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IRS Free File: Do Your Taxes for Free

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Re: IRS Free File: Do Your Taxes for Free

#201

Post by kwhitefoot »

nly wrote: post #163

It's crazy to me that all Americans have to do their taxes every year and are charged for this. Many people in the UK go their entire lives without ever interacting with HMRC (our equivalent of the IRS) Self Assessment (doing taxes every year) takes about 20-30 minutes and that's when I'm claiming tax reliefs

Same in Norway only it's even simpler. They send you a text saying your proposed tax return is ready. If you check it and agree you need do nothing at all. Otherwise one corrects the input figures and perhaps adds a little that they don't have direct access to such as overseas investments and property. All online and the system instantly recalculates the tax due. No need to claim any tax relief, it does it for you.

Re: IRS Free File: Do Your Taxes for Free

#202

Post by IgorPartola »

joxel wrote: post #172
IgorPartola wrote: post #53

Earlier quoted context omitted.

Yup. I suppose they can use the cell phone tracking to figure how many miles you’ve put on your personal vehicle and use AI to figure out how many were business use miles. /s In reality only if you take standard deductions and only get paid with a W-2 can they actually figure it out. But I agree that overall the process is messed up.

So the reality is that they could automatically calculate taxes for >>50% of households?

Except they don’t know who they can and can’t do this for, so the entire exercise is a bit useless.

Re: IRS Free File: Do Your Taxes for Free

#203

Post by lotsofpulp »

ThunderSizzle wrote: post #185
lotsofpulp wrote: post #50

Earlier quoted context omitted.

I assume Intuit and their ilk lobbied for the limit. I recall reading that the IRS was developing a way to automatically do most people’s taxes, but the tax preparation companies lobbied Congress to stop that, and instead offered their services for free…with the caveat that higher income filers are excluded.

Making it automatic is a step in the wrong direction. They need it heavily simplified or even entirely removed. Then they should worry about automation.

It is simple for most people. It can be automated, and then those who have complications can decide to file an amended return.

Surely, there can be a database at the IRS of everyone’s W-2 and 1099 income.

Re: IRS Free File: Do Your Taxes for Free

#204

Post by Beached »

maxerickson wrote: post #179
twoodfin wrote: post #178

Earlier quoted context omitted.

To cover the breadth of US tax law, including provisions that impact large swaths of ordinary Americans, the IRS would have to collect a lot more data than they do today. More than likely this would be politically infeasible: Look at the uproar over their (now deferred) attempt to collect information on relatively low-dollar Venmo accounts.

The number of people that it would work for would easily justify the cost of the IRS sending out prepared taxes. That some small sliver of people have complicated taxes or want to itemize their expenses is not a good reason to complicate the activity for the majority that have straightforward taxes. And then if you want to simplify, just eliminate deductions altogether (and shift brackets to compensate). Eliminating…

it isn't only itemizing for general deduction. there are a LOT of people who claim other tax incentives outside of that. I have claimed something almost every year in the past 15 years. and almost every friend I have does the same. if you are self employed or have a home, it is super common to claim items on taxes that the IRS doesn't know about currently.

but yes, they should just eliminate all deductions and shift how much you are taxed to compensate

Re: IRS Free File: Do Your Taxes for Free

#205

Post by drdec »

daveguy wrote: post #199
EVa5I7bHFq9mnYK wrote: post #153

Earlier quoted context omitted.

Crypto is simple. Anything mined/airdroped is ordinary income, anything bought and later sold is capital gains.

If you held it for over year. Otherwise it's income of sale price - cost basis. Don't know about fees. I'm not an accountant, but I do know you have to hold an asset for at least 1 yr to count it as capital gains.

> I do know you have to hold an asset for at least 1 yr to count it as capital gains.

That is not true. Perhaps what you mean is that capital gains on assets held less than a year are taxed at a different rate than capital gains on assets held longer than a year?

Don't mean to get pedantic but I didn't want someone to read your comment and think that they owe no taxes on short-term capital gains. (What a crazy tax incentive that would be!)

Re: IRS Free File: Do Your Taxes for Free

#206

Post by Consultant32452 »

nly wrote: post #163

It's crazy to me that all Americans have to do their taxes every year and are charged for this. Many people in the UK go their entire lives without ever interacting with HMRC (our equivalent of the IRS) Self Assessment (doing taxes every year) takes about 20-30 minutes and that's when I'm claiming tax reliefs

I don't think the government should even allow your employer to automate the payroll deductions. If every family in the country got hundreds of dollars more in their take-home pay and had to write a check to the government like they write a check for their mortgage, it would allow (force?) citizens to really consider the value they get for their money.

Re: IRS Free File: Do Your Taxes for Free

#207

Post by aceazzameen »

phpisthebest wrote: post #198
nly wrote: post #163

It's crazy to me that all Americans have to do their taxes every year and are charged for this. Many people in the UK go their entire lives without ever interacting with HMRC (our equivalent of the IRS) Self Assessment (doing taxes every year) takes about 20-30 minutes and that's when I'm claiming tax reliefs

This is a double edge sword While the Tax Compliance scam is something that needs to be addressed, I am also not a fan of completely automated and "easy" taxation. I think government taking our money should be painful, and in your face. I am not even a fan of automated payroll deduction for this reason, people should experience having the money removed from them every month, week, what ever just like any other bill t…

I'm the opposite. I think we Americans have made it entirely too easy for corporations, accountants, and lawyers to swindle money from us. And I'm only referring to instances involving government taxes!

I don't need this pain and nonsense every year. I'd rather be enjoying the one life I have.

Re: IRS Free File: Do Your Taxes for Free

#208

Post by itake »

rwmj wrote: post #171
nly wrote: post #163

It's crazy to me that all Americans have to do their taxes every year and are charged for this. Many people in the UK go their entire lives without ever interacting with HMRC (our equivalent of the IRS) Self Assessment (doing taxes every year) takes about 20-30 minutes and that's when I'm claiming tax reliefs

Self Assessment is definitely not "20-30 minutes". Anyway what's crazy is that we have to do this at all. In normal countries the government calculates the tax you owe based on information filed by your employer, bank etc, and then sends you the bill. If you agree with it, you pay that. You are required to do no work at all unless you want to dispute the bill.

How do you track income that wasn’t from your employer? Like rent?

How do you track deductions like installing a heat pump?

Re: IRS Free File: Do Your Taxes for Free

#209

Post by phpisthebest »

aceazzameen wrote: post #207
phpisthebest wrote: post #198

Earlier quoted context omitted.

This is a double edge sword While the Tax Compliance scam is something that needs to be addressed, I am also not a fan of completely automated and "easy" taxation. I think government taking our money should be painful, and in your face. I am not even a fan of automated payroll deduction for this reason, people should experience having the money removed from them every month, week, what ever just like any other bill t…

I'm the opposite. I think we Americans have made it entirely too easy for corporations, accountants, and lawyers to swindle money from us. And I'm only referring to instances involving government taxes! I don't need this pain and nonsense every year. I'd rather be enjoying the one life I have.

I don't think these are mutually exclusive...
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