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IRS Reforms Free File Program, Drops Agreement Not to Compete with TurboTax

propublica.org

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Re: IRS Reforms Free File Program, Drops Agreement Not to Compete with TurboTax

#141

Post by jandrese »

rb808 wrote: post #25
jjeaff wrote: post #11

There is no reason the IRS shouldn't have a simple, online fillable 1099EZ that makes the calculations and validations for you. And while their at it, match the SSN to the w2 info that they have on file. This would take care of 80% of the population. Just don't outsource it. I'm sure USDS could have it ready in less than a year.

What about States? Should the IRS make a online form that will do your state tax too?

Virginia used to have an online system like that. It was wonderful, so Intuit/H&R block lobbied the state legislature and had it killed.

Re: IRS Reforms Free File Program, Drops Agreement Not to Compete with TurboTax

#142

Post by [deleted] »

hexeater wrote: post #68
coldpie wrote: post #35

Earlier quoted context omitted.

Have you actually gotten a penalty? The IRS is just interested in gathering its taxes, it has no interest in punishing you. You have to mess up pretty hard and/or deliberately to get the IRS on your case.

I have gotten IRS penalties/interest due to my incorrectly reporting. I was confused about how to report RSU and Stock Option income, and then I was doubly confused about how to do quarterly filings. I am REALLY trying to do this on my own without an accountant. I think I got it right with 2019, but I will find in a few week how far off I am when I try to file. I'd say my interaction feels like the IRS is just painti…

[deleted]

Re: IRS Reforms Free File Program, Drops Agreement Not to Compete with TurboTax

#143

Post by jfc »

granzymes wrote: post #7

>Now companies are barred from hiding their free products from search engines such as Google, and a years-old prohibition on the IRS creating its own online filing system has been scrapped. >Under the new rules, participating companies also have to standardize the naming convention of their Free File version as “IRS Free File program delivered by [product name].” Respect to ProPublica for their commitment to this iss…

ProPublica reported that after they published this story, people eligible for free filing contacted TurboTax to get refunds. At first, they were able to get refunds of the fees that they paid but once word got out the customer service reps stonewalled them. So ProPublica invited readers to submit stories of their experiences with TurboTax customer service.

Quality journalism.

Re: IRS Reforms Free File Program, Drops Agreement Not to Compete with TurboTax

#144

Post by astura »

mulmen wrote: post #105
astura wrote: post #17

This is great news! I really hope the IRS creates it's own site, they would need to advertise it heavily though, way way too many people think eFile = TurboTax. There's already vastly better options out there but very few people use them or know about them. Edit: I think the real killer feature would be to pre-populate the "IRS e-file" with the information the IRS already knows about you. That would get people paying…

Care to mention any of these better options?

I can only speak to myself.

TaxHawk ( https://www.taxhawk.com ) is what I've been using for like almost a decade. Federal filing is free, state filing is only is $15. You're free to use the free federal option without having to pay for the state option. No tiers, no dark patterns, no upsells. The UI is fantastic (and the UI is the entire point of using software, otherwise I'd just fill out my 1040 by hand like I did for many years). You can pull up the 1040 for any of your previous returns.

I've mentioned it on HN before and one reply said they used it to file because of my recommendation and it was both better than TurboTax and saved them like $100.

Re: IRS Reforms Free File Program, Drops Agreement Not to Compete with TurboTax

#145

Post by alistairSH »

dahfizz wrote: post #132
alistairSH wrote: post #67

In the US, we've had decades of (largely GOP) messaging that the government can't do anything properly. A substantial portion of the population believes it. As noted in a sibling comment, the IRS could pre-fill forms that would be correct for the vast majority of tax payers (who take the standard deduction/don't itemize, have a single job, and no other edge cases). These people should not be paying TurboTax either wa…

I have had a different experience. Last year I filled out my 1040EZ and was unhappy with the final amount owed. I decided to click through turbo tax who found me a lot of deductions related to student loans and things. I think I only paid like $35 and they saved me over a thousand I would have missed otherwise. And truthfully, it's not a lot of money. I would gladly pay $30-40 just to not have to deal with the hassle…

The majority (~70%) of tax-payers don't have $12k/$24k (single/married) worth of things to deduct. Yet, ~90% of tax-payers use either a CPA (~50%) or tax software (30%) to file.

Between overly complex rules, heavy advertising, and lobbying, the tax prep companies have us all convinced we'll go jail if we don't pay $40-$400+ for prep services.

Re: IRS Reforms Free File Program, Drops Agreement Not to Compete with TurboTax

#146

Post by nightski »

rdtsc wrote: post #90
coldpie wrote: post #35

Earlier quoted context omitted.

Have you actually gotten a penalty? The IRS is just interested in gathering its taxes, it has no interest in punishing you. You have to mess up pretty hard and/or deliberately to get the IRS on your case.

6 years later you don't just get to pay what you owed. There is interest to be paid as well. You can negotiate sure, but they could have just sent a pre-filled form saying "based on W-2 and what we already took out, here is how much you owe us, if you agree, sign, send the check and return it" or even better do it online.

In my experience the IRS will get back to you within a few months if there are errors at most with exactly the information you described. Where is this 6 years coming from?

Re: IRS Reforms Free File Program, Drops Agreement Not to Compete with TurboTax

#147

Post by logfromblammo »

rdtsc wrote: post #23
jjeaff wrote: post #11

There is no reason the IRS shouldn't have a simple, online fillable 1099EZ that makes the calculations and validations for you. And while their at it, match the SSN to the w2 info that they have on file. This would take care of 80% of the population. Just don't outsource it. I'm sure USDS could have it ready in less than a year.

100% agree. To me they seem to be playing this perverse game of knowing how much you owe based on your W-2s then not telling you, waiting for you to file and guess how much you owe just right. If you guess wrong tough luck, you get penalties years later.

They'll tell you, if you file a FOIA request.

But then the documents they send are poorly documented, and very difficult to extract the required information from. The documents you want might also arrive after the annual filing deadline, or never.

And what they calculate for what you owe never includes optional means of reducing tax owed. So in some cases, the number you calculate for yourself can be both lower than theirs and yet still correct.

If you are in a business that includes a lot of cash transactions, or have to report additional income from sources that do not automatically report on a 1099 or w2, a FOIA request should be able to tell you what the IRS already knows about, and can prove that you earned. That will allow you to calculate how many patriotic brownie points you will earn for reporting those sources that aren't already noted in your file. As with many things related to government administration, be warned that if you choose to play stupid games, you might win stupid prizes.

Re: IRS Reforms Free File Program, Drops Agreement Not to Compete with TurboTax

#148

Post by Craighead »

komali2 wrote: post #82
alistairSH wrote: post #67

In the US, we've had decades of (largely GOP) messaging that the government can't do anything properly. A substantial portion of the population believes it. As noted in a sibling comment, the IRS could pre-fill forms that would be correct for the vast majority of tax payers (who take the standard deduction/don't itemize, have a single job, and no other edge cases). These people should not be paying TurboTax either wa…

It's pretty disgusting. Summed up in one of my favorite tweets, which went something like > Gov: you owe us money. It's called taxes > Ctzn: oh ok, how much do I owe you? > Gov: you have to figure it out > Ctzn: oh well, then I owe you 0 > Gov: no, no, we know how much you owe, you have to figure it out, and by the way if you get it wrong you go to jail

The purposefully vauge summation you provided misses the part where the highly influential people lobbied to be able to associate money as speech, use said speech to funnel external funds into a domestic process of government, and ensure that wealthy oligarchs from around the world can continue to steal from the poor while ensuring the same poor think it's the fault of the government, and thus the cycle continues.

You and your tweet are not correct and the purposeful lack of nuance tells me you are commenting in bad faith.

Re: IRS Reforms Free File Program, Drops Agreement Not to Compete with TurboTax

#149

Post by creato »

astura wrote: post #111
alistairSH wrote: post #67

In the US, we've had decades of (largely GOP) messaging that the government can't do anything properly. A substantial portion of the population believes it. As noted in a sibling comment, the IRS could pre-fill forms that would be correct for the vast majority of tax payers (who take the standard deduction/don't itemize, have a single job, and no other edge cases). These people should not be paying TurboTax either wa…

It's also anti-tax activist like Grover Norquist’s Americans for Tax Reform who hate automatic filing and prefilled forms too. Their reasoning is if taxes are "too easy" then somehow Americans will blindly accept tax increases so they actually want to keep tax filing as difficult as possible.

> Their reasoning is if taxes are "too easy" then somehow Americans will blindly accept tax increases so they actually want to keep tax filing as difficult as possible.

It's simpler than that: They want taxes to be a pain in the ass so people hate them.

Re: IRS Reforms Free File Program, Drops Agreement Not to Compete with TurboTax

#150

Post by cortesoft »

JohnFen wrote: post #54
skizm wrote: post #48

Earlier quoted context omitted.

An actual argument I've heard from TurboTax shills is that tons of people underpay taxes now with the self report system, and having the government pre-fill forms for you to rubber stamp would effectively increase taxes on the working class.

That's such a nonsense argument, though. Having the IRS pre-fill basic forms for you would not obligate you to accept them. People could still compute their taxes themselves (or pay someone else to do it).

Ok, I disagree with the TurboTax reasoning, but I think your argument doesn't make sense... if most people have their pre-filled tax forms making them pay more than they should, then everyone is going to compute their taxes themselves anyway to avoid paying too much... at that point, why is it better than the current system?
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