IRS tests free e-filing system that could compete with tax prep giants • Hacker News Board

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

#101

Post by [deleted] » Mon, May 15, 2023, 6:20 PM UTC

_yb2s wrote: post #51

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…

The weird thing is the IRS already knows my taxes better than I do… a few times I’ve made mistakes inputting forms or forgot to put something in, and I will always get a letter from them about it. They’ve already done my taxes so they should just send me a bill and not waste my time, possibly with the option to submit extra details they are missing like deductions… but that should be an option for people that need it…

[deleted]

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

#102

Post by gowld » Mon, May 15, 2023, 6:22 PM UTC

clintonb wrote: post #54

themagician wrote: post #45

Does the IRS actually know what everyone owes? I know it's true for W-2 employees, but what about everyone else? I've always had this feeling that you could ask the IRS what they believe any given SSN/EIN owes and they'd be able to tell you (not that they would, but that it's already calculated somewhere). I don't know if this actually true though. I know almost all W-2 information is sent electronically. They know a…

They know when you don't pay enough, so they have to know what you owe. All of the forms we receive (e.g., W-2, 1099) are transmitted to the IRS. They can use them to determine if a tax payer underpaid. I know this firsthand because a broker transmitted proceeds without transmitting a cost basis, resulting in a scary letter from the IRS a few months after I filed. The problem, as I understand it, is that the IRS' tec…

They want to spook you into being honest, by not telling you what they know.

If you knew the IRS missed something , you could safely not report it.

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

#103

Post by whimsicalism » Mon, May 15, 2023, 6:22 PM UTC

_yb2s wrote: post #51

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…

The weird thing is the IRS already knows my taxes better than I do… a few times I’ve made mistakes inputting forms or forgot to put something in, and I will always get a letter from them about it. They’ve already done my taxes so they should just send me a bill and not waste my time, possibly with the option to submit extra details they are missing like deductions… but that should be an option for people that need it…

My partner and I are both W2 earners and filing our taxes takes like under half an hour.

Are we doing something wrong? It seriously does not seem hard to file taxes.

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

#104

Post by beisner » Mon, May 15, 2023, 6:22 PM UTC

CodeWriter23 wrote: post #94

You all are so cute thinking the government is going to perform this function when in reality they are simply going to choose a third party to outsource to. Probably without even giving Intuit a chance to bid on it. Not that I like Intuit, they suck IMO. But I do think a vendor selection process such as this should be an open one. Instead we will have more back room-brokered graft.

Yeah the USDS is one of the only romantic/bright spots for good application of tech in the US government.

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

#105

Post by callalex » Mon, May 15, 2023, 6:23 PM UTC

macinjosh wrote: post #56

The fact that we have to report anything about our personal finances to the Federal Government is a violation of the 5th Amendment. The fact that they've forced employers to be their snitches is even more gruesome. Isn't it a sure sign of fascism when corporations and government work hand in glove?

I recommend that you re-read the constitution.

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

#106

Post by hibikir » Mon, May 15, 2023, 6:23 PM UTC

jrochkind1 wrote: post #85

cstoner wrote: post #74

Earlier quoted context omitted.

The vast majority of people take the standard deduction, so offering a "here's what we think you owe, but if you disagree feel free to do the full return" form would be a huge efficiency gain. Your comment seems like a prime case of perfect being the enemy of good.

> The vast majority of people take the standard deduction Unless they are a homeowner, probably. Part of the issue is that the US tax code is a lot more complex than most countries. (And the homeowner-targetted deductions are kind of insane and bad policy too). Still, I don't disagree with the basic premise. They probably know enough to know if itemizing your homeowner-related things would be better for you, and do i…

Unless you are a homeowner at an expensive metro. It used to be basically every homeowner, but the changes in 2018 led to a massive reduction of people itemizing. The standard deduction went up a whole lot, and along with it, the deduction for state and local taxes was capped to a relatively low number. So if you owe, say, $200K in your mortgage, chances are that you are going to need non-trivial bonus itemization to get to the cap, when in 2016, that was definitely enough to itemize.

In practice, about half as many people itemize today than they did back in 2016.

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

#107

Post by whimsicalism » Mon, May 15, 2023, 6:23 PM UTC

throwaway85858 wrote: post #32

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…

The US basically has a privatized version of this.

Pretty much all I need to do is upload a 1099 for my bank account interest & cap gains, everything else is autouploaded.

The main difference you have to realize is not that our system is actually super shitty, we just have 4x the number of people to complain about things.

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

#108

Post by gtop3 » Mon, May 15, 2023, 6:23 PM UTC

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…

My taxes have been getting more complex every year, and after this year I no longer trust TurboTax. There was a situation where Turbotax did not recommend a tax form to me, despite me answering questions in such a way that it was clear the tax form would have been impactful and applicable.

After I filled out all of the tax information my taxes were clearly off many thousands of dollars. I had to review my tax forms, do research, talk to an accountant, and then specifically request a tax form number in the help bar of TurboTax.

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

#109

Post by Finnucane » Mon, May 15, 2023, 6:24 PM UTC

linuxftw wrote: post #89

Finnucane wrote: post #69

Earlier quoted context omitted.

Obviously, what the tax preparers are afraid of is that the IRS could provide system that works perfectly well for a large majority of their customers, leaving them only the people with more complex needs, or need to manage a lot of deductions, etc. No one would be forcing you to use the IRS system if you think it doesn't work for you.

No, but I would be forced to pay for the system whether I use it or not. I prefer not to pay for the system.

Yeah, I know, tax money going for stuff that other people might benefit from more than we do ourselves, the great tragedy of our times. Never mind that any system that improves compliance could raise more money than it costs.

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

#110

Post by binarymax » Mon, May 15, 2023, 6:24 PM UTC

whimsicalism wrote: post #103

_yb2s wrote: post #51

Earlier quoted context omitted.

The weird thing is the IRS already knows my taxes better than I do… a few times I’ve made mistakes inputting forms or forgot to put something in, and I will always get a letter from them about it. They’ve already done my taxes so they should just send me a bill and not waste my time, possibly with the option to submit extra details they are missing like deductions… but that should be an option for people that need it…

My partner and I are both W2 earners and filing our taxes takes like under half an hour. Are we doing something wrong? It seriously does not seem hard to file taxes.

No you’re doing everything right! The point is that you shouldn’t even need to do anything. The IRS already has your information. Unless youre changing something that they won’t know about (for example not using the standard deduction), then ideally you would get an automated return and possible refund without taking any action.