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Congress Is About to Ban the US Government from Offering Free Online Tax Filing

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Re: Congress Is About to Ban the US Government from Offering Free Online Tax Filing

#41

Post by jermaustin1 »

alkonaut wrote: post #23

I just filed my taxes in 10 seconds using the tax authority's smartphone app. It had pre-filled all my deductions such as interest using info reported from my employer and banks. Apart from bribes from those who make tax software (which should be pretty easy to expose) I can't understand why congress wouldn't want to make paying taxes simple and efficient?

There is a podcast episode of "Planet Money" that goes into the history of this [1]. Pretty much it goes: If taxes were easy, people would hate them less, and not fight to abolish them - Grover Norquist.

1: https://www.npr.org/sections/money/2017/03/22/521132960/epis...

Re: Congress Is About to Ban the US Government from Offering Free Online Tax Filing

#42

Post by dalbasal »

This is one of the more explicit examples where complexity is stealth-deliberately is promoted.

Tyler Cowen (and in his own way, david graeber) made a point that really stuck with me. Badly paraphrased:

The introduction of PCs & software to the office, has not increased office worker productivity at all. It's very hard to define or measure white collar productivity, but to the extent that it can be measured... it hasn't improved. From another angle, university administrations, tax collectors, accountants, legal departments, international customs agencies, etc. have as many or more people and don't seem to be producing a whole lot more.

To paraphrase Graeber's more beligerent take on it: Getting more efficient at paperwork just produces more & more complicated paperwork.

Re: Congress Is About to Ban the US Government from Offering Free Online Tax Filing

#43

Post by linuxftw »

fsloth wrote: post #25

Oh man, I've had government provided automatic filings for ages now (Finland). US is really odd how it emphasizes the benefit of the middleman over the benefit of the individual citizen (it seems). Or have I completely misunderstood what's going on here?

(in the US) I would trust the government provided tax-return software to provide the smallest refund possible. It will also take $50 billion and 3-4 years to develop, and it will be down from April 1st to May 7th due to overload on the system. Your confirmation emails won't come through, and the database will be hacked and all records leaked within the first 18 months of operation.

Re: Congress Is About to Ban the US Government from Offering Free Online Tax Filing

#44

Post by lenticular »

westmeal wrote: post #35
tvanantwerp wrote: post #21

Earlier quoted context omitted.

I can imagine it happening. The US tax code is so complicated that most tax payers don't really understand it. Heck, most tax payers don't understand how marginal tax rates work or why having a large refund isn't actually a good thing. I can absolutely believe that a majority of people would accept a negative change to the tax code due to an inability to understand it, choosing to just accept whatever they're being t…

Why isn't a large tax return a good thing? Is it because the tax return is basically what they have taken from your income already?

Yeah, your tax refund was an interest-free loan to the government.

Re: Congress Is About to Ban the US Government from Offering Free Online Tax Filing

#45

Post by castlecrasher2 »

0xfeba wrote: post #26

What's preventing a OSS solution to this? What I can think of off the top of my head: * Lack of e-file permission * Lack of any kind of legal recourse or audit protection for the user * Constantly changing tax system After a casual search on GitHub I see a few calculator projects but nothing serious. I'd be down to help make a free competitor to Intuit. I see no reason to use a non-static site unless it's to keep pre…

I think the biggest reasons are 1) the vast amount of subject matter expertise required, especially with each state having its own rules, and 2) pretty much any risk at all of having an incorrect return because of buggy prep software is enough to deter most people from using it.

Re: Congress Is About to Ban the US Government from Offering Free Online Tax Filing

#46

Post by linuxftw »

tvanantwerp wrote: post #21
komali2 wrote: post #10

Earlier quoted context omitted.

>sneak in stealth tax changes I don't think we exist in a world where this is possible.

I can imagine it happening. The US tax code is so complicated that most tax payers don't really understand it. Heck, most tax payers don't understand how marginal tax rates work or why having a large refund isn't actually a good thing. I can absolutely believe that a majority of people would accept a negative change to the tax code due to an inability to understand it, choosing to just accept whatever they're being t…

Most tax payers can't multiply two fractions. It could be as simple as filling in 3 fields on a form, they'll still march down to Jackson Hewitt and pay someone hundreds of dollars to do it for them.

Re: Congress Is About to Ban the US Government from Offering Free Online Tax Filing

#47

Post by maxwell »

linuxftw wrote: post #43
fsloth wrote: post #25

Oh man, I've had government provided automatic filings for ages now (Finland). US is really odd how it emphasizes the benefit of the middleman over the benefit of the individual citizen (it seems). Or have I completely misunderstood what's going on here?

(in the US) I would trust the government provided tax-return software to provide the smallest refund possible. It will also take $50 billion and 3-4 years to develop, and it will be down from April 1st to May 7th due to overload on the system. Your confirmation emails won't come through, and the database will be hacked and all records leaked within the first 18 months of operation.

https://designsystem.digital.gov/

https://federalist.18f.gov/

https://www.opensecrets.org/orgs/lobby.php?id=D000026667

Re: Congress Is About to Ban the US Government from Offering Free Online Tax Filing

#48

Post by chadash »

0xfeba wrote: post #26

What's preventing a OSS solution to this? What I can think of off the top of my head: * Lack of e-file permission * Lack of any kind of legal recourse or audit protection for the user * Constantly changing tax system After a casual search on GitHub I see a few calculator projects but nothing serious. I'd be down to help make a free competitor to Intuit. I see no reason to use a non-static site unless it's to keep pre…

The problem is that the system requires constant maintenance every time some tax law changes in any state, and great maintenance is something that only the most well funded OSS projects get. And you need participation from lawyers and accountants, not just software developers.

As the article notes, there are already free solutions for people with basic income situations (W-2, some bank interest, no stock sales) making under $66k. Personally, I don't mind paying $100 to turbotax for the peace of mind of knowing that at the very least, they have a staff of tax experts looking over the details of their filing process.

Now, if the IRS came along with an official app that showed me what information they already had and I just needed to make some small adjustments from there (assuming my tax situation isn't complicated), then yeah, I'd use that. And it's a bit crazy that we don't have that. But unlike many countries, we are taxed at both the federal and state levels, which makes the process much more complicated. And to complicate things further, the two interact: I can deduct some of my state taxes from my federal taxes (though less than before). And don't even get me started with the complications of a move from state to state.

EDIT: thinking about this a bit more. What really annoys me about the current system isn't necessarily that I pay to file my taxes. It's that it's so easy to miss things. Maybe i have a bank account that earned $12 in interest and I earned $20 from money that I put into lendingclub.com two years ago. It's annoying that the government has this information, but on the other hand, it's very easy for me to not see (or forget about) the email/snail-mail that I got about this income and then forget to declare it on my taxes. Yes, I know that the IRS isn't sending me to jail for forgetting to pay $5 in taxes, but in general, the process would be much less stressful if I had some kind of centralized reminder of all the income I made.

Re: Congress Is About to Ban the US Government from Offering Free Online Tax Filing

#49

Post by EGreg »

fsloth wrote: post #25

Oh man, I've had government provided automatic filings for ages now (Finland). US is really odd how it emphasizes the benefit of the middleman over the benefit of the individual citizen (it seems). Or have I completely misunderstood what's going on here?

Yes, the US really values the middleman. There is something to be said for it, since middlemen can compete and innovate. In computer science, this is called indirection — it provides more flexibility and without it, you have one-size-fits-all solutions. In the real world, you have for example Uber/Amazon/Apple /Google/Facebook squeezing providers, due to their monopoly powers.

What happens in the real world is that the doctors aggregate (AMA, ADA) and then the patients aggregate (insurance companies) but it never quite gets to a complete single buyer/payer on both sides without government action.

There is also the argument for how many jobs will be lost in X industry if we replace it with a more efficient solution. Here is a recent video of a famous paleoconservative debating it with a famous neoconservative in the US: https://m.youtube.com/watch?v=YFMcq0Vzsb4

Usually the solution is social democracy - letting the private markets operate but having the government run a single payer system for the basic level of service so sellers compete and buyer’s don’t, and everyone is entitled to the basic level.

Single payer can achieve far lower prices, as can eliminating IP protection. But after a while this may have a deleterious effect on R&D (unless you eliminate the IP protection).

Re: Congress Is About to Ban the US Government from Offering Free Online Tax Filing

#50

Post by SkyBelow »

fsloth wrote: post #25

Oh man, I've had government provided automatic filings for ages now (Finland). US is really odd how it emphasizes the benefit of the middleman over the benefit of the individual citizen (it seems). Or have I completely misunderstood what's going on here?

>US is really odd how it emphasizes the benefit of the middleman over the benefit of the individual citizen (it seems).

I wonder what extent this is decided by how we vote. As long as voters pick the politician who prioritizes the middle man and gets their campaign contribution is selected over the politician who prioritizes the public but whose opponent gets the middleman's campaign contribution we will continue to see this behavior. The moral of the story is to look at the voters' actions and not their words. They select candidates based on oftentimes harmful criteria.

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