Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Direct File won't happen in 2026, IRS tells states

nextgov.com

Post reply on HN
Print view View original

241–250 of 284 posts

Re: Direct File won't happen in 2026, IRS tells states

#241

Post by Thorrez »

RajT88 wrote: post #172
Thorrez wrote: post #153

Earlier quoted context omitted.

RSUs are not straightforward: https://news.ycombinator.com/item?id=43676698 And options are worse.

All right, I guess I see your point. If you company doesn't handle the complexity, it can be a nightmare. Where I've worked, they withhold the necessary number of shares from RSU's and it just gets taxed as W-2 income. Then, it shows up with the taxed cost basis in Fidelity so you don't get double taxed when selling shares. It doesn't appear like they have to factor in travel into that equation - that's only for your…

>Where I've worked, they withhold the necessary number of shares from RSU's and it just gets taxed as W-2 income. Then, it shows up with the taxed cost basis in Fidelity so you don't get double taxed when selling shares.

The same as where I work (Schwab though for me, not Fidelity). However, they don't track wash sales for me. Do they track wash sales for you? From what I understand, federal law tells brokers to track wash sales for regular stock purchases and sales, but not for stock from vested RSUs, but still requires the stock holder to track wash sales for stock from vested RSUs.

>It doesn't appear like they have to factor in travel into that equation - that's only for your salary.

My employer also doesn't generally track travel for the purposes of taxes. But the state laws say I need to do it and file taxes based on my tracking.

Re: Direct File won't happen in 2026, IRS tells states

#242

Post by Amezarak »

dpark wrote: post #225
Amezarak wrote: post #220

Earlier quoted context omitted.

Filing a 1040 in the US is also very easy and takes a few minutes and can be done for free. Another factor most people are ignoring is that state taxes are filed at the same time and each state has its own separate system. These third parties let you fill in and file both at the same time. It would be nice if the US gov did this too but it requires a total restructuring of the American system, and Intuit’s lobbying h…

> Filing a 1040 in the US is also very easy Not for most people. It’s a giant pain in the ass if you have bank accounts and want to file correctly. If all you do is plug in your w-2 and pretend that’s your whole tax return and you don’t care about anything except the standard deduction, sure. That’s not correct for most people. > state taxes are filed at the same time and each state has its own separate system Can we…

That is correct for most people. 90% of people according to the IRS take the standard deduction.

Interest income from your bank account comes on a 1099 and it takes 30 seconds to add onto your 1040. I do it every year.

Re: Direct File won't happen in 2026, IRS tells states

#243

Post by dpark »

Amezarak wrote: post #242
dpark wrote: post #225

Earlier quoted context omitted.

> Filing a 1040 in the US is also very easy Not for most people. It’s a giant pain in the ass if you have bank accounts and want to file correctly. If all you do is plug in your w-2 and pretend that’s your whole tax return and you don’t care about anything except the standard deduction, sure. That’s not correct for most people. > state taxes are filed at the same time and each state has its own separate system Can we…

That is correct for most people. 90% of people according to the IRS take the standard deduction. Interest income from your bank account comes on a 1099 and it takes 30 seconds to add onto your 1040. I do it every year.

25% of returns include the child tax credit and 16% include the earned income tax credit. These aren’t wealthy people filing with CPAs. These are lower income folks who specifically benefited from the IRS direct file program.

Again, you seem to simultaneously believe that nearly everyone has trivial taxes to file while believing that the government cannot reasonably support free direct filing for these people. I have to wonder how you reconcile these beliefs in your head. “I mean, this is so simple. Any moron can do it. But not the agency specifically responsible for handling trillions in tax revenue. Nah, too complex for them.”

Re: Direct File won't happen in 2026, IRS tells states

#244

Post by ClayShentrup »

mindslight wrote: post #205
ethin wrote: post #154

Earlier quoted context omitted.

This problem is only magnified when you consider our voting system. Any ranked voting system inherently runs into Arrow's Impossibility Theorem, which makes what we have right now not exactly democratic. The solution would be to switch to something like approval voting but good luck getting that going.

It's been a while since I've studied the details of voting systems, but it seems like Approval voting just moves the spoiler effect into how people vote - ie strategic voting. Personally I think the possibilities of circular ties under Ranked Pairs is oversold. Society is well acquainted with the concept of a tie, and whatever tiebreaker procedure we define probably won't factor into voter strategy all that much (tha…

> it seems like Approval voting just moves the spoiler effect into how people vote

that's orthogonal. ranked voting methods already have (arguably more severe) response to strategic voting AND ALSO can fail IIA even with no strategy applied, just by changing an irrelevant alternative.

> Personally I think the possibilities of circular ties under Ranked Pairs is oversold.

what does that even mean? we have VSE figures that measure the combined effect of all failures, including when the Condorcet winner isn't the favorite candidate of the electorate (not the social utility maximizer). https://electionscience.github.io/vse-sim/vse-graph.html

that's not under or oversold, it's just measured performance.

Re: Direct File won't happen in 2026, IRS tells states

#245

Post by ClayShentrup »

ethin wrote: post #154
whoooboyy wrote: post #94

Earlier quoted context omitted.

Try telling people you voted third party because of a deeply held conviction about not electing corrupt politicians. You will be told you are evil, that you've got an unreasonable/impossible purity bar, that you don't really believe in that deeply held moral conviction actually, that you are worse than the people who voted for the other guy, that you are a utopian idealist, etc etc. Don't get me wrong, I did vote thi…

This problem is only magnified when you consider our voting system. Any ranked voting system inherently runs into Arrow's Impossibility Theorem, which makes what we have right now not exactly democratic. The solution would be to switch to something like approval voting but good luck getting that going.

i had a chance to visit arrow at his palo alto condo circa 2014. his theorem is nice and all, but it only makes sense to apply it to social welfare functions, not voting methods. yes, the correct social welfare function is just the utilitarian sum of all voters' individual utilities.

https://www.rangevoting.org/UtilFoundns

once you know that, that's the function you use in your VSE metrics. then the performance of the voting method is measurable without having to think about any specific criteria.

https://www.rangevoting.org/PropDiatribe

Re: Direct File won't happen in 2026, IRS tells states

#246

Post by mindslight »

ClayShentrup wrote: post #244
mindslight wrote: post #205

Earlier quoted context omitted.

It's been a while since I've studied the details of voting systems, but it seems like Approval voting just moves the spoiler effect into how people vote - ie strategic voting. Personally I think the possibilities of circular ties under Ranked Pairs is oversold. Society is well acquainted with the concept of a tie, and whatever tiebreaker procedure we define probably won't factor into voter strategy all that much (tha…

> it seems like Approval voting just moves the spoiler effect into how people vote that's orthogonal. ranked voting methods already have (arguably more severe) response to strategic voting AND ALSO can fail IIA even with no strategy applied, just by changing an irrelevant alternative. > Personally I think the possibilities of circular ties under Ranked Pairs is oversold. what does that even mean? we have VSE figures…

Restating my disclaimer of "It's been a while since I've studied the details of voting systems"...

> ranked voting methods ... can fail IIA even with no strategy applied, just by changing an irrelevant alternative.

Can you clarify whether you're referring to some ranked methods (eg IRV), or all ranked methods (ie including ranked pairs) ?

> that's not under or oversold, it's just measured performance.

Isn't this due to defining "performance" in a way that is congruent with Approval (/ Score) ? A quick skim of that VSE page has it talking about "utility", which I would imagine is a scalar per candidate representing "happiness" ?

The problem I have with Approval is that coming from our two-terrible-party system - do I Approve my latent terrible party or not? That choice seems purely down to strategy, compared to being able to rank them to say I completely prefer the new party/candidate over my latent terrible party, and my latent terrible party over the other latent terrible party. The dynamic also seems exacerbated knowing there will be a lot of people who continue to vote exactly as they did under plurality.

Re: Direct File won't happen in 2026, IRS tells states

#247

Post by Amezarak »

dpark wrote: post #243
Amezarak wrote: post #242

Earlier quoted context omitted.

That is correct for most people. 90% of people according to the IRS take the standard deduction. Interest income from your bank account comes on a 1099 and it takes 30 seconds to add onto your 1040. I do it every year.

25% of returns include the child tax credit and 16% include the earned income tax credit. These aren’t wealthy people filing with CPAs. These are lower income folks who specifically benefited from the IRS direct file program. Again, you seem to simultaneously believe that nearly everyone has trivial taxes to file while believing that the government cannot reasonably support free direct filing for these people. I have…

Credits are applied after you take the standard deduction. You subtract the standard deduction, figure out your taxable income, then subtract credits and taxes already paid.

> These aren’t wealthy people filing with CPAs. These are lower income folks who specifically benefited from the IRS direct file program.

Lower income people were not using IRS direct file. That’s would be the economically rational thing to do, but this is exactly the market the strip mall CPA target. They also offer advances. I have tried and tried and tried to get lower income people to use free or direct file. Virtually none are interested. They have “their guy” who is getting them a great refund.

Re: Direct File won't happen in 2026, IRS tells states

#249

Post by foxglacier »

simoncion wrote: post #81
foxglacier wrote: post #60

Earlier quoted context omitted.

Doesn't America have uniquely complicated tax that requires you to keep all your receipts to claim all sorts of confusing deductions? How can the IRS know what you spent your income on if you don't tell them? I've had the misfortune of having to fill in a W8-BEN-E form [1] and the first time, I just gave up and refused to work with the client because it was too complicated. The 2nd time, I got an LLM to tell me how t…

> Just look at the dense jargon ... There are 32 of them! What the hell is all that? For every form I've ever had to file with the IRS, there's a corresponding set of instructions. Those instructions inevitably have a definitions section and/or define the terms in-line. The instructions for form W8-BEN-E are at [0]. The definitions section starts at printed page 4 and continues through to printed page 7. Some terms y…

Yea I did look at the guide but it's a huge amount of work that I wasn't prepared to do just to make a couple of hundred dollars from one client. Imagine you start at the first option:

Nonparticipating FFI. A nonparticipating FFI means an FFI that is not a participating FFI, deemed-compliant FFI, or exempt beneficial owner.

OK, then what's an FFI, a participating FFI, a deemed-compliant FFI, and an exempt beneficial owner? That's 4 other definitions to look up just to learn you should not choose option 1 of 32. If you keep track of this intermediate knowledge, it can help you skip some other options but you have to look ahead and see that possibility and find a way to store all these intermediate conclusions so that when you wake up the next day you haven't forgotten if you're an exempt beneficial owner or not - and by the way, before you even begin, you have to work out if you're a beneficial owner - exempt or not.

Once you've decided you're not an FFI, you look to see if you're a "Certified Deemed-Compliant Sponsored, Closely Held Investment Vehicle", which doesn't have a definition in the guide! What now? Try to find it in the Internal Revenue code?

By the way, the one you called out - "Excepted Territory NFFE" doesn't actually have a definition at all in the guide either and it refers you to "Regulations section 1.1472-1(c)(1)(iii)". Maybe if you're clever, you can set aside these difficult ones in case you discover an easy right answer first, but that gets back to designing a system to manage the intermediate knowledge and design your search strategy. Yes, you can do it, but also it's stupidly burdensome.

Re: Direct File won't happen in 2026, IRS tells states

#250

Post by dpark »

Amezarak wrote: post #247
dpark wrote: post #243

Earlier quoted context omitted.

25% of returns include the child tax credit and 16% include the earned income tax credit. These aren’t wealthy people filing with CPAs. These are lower income folks who specifically benefited from the IRS direct file program. Again, you seem to simultaneously believe that nearly everyone has trivial taxes to file while believing that the government cannot reasonably support free direct filing for these people. I have…

Credits are applied after you take the standard deduction. You subtract the standard deduction, figure out your taxable income, then subtract credits and taxes already paid. > These aren’t wealthy people filing with CPAs. These are lower income folks who specifically benefited from the IRS direct file program. Lower income people were not using IRS direct file. That’s would be the economically rational thing to do, b…

> Credits are applied after you take the standard deduction.

I did not state otherwise. The point is that you are misstating the complexity of the typical tax return. It is not in fact “enter your W-2, take the standard deduction, and done” for most people, even for those with relatively straightforward taxes.

> Lower income people were not using IRS direct file.

I don’t think the IRS has released this data. I do know that direct file was specifically limited to simple cases though.

Post reply on HN