Open Source Tax Software • Hacker News Board

Re: Open Source Tax Software

#191

Post by PaulDavisThe1st » Tue, Oct 05, 2021, 2:16 PM UTC

nwatson wrote: post #173

Jugurtha wrote: post #159

Earlier quoted context omitted.

In Algeria, we have "retenue à la source". Taxes are withheld and paid by the company on behalf of the employee, so you don't need to do any taxes. The company takes care of social Security payment and taxes, and it appears in the tax returns of the company, and the employee's pay stubs. The organization's accountant or accounting firm takes care of it. You don't interact with the revenue service as an employee, or f…

In the U.S. this "withholding" happens as well. Regular employee paychecks already lose a chunk of nominal income attributed to various buckets, federal and state and maybe local level. Toward the beginning of the next year comes the grand reconciliation though, where what you "really owe" gets computed, only roughly matching what already is withheld. There are so many rules, exclusions, exceptions, additions. They i…

The US uses its tax code(s) to try to implement policy. Increase taxes on something to try to discourage people from using/buying/participating in it. Decrease taxes or offer tax credits to try to encourage something. On the face of it, this is not a bad idea, but cumulatively it gets pretty messy (especially when, as you note, some of the policy-as-tax-code has implications over more than just a single tax year).

Re: Open Source Tax Software

#192

Post by seanmcdirmid » Tue, Oct 05, 2021, 2:16 PM UTC

PaulDavisThe1st wrote: post #189

ghaff wrote: post #168

Earlier quoted context omitted.

So sure. You can write software that can handle a simple Federal-only case. (Basically what used to be a 1040-EZ: W-2(s), a couple 1099s with all the cost basis info existing, standard deductions, etc.) But, at that point, your taxes are pretty simple to fill out anyway and I'm guessing there are even spreadsheet templates out there that let you type in some numbers and everything is calculated.

My experience of state taxes over 32 years (WA, PA and NM) has been that filing these returns is easy-peasy compared to my federal return (I'm self-employed). I'd be happy to have a full federal filing system even if it left me to do my state taxes "by hand".

> My experience of state taxes over 32 years (WA, PA and NM)

One of those states (WA) doesn’t belong in the list of states that require personal income tax returns, unless you mean something else?

Re: Open Source Tax Software

#193

Post by lotsofpulp » Tue, Oct 05, 2021, 2:18 PM UTC

syshum wrote: post #142

ineedasername wrote: post #73

Earlier quoted context omitted.

Disruption could also come from tax reform. Some countries don't make you figure out things on your own: That's a bit like making a shopper put in the correct prices on each item they're buying and penalizing then for mistakes. A "Price is Right" game-show version of a tax filing system. Some other countries just tell you where you stand because for the vast majority of people a standard filing is all that's required…

>> I am of course pessimistic on tax reform since that general populace just accepts "oh yeah filing taxes sucks" That is not the hold back for tax reform, any efforts to simply the tax code gets push back from every special interest that to keep their deductions, and they point to "the others" as "unfair" deductions, so it never changes. People with kids want to keep the massive deductions for having kids, even thou…

Deductions should not exist period. The more transparent way for a government to subsidize something would be to give cash. This would force the government to recognize the costs of the subsidy and who is benefiting from it clearly.

Re: Open Source Tax Software

#194

Post by gorbachev » Tue, Oct 05, 2021, 2:19 PM UTC

joshuaheard wrote: post #44

jjeaff wrote: post #37

Earlier quoted context omitted.

Yes, and it's not just calculations. It's things like, "if section F line 27 is greater than the total in section B line 12, subtract the amount in section z line 127 from this total and multiply the result by the appropriate tax rate (see long form instructions for form 478B and fill out Worksheet 12C to calculate your appropriate tax rate). This is not a verbatim quote, but solar to what you have to do now to calcu…

I build a spread sheet for all the forms and worksheets that require calculations. FreeFillableForms does some of the calculations for you, and does not have any worksheets. Excel has formulas for everything I have encountered paying taxes, and I have a joint account with stock options and several rental property LLCs. As a bonus, the spreadsheets are generally reusable, after checking to make sure there are no chang…

FreeFillableForms is great and has saved me a ton of time, but it does not do the calculations automatically for every field. You still have to manually lookup certain things from tables. It's freakin' frustrating, because there's no reason why it couldn't automate those as well.

Re: Open Source Tax Software

#195

Post by PaulDavisThe1st » Tue, Oct 05, 2021, 2:19 PM UTC

hahamrfunnyguy wrote: post #137

ineedasername wrote: post #73

Earlier quoted context omitted.

Disruption could also come from tax reform. Some countries don't make you figure out things on your own: That's a bit like making a shopper put in the correct prices on each item they're buying and penalizing then for mistakes. A "Price is Right" game-show version of a tax filing system. Some other countries just tell you where you stand because for the vast majority of people a standard filing is all that's required…

Couldn't agree more. We need tax reform, not software. The returns should be file automatically, if we disagree we can fill out paperwork with what we should be getting.

Roughly 7% of the US population is self-employed (a little over 10 million people).

It's not clear to me what "the returns should be file[d] automatically" means for this group of people.

In addition, there are many non-employment based events in the US tax code that change your tax liability. Last year I received a roughly US$3k tax credit because I installed a 6.6kW solar PV array on my house. There are dozens or even hundreds of cases like this in the US tax code.

Re: Open Source Tax Software

#196

Post by PaulDavisThe1st » Tue, Oct 05, 2021, 2:23 PM UTC

maxlybbert wrote: post #190

cranekam wrote: post #111

Earlier quoted context omitted.

> You just plug in the data from your W-2. This is still a lot more work than in many countries, and you still need to either fill in a paper 1040 (plus state taxes where appropriate, and some of those (cough CA) are far from simple), use tax prep software, or someone like H&R Block. In the UK, if you're in the majority of people who have one job and straightforward finances (e.g. not renting property, no CGT, etc) y…

Each country has a different idea of what matters for tax purposes. The IRS doesn’t necessarily have all the information that would be relevant to calculate taxes for most people (you have to include that information when you file, so they are in a position to check). They know your income and could probably figure out other wage-earners in the household based on their addresses. They don’t necessarily know all the p…

A lot of this comes from the US aversion to explicitly re-distributive federal policy (i.e. sending people checks), and a preference for implicit mechanisms (i.e. tax credits, refunds and deductions).

Re: Open Source Tax Software

#197

Post by PaulDavisThe1st » Tue, Oct 05, 2021, 2:26 PM UTC

kmonsen wrote: post #108

wahern wrote: post #86

Earlier quoted context omitted.

> Some countries don't make you figure out things on your own: That's a bit like making a shopper put in the correct prices on each item they're buying and penalizing then for mistakes. A "Price is Right" game-show version of a tax filing system. The U.S. doesn't make you do this, either. Most people don't itemize deductions. You just plug in the data from your W-2. The percentage of people itemizing was 30%, but wit…

Funny you should call it the Trump tax cut since mine went up substantially for the reasons you mention.

If it went up for the reasons mentioned, it means that your (previousl) itemized deductions put you in a rather small percentage of Americans. Also an unfortunate group: rich enough to have deductions at this scale, but not rich enough to have wriggled out of a large chunk of tax obligations.

Re: Open Source Tax Software

#198

Post by NikolaeVarius » Tue, Oct 05, 2021, 2:29 PM UTC

AmericanChopper wrote: post #120

drstewart wrote: post #96

Earlier quoted context omitted.

90% of people in the US could fill out their taxes by hand in less than 5 minutes. It's Yes, the IRS could do even this for you, but there's a myth that US taxes are always monstrously complicated that everyone likes to perpetuate: 1) The tax companies like it because it keeps people scared of doing it themselves 2) Tax reform advocates like it because it's they can cluck and shake their head at the corrupt governmen…

US tax laws are monstrously complicated. There’s a couple thousand pages of tax code, along with close to 10,000 pages of IRS regulations, that you won’t understand adequately unless you’ve also studied the many tens of thousands of pages of related case law. There is no single person alive who fully understands US tax laws, and even a well resourced team of people likely won’t when combined. It’s possible to underst…

> some of those mistakes are pretty much guaranteed to be criminal offences.

Unless there is malicious intent, the IRS does not give a fuck. They will bring it up, and ask you to fix it.

Re: Open Source Tax Software

#199

Post by PaulDavisThe1st » Tue, Oct 05, 2021, 2:32 PM UTC

seanmcdirmid wrote: post #192

PaulDavisThe1st wrote: post #189

Earlier quoted context omitted.

My experience of state taxes over 32 years (WA, PA and NM) has been that filing these returns is easy-peasy compared to my federal return (I'm self-employed). I'd be happy to have a full federal filing system even if it left me to do my state taxes "by hand".

> My experience of state taxes over 32 years (WA, PA and NM) One of those states (WA) doesn’t belong in the list of states that require personal income tax returns, unless you mean something else?

It's been 24 years since I was in WA :) I forgot they had no income tax. Sorry.

Re: Open Source Tax Software

#200

Post by zakpatterson » Tue, Oct 05, 2021, 2:43 PM UTC

lbriner wrote: post #178

zakpatterson wrote: post #64

Earlier quoted context omitted.

Open source can solve this problem. Any service you choose might be missing your edge case. But if you can see all the code and figure out where to plug in your edge case, then you can contribute it for all users in the future to enjoy. We've already seen people show up and implement features we hadn't researched yet. I encourage you to check it out.

I think this only makes sense to an outsider dev who thinks everything is relatively easy. Tax and accounting is definitely not. What happens if you fall under two different tax-breaks or if a payment was taken on a certain date which falls before or after a cut-off point? A lot of complexity, that the developers could solve but will not necessarily know how to handle. At least when you submit this to the relevant ta…

It's hard for me to understand what you mean.

First of all I'm one of the maintainers on the project. Handling people between two tax-brackets doesn't seem like a problem.

A spreadsheet might be simple for you dealing with your own taxes, but you can't email your spreadsheet to tens of thousands of people and have them all improve upon it and share it amongst each other so all of them can benefit. That's the vision here, I don't know if it will succeed, but that's what we're trying to accomplish.