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IRS tests free e-filing system that could compete with tax prep giants

washingtonpost.com

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Re: IRS tests free e-filing system that could compete with tax prep giants

#31

Post by bubbleRefuge »

ShadowBanThis01 wrote: post #5

It is WAY past time for this. It's absurd that we have to regurgitate tax information that has already been reported to the government. But it's even more absurd that the government gives us no way to do so electronically. And then there's the disgusting shell game that IS the entire U.S. tax system, which is the root of the whole problem. But... didn't Congress pass some corrupt legislation years ago that made it il…

No to mention the brain drain/opportunity costs of employing people working in the tax prep software industry when they could be solving more other more useful problems.

Re: IRS tests free e-filing system that could compete with tax prep giants

#32

Post by throwaway85858 »

Some notes about the official system in Germany called "Elster"

1. Sign in via chip card or certificate based authentication for which the activation codes come in the post.

2. All forms are neatly laid out and guide you through the process of filing them, the quality of the frontend is really top notch, they even have a dark mode.

3. All insurances (health, life etc.) and wage statements have already been submitted and you just import them to your filing for that year, there's no guessing on what the correct deduction should be etc.

4. You add in your extra deductibles and submit, you'll have a response in the post within 2-4 weeks.

5. If anything is wrong I can call my dedicated guy at the local Finanzamt, I've had the same tax official for the last 10 years.

6. I still use tax advisors for some years because they just know more tricks then I do, and the legalese German is a bit of a pain to grok.

7. Best of all there's no requirement to do a yearly tax statement if you work a normal job.

Re: IRS tests free e-filing system that could compete with tax prep giants

#33

Post by brocklobsta »

AlexandrB wrote: post #26
brocklobsta wrote: post #15

What I don't understand about these programs is the added income clause. In California the state provides a free tool to file state income taxes (CalFile), but you can't use it if you make over $230,000 a year. Does it really make sense? It's similar with the federal free file program I believe. You would think they would want to encourage high income citizens to use their tool so they can control the deductions/cred…

American legislators seem to loooove "means testing" every government-provided service. Maybe it's a misguided version of that?

Agreed, but I don't see this as a service as much as a tool to perform a mandatory task. I don't WANT to do my taxes, I am forced to. At least don't deny me a tool because I pay the government a higher share of my income.

Re: IRS tests free e-filing system that could compete with tax prep giants

#34

Post by AlexandrB »

msla wrote: post #6

I'm sure this will be killed in a lawsuit. Can't have the government destroying jobs.

If the government destroys jobs: it's creeping communism. If the private sector destroys jobs (e.g. via automation): it's innovation and the free market at work.

I wonder if a politician could get away with calling these "bullshit jobs" in response.

Re: IRS tests free e-filing system that could compete with tax prep giants

#35

Post by bubbleRefuge »

jandrese wrote: post #20
jeffwask wrote: post #14

Earlier quoted context omitted.

It seems especially ridiculous since the US raised the standard deduction in 2017 fewer and fewer of us can itemize enough to meet it.

Not only did they raise the standard deduction, but there's that $10k limit that you slam into when trying to itemize. My total tax burden went up about 2% after that change, but it does make filing theoretically easier, except that my wife is always holding out hope so we go through all the work to itemize only to discover yet again that we're over the cap and wouldn't benefit.

10K limit on mortgage interest from primary residence , right ?

Re: IRS tests free e-filing system that could compete with tax prep giants

#36

Post by pstuart »

ShadowBanThis01 wrote: post #5

It is WAY past time for this. It's absurd that we have to regurgitate tax information that has already been reported to the government. But it's even more absurd that the government gives us no way to do so electronically. And then there's the disgusting shell game that IS the entire U.S. tax system, which is the root of the whole problem. But... didn't Congress pass some corrupt legislation years ago that made it il…

Check out Grover Norquist and his goals -- this tax hell is intentional.

Re: IRS tests free e-filing system that could compete with tax prep giants

#37

Post by jimbob45 »

pb7 wrote: post #27
throw9away6 wrote: post #22

Earlier quoted context omitted.

If you pay taxes with a card the processor charges a fee. You won’t come out ahead

The credit card fee is around 1.9% (e.g. Pay1040), most credit cards will fall somewhere between 1-2% cash back which will make up for the fee alone without even considering the sign up bonus. Example: Chase Ink Unlimited[0] has a 75K points ($750 at minimum, more if you have a Preferred or Reserve to transfer to; was a 90K/$900 offer up until tax time this year) bonus and 1.5% cash back. It's free (untaxed!) money t…

PSA: There are helpful websites[0] that can enable you to quickly compare credit cards to determine which fits your lifestyle best.

[0]https://www.nerdwallet.com/best/credit-cards/cash-back

Re: IRS tests free e-filing system that could compete with tax prep giants

#39

Post by ye-olde-sysrq »

pb7 wrote: post #23
jandrese wrote: post #16

For what it is worth, even with my medium-complex tax return I have had great results with freetaxusa.com for the past few years. The first couple of times we used it we ran the taxes through TurboTax and FreeTax at the same time and due to better UI the FreeTax version was faster and less confusing. That said, at the end of the process after entering all of the same information in the same places the TurboTax one di…

Curious, does your medium-complexity tax return include investments?

I've used freetaxusa for 3 years now and have the same positive experience as the parent poster.

And yeah my scenario includes investments. off the top of my head my return featured:

* income from 2 employers for the same person

* income in 2 states

* kids and the stuff that comes with that (child tax credits etc)

* capital losses (it's that time of the business cycle :* interest (US treasury products)

* dividends

* mortgage stuff

So if tons of americans can just do a 1040-EZ, then I feel like my usage probably covers like 99% of the remaining folks (which I would characterize as "I could do a 1040-EZ but I have kids and stocks").

Re: IRS tests free e-filing system that could compete with tax prep giants

#40

Post by jandrese »

kristopolous wrote: post #25
jandrese wrote: post #16

For what it is worth, even with my medium-complex tax return I have had great results with freetaxusa.com for the past few years. The first couple of times we used it we ran the taxes through TurboTax and FreeTax at the same time and due to better UI the FreeTax version was faster and less confusing. That said, at the end of the process after entering all of the same information in the same places the TurboTax one di…

I go with them too. Everytime this comes up though I post this https://apps.irs.gov/app/freeFile/browse-all-offers/ There's many nice and cheap options out there. Please, if you value basic democracy, don't give money to Intuit or TurboTax - not a dollar, not a penny. But do click on their paid ads whenever you see them and just close out after the page load. That company needs to be dismantled brick by brick, byte b…

One of the things to watch out for is so many free options that are only usable if you taxes are already trivial.

Strangely enough that IRS search tool claims there are 0 options for me, even though FreeTax works just fine.

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