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

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

#141

Post by randerson »

yndoendo wrote: post #53

I would argue that having to file taxes through a 3rd party accountant or service is not only forced commerce but also broken glass economics. Looks like it helps the economy by creating jobs but the job is redundant and does not create anything of value. Where are crimes more likely to occur, a city with 10,000 or 1 million? Where are financial crimes more likely to occur, people that make $10,000 a year or people t…

I keep hearing that its mostly the wealthy who evade tax, but I don't understand it. Service workers love being tipped in cash because its easy to not report. OTOH the wealthy have more to lose if they're caught, and can afford to pay their taxes and accountants.

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

#142

Post by GeekyBear »

llamaimperative wrote: post #65
rqtwteye wrote: post #20

Earlier quoted context omitted.

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 So you end up with a lot of programs that get started and after a while get repealed or maintained badly.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 replac…

Please provide examples of Democrats undoing good policy/legislation just because it was passed by a prior Republican administration.

I would give the example of the 2001 Bush tax cuts.

Since the Republicans lacked 60 votes in the Senate and zero Democrats supported the Bush tax cuts, The law enacting them was passed using budget reconciliation rules.

> Budget reconciliation is a special parliamentary procedure of the United States Congress set up to expedite the passage of certain federal budget legislation in the Senate. The procedure overrides the Senate's filibuster rules, which may otherwise require a 60-vote supermajority for passage. Bills described as reconciliation bills can pass the Senate by a simple majority of 51 votes or 50 votes plus the vice president's as the tie-breaker

https://www.wikipedia.org/wiki/Reconciliation_(United_States...

Using budget reconciliation rules automatically set a sunset date for the tax cuts, after which they would automatically expire.

When the tax cuts should have automatically expired at the end of 2010, the Democrats controlled the House, Senate and White House. Despite frequent claims over the decade that tax cuts for the rich were morally reprehensible, the Democrats did not allow the tax cuts to automatically expire, extending them for two years in the lame duck session of Congress, and then most were made permanent two years later before they should have expired again.

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

#143

Post by dpc050505 »

crazygringo wrote: post #101
londons_explore wrote: post #88

Earlier quoted context omitted.

Conventional wisdom is that if one can fund the IRS with one extra dollar, and they use that dollar to collect two dollars more taxes (from evaders), than that was a good way to spend taxpayers money. Many economists don't agree though. If you care about economic success of the country, the goal isn't 'collect as many taxes as possible'. The goal is to make the citizens wealthier in real terms. Effort your citizens p…

> If you care about economic success of the country, the goal isn't 'collect as many taxes as possible'. The goal is to make the citizens wealthier in real terms. But the goal of taxation isn't to maximize the country's economic success or overall wealth. It's to fund necessary government services (schools, courts, police, military, etc.) and to redistribute wealth (Social Security, Medicare, Medicaid, etc.). We only…

>We only want to maximize national wealth after we've funded government services fully and redistributed wealth

There's a chicken or the egg issue here. If your country isn't rich enough to fund government services such as education, transport and healthcare you need some economic development first.

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

#144

Post by whimsicalism »

randerson wrote: post #141
yndoendo wrote: post #53

I would argue that having to file taxes through a 3rd party accountant or service is not only forced commerce but also broken glass economics. Looks like it helps the economy by creating jobs but the job is redundant and does not create anything of value. Where are crimes more likely to occur, a city with 10,000 or 1 million? Where are financial crimes more likely to occur, people that make $10,000 a year or people t…

I keep hearing that its mostly the wealthy who evade tax, but I don't understand it. Service workers love being tipped in cash because its easy to not report. OTOH the wealthy have more to lose if they're caught, and can afford to pay their taxes and accountants.

not sure how you keep hearing this, the IRS is very clear that lower income filers commit much more tax fraud which is why they focus audits on filers in this income bracket because it generates the best returns

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

#145

Post by tombert »

dheera wrote: post #112
macrael wrote: post #81

It's SUCH a win that they managed to roll this out to a small set of tax situations and states to start. Every government project I've been on has required creativity in defining an MVP that doesn't include shipping to everyone. This was cited consistently as one of the great successes of this project, they were able to ship something that successfully filed 150k taxes b/c they were able to scope things down to somet…

sigh this is a baby step but - Many if not most software engineers in California earn more than the $200K household limitation for using Direct File - From my understanding there is no way auto-generate my state tax return from Direct File so I would have to do all the work twice even if I can use it - Complicating my tax situation (legally) allows me to save more money, I would save far more than the price of TurboT…

I mean, I don't dispute anything that you said, but a baby step is still a step. As they onboard more people onto the platform, they're be able to suss out bugs and fix issues and be able to raise income thresholds and maybe start handling state returns as well.

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

#146

Post by Alupis »

llamaimperative wrote: post #138
Alupis wrote: post #126

Earlier quoted context omitted.

[flagged]

Sorry but the elected leader of a party openly stating his objectives is not "partisan propaganda." So free of Koolaid you think simply citing the actual words that a grown adult said of his own free will and cognizance is "partisan propaganda."

Care to explain what happened during the Trump Administration then?

It's so easy for people to hyper-focus on "my side good" that they lose sight of the overall picture. Resisting an administration's agenda is pretty normal and expected... the people who voted for Mitch simply do not agree with the Biden agenda. Mitch (and other R's) are there to enact the agenda their constituents want. What a shocker...

Why is this surprising to you? Have you pondered, even for a few moments, what Democrats do when there's a Republican administration in office?

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

#147

Post by whimsicalism »

londons_explore wrote: post #88
yndoendo wrote: post #53

I would argue that having to file taxes through a 3rd party accountant or service is not only forced commerce but also broken glass economics. Looks like it helps the economy by creating jobs but the job is redundant and does not create anything of value. Where are crimes more likely to occur, a city with 10,000 or 1 million? Where are financial crimes more likely to occur, people that make $10,000 a year or people t…

Conventional wisdom is that if one can fund the IRS with one extra dollar, and they use that dollar to collect two dollars more taxes (from evaders), than that was a good way to spend taxpayers money. Many economists don't agree though. If you care about economic success of the country, the goal isn't 'collect as many taxes as possible'. The goal is to make the citizens wealthier in real terms. Effort your citizens p…

it is not good policy to reward people who break the law to the detriment of people who abide by the law. if tax fraud occurred less, it would give us latitude to lower taxes which would give the broad based economic improvement you are discussing.

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

#148

Post by junar »

swozey wrote: post #36
nly wrote: post #28

As a Brit it's baffling that this is even an issue. I filed my taxes online with HMRC for free this year (we call it Self Assessment), it took 20 minutes, and I received a 4 figure refund in ~2 weeks directly in to my bank account.

The tax system here (usa) is an absolute joke. I owed $5k this year and I literally did nothing different except receive a small 5% raise last year. I have the most basic taxes you can, single, no kids, no house. Literally just a salary paycheck every 2 weeks. Had no idea I would owe anything, much less that much money until I filed 2 weeks prior to our tax date in April and you're expected to pay everything you owe…

Default federal income tax withholding on bonuses is 22%. If your marginal federal tax rate is higher than that, then you underwithheld, meaning you owe more in taxes than you paid over the year.

https://pburgoscpa.com/managing-your-bonus-in-nyc-a-high-inc...

For your home sale, the person responsible for closing the transaction files Form 1099-S with the IRS, reporting the sale amount (which they're responsible for) but not how much you paid for it (because you're responsible for that). You should have gotten a copy of the 1099-S, which was your clue that you needed to report it on your return.

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

#149

Post by ohashi »

dheera wrote: post #139
dmd wrote: post #136

Earlier quoted context omitted.

94% of Americans make less than $200k a year. Not everything is meant for "software engineers in California".

I meat this is Y Combinator Hacker News, so I would expect "software engineers in California" to be a significant fraction of the user base here.

Some people have a broader view of the world and care about things which might not directly impact them

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

#150

Post by giantg2 »

NickC25 wrote: post #122
giantg2 wrote: post #117

I'll still be using 3rd party software. The main benefit is the guarantee of audit support and legal representation. For such a small fee, that's decent insurance. You'll get no such benefit working directly with the IRS.

You're probably in the minority, or you make a significant amount of income. If you are single or married without a family, a 1099 contractor or just inputting in a W2 or two, and have a single form from your healthcare company, chances are this really, really helps. The IRS isn't going to audit someone who just files a single W2 and claims maybe 1-2 deductions and a small stock portfolio appreciation.

I'm not saying it's a bad service. I'm saying for $30 some audit and legal representation is cheap insurance. The IRS can audit anyone they want. My finances are not exceedingly complicated, nor am I a high earner. It's an extremely low risk but still can happen.
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