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IRS to begin trial of its own free tax-filing system

nytimes.com

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Re: IRS to begin trial of its own free tax-filing system

#31

Post by ndriscoll »

GreedClarifies wrote: post #16
wolfgang42 wrote: post #12

Earlier quoted context omitted.

> In one possible scenario included in the agency’s report to Congress, the I.R.S. could fill out tax returns with information it already has, like data from W-2 wage statements. For the pilot, however, participants will have to enter their own financial information, the I.R.S. said.

So in its initial form it is indeed a complete waste of tax payers money. Shocking.

If it gives feature parity with the existing solution, it seems fine as a start. At least we'll presumably be able to file on a .gov now instead of freefilefillableforms.com, which seems like it was chosen to be intentionally sketchy looking.

Edit: actually looks like it doesn't reach parity with the existing free e-file system and only covers the simplest cases, and "the annual cost of a direct-file system could range from $64 million to $249 million" sounds absolutely absurd to me.

Re: IRS to begin trial of its own free tax-filing system

#32

Post by ttyprintk »

calamari4065 wrote: post #25
crazydoggers wrote: post #13

Earlier quoted context omitted.

This is why we still have the income tax system that we do. It’s a $14 billion a year industry. I’ve talked to people who work the lobbying system very hard. There’s lots of wining and dining to make sure no one messes with the complexity of the system. We need more people who are immune to lobbying in government positions. We’ll see how this goes.. depending on the next election cycle this will either get quashed qu…

Maybe spending billions of dollars lobbying should be illegal

It’s not that lobbying is a major slice of $14B, it’s that they actually spend only $3m and it’s effective:

https://www.opensecrets.org/federal-lobbying/clients/summary...

Re: IRS to begin trial of its own free tax-filing system

#33

Post by GreedClarifies »

jacobyoder wrote: post #21
GreedClarifies wrote: post #16

Earlier quoted context omitted.

So in its initial form it is indeed a complete waste of tax payers money. Shocking.

Absolutist takes like this never achieve much. Yes, it could be better. But an mvp-type launch that does some things well, without trying to achieve everything on day one, would definitely not be a "complete waste". If successful, it's laying the base for the next iterations of functionality. For a lot of folks, they have one or two W2 forms to enter, and that's it. It's really not that hard. If even a million or so…

The IRS should play try to create an actual MVP. Create an API which allow for efile (which I assume already exists given turbotax) and create an API which allows the download whatever information the IRS has on the tax payer.

Then allow companies or open source software to create whatever value add they want on top of these APIs.

That sounds like a minimalist launch.

Re: IRS to begin trial of its own free tax-filing system

#34

Post by MenhirMike »

crazydoggers wrote: post #13
k2enemy wrote: post #3

> A spokeswoman for Intuit, Tania Mercado, criticized the direct file project as a “half-baked solution” and a waste of taxpayer money. “The direct file scheme is a solution in search of a problem,” she said. Wow, I thought that Intuit would have gone for a little more subtlety.

This is why we still have the income tax system that we do. It’s a $14 billion a year industry. I’ve talked to people who work the lobbying system very hard. There’s lots of wining and dining to make sure no one messes with the complexity of the system. We need more people who are immune to lobbying in government positions. We’ll see how this goes.. depending on the next election cycle this will either get quashed qu…

Which is really the main issue. Offering a more accessible free version to file taxes is great, but the real problem is the need to file taxes at all for a lot of people. The IRS already knows the relevant info: Your employer sends W-2 information, your bank and broker are sending the various 1099 forms for interest, dividends, stock sale gains/losses, etc. Same for your spouse and kids/dependents. Don't even need to itemize in a lot of cases, since the standard deduction is preferable in many years.

Unless you're dealing with foreign income, are a business, or do a lot of contract work for cash, I don't see much reason why the IRS can't just handle all the taxes automatically - apart from the fact that some company wants to charge me $150 a year to file my taxes and making sure that my tax situation (which would fit on a beer coaster otherwise) is as complicated as possible.

Re: IRS to begin trial of its own free tax-filing system

#35

Post by mig39 »

asia92 wrote: post #11
gigel82 wrote: post #8

Earlier quoted context omitted.

You mean like they do in ... every other country on earth?

Not canada

For the last couple of years, my T4, pension, RRSP, and some of my pension forms have all been imported automatically into CRA, and then into Turbotax.

So maybe it's an optional thing for some employers?

Of course, would be great to just skip the Turbotax portion.

Re: IRS to begin trial of its own free tax-filing system

#36

Post by ttyprintk »

HarryHirsch wrote: post #20
nerdponx wrote: post #7

Earlier quoted context omitted.

Not only will they, but Trump's Secretary of Treasury will order the IRS to cancel the program as soon as he's elected.

Why? Trump is a populist. "Get your taxes done with me for free instead of HR Block charging you a couple hundreds" is a low-hanging fruit.

It makes more sense that his party maintains the image that paying taxes is arduous and better left to technicians (short guys wearing yarmulkes in Trumps view). Those who can avoid burdensome bureaucracy are “smart”, presumably tall and yarmulke-less.

Re: IRS to begin trial of its own free tax-filing system

#37

Post by dimal »

GreedClarifies wrote: post #18
k2enemy wrote: post #3

> A spokeswoman for Intuit, Tania Mercado, criticized the direct file project as a “half-baked solution” and a waste of taxpayer money. “The direct file scheme is a solution in search of a problem,” she said. Wow, I thought that Intuit would have gone for a little more subtlety.

From the article and from a poster below: "For the pilot participants will have to enter their own financial information, the I.R.S. said." It is indeed a complete waste of taxpayer money unless they actually prefill with the IRS' data.

Consider it an MVP.

Re: IRS to begin trial of its own free tax-filing system

#39

Post by Klinky »

MenhirMike wrote: post #34
crazydoggers wrote: post #13

Earlier quoted context omitted.

This is why we still have the income tax system that we do. It’s a $14 billion a year industry. I’ve talked to people who work the lobbying system very hard. There’s lots of wining and dining to make sure no one messes with the complexity of the system. We need more people who are immune to lobbying in government positions. We’ll see how this goes.. depending on the next election cycle this will either get quashed qu…

Which is really the main issue. Offering a more accessible free version to file taxes is great, but the real problem is the need to file taxes at all for a lot of people. The IRS already knows the relevant info: Your employer sends W-2 information, your bank and broker are sending the various 1099 forms for interest, dividends, stock sale gains/losses, etc. Same for your spouse and kids/dependents. Don't even need to…

This is a good first step. Ideally it turns into a "verify this all looks correct & add anything we're missing" kinda thing.
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