Stanford Professor Loses Political Battle To Simplify Tax Filing Process • Hacker News Board

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

#361

Post by antisthenes » Thu, Mar 30, 2017, 3:49 PM UTC

basseq wrote: post #337

I did some work for the IRS several years ago to explore the same idea. There are many benefits, including simplicity and accuracy of filing (closing the $500B tax gap), as well as better fraud protection (another $25B). Protectionism of the tax return industry is common, but not the primary reason. Instead, the biggest pushback is from taxpayer advocacy groups. The issue is this: for many Americans, particularly low…

If you receive a huge tax refund from the IRS, that means you set up your initial deductions improperly.

If your sole income is 1 main full time job, it's really not hard to estimate your taxes to the point of having a refund under $500. That way you don't government use you as a bank for 0% interest and have more money throughout the year.

To preempt some of the responses - no, let's not denigrate poor people for their spending habits and pretend like somehow getting the refund is better than having that money during the year.

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

#362

Post by quadrangle » Thu, Mar 30, 2017, 3:49 PM UTC

Radim wrote: post #317

quadrangle wrote: post #228

Earlier quoted context omitted.

The goal of all taxing and spending must be related to political goals. They aren't goals in and of themselves. What is the political value of taxing a flat percent instead of a progressive percent (let alone taxing a flat dollar amount)? The political value of progressive percentages is that it keeps the money supply stable without taking too much spending power away from the lower and middle income people where the…

A fundamental sense of fairness -- for reasons given above. I understand that the "social contract" may dictate otherwise in practice (even ignoring arrogant self-declarations of "social value", coming from a communist East European country, I've seen enough of those). After all, we're just a bunch of primates. But to pretend there's nothing bizarre about this group-above-individual arrangement, that the opposite is…

Did you infer from anything I wrote some sort of group-above-individual dogma?

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

#363

Post by antisthenes » Thu, Mar 30, 2017, 3:51 PM UTC

cwkoss wrote: post #108

TeMPOraL wrote: post #79

Earlier quoted context omitted.

A more important question I never see addressed is how you prevent "money in politics" from unfixing itself as soon as you're done with the fixing? Money and political influence are two sides of the same coin - power. Money gives more influence, which attracts more money, and so on, in a positive feedback loop. How do we break, or at least control, that loop? Is it even possible?

Decentralization of power. For example, I'd love to see a progressive tax rate for corporations: companies' tax rates would be based on total revenue or profits. ex. If your company earns less than $50k/year, no taxes, 10% tax rate up to 250k, 20% up to $1M, 40% up to 10M, 50% on earnings over $10M. This would provide a strong incentive to only maintain a large corporation if the value of your economy of scale exceed…

You haven't really answered the question:

> For example, I'd love to see a progressive tax rate for corporations: companies' tax rates would be based on total revenue or profits. ex. If your company earns less than $50k/year, no taxes, 10% tax rate up to 250k, 20% up to $1M, 40% up to 10M, 50% on earnings over $10M.

What sort of politicians would actually push this through Congress? What stops it from being repealed with the next cycle? Without a culture of socialism and understanding that corporate/owner and individual interests are not incentive compatible, none of this would work.

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

#364

Post by egoine » Thu, Mar 30, 2017, 3:52 PM UTC

Tloewald wrote: post #239

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…

Actually I think Grover Norquist's position is that making the tax easier to pay would make it less easy to notice it rising and less unpopular. It's a horrible position but not quite so bizarre.

You are correct. But I find his argument to be BS.

1) if it is a simple number, it will be _easier_ to notice it rising.

2) For sure most people using software have no clue what it does. If the software told them they owe 1k more, they would pay it. So when he says that making it simpler would mean people wouldn't notice change to the tax code etc... well, I have a hard time believing they would notice in today's system!

I think he is full of s__t. He should be for a simpler system were the focus is not on detailed expenses and what not but on a simple number. This actually makes it easy to know if they went up. Intuit can then provide a software "why did my taxes go up" if it feels like it :)

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

#365

Post by quadrangle » Thu, Mar 30, 2017, 3:53 PM UTC

lagadu wrote: post #328

kakapupu wrote: post #285

Earlier quoted context omitted.

> they can use government to actually offset the power that corporations have (through plain capital and through regulatory capture) You're saying people can "use" the government to compensate for the government itself preventing competition with their cronies. Isn't that a bit of a fool's errand, even disregarding the fact that in reality we don't use the government - the government very much uses us.

>the government very much uses us. No, we put the government and the rules it has to follow in place to ensure that it has our best interests and nothing else in mind. They are a tool we use to make sure the state is run the way we want it to be.

Oh come on, I'm the one defending the idea that government can be positive and serve the people. But we can't honestly suggest that this is what it IS already like it's the plain truth. It's just something it sometimes sorta is (lots of examples that live up to the ideal, lots that don't). It's a premise that is possible. Governments always have been historically run by powerful interests and not actually lived up to democratic ideals.

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

#366

Post by quadrangle » Thu, Mar 30, 2017, 3:57 PM UTC

nocman wrote: post #355

toomuchtodo wrote: post #190

Earlier quoted context omitted.

That's not withholding though (as the parent referred to; withholding towards your federal income tax bill); as you mention, that's payroll taxes, which you're going to get in retirement back as entitlements. Consider what would happen if the IRS was efficient enough (through these automated tax accounting systems) to not get an interest free loan from working America for an entire year (ie dynamically modifying ever…

"which you're going to get in retirement back as entitlements." I doubt it. By the time I retire I expect that SS will be bankrupt. It has been going further down that road for years, and I don't see anything stopping the train.

There is NO SUCH THING as SS bankruptcy. It makes NO SENSE as a concept at all. It's a complete fiction. There is NO scenario in which the federal government can't just cash every SS check.

http://www.moslereconomics.com/wp-content/powerpoints/7DIF.p... fraud number 4. Short read, but easiest to understand if you read the first frauds.

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

#367

Post by quadrangle » Thu, Mar 30, 2017, 4:00 PM UTC

dragonwriter wrote: post #289

quadrangle wrote: post #219

Earlier quoted context omitted.

"IRS gets a loan" is metaphorically true in a sense but really doesn't hold up to scrutiny. The IRS doesn't actually get money from taxpayers at all. The IRS is just the bureaucracy that determines things. The money that you "pay" in federal taxes is just dollars that are deleted out of existence so that the dollars created by federal spending don't create inflation. The federal government's "cash flow" is made up en…

> The money that you "pay" in federal taxes is just dollars that are deleted out of existence so that the dollars created by federal spending don't create inflation. No, it's not. Federal government revenue is real revenue, federal government borrowing is real borrowing, and federal government spending is real spending. The Federal Reserve creates and destroys money, but that monetary action is separate from the fisc…

Yes, spending is real spending, but no taxes are not revenue. Read the link I posted. This isn't that hard to understand. The entire concept of federal budget is a balance between "revenue" and spending in order to keep the monetary supply stable. But seriously, just read the link, you don't seem to understand the basic facts I'm expressing.

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

#368

Post by quadrangle » Thu, Mar 30, 2017, 4:03 PM UTC

pas wrote: post #311

quadrangle wrote: post #252

Earlier quoted context omitted.

Yes, it's TOTALLY different. The U.S. power globally is EXTREMELY tied to the use of the dollar internationally. Everyone else who uses dollars (or has currency pegged to the dollar) is under major economic control and influence of the U.S. Oil priced in dollars is huge. When the U.S. left the gold standard it was giant fuck you to all the countries who held dollars and could no longer exchange them for gold. The U.S…

No it's not. Don't spread bullshit. Taxation works pretty much the same way everywhere. The central banks are separate entities in any modern state/economy/monetary zone. The federal and state/local taxes are the same. The federal government takes on debts like states. You might remember the brouhaha about the debt ceiling and the big sequester in the past few years. The Bretton Woods system was doomed to fail anyhow…

Are you actually aware of the points in the link I posted?

The import/export issue is real in the sense that Chinese folks holding U.S. dollars could buy up lobbyists and land and such in the U.S. if we let them. It's not real in the sense that we could, if we wanted, just give every U.S. citizen an extra $50,000 to dilute the buying power of foreign holders of dollars. That would be aggressive for sure, but we have the power to do that. It's a complex set of arrangements here.

Yes, the U.S. benefits the most from the current arrangement, so we aren't interested in screwing that up. But we could and would take action if the foreign-held dollars started getting used in ways that were bad enough for us to do something about it.

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

#369

Post by quadrangle » Thu, Mar 30, 2017, 4:06 PM UTC

Camillo wrote: post #288

quadrangle wrote: post #219

Earlier quoted context omitted.

"IRS gets a loan" is metaphorically true in a sense but really doesn't hold up to scrutiny. The IRS doesn't actually get money from taxpayers at all. The IRS is just the bureaucracy that determines things. The money that you "pay" in federal taxes is just dollars that are deleted out of existence so that the dollars created by federal spending don't create inflation. The federal government's "cash flow" is made up en…

Money is fungible. It doesn't make sense to say that these dollars that "disappear" are completely separate from these other dollars that magically "appear" out of nowhere. In real terms (we'll call it wealth, but you can call it purchasing power, or whatever other term you want to use for what dollars represent or enable), the wealth the US government spends comes from the actual people who get taxed, in the proport…

Yeah, but that's not contrary to what I'm saying. The real point is that the question of how much "revenue" in taxation vs spending is more of a matter of policy and purchasing power etc. to further economic and social goals and not something that has any inherent need to balance out.

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

#370

Post by toomuchtodo » Thu, Mar 30, 2017, 4:12 PM UTC

nocman wrote: post #353

toomuchtodo wrote: post #244

Earlier quoted context omitted.

The US government lends itself SS and Medicare funds because there is no safer asset class than US treasuries.

"The US government lends itself SS and Medicare funds" And that should have NEVER been legal. That money should have stayed in the funds. Any growth from those funds should still be in the funds. If they had not effectively stolen the money for other uses, those programs would not be in the mess they are in now.

The US government borrowing is how that money is invested. If you're upset it was all spent on wars and the military and not on productive uses, that's a governance problem; hold your reps accountable.