more pays more, and it's more difficult to escape. This issue is very unintuitive and numbers tend to hide reality. Let me put an example on how numbers can fool us. In my c…

> With deductions, rich people end up paying very little for income tax You're utterly wrong. The wealthiest 0.001% paid 17.6% of their income in taxes in 2012[1]. That's not "very little" -- it's likely in the tens of millions per person . The top 1% paid even more than that. Some corporations will avoid income tax altogether, as will some small-business owners, but individuals still pay substantial amounts of incom…

> That's not "very little"

In my book, a billionaire paying a lower tax rate than their secretary, driver, security guard, etc. is paying proportionally "very little" taxes.

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#180

Post by thomastjeffery »

KZeillmann wrote: post #25
noobermin wrote: post #20

I'm going to say this until I'm blue in the face: fix money in politics, and half of these issues will no longer be intractable.

How do we "fix money in politics" without chilling free speech?

The problem is that a corporation is legally defined to be the same as a person. A corporation has the same rights that a person does. Spending money is legally equivalent to speech.

Because of those two simple legal precedents, a corporation's right to lobby is literally protected by free speech.

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