Huh, as an aspiring tax professional how do I get in on this?
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Thank you for the explanation. I've never contributed before to open source and have benefited from open source software a lot, so I'm trying to contribute to this the right way.
Blaming "lobbyists" absolves the politicians of their responsibility. The fault lies with the politicians for creating and perpetuating this broken system. (copy and pasted from another comment)
Like anyone else, politicians respond to incentives. US crony capitalism is a large-scale systemic failure, and the tax filing system (and under-resourced IRS) is just one symptom. If you want a narrow target, you can blame the GOP activists on the US Supreme Court, or if you want to go beyond that, blame the GOP senators/presidents who appointed them, the Federalist Society, the GOP donor base, GOP-aligned media org…
I'd add one more in there for a tighter focus -- the lobby group "Americans for Tax Reform", which opposes all tax increases, and specifically opposes any effort from the federal or state governments to provide pre-filled tax returns.
A few years back I got audited, and it was called an "electronic audit" by the IRS. Which basically meant that they had their computer systems scour a bunch of the bank records and discovered that I had forgotten to claim a 1099 for some contract work I had. OK, so they sent me a computer print out and they had cross checked everything on my return electronically, my property tax deductions, my stock dividends so on…
The thinking is that the more painful filing your taxes is, the more people will have a negative perception of taxes in general and be opposed to tax increases.
There was an interesting Planet Money episode about this [0].
> the 1040EZ form no longer exists That is wild. I remember using it for my first job, and yep, it took me all of a few hours to fill it out by hand and mail it in.
A few hours? HOURS? The 1040EZ was like 6 questions, it shouldn't have to take you more than 10 minutes.
You're right, I'm basically counting all the time it took me to find an envelope and stamps, get lunch, get a bus to the post office, drop it off, and head to a nearby coffee shop :)
In the US, the Republican Party has a history of intentionally pushing for cumbersome tax filing as part of encouraging people to hate the idea of taxes in general.
That's why I do my taxes manually and mail them in. I want it to be as painful as possible.
nice one, letting the government hold onto your refund for an extra month is really sticking it to the man!
This is how is works in Australia. The Australian Tax Office will pre-fill your tax return online with income from your wages, interests, managed fund distributions, dividends etc. That maybe enough for simple tax returns, you can just accept their values and submit. What they don't know is your income from sources like rental income or crypto. They also don't know deductions you are going to claim. In this case you…
Since we're having the semi-annual "how do taxes work in other countries" thread, here is my experience as an American living in Switzerland. Though I have been here a while, I still find it interesting and a little weird. At the beginning of the year, you get a bill for that year based on what they think you will owe. This bill is due on October 31, i.e. you need to pay your estimated income tax before you have earn…
Are you sure about the dates? As far as I know, you need to file your tax declaration for the previous fiscal year by mid-March, and pay before the end of March. But as you say, you're supposed to pre-pay most of it before based on an estimation (though you have to do the estimation yourself, not the government). You don't have to pay all at once though, you can pay in monthly installments with no penalties.
Whatever indicators they use to select audit recipients may correlate with under-payers, but it's not a guarantee. I'm sure there's some fraction of those they audit that turn out to have paid too much.
They have some data on this ( https://www.irs.gov/pub/irs-pdf/p55b.pdf , pages 33-35). Out of 509,917 examinations, 18,988 resulted in a refund. There was $7.0 billion of tax refunded in 2020. For comparison, there was $17.2 billion of additional tax generated with additional recommended and unagreed amounts.
Huh, that's a pretty large amount of refunds (granted, still $10B in additional revenue). Interesting data, thank you for sharing.
I'm working with other contributors on https://ustaxes.org , an open source tax filing webapp https://github.com/ustaxes/UsTaxes . Currently, many Federal tax forms are supported, as well as tax filing for the state of Illinois. Filing for Oregon and California is under development!
Very cool. There's also [0] if you just want a "digitized" version of all the forms.
I don't believe I did, it was my primary residence so bypassing a lot of the tax implications from capital gains. It was my first house sale so I was really expecting to companies involved in it that I paid a small fortune to to handle things of that nature, or at least send me documentation to send when I did my taxes. Unless something got lost in the mail I never received any sort of tax docs, which in my obvious-n…
I'm not a tax person, but probably all they need is an amended tax return (1040X) with the sale reported. Grab the instructions for schedule D for the tax year you sold your home, and follow the section for "Sale of Your Home". It says you're only required to report the sale if the gains exceeded the exclusion amount or you received a 1099-S; but I'm guessing the IRS must have received a 1099-S even if you didn't. Yo…
Just as an update, apparently it takes 1-3 months for docs to the IRS to make it to where they're supposed to go. I just got off the phone w/them (took 1hr:45mins to get a person) and found out I only owe $20 after faxing them my house sale docs in November!
Politicians are surprisingly cheap, so long as you're talking about topics that don't get a lot of press. And thanks to Citizens United and similar decisions that have driven up the cost of US elections, US pols are very expensive compared to their counterparts in other countries. It does make me wonder about the efficacy of standing up a lobbying fund to lobby to Do The Right Thing about something. This would be a p…
I completely agree that politicians are not cheap at all. The reality is that so much of the money that's invested in influencing politicians is through means other than campaign contributions. It's through season tickets to the network of friends that know the politician, it's through donations to the university that gets their child into college, it's through pacs and issue groups, it's through lining up and bundli…
True! Great point that there are very, very many other ways that they are "compensated" besides direct $$$ donations. Thank you for noting that.