Why does the average American have to file taxes? You know my W2 you know my family members. Just send out the withhold amount to my employer.
Free IRS-run tax filing pilot to be available in 13 states
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Re: Free IRS-run tax filing pilot to be available in 13 states
#102Retail financial services are a source of misery for low income people. Providers don't want those customers, and it shows. Predatory products and service providers prey on the less well off. Postal banking would be a good next step.
Re: Free IRS-run tax filing pilot to be available in 13 states
#103> eligibility to participate in the pilot...will be limited to taxpayers with certain types of income, credits and deductions – taxpayers with relatively simple returns. The IRS today announced it anticipates specific income types, such as wages on a Form W-2, and important tax credits, like the Earned Income Tax Credit and the Child Tax Credit, will be covered by the Direct File pilot. This is what I was mostly curi…
The bottom of the blog post has the eligibility requirements list/things-the-pilot-will-support:
Income reporting
-W-2 wage income
-Social Security and railroad retirement income
-Unemployment compensation
-Interest of $1,500 or less
Credits
-Earned Income Tax Credit
-Child Tax Credit
-Credit for Other Dependents
Deductions
-Standard deduction
-Student loan interest
-Educator expenses
Re: Free IRS-run tax filing pilot to be available in 13 states
#104Earlier quoted context omitted.
The model is that someone with a W-2 and a 1099 or two and just taking the standard deduction should be "Yep, looks OK." If it gets more complicated than that you probably need to either spend a bunch of your own time or hire a professional.
That's basically how the services work today for that segment of citizens, and they are free.
Re: Free IRS-run tax filing pilot to be available in 13 states
#105One thing I really want to see is an official form where if you answer all the questions, to the best of your knowledge correctly, protects you from liability for incorrectly filing your taxes. End of the day with TurboTax and co, you, as expected, get a "not our system, not our problem" type response when dealing with the post-filing ramifications. There seems to generally be a lot of "I'm not sure if I did it right…
If you make a good faith attempt at filing your taxes, you won't need liability protection. If you screw it up, you'll get a (relatively) polite message from the IRS that your taxes were screwy and you owe them money (or, occasionally, they owe you money).
Re: Free IRS-run tax filing pilot to be available in 13 states
#106Earlier quoted context omitted.
The model is that someone with a W-2 and a 1099 or two and just taking the standard deduction should be "Yep, looks OK." If it gets more complicated than that you probably need to either spend a bunch of your own time or hire a professional.
That's basically how the services work today for that segment of citizens, and they are free.
It's been for many years now that eFile with IRS is free, but eFile with your State is paid.
You can always choose to print out your forms and mail them though.
Re: Free IRS-run tax filing pilot to be available in 13 states
#107Misleading title here that differs from the title in the linked article - it’s a pilot in 13 states, not generally available.
I've changed it now. Submitted title was "IRS will officially launch free online tax filing service for 2024 tax season".
Please consider punishing the marketing guy doing this submission. This was not done by chance or mistake.
Re: Free IRS-run tax filing pilot to be available in 13 states
#108Earlier quoted context omitted.
Here's a better / more nuanced standard: If an industry exists because of the government and it can be replaced by a public service, then it doesn't deserve to exist. FWIW, public defenders are a public service used to interact with a government-created system, but the private legal defense industry is alive and well. So, it's not like making a public service is sufficient to kill any government-created industry.
> If an industry exists because of the government and it can be replaced by a public service, then it doesn't deserve to exist. It's a start, but I'd need to think of examples. I'd say if the government creates inefficiencies, such as for basic tax filing, it should remove them if possible regardless of the effect on businesses profiting from them. Off the top if my head, there could be cases where government makes a…
> I'd say if the government creates inefficiencies, such as for basic tax filing, it should remove them if possible
The complexity of the US tax code is certainly inefficient from the perspective of someone trying to get through their taxes, but many economists would argue that it enables a very economically efficient way to soft-enforce policy and influence behavior without resorting to regulation and law enforcement.
Whether the economic efficiency outweighs the bureaucratic inefficiency... I'm not sure. I guess that's where public tax software comes in.
Re: Free IRS-run tax filing pilot to be available in 13 states
#109This is great news; no matter how restricted it may be initially, I think having a "guaranteed-free" tax filing system will be great for most people, especially lower-income people. The private companies have demonstrated pretty clearly that they will do everything they can to avoid people actually having free tax filing, and while ~$50-100 might not seem like a ton of money, keep in mind that at the current United S…
FWIW, FreeTaxUSA[0] is much cheaper than Intuit and has worked great for me the past few years. I find it slightly easier than TurboTax, in fact.
Re: Free IRS-run tax filing pilot to be available in 13 states
#110If an entire industry can be killed by a public service, it probably didn't deserve to exist in the first place.
I disagree. If anything, this will compel the tax preparation software companies to get even better than before, and offer an increased value proposition. Competition benefits the consumer, and for a long while there's been limited, mostly fixed competition (via Brand awareness mostly). FreeTaxUSA is amazing, and cheap, but it does not yet have the brand power the incumbents do. It's unlikely the IRS offering will be…
> Competition benefits the consumer, and for a long while there's been limited, mostly fixed competition (via Brand awareness mostly).
I don't know that this is really true anymore. Maybe a little, but mostly just no.