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

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

#251

Post by mminer237 »

LelouBil wrote: post #230

Is there any documentation on how an average person living in the US files their taxes ? Are you forced to use third party services ? How exactly is it hard to do your taxes on your own ?

There are PDFs you can fill out yourself and either paper or e-file, but very, very do it. It's not really hard for most people. Probably 40% of people can put their wages in box 1 and be done. But most people's eyes would glaze over at seeing a 1040.

Every February everybody who paid you or got paid tax-deductibly mails you a form with the finals amounts for last year. On the back are instructions for where it goes on the forms.

The basics are simple, but few people really understand taxes at all let alone care to look at the forms. Instead probably 70% of people go to an accountant and give them the forms to punch into a program which generates the IRS forms and e-files them. Cheap places are maybe $100, but complicated returns at good accountants run like $500.

The other option most people who "do their own taxes" do is to purchase a yearly license to software which you can punch the numbers into yourself and it'll generate and e-file a return for you. It's like $50–$70 normally but some are free.

Most complications arise either from:

* You run your own business and have to do two returns basically without getting nice filled forms for all the numbers. * Congress constantly wants to incentivize behaviors and give people breaks on their taxes so there are a lot of little things you can get credits for like having kids and buying electric vehicles. It's really easy to miss deductions you're entitled to. * States have their own separate taxes, so you have to do everything twice and lots of programs have less support and make you pay extra too.

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

#252

Post by BurningFrog »

Buttons840 wrote: post #232
AnthonyMouse wrote: post #227

Earlier quoted context omitted.

> I just hate the argument that government inherently because it's government is inefficient and will never be effective The more general argument is that monopolies are inefficient, and most instances of government programs are monopolies. > In the US half the people in charge of the government hate it and want it to fail. This is uncharitable. It's more accurate to say that they expect it to fail and hate governmen…

> The more general argument is that monopolies are inefficient, and most instances of government programs are monopolies. Even more general, markets where it is hard for new competitors to enter are inefficient. It's perfectly possible for a market with 10 or 20 competitors to stop competing for mutual benefit. I'd even argue a monopoly (a single dominant company) is fine, so long as it's easy for competitors to ente…

> It's perfectly possible for a market with 10 or 20 competitors to stop competing for mutual benefit.

As I remember it, the empirical research says two competitors can keep a stable monopoly cartel going for a long time. three can maybe do it for a while. With larger numbers things get very unstable.

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

#253

Post by iambateman »

AnthonyMouse wrote: post #233
remarkEon wrote: post #226

Earlier quoted context omitted.

I don't think it's really a distraction. It seems illogical for the government to not have a free, easy way for the taxpayer to remit their taxes to the government (or submit the paperwork that should generate a return from that government). But at the same time I think it's fine to be skeptical that you should trust the government to be honest in showing you what amount of taxes you actually owe given how complicate…

> Is the free-filing system designed to maximize your return? The solution to this is for the government to publish the source code in the public domain. Then anyone who can do better can fork it and sell it, which will make that market more competitive when it's cheaper to enter because the government has already done 80% of the work, but there will only be a market for this if the government isn't maximizing your r…

Oh, nice, this is a fun idea. If submitting taxes were essentially an open API endpoint and the front end was an open source government-sponsored UX. Love that.

The US Digital Corps has the technical chops to do that well if the politics could work out.

To the Intuit folks reading this because your boss told you to keep an eye on the sentiment on Hacker News…don’t worry you can _totally_ have your own fork and since you’re the best you would have nothing to worry about. Since you care so much about the American tax payer, I look forward to your enthusiastic support of more transparent tax filing.

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

#254

Post by int_19h »

ksenzee wrote: post #235
moduspol wrote: post #216

Earlier quoted context omitted.

And that's why our west coast cities, which are not run by the half that hates government, are shining beacons of just how effective and successful governments can be.

There's this idea that west coast cities are shitholes, and honestly it's BS. I live in the Seattle suburbs and I'm downtown regularly, and the only obvious problem is the public disorder visited on us all by Martin v. Boise. It's pretty clear from housing prices that wealthy people are still happy living in Seattle: the market is speaking loudly. Don't get me wrong—I live in the suburbs for a reason, you couldn't pa…

I agree that in many cases there isn't any substance behind the talk. Yet the single largest state-to-state flow of people is from California to Texas, not the other way around; surely there's something objective that is driving that. And, given the time and effort required for such a move, it's not something most people would do on a whim without doing at least some research.

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

#255

Post by int_19h »

lispybanana wrote: post #228
mixdup wrote: post #212

Earlier quoted context omitted.

>that all inefficiency is caused by governments Forget about the evidence of other countries (which is completely valid), I just hate the argument that government inherently because it's government is inefficient and will never be effective In the US half the people in charge of the government hate it and want it to fail. Of course it's going to be bloated, inefficient, and costly. It's being sabotaged from the top.…

You're suggesting the half that wants smaller government impedes the day-to-day productivity of the half that wants it bigger? Some things work well in government given limited resources. Other parts of government seek bigger and bigger budgets to implement ideological goals, no matter their efficiency. (Any amount of money spent is justified by the end goal since the purpose of government is to print however much mo…

The half that wants it smaller, when it succeeds, guts the government, with the result being that whatever remains is incapable of properly carrying out the duties it is still assigned.

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

#256

Post by iambateman »

rayiner wrote: post #242
iambateman wrote: post #223

Just one thing to add… The “IRS will functionally increase taxes” argument is a distraction and I doubt anyone here takes it seriously. But the argument matters because it has given Congress political cover to let Intuit keep leeching off the system, so a response is in order. Congress should require the IRS to give every person an auditable receipt of every tax they paid in a standard format. Then, truly public-mind…

The IRS already provides a transcript.

Nice, I didn’t realize that.

I just checked and it looks like a good start, even though I’d like it to be fully granular.

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

#257

Post by int_19h »

Dalewyn wrote: post #192
toomuchtodo wrote: post #179

Earlier quoted context omitted.

Indeed! Japan’s system is very efficient, and he has lived there for some time, so he should be familiar. Similarly, it took the US forever to implement an instant payment system (commercial banks built Zelle via Early Warning Systems and RTP via The Clearinghouse, and the Fed finally built FedNow after Congress directed them to in order to ensure universal access) while India and Brazil rapidly rolled out their impl…

>Japan’s system is very efficient, Yes, because there is only one tax authority (国税庁, Kokuzeichou, National Tax Agency). Here in the US, we have more than one tax authority: We have the IRS, which is the federal tax authority. Each state then has their own tax authority. Each county then has their own tax authority. Each city then might have their own tax authority. And we must submit filings and returns with and pay…

For most individuals (as opposed to businesses), the only relevant taxes for the tax return are federal and state income taxes. Even then, there are several states in the country that have no state income tax, so you end up filing only the federal return. I live in such a state, and I still find the system very convoluted compared to what I've seen elsewhere.

Most crucially, it's still unclear to me why a return has to be filed at all for any tax that is already paid (from wages), and why it has to be manually compiled in cases where the agency has all the information about taxable income. If I don't owe anything, I shouldn't even need to file anything. If I do owe taxes, send me the forms prefilled and let me either sign off on them or add any missing info as needed. Anything over and above this is just pure waste of everybody's time and an opportunity for parasites to profit.

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

#258

Post by tbrownaw »

ants_everywhere wrote: post #239
mixdup wrote: post #212

Earlier quoted context omitted.

>that all inefficiency is caused by governments Forget about the evidence of other countries (which is completely valid), I just hate the argument that government inherently because it's government is inefficient and will never be effective In the US half the people in charge of the government hate it and want it to fail. Of course it's going to be bloated, inefficient, and costly. It's being sabotaged from the top.…

> I just hate the argument that government inherently because it's government is inefficient and will never be effective The big incentive problem here is that democracies reduce the power held by private individuals. So (primarily wealthy, powerful) private individuals have an incentive to market the idea that government is inefficient to reduce the impact of decisions made by democratic choice. This same conflict o…

> For example, the Magna Carta was a major concession of the power of the English King to lower nobility. There are always going to be people who dream of running their own fiefdom and see democracy as at best a nuisance and at worst an active impediment.

...what? Are you seriously trying to claim that absolute monarchy is a form of democracy?

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

#259

Post by int_19h »

leereeves wrote: post #187
consp wrote: post #160

Earlier quoted context omitted.

> A perfect world would have people writing a check for their entire annual tax just before stepping into the voting booth. That would definitely be a horrible idea. No, I won't vote for drivable roads because I just payed my taxes, potholes be damned. And afterwards complain about the potholes anyway.

I think most people would still vote for drivable roads, and that there are a lot of government policies that could be eliminated before drivable roads are even on the table.

There are places in US where the firefighters won't respond to a fire in buildings where owners haven't specifically paid the bill for their own coverage, because the local voters like it that way (those that haven't had their house burn down while the coverage lapsed, anyway).

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

#260

Post by rayiner »

ksenzee wrote: post #235
moduspol wrote: post #216

Earlier quoted context omitted.

And that's why our west coast cities, which are not run by the half that hates government, are shining beacons of just how effective and successful governments can be.

There's this idea that west coast cities are shitholes, and honestly it's BS. I live in the Seattle suburbs and I'm downtown regularly, and the only obvious problem is the public disorder visited on us all by Martin v. Boise. It's pretty clear from housing prices that wealthy people are still happy living in Seattle: the market is speaking loudly. Don't get me wrong—I live in the suburbs for a reason, you couldn't pa…

That doesn’t really respond to the point, though. Is Seattle’s government efficient and effective? To my recollection, Seattle doesn’t have great public services.
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