Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

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

washingtonpost.com

Post reply on HN
Print view View original

281–290 of 589 posts

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

#281

Post by runako »

akira2501 wrote: post #241
runako wrote: post #66

"The IRS currently refers people seeking no-cost filing options to a consortium of companies that provide free e-filing for taxpayers below a certain income level. Though 70 percent of taxpayers qualify for those products, fewer than 3 percent of taxpayers use them, according to a Government Accountability Office report." This low uptake absolutely has to be one of the impediments to a rollout of a free IRS-run tax s…

> why should we invest resources in expanding our free services when taxpayers don't use what we already make available? It's not a service. It's an obligation. You want my money? Why do I have to find a "service" to get you to take it? If you've never used one of those services, you should. Some of them have gotten better only very recently, some still look like fly-by-night scam operations that are trying to filch…

> If you've never used one of those services, you should

Complex tax situations, likely will be using third-party advisors from here out regardless of what the IRS provides for wage earners.

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

#282

Post by elicash »

alistairSH wrote: post #240
elicash wrote: post #144

Earlier quoted context omitted.

I know I'm likely better off with the standard deduction, but I still have to check both ways to know for sure that's the case for me. So standard deduction never actually saves me time even though post Trump tax reform I generally take it.

But surely, you're on the cusp of itemizing. Or have dramatically changing circumstances year to year. Otherwise, you're just wasting time. FWIW, we are in the "on the cusp" boat. Another year or two and our mortgage interest vs principle equation will put us in the standard deduction range. And short of massive changes to either tax law or our income, we'll remain there.

Last year I had lots of investments that I hadn’t previously. This year I sold a home. Next year, I’m planning to get married. The year after that, a new home?

Maybe these are “drastic” changes but they aren’t unusual across the population. Not planning on kids, so that means I’ll have fewer changes than most. But the person I plan to marry has significant changes to income based on commission so I’ll probably be doing taxes this way for a long time!

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

#283

Post by RajT88 »

technothrasher wrote: post #275
thelittleone wrote: post #155

Earlier quoted context omitted.

You could establish a corporation in a UAE freezone with visa and not even need to keep books. Of course assuming your laws allow it.

US law doesn’t allow it, or at least it doesn’t allow you not to declare and pay US tax on any income you make no matter where you make it.

Yes, the US government generally frowns on tax dodges. Famously, that's how they have put away hardened criminals like Al Capone.

But of course, the dynamics of our current system are such that the people least likely to be able to defend themselves legally are the ones which are frequently targeted for tax dodges. How many years do the extremely wealthy have to dodge taxes before the IRS finally comes down on them? Meanwhile, a friend of mine got dinged for a $500 deduction for unreimbursed work travel and not having receipts (a $2000 fine which she had to borrow money to pay).

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

#285

Post by pb7 »

aynyc wrote: post #261
pb7 wrote: post #252

Earlier quoted context omitted.

They’re not mutually exclusive. A W-2 employee has very few ways to reduce taxes and no amount of energy or effort will change that.

If you are on w2 and owe big taxes, then you are intentionally under withholding. Unless you won IPO or buyout jackpot, then spend your time planning your retirement, not credit card churn (unless that’s your plan all along).

>then you are intentionally under withholding

What’s wrong with that? You can pay estimated quarterly taxes with a credit card too. Many churners do.

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

#286

Post by lazide »

alistairSH wrote: post #273
lazide wrote: post #231

Earlier quoted context omitted.

Most of the economy (as in cash flow) is through businesses, and what you’re saying doesn’t apply to them.

So...? There are 131,000,000 households in the US. Something like 40% of people surveyed use tax prep software (at $50+/year). That's a massive waste of money that society could use on something useful.

Someone asked why it was happening in the US. I pointed out why.

That not everyone agrees that it is a waste, or that society would find a better use for it is of course going to be a matter of opinion. Which some folks are heavily incentivized to weigh in on (to the point it may be a large percentage or all of their net worth), and to others it’s $50/yr.

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

#287

Post by projektfu »

mikeortman wrote: post #38

I bet the SEO, dark patterns, and advertisement bullshit by Intuit et al. is going to be ridiculous if this releases to the masses. I bet they can get the IRS tool on page 3 of Google/Bing with enough effort

I hope they use a ".gov" address instead of something ridiculous like "freefilefillableforms.com" which looks inauthentic, complete with GoDaddy TLS certificate, even though it is the official version.

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

#288

Post by graypegg »

Really hope this puts pressure on the CRA (Canada) to do the same! It’s comical how accurate CRA’s Auto-Fill system [0] is when filing my (admittedly simple) taxes.

They’re so close to their own solution, “just” needs some UI. (Famous last words, but still…)

I’d be content with “here’s what the CRA has on file.” with a big list of everything already in auto-fill. Then two buttons [accept] which just send it to the CRA with NETFILE, or [file myself] which directs you to a private service instead.

7/7 years I’ve been required to file taxes I would’ve clicked [accept].

[0] https://www.canada.ca/en/revenue-agency/services/e-services/...

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

#289

Post by sgerenser »

PopAlongKid wrote: post #246
jghn wrote: post #239

Earlier quoted context omitted.

Exactly. Doing custom taxes could be opt-in. "Here's what we're going to charge you. If you think you owe less due to details we don't have, feel free to file the old way"

Correction: "If you think you owe less or more due to details we don't have, feel free to file the old way"

I’d be happy with a system like this, as long as they made it very clear WHEN you should do it the old way. For example:

“Our estimate of your income may be too high in certain situations, for example if you are a business owner, independent contractor, or receive income from RSU or ESPP sales where the tax basis reported to the IRS is missing or inaccurate. In those cases, you are encouraged to fill out your tax return using the tool of your choice” (Hopefully with links to some options).

Otherwise, there’s going to be a lot of tech workers who don’t understand RSU taxation paying thousands/10s of thousands of dollars extra in taxes for no reason. (And yes, I realize some may think this is a feature, not a bug.)

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

#290

Post by deepzn »

Intuit has a $120 B market cap. And it is a monopoly. It's been rightly found misleading users to pay for services. I'd been deceived to pay for it my first year or so dealing with taxes, as I ended up entering all the information, and then being told I had to pay when it initially was advertising as free.

With ChatGPT models, we can perhaps have our own tax agent who can assist us -seems likely in the near future in any case. Also as other pointed out, the tax system is at fault, it should just be automatically done and billed by the IRS.

Post reply on HN