IRS Direct File to open to all 50 states and D.C. for 2025 tax season • Hacker News Board

Re: IRS Direct File to open to all 50 states and D.C. for 2025 tax season

#11

Post by Covzire » Fri, May 31, 2024, 4:31 PM UTC

Someone1234 wrote: post #4

How volatile is this to the political winds? As the article makes clear this was largely done with the support of the current incumbent, but what if the next one is more amenable to TurboTax's ideas? That seems to be an ongoing headache in the US with executive branch created programs, courts can just immediately squish them or political winds can change, then they're suddenly gone. Something like this, in order to b…

Not very, absolutely everyone hates doing their taxes and the whole shady process behind it all. The IRS should have to declare what they think you owe before you pay or submit any paperwork, I don't know if that'll ever happen but any baby or big steps towards that reality will win bipartisan support, easily. Just have to get past the conflicted-out members of congress who are truly being controlled by Turbo Tax and other industry lobbyists.

Re: IRS Direct File to open to all 50 states and D.C. for 2025 tax season

#12

Post by jawns » Fri, May 31, 2024, 4:31 PM UTC

The Taxpayers Protection Alliance spokesperson quoted at the bottom says:

> Private tax services "have every incentive to find the deductions that will yield them the best return," Zupkus said, adding that the IRS wants "to extract as much as possible from the taxpayer."

I think it's worthwhile to acknowledge that there are indeed slightly different incentives involved when it comes to the private sector handling tax prep versus the government.

But it's laughable to argue that the private sector is not in it to extract as much as possible from its customers.

ProPublica's series on the nasty ways TurboTax fooled its customers to extract more money from them is a clear example: https://www.propublica.org/series/the-turbotax-trap

Edit: I think some commenters are missing my point here. I'm not agreeing with this spokesperson. I'm saying that it's disingenuous to argue that the government is trying to fleece consumers when it's clear that the private sector has been doing so for some time.

Re: IRS Direct File to open to all 50 states and D.C. for 2025 tax season

#13

Post by bombcar » Fri, May 31, 2024, 4:33 PM UTC

jawns wrote: post #12

The Taxpayers Protection Alliance spokesperson quoted at the bottom says: > Private tax services "have every incentive to find the deductions that will yield them the best return," Zupkus said, adding that the IRS wants "to extract as much as possible from the taxpayer." I think it's worthwhile to acknowledge that there are indeed slightly different incentives involved when it comes to the private sector handling tax…

It's not even correct - the IRS wants to follow their rules as closely as they can.

I have had the IRS unprompted send me an additional refund because of a mistake I made on my forms, and they caught.

(They also included a letter saying that if I thought my mistake was right, I could fight the refund, or file a new amended form and go for a bigger one.)

Re: IRS Direct File to open to all 50 states and D.C. for 2025 tax season

#14

Post by rqtwteye » Fri, May 31, 2024, 4:33 PM UTC

CharlieDigital wrote: post #2

> Rep. Brad Sherman (D-Calif.), an accountant and senior member of the House Financial Services Committee, told Axios in April that he wants to go "way beyond Direct File," calling for a "self-populating form." > > "Why in the heck should you have to fill out your return when the government has all the information. They know what's on your W-2 form before you do. They know what's on your 1099 … Do you know how many m…

That's the way it should be. Even the anti-tax people should be for this because it allows people to see what the IRS already knows. That would allow them to request changes as needed. I know people where the IRS had wrong 1099s and it was hard for them to figure out the problem and correct it.

Re: IRS Direct File to open to all 50 states and D.C. for 2025 tax season

#15

Post by MichaelNolan » Fri, May 31, 2024, 4:33 PM UTC

Someone1234 wrote: post #4

How volatile is this to the political winds? As the article makes clear this was largely done with the support of the current incumbent, but what if the next one is more amenable to TurboTax's ideas? That seems to be an ongoing headache in the US with executive branch created programs, courts can just immediately squish them or political winds can change, then they're suddenly gone. Something like this, in order to b…

> How volatile is this to the political winds?

Very. Had the GOP won the senate in 2022, this would have probably been cut already. Depending on how this November goes the policy could definitely be reversed.

> Something like this, in order to be permanent, needs congressional approval.

This program did come from Congress. It was apart of the inflation reduction act.

Re: IRS Direct File to open to all 50 states and D.C. for 2025 tax season

#16

Post by mminer237 » Fri, May 31, 2024, 4:36 PM UTC

spiderice wrote: post #6

CharlieDigital wrote: post #2

> Rep. Brad Sherman (D-Calif.), an accountant and senior member of the House Financial Services Committee, told Axios in April that he wants to go "way beyond Direct File," calling for a "self-populating form." > > "Why in the heck should you have to fill out your return when the government has all the information. They know what's on your W-2 form before you do. They know what's on your 1099 … Do you know how many m…

This works against the governments interest, as they'll lose revenue from all the fines they give to people who accidentally fuck up their tax return.

1. It surely costs way more in employee expenses to monitor, correct, and collect such small fines. Plenty of times they'll just let a $200 fine go because it's not worth the effort to collect.

2. Taxes are a means to an end, as is the government. There's no benefit to fining people for clerical mistakes besides encouraging them to not make them. There's no value created by fines. There's no shareholder greedily pocketing the revenue. If they can avoid mistakes for people, that benefits government employees by having to waste less time on stupid stuff, the taxpayers by not having to waste time on stupid stuff and avoiding fines, and the people at large by not having to waste public money on paying people to fix stupid stuff on people's returns.

Re: IRS Direct File to open to all 50 states and D.C. for 2025 tax season

#17

Post by kbolino » Fri, May 31, 2024, 4:36 PM UTC

spiderice wrote: post #6

CharlieDigital wrote: post #2

> Rep. Brad Sherman (D-Calif.), an accountant and senior member of the House Financial Services Committee, told Axios in April that he wants to go "way beyond Direct File," calling for a "self-populating form." > > "Why in the heck should you have to fill out your return when the government has all the information. They know what's on your W-2 form before you do. They know what's on your 1099 … Do you know how many m…

This works against the governments interest, as they'll lose revenue from all the fines they give to people who accidentally fuck up their tax return.

That revenue isn't even a drop in the bucket. The issue is and always has been parasitic jobs: you wouldn't need anywhere near as many IRS employees and tax accountants.

Re: IRS Direct File to open to all 50 states and D.C. for 2025 tax season

#18

Post by bombcar » Fri, May 31, 2024, 4:38 PM UTC

spiderice wrote: post #6

CharlieDigital wrote: post #2

> Rep. Brad Sherman (D-Calif.), an accountant and senior member of the House Financial Services Committee, told Axios in April that he wants to go "way beyond Direct File," calling for a "self-populating form." > > "Why in the heck should you have to fill out your return when the government has all the information. They know what's on your W-2 form before you do. They know what's on your 1099 … Do you know how many m…

This works against the governments interest, as they'll lose revenue from all the fines they give to people who accidentally fuck up their tax return.

It does work against the government's stated interest, but not in the way you think.

Tax policy is the government's strongest tool to change personal behavior, and if the system is simple and automated it doesn't do that at all.

Re: IRS Direct File to open to all 50 states and D.C. for 2025 tax season

#19

Post by xeromal » Fri, May 31, 2024, 4:38 PM UTC

t3rabytes wrote: post #3

It seemed like the initial Direct File rollout was limited to states that didn't have a state-level income tax, or directly cooperated with the IRS. Are they forcing all states to play ball, or will Direct File not cover state tax submissions?

I doubt this will do anything for a state tax form. It's not their responsibility.

Re: IRS Direct File to open to all 50 states and D.C. for 2025 tax season

#20

Post by rqtwteye » Fri, May 31, 2024, 4:40 PM UTC

MichaelNolan wrote: post #15

Someone1234 wrote: post #4

How volatile is this to the political winds? As the article makes clear this was largely done with the support of the current incumbent, but what if the next one is more amenable to TurboTax's ideas? That seems to be an ongoing headache in the US with executive branch created programs, courts can just immediately squish them or political winds can change, then they're suddenly gone. Something like this, in order to b…

> How volatile is this to the political winds? Very. Had the GOP won the senate in 2022, this would have probably been cut already. Depending on how this November goes the policy could definitely be reversed. > Something like this, in order to be permanent, needs congressional approval. This program did come from Congress. It was apart of the inflation reduction act.

It's a huge problem that when the opposition comes into power, they immediately try to revert and undermine what the previous party did. Not because of merit, but just because of partisanship. So you end up with a lot of programs that get started and after a while get repealed or maintained badly. This costs the country a lot of money.

The ACA is a classical example. Instead of improving it or proposing a real replacement, they campaign for repealing it and some incantations of "free market" without explaining how patients won't get screwed over even more than now.