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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

#271

Post by tpmoney »

fn-mote wrote: post #246
tpmoney wrote: post #185

Earlier quoted context omitted.

>Considering the penalties for getting it wrong. Simply no. You assume it is correct if it matches the data you have, not by default. We live in a world where people routinely borrow from "tribal lending services" at 500% APR. Where they buy a car on the monthly payment value without consideration for APR or loan term. Where an entire financial crisis was caused in large part by people taking out bad loans they knew…

> [...] I don't share your optimism on whether most tax payers would assume the answer the government got was correct or not [...] Rephrasing your response, it sounds like you would say you expect most tax payers lack the ability (or interest) to compute their taxes correctly under any circumstances. Review has nothing to do with it. I believe that providing people the correct numbers is just going to increase compli…

I can't speak for "under any circumstances" but I suspect the vast majority of tax payers already outsource their tax computations to either one of the major software vendors, one of the major tax services or their own financial institutions / private accountant. I assume this because otherwise I would not expect "IRS makes a self service portal" to be headline news or a game of politics.

Beyond that though, the thread discussion was about whether there are any mechanisms by which the government pre-filling people's taxes could '[make] "tax increases by stealth" easier'. I proposed there were, though with no claims to the degree to which that actually had real world impact on tax payers and their behavior.

If we assume as you say that people "want to pay what they have to pay and get on with the rest of their lives", then it seems reasonable to think that anything which reduces the amount of effort and thought necessary for the process also has potential to '[make] "tax increases by stealth" easier', simply by the fact that it reduces the amount of thought one needs to afford to the concept of taxes in the the first place.

The alternative would be to propose some mechanism by which the government pre-filing people's taxes would increase the degree to which they pay attention to their taxes. Or at a minimum one needs to argue that people would pay exactly as much attention as they do now and thus it would be a net-zero change in focus on taxes, but if that's the case, then any compliance increase would be a function of making it easier to be in compliance at all, which is tangental to whether or not it '[made] "tax increases by stealth" easier'

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

#272

Post by hiddencost »

rayiner wrote: post #249
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.…

> 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. How are republicans sabotaging New York City, San Francisco, etc? Historically, half of all governmental spending in the country happens at the state and local level—-and that comprises most of the services that affect people’s daily lives…

[flagged]

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

#273

Post by wernercd »

moduspol wrote: post #216
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.…

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.

"shining beacons" The same cities in states that are now in massive deficits? or covered in feces? with massive increases in drug and homeless problems? The same cities that have people feeling from states because of overregulation and overtaxation?

Those are the shining beacons of success?

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

#274

Post by jandrewrogers »

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 think there is a correct perception that many west coast cities are shitholes relative to what their per capita tax expenditures buys in most other cities. It is an argument about relative ROI, not absolute quality of life. If I spend $150k on a car, I don’t expect a used Toyota Corolla.

Cities like Seattle generate inexplicably little public value for the extremely high per capita spending. It should be much nicer for the amount of money it spends. The quality of services relative to expenditure is not defensible. Many cities do far more with far less. I’ve lived in Seattle around downtown for a long time, but it is far from the only city I spend time in. If per capita spending was correlated with quality of city experience, Seattle should be one of the best cities in the world to live in, but I don’t think anyone would make the argument that this is the case. As with San Francisco, most of that taxpayer money is lit on fire with no accountability and no contribution to the public good.

This is similar to the observation that on the same stretch of highway, California somehow manages to spend 10x per mile as its neighbors for visibly and audibly worse roads. People have made jokes about it for decades because the contrast is so stark if you drive on those roads.

It is not unreasonable for taxpayers to expect better than what is available in other cities when they are spending several-fold what those other cities are to achieve, at best, the same results. It doesn’t have to be a total shithole to be grossly mismanaged. People in Seattle spend enough tax money per capita that their city experience is far worse than what they have a right to expect.

It isn’t a political issue.

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

#275

Post by smsm42 »

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…

I'm usually lean to the side of "keep your government paws out of the business". But taxes aren't business - it's a governmental function, and there's no reason why the government who levies the taxes can't also produce proper documentation for it and make the compliance easier. There could be corner cases where it's hard to do, fine - just do the easy 80% and let the business take care of the rest. Let the business also be able to check it and profit if they find a mistake. If you don't believe The Man did it right - you should be able to download the data and give it to the same Intuit folks and see if they can do better. It's just adding an easy option, I don't see anything wrong with that at all.

Intuit would do fine with it - yes, they'd lose some income, but they have more then enough other business, both in more complex taxes and other ways of organizing business, they don't need to be able to fleece every single taxpayer. In fact, if such IRS system is built, they'd probably will make a good buck by providing added value offerings to it, just as they do now for existing tax filing systems.

Even if the system to do that costs double to the high estimate - let's say $0.5B per year, given the government projects are always over cost - it's still about 0.15% of the taxes collected every year. There's no reason why it'd have any influence at all on the level of taxes collected.

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

#276

Post by smsm42 »

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…

You don't need the code even - though the code, as being already paid for by the taxpayers, should be available to them anyway - the rules are public, the data should be available to the public, so you can just reimplement the rules and see if you get the same answer. They key here to make the data a) available b) portable c) every decision the system takes be documented and having the audit trail.

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

#277

Post by rayiner »

ksenzee wrote: post #264
rayiner wrote: post #260

Earlier quoted context omitted.

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.

It doesn't look to me (from 20 miles away) as if Seattle's government is notably efficient or effective, and I'd even say one-party rule is partly to blame: opposition parties serve a useful purpose. But I don't think the standard Republican sneer of "look what a crappy job the Democrats do of running the big cities" makes any sense, either. The things Republicans are pointing at as symptoms of bad Democratic governm…

[flagged]

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

#278

Post by rayiner »

hiddencost wrote: post #272
rayiner wrote: post #249

Earlier quoted context omitted.

> 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. How are republicans sabotaging New York City, San Francisco, etc? Historically, half of all governmental spending in the country happens at the state and local level—-and that comprises most of the services that affect people’s daily lives…

[flagged]

Look, I’d love it if there were American cities like Copenhagen. But there aren’t any, and it’s some serious cope to blame that on republicans, seeing as how a republican couldn’t get elected dog catcher in these places.

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

#279

Post by remarkEon »

MobiusHorizons wrote: post #237
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…

Do you consider it an incentive problem for cloud providers to send you a bill instead of asking you to submit what you believe you should owe? We have societally solved these problems my making them auditable. People don’t necessarily trust the bill, and have means of disputing it. If you think the government’s tool is overcharging, you are welcome to file your own taxes and deal with the possibility of getting audi…

Wait, do people not keep track of their own usage to compare it to their AWS bill? I just use free tiers for personal projects, but I guess I assumed that there would be some log reviews at some point if you were using it for running an actual business.

Anyway, I guess that means my answer is "yes".

>If you think the government’s tool is overcharging, you are welcome to file your own taxes and deal with the possibility of getting audited.

"Pay what we say you owe or we'll nuke your finances with an audit". Yes this is exactly my problem.

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

#280

Post by Anon4Now »

fsmv wrote: post #78
practicemaths wrote: post #44

I just file my taxes by hand and mail it in. Somewhat less concern with 3rd parties holding my information and losing it to leaks/hacks. It is free. A little obnoxious but the forms do have instructions/directions.

I heard that this sometimes takes them much longer to process the returns that way. Has that been your experience? One time I reproduced the forms in a spreadsheet following the instructions and it wasn't much different from doing the online wizards. I would have liked to mail it in but I just paid to e-file anyway.

Yes - especially for my state returns here in Oregon. I am due a refund. I received a letter stating that they made an adjustment. They still haven't sent the refund.
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