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Claiming high user satisfaction, IRS will decide on renewing free tax site

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Re: Claiming high user satisfaction, IRS will decide on renewing free tax site

#201

Post by torstenvl »

loeg wrote: post #108
PopAlongKid wrote: post #23

Earlier quoted context omitted.

>why does EITC exist? To relieve the regressive payroll tax (FICA) on low-income families.

FICA taxes aren't regressive.

FICA taxes are, as a matter of inarguable, objective fact, regressive, which is to say that people who make more money pay a lower rate of FICA taxes. This is due to two facts: (a) FICA taxes do not apply to interest or capital gains or other income sources that apply solely to middle class and above; and (b) FICA taxes do not apply to income above ~$160k.

Please do not post misinformation.

Re: Claiming high user satisfaction, IRS will decide on renewing free tax site

#202

Post by reindeergmz »

akira2501 wrote: post #39
janalsncm wrote: post #18

Earlier quoted context omitted.

Liberty and privacy are fashionable. The problem is that our Congress passes hundreds of pages of domestic spying legislation in the middle of the night. It’s not exactly the School House Rock democratic process we learned about in 4th grade. But that’s really beside the point. If you are like millions of other Americans filing W2s, the fact that you work for your employer isn’t a secret. Your salary isn’t a secret.…

> the fact that you work for your employer isn’t a secret I would prefer if it was. It's even worse than that, the government has entitled itself to be a party to every transaction over $600, so even the self employed have to shoulder this unseemly burden. > Your salary isn’t a secret It is. It's a shared secret. Again, I would prefer if I didn't have to do this. My salary is not at all the same as my "taxable income…

[dead]

Re: Claiming high user satisfaction, IRS will decide on renewing free tax site

#203

Post by altdataseller »

troupo wrote: post #174
altdataseller wrote: post #90

Earlier quoted context omitted.

What about expenses for those that are self employed? What about rental income? What about expenses related to rental properties? Lots of things the government doesn’t know…

This is solved by: - IRS pre-fills all it knows about you - you log into to IRS web site to check if everything is correct, and provide additional data or correct invalid data - submit Oh look. By implementing this you may join Sweden and a bunch of other countries in the 21st century.

Gotcha. I was under the impression that what the government showed you was 100% final

Re: Claiming high user satisfaction, IRS will decide on renewing free tax site

#204

Post by hedora »

anon291 wrote: post #101
tmountain wrote: post #8

It’s amazing that 54% of adults in the United States have a literacy below 6th grade level, but it is expected for the same population to have the financial literacy to file their taxes accurately. Going further, the IRS already knows the details of most people’s taxes before they file, yet everyone is expected to complete what amounts to a complex task for many people. I cannot fathom why it is still done this way.

Following tax forms is so braindead simple, I honestly can't see how anyone can be that incapable without being mentally deficient enough to be under conservatorship. It's literally step by step "Add this" or "subtract that". If you have a calculator and a 3rd grade level understanding of English, I can't see how you'd have a problem.

The US tax code is 70,000 pages, and is revised an average of once per day:

https://taxfoundation.org/blog/how-many-words-are-tax-code/

A typical federal tax filing for our household is over 100 pages long, and that’s just the stuff that we need to mail. The accompanying directions and worksheets are probably close to 1000 pages.

Also, lots of the directions are incredibly obfuscated once you start getting into those 1000 pages.

> If you do A and not B then you can do C.

> Example calculation of C (usually over a page long):

> Bob wants to do C but encountered corner case exceptions E and F in the absence of event G. That implies B, so here’s the arithmetic for doing D (which is covered elsewhere in this book, and is probably irrelevant to your situation).

This is just standard stuff TurboTax handles. God help people with filings too complicated for that!

(And, yes, I used to do taxes by hand.)

Re: Claiming high user satisfaction, IRS will decide on renewing free tax site

#205

Post by balls187 »

majormajor wrote: post #21
idle_zealot wrote: post #6

Earlier quoted context omitted.

This last year when filing my taxes with a paid turbotax product some value was auto-filled and looked about right. After submission I was notified that the IRS rejected my form because the field was wrong. They did not correct the field or otherwise communicate what they believed the value should have been. Tracking down what number they actually wanted there was a hassle. So... they have on file what they expect yo…

Huh, I've never had my filing rejected but I've had the IRS send me letters a couple times. Once a year or two later, the other time (last year) a few weeks later or so before I got the refund: each time they told me exactly what they thought I'd missed. Which still highlights the absurdity of making me re-enter the stuff they already know.

Rejection is usually something the IRS can suss out immediately when you e-filing such as incorrect SSN for dependents. Correction letters are just form letters from automated audits, usually forgetting to input a 1099 misc from some bank account.

Re: Claiming high user satisfaction, IRS will decide on renewing free tax site

#206

Post by EduardoBautista »

ITB wrote: post #27
balls187 wrote: post #4

Earlier quoted context omitted.

It is bonkers that the IRS cannot prefill information for the majority of Taxpayers.

They could. They just want you to confess the things that are harder for them to track. So they pretend they know more than they do.

Most people get money back from the IRS. If anything, making tax returns optional for people with just employment income would mean the IRS would keep more money.

Re: Claiming high user satisfaction, IRS will decide on renewing free tax site

#207

Post by EduardoBautista »

willcipriano wrote: post #36
nneonneo wrote: post #2

I did my Canadian taxes for me and my spouse on a free filing site last night, in less than two hours, for $0. Everything was prefilled; practically the only thing I had to fix was to convert an imported investment statement from USD to CAD, and double check that everything was accurate. I welcome the Americans to the delightful convenience of hassle-free taxes!

> less than two hours > hassle-free taxes That's still a crazy demand on the time of someone paying for everything. My bank, my employer and my brokerage all report on me, the IRS should be able to just mail a check or a bill most of the time.

My C-corp taxes took about half an hour with turbo tax (just software development contracting).

It really puzzles me what is so complicated about filing taxes as someone who only has employment income.

Re: Claiming high user satisfaction, IRS will decide on renewing free tax site

#208

Post by Maxatar »

yorwba wrote: post #147
throwup238 wrote: post #132

Earlier quoted context omitted.

Only 14% of the US is foreign born according to the last census so that’s not enough to make up the difference. The functional literacy statistics are bad no matter how you dice them.

How about dicing them this way: "Sixth-graders already read about as well as the median adult." Sounds pretty good to me. The shock value of the original statement derives from the idea that sixth-graders are basically illiterates who can barely function in society, but what if that's not the case and six years in school are actually enough to learn reading and writing? It's a pretty long time already. What further i…

The shock value should come from the fact that the US scores very low among developed countries. The UK, Canada, and most of Europe score much higher on literacy tests.

The US has exceptional universities and colleges, but its K12 education system leaves much to be desired.

Re: Claiming high user satisfaction, IRS will decide on renewing free tax site

#209

Post by loeg »

torstenvl wrote: post #201
loeg wrote: post #108

Earlier quoted context omitted.

FICA taxes aren't regressive.

FICA taxes are, as a matter of inarguable, objective fact, regressive, which is to say that people who make more money pay a lower rate of FICA taxes. This is due to two facts: (a) FICA taxes do not apply to interest or capital gains or other income sources that apply solely to middle class and above; and (b) FICA taxes do not apply to income above ~$160k. Please do not post misinformation.

The FICA system, of which taxes are one component, also pays out a lower proportion to higher earners. https://www.ssa.gov/oact/cola/bendpoints.html It is incorrect to describe the system as regressive.

It's a little weird to lump it all together as FICA taxes, too. Social security is more of a mandatory pension program that caps both contributions and benefits for high earners (in addition to progressively lower benefits for higher earners on the back end). Medicare taxes are straight up progressive -- there is an extra 0.9% tax bracket on higher W-2 income and the 3.8% NIIT investment income tax on stocks.

Re: Claiming high user satisfaction, IRS will decide on renewing free tax site

#210

Post by jcranmer »

anon291 wrote: post #101
tmountain wrote: post #8

It’s amazing that 54% of adults in the United States have a literacy below 6th grade level, but it is expected for the same population to have the financial literacy to file their taxes accurately. Going further, the IRS already knows the details of most people’s taxes before they file, yet everyone is expected to complete what amounts to a complex task for many people. I cannot fathom why it is still done this way.

Following tax forms is so braindead simple, I honestly can't see how anyone can be that incapable without being mentally deficient enough to be under conservatorship. It's literally step by step "Add this" or "subtract that". If you have a calculator and a 3rd grade level understanding of English, I can't see how you'd have a problem.

> Following tax forms is so braindead simple

One year, I had to spend a good deal of time working around a cycle in my taxes--VA wanted me to do my CA taxes first and CA wanted me to do my VA taxes first, and the instructions that explained how to handle this situation were only one on the one form that needed to be used to solve it, with nothing telling you maybe you should look for that form instead.

Furthermore, there's quite a few cases where the instructions basically tell you "fill in the number that belongs here" without giving a good idea of what numbers actually belong there. Here is an example of such an instruction in its entirety:

> Enter in line 5 the amount of pension, annuities, IRA/Keogh distributions not taxed on your Massachusetts Form 1.

The hard part of taxes isn't knowing whether or not to add or subtract two lines. It's knowing which lines shouldn't be 0!

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