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Filing Taxes in Japan Is a Breeze. Why Not in the US?

nytimes.com

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Re: Filing Taxes in Japan Is a Breeze. Why Not in the US?

#151

Post by cjhanks »

eloisant wrote: post #54

It's a breeze in France too. Login to the government website, verify that everything preloaded is correct, add the few things they don't know about and you're done. It's a mess in the US because Turbotax and others make money on that complexity and do lobbying to keep it that way.

I am not sure I get it... it took me less than 2 hours to enter my W2's, import my brokerage liabilities, and insert my itemized deductions.

All for about $60.

You know what would be worse than that? A system which has absolutely no competition or financial incentive to improve....

Re: Filing Taxes in Japan Is a Breeze. Why Not in the US?

#152

Post by badminton1 »

For income tax return, many countries offer the possibility of filing a tax return that is pre-filled with information available to the tax revenue service.

For a person with simple reporting requirements, like only one source of income from a job, and no foreign income (99% of tax returns), the most likely required action is to just accept the proposal and file it... all done for free.

Re: Filing Taxes in Japan Is a Breeze. Why Not in the US?

#153

Post by vonmoltke »

obstinate wrote: post #144
csomar wrote: post #107

Earlier quoted context omitted.

yeah I was not too convinced when I read the article. The government can easily figure out the taxes for your wage (which your employer did actually figure out) but they can't figure out the taxes on your real estate revenue, and maybe other activities (traded cryptocurrency? freelanced on the side? Airbnb"ing" some of your estate)

I am not able to find a citation for this, but I would be surprised if more than a small fraction of Americans had significant non-wage, non-financial institution investment income to report. A solution doesn't have to solve a problem for everyone to be useful.

That's just income. There is also the issue of deductions and credits, which covers many more people. The income portion of my taxes takes me about 5 minutes. Most of my time is spent on the deductions and credits portion.

Re: Filing Taxes in Japan Is a Breeze. Why Not in the US?

#154

Post by the_mitsuhiko »

fredophile wrote: post #136
II2II wrote: post #127

Earlier quoted context omitted.

Wouldn't American employers also be spending a fair bit of money figuring out taxes for their employees prior to handing off the data and money to the IRS? And wouldn't financial institutions be doing something similar for their clients? The systems described by the article seem to be using the data submitted by employers and financial institutions to generate a tax return, which the tax payer verifies or adds to (in…

Not really. I don't have first hand experience but my understanding is that if you're employed as a salaryman in Japan then your employer will file your taxes for you. That is very different from your employer sending a form saying how much they paid you and what was already deducted for taxes.

I don't know how it's in Japan but in Austria neither the company nor the employee file taxes. There is a general tax withholding that you do as an employer for your employees but the taxes are filed automatically by the state.

You can then retroactively go in and modify that by doing a "Arbeitnehmerveranlagung" where you can claim modifications to your automatic tax filings.

This is a different process for when you are self employed and you actually file taxes from "scratch" which however is also a significantly simplified process.

Re: Filing Taxes in Japan Is a Breeze. Why Not in the US?

#155

Post by BoorishBears »

eitally wrote: post #148
BoorishBears wrote: post #90

Earlier quoted context omitted.

It took me about 10 minutes here in the US. Log into Turbo Tax, have it pull my last year's information, update the income fields and click through a wizard. It cost 30$, and I can see how you could argue the fact I paid a private company for a convience other countries get from their government for free is sad, but I'll take it since my quality of life would drop significantly at a comparable salary in Sweden due to…

It's only 10min [using Turbo Tax | Tax Act | Whatever] if you have a simple 1040/1040EZ. Even simple things like 1099-DIV or 1099-INT, capital gains & losses on investments (including employee stock purchase or options programs), and charitable donations can add many hours, especially if the software doesn't have an automated interface to your various financial accounts. I typically use Turbo Tax, too, and even pulli…

I lucked out with the integrations lining up with most of my accounts this year(and personally I think the charitable donations wizard takes that long but I guess it depends on the nature of them), but even in years where it took days of slogging through wizards I still think about what the alternatives around the world are and I'm pretty ok with it.

Obviously given the choice of a comparable tax burden and simplified returns I'd take it, but I find that for the most part once your taxes are so complicated you have to pay someone to do your taxes, you still won't ever pay anything even remotely high enough to close the gap between what your tax burden in a country like Sweden would be and what it is here

Re: Filing Taxes in Japan Is a Breeze. Why Not in the US?

#156

Post by krzyk »

chimeracoder wrote: post #109
jacquesm wrote: post #100

Earlier quoted context omitted.

> I was particularly surprised how you have to pay many different fees which in Finland would have been bundled together. Namely having separate bills coming on varying payment schedules for income tax, municipal tax, entrepreneur tax (5%) and health insurance. This seems inefficient and confusing to me. That's how it is in most countries because they're all different entities collecting.

> That's how it is in most countries because they're all different entities collecting. Exactly. I pay city, state, and federal income tax in the US. My city is about 1.5 times the population of Finland, and that's only one of the three different forms of income tax I have to pay. At least that goes through the state, so it's only two departments, but that's again separate from the federal IRS. And that's just income…

In Poland municipal, state and federal income taxes are paid as a single entry on the tax form. The government then transfers the money to the appropriate lower level of authorities.

So I wouldn't say that most countries differentiate like in the states.

Maybe it is a Europe - USA difference?

Re: Filing Taxes in Japan Is a Breeze. Why Not in the US?

#157

Post by InitialLastName »

chimeracoder wrote: post #109
jacquesm wrote: post #100

Earlier quoted context omitted.

> I was particularly surprised how you have to pay many different fees which in Finland would have been bundled together. Namely having separate bills coming on varying payment schedules for income tax, municipal tax, entrepreneur tax (5%) and health insurance. This seems inefficient and confusing to me. That's how it is in most countries because they're all different entities collecting.

> That's how it is in most countries because they're all different entities collecting. Exactly. I pay city, state, and federal income tax in the US. My city is about 1.5 times the population of Finland, and that's only one of the three different forms of income tax I have to pay. At least that goes through the state, so it's only two departments, but that's again separate from the federal IRS. And that's just income…

Side note... when you say your city is 1.5 times the population of Finland, are you referring to the only city in the US with a larger population than Finland?

Re: Filing Taxes in Japan Is a Breeze. Why Not in the US?

#158

Post by _delirium »

II2II wrote: post #135
sidlls wrote: post #117

Earlier quoted context omitted.

I view over-withholding as an interest free loan to the government. No thanks. I'd rather underpay by 1% than overpay. For me 1% is over $100/mo. I'd rather earn interest, dividends, whatever on that and then pay the balance.

They seem to over-withhold in Canada as well, and I disagree with it for similar reasons. On the other hand, it is likely a huge benefit to the poor and those who are poor at managing their money. Come tax time, they could easily face a bill that exceeds their paycheck and paying interest on top of their taxes. It would also cost the government more since they would have to pursue collection more aggressively.

They tend to overwithhold in Denmark as well, mostly because it avoids having to chase down people for payments later (giving people refunds is easier and fully automated). However they do pay interest on the overwithheld amount.

Re: Filing Taxes in Japan Is a Breeze. Why Not in the US?

#159

Post by strictnein »

The reason American taxes are more complex is that both parties use the income tax system for social engineering. They want to encourage things like home ownership, attending college, having kids, donating to charity, etc, so they let you deduct related costs.

Re: Filing Taxes in Japan Is a Breeze. Why Not in the US?

#160

Post by Fej »

I'm one of the somewhat lucky ones - I file a Form 1040EZ. It's pretty simple. Fill in the boxes, do a bit of really simple math, and sign on the dotted line. My state, New Jersey, does free online filing as well.

There is a silver lining to everything. US tax filing isn't completely bad.

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