Live data from Hacker News

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

propublica.org

131–140 of 717 posts

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

#131
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?

Is this similar to PAYE or do you actually have to submit a tax return but it's pre-filled for you? In the UK, most people don't have to submit a tax return at all. Not sure the actual cost of this, but the convenience is unparalleled.

>Is this similar to PAYE or do you actually have to submit a tax return but it's pre-filled for you?

As long as your PAYE is like Ireland's (ROI) PAYE, then the American's system is far-removed from it.

Even though their tax revenue office gets the reports from businesses for how much they were paid and how much taxes they paid, the Americans still need to fill out a tax form - every year - to repeat the same information (it's an added benefit for the prison system, in that mistakes on tax forms can equate to jail time). They get a form from their employer (which their tax office also has), that contains all of this information.

>In the UK, most people don't have to submit a tax return at all. Not sure the actual cost of this, but the convenience is unparalleled.

Aye, it's the same in Ireland (ROI). You can just call-up or email Revenue and they check if you've overpaid, by how much, and they just send you the money. No forms. No bullshit. No threats of jail time. It's pretty deadly[0].

You want nothing to do with the Yanks' tax system, trust me.

[0] - https://www.whygo.com/ireland/irish-slang-deadly.html

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

#132
post #20

Earlier quoted context omitted.

Poor phrasing on my part - I’m not implying they would insert new taxes on the sly, but rather that in areas where tax payers have some discretion, the government software would default to the least favorable treatment for the tax payer, the effect being a higher net tax...

What would stop people from consulting to get more favorable taxes? Very few people need tax optimization[1], and government default doesn't preclude it - maybe Intuit could offer this as a service instead. In any case, I don't think the net tax would be higher than the current one that includes paying hundreds for TurboTax or a tax accountant (multiplied by all filers). 1. A guess. The majority think of rebate as "m…

Your premise is incorrect. Under 20% of people file a 1040ez, the simplest tax form. (Which doesn’t allow you to claim basic deductions like student loan interest.) That means the vast majority of filers see some benefit from “tax optimization.” If your computerized system did just the 1040ez calculation, for example, that’d be a huge effective increase in taxes.

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

#133

Earlier quoted context omitted.

Why aren’t they “freedoms”? Increased financial security due to eliminating the possibility of medical bankruptcy increases an individuals’ options/choices in life, does it not?

Freedom doesn't mean the same thing as "convenient for me". In fact freedom can often be difficult. Each item listed has an opposition position, most notably freedom to own a gun. Germany also has some of the most draconian anti-free speech laws of all first world nations, so I really don't think they're a good example to use as a pillar of freedom.

The elimination of medical bankruptcy is a “convenience”?

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

#134
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?

We’ve had great digital government services In Sweden for years. I did my taxes yesterday in 3 minutes from my laptop, digitally signed and submitted.

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

#135
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?

Out of curiosity, do you have insight on how this evolved? Did the government go from requiring paper to offering an electronic equivalent? In the US, the IRS supported an e-file system that basically allowed electronic versions of forms to be submitted, but it was arcane enough that a cottage industry developed to assist users in prepping documents for e-file. How does Finland support tax preparation services; what…

"Out of curiosity, do you have insight on how this evolved? Did the government go from requiring paper to offering an electronic equivalent?"

The taxation has been pretty automated for a long time.

As a regular taxpayer nowadays I just get a paper form that describes the precalculated taxes, and if they are fine, I don't have to return anything. There are some pre-deducted things, and if I have anything add to that, I'll then just either fill in the paper form or the electronic equivalent.

So yes, there was a basic "semi automated" scheme that has been steadily improving and now the tax authority has just added a web based interface for feeding data into it.

About filling the taxes on behalf of someone else -

There really is no need for tax preparation services unless you are business entity (in which case you likely already have your own accountant doing it) or the wealth is considerable enough to merit actual tax planning. Otherwise the tax code is so straightforward and simple that anyone can do it. If there are some questions, you can always contact the tax services and they will usually offer helpful and professional advice on how to proceed.

So there is no market for that kind of thing in the large. The "defaults" provided by government help in this regard as well.

I kinda understand the adverserial positioning of "people vs. the government" in the US - it just sounds to an outsider the main reason not to make things easier is because that would eradicate business from turbo tax. Kinda like the government mandated you need to own a useless dead parrot, that you can only buy from Parrot Co, that needs to be kept in the refridgerator in an exact position mandated by the law.

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

#136
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 Sweden too it’s super easy.

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

#137
post #104

As the article makes clear, this is not a unilateral ban on competing with tax prep software companies, but rather a deal (pre-existing but now codified into law) in which the companies agree to provide free tax prep software to low-income taxpayers and in exchange the federal government agrees not to create a competing product. To me this sounds like a great deal for taxpayers. In exchange for not spending tons of t…

But is it really free? Or are you just paying in a different way? https://www.washingtonpost.com/technology/2019/03/07/when-ta...

That article is referring to a different breed of free service.

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

#138
Taxes are complicated to file because taxes are complicated. I’m surprised the source of tax woes is left out of this discussion, and the obvious solution (a simple tax system).

The solution to excessive, complicated rules is less, simpler rules.

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

#139
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…

Also interested.

I see a lot of criticism of the idea, but there's more than one way to skin a cat.

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

#140

Earlier quoted context omitted.

Is this similar to PAYE or do you actually have to submit a tax return but it's pre-filled for you? In the UK, most people don't have to submit a tax return at all. Not sure the actual cost of this, but the convenience is unparalleled.

> Is this similar to PAYE or do you actually have to submit a tax return but it's pre-filled for you? As long as your PAYE is like Ireland's (ROI) PAYE, then the American's system is far-removed from it. Even though their tax revenue office gets the reports from businesses for how much they were paid and how much taxes they paid, the Americans still need to fill out a tax form - every year - to repeat the same inform…

> Even though their tax revenue office gets the reports from businesses for how much they were paid and how much taxes they paid, the Americans still need to fill out a tax form - every year - to repeat the same information (it's an added benefit for the prison system, in that mistakes on tax forms can equate to jail time). They get a form from their employer (which their tax office also has), that contains all of this information.

You seem quite ignorant of the U.S. tax system. There are no criminal penalties for mistakes on your tax form. (the IRS doesn't even have prosecution authority--all it can do is collect evidence of a crime, and refer the case to the Department of Justice.)

And your tax return doesn't just "repeat the same information" as your W-2s. For example, the W-2 reports income on an individual basis, while married couples file a return as a single unit. The amount of tax owed will generally be different for married couples versus the amount of tax withheld. (And there is no federal government database of marriages the IRS can use to match up things on the back end.) The IRS also has no idea how many children you have living with you, and can't give you the appropriate credits for that.

Post reply on HN