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

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

#261

Post by EGreg »

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…

The funniest and most ridiculous thing is when they cut taxes so they need to cut back on federal agencies so they cut the resources OF THE IRS so now the IRS can’t afford to audit rich people and their staff, only poor people. Perhaps it was intentional?

(By the same people who complained the IRS was targeting them for audits.)

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

#262

Post by JamesBarney »

jxramos wrote: post #168
komali2 wrote: post #82

Earlier quoted context omitted.

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 thing people misunderstand with the government not being able to figure it out is because there's a huge variety of complexity that is truly individual based. Did you make a contribution to a tax deductible IRA? Did you make a retroactive payment to that account in the following tax calendar year? There's a ton of variables going on here, where the government doesn't have this all-seeing system where everything g…

Tax brackets are the simplest thing in the world but I've heard this argument several times. Is it made it good faith? Are there really people who think tax brackets make taxes complicated and not 401ks, mortgage interest tax deductions, capital gains, etc?

A flat tax is completely orthoganal to the complexity of the tax system(which is almost entirely what counts as income, and what type of income does it count as).

If tomorrow we merged all tax brackets into one, no one's taxes would get any simpler, just the poor would pay far more in taxes and the rich far less.

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

#263

Post by Apocryphon »

reaperducer wrote: post #253
arcticbull wrote: post #235

Earlier quoted context omitted.

Literally all of that information is already being reported to the IRS by the relevant companies on forms 1098, 1099-whatever, W-2, W-4 and whatever other schedules apply. The IRS defines the rules, they built an engine to take all that into account to ensure you're not lying on your taxes. They just have to literally run it and send you the printout for verification with a remittance stub. The rest is regulatory cap…

Literally all of that information is already being reported to the IRS by the relevant companies on forms 1098, 1099-whatever, W-2, W-4 and whatever other schedules apply. But not instantly. And not all of it in time for April 15th. Sometimes those details don't make it to the IRS for years. We don't yet live in a world of instantaneous information transfer about every American citizen to the government. Some people…

Then by all means, make citizens send in the relevant documents to the IRS- but don't force them to have to figure it out on their own if the IRS's software can already do it with those docs!

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

#264

Post by strbean »

nicoburns wrote: post #223
danschumann wrote: post #173

Earlier quoted context omitted.

I think are more steelman'ed version of the GOP argument is: when government does things badly, they can go VERY VERY badly. It's a risk viewpoint. Whereas the progressive viewpoint letting government do more and more things. The other risk is bloat. Once a government program exists, it is very very hard to stop it and get the funds back ( from a political perspective ). It's unpopular to fire people. When government…

> Once a government program exists, it is very very hard to stop it and get the funds back ( from a political perspective ). Experience in the UK tells me otherwise. Our government has been doing little else for the last decade. > It's not so much saying that all government is bad, but it's looking at worse case scenarios and balancing risk. It's funny how worst case scenarios (like monopolies or oligopolies) aren't…

Yeah, I'm waiting on the replacements for BP, Wells Fargo, Comcast, ...

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

#265

Post by danans »

jxramos wrote: post #231
danans wrote: post #197

Earlier quoted context omitted.

> Needless to say all of this would be much more simple if we just pay a flat tax on all income for all people. Nothing simpler than that. That would be a highly regressive tax system that dramatically transfers even more wealth to the already wealthy. But sure, it's definitely simpler. That doesn't make it better.

The regression application here seems flawed, that assumes a fixed percentage is applied to a fixed amount, where that amount is invariant to income. That is not the case with a flat tax where a fixed percentage is applied to a variable amount. The flatness of the flat tax is on the percentage, the amount (income) is the variable portion that will be more or less based on the individual. The percents however will be…

A flat tax would be more regressive than a progressive tax scheme - it's a spectrum.

> That's about as equal and fair as you can get

Equal in terms of % of income paid: yes, fair: no way. Your statement makes the assumption that the opportunities to gain higher income are equally and fairly distributed, which they are manifestly not.

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

#266

Post by dehrmann »

redisman wrote: post #258
dehrmann wrote: post #210

Earlier quoted context omitted.

> They know all of your income down to the cent If you have a W-2 job and all your investments are in a bank or brokerage, but they still don't know your filing situation, dependents, other income, or deductions. Not that I'm justifying the current system. It's just that the IRS only knows the big picture for most people. The rest is complicated.

Don't they know that from the W-4? Or does that not go to the IRS

I'm not sure if it does or not, but you can have one W-4 per paycheck, so I thought it was just used to figure out your withholding. The amount withheld shows up on your W-2.

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

#268

Post by lutorm »

jacurtis wrote: post #214
jxramos wrote: post #168

Earlier quoted context omitted.

The thing people misunderstand with the government not being able to figure it out is because there's a huge variety of complexity that is truly individual based. Did you make a contribution to a tax deductible IRA? Did you make a retroactive payment to that account in the following tax calendar year? There's a ton of variables going on here, where the government doesn't have this all-seeing system where everything g…

I do agree, that ultimately there are several deductions that can reduce the taxes you owe in a given year. But most americans don't have enough of these deductions to make a significant difference. So the ideal solution would be that the IRS sends you a letter in January that basically says "You made $XX,XXX this year, you are in YYY tax bracket, and thus you owe $ZZ,ZZZ money". So if they sent that in January, then…

This is how it works in Sweden, at least for people with reasonably simple situations: You get a piece of paper saying "this is what we think you made and how much taxes you should pay". Unless some reporting is wrong, you just log on to the tax website and approve it.

They also keep a running tab on your tax account, if you underpay or overpay you have an interest-yielding balance that you can either correct or let sit until next year if the amount is so little it doesn't matter. And it's symmetric with respect to a surplus or deficit, unlike the IRS "if we owe you, then thanks for the zero-interest loan you gave us, but if you owe us then there will be interest and possibly penalties" scheme.

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

#269

Post by formercoder »

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…

Based on empirical evidence the government is terrible at doing pretty much anything. I don’t remember the last time I had a logical, efficient, pleasant, and cheap interaction with a US government agency. I happen to have those with private companies all the time.

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

#270

Post by rstupek »

jorblumesea wrote: post #200
briandear wrote: post #155

Earlier quoted context omitted.

Sabotaging democracy? You mean like attempting to overturn a presidential election?

I mean, Gerrymandering, voter suppression... Hard to believe they're acting in any democratic fashion. Btw, impeachment is a well documented power of the legislative branch.

Gerrymandering is not a one-sided thing. Both parties have done it and will likely continue to do it.
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