ProPublica seems to be singularly focused on Intuit to the exclusion of all the other powerful interests who benefit from a complex and opaque tax code. They may be fighting efforts to make filing easier under the current rules, but they aren't really doing anything to keep those rules a clusterfuck.
Your point being? This discussion refers to an article about tax filing and Intuit’s efforts to retain tax code complexity and self-beneficial regulatory conditions.
Yes, companies like the ones you cited spend significant amounts of money to educate and persuade lawmakers. Academically I’d like to see what a world without lobbying looks like, but honestly, I’m not confident it would be significantly better for citizens (and may be significantly worse in some ways).
But that’s a tangential topic for a different discussion.
The Republican party? Seriously Grover Norquist wants taxes to be painful so you associate them with bad feelings. They made it illegal to compete with TurboTax by offering a free piece of software from the IRS. Look up California's FreeFile software. There is nothing Republicans have done that helps taxpayers unless they make over a higher than average amount of money. I'm not even trying to be political, this has just been an arm of their platform since the 1980s. I've included a link to a podcast which goes pretty deep on this topic.
The Republican Party itself is not a lobbying group, but a political party. To the extent that they want to make taxes worse, they are both internally motivated and also the subject of lobbying. To make my original question more pointed: Who else lobbies like Intuit? It is already well-established that the Republican Party's members broadly support these antisocial tax-frustrating positions; we are examining the people who put money into those positions, not the people who put people into those positions.
Norquist is a great example of a lobbyist worth examining. He's a real piece of shit. His group is Americans for Tax Reform (ATR). Their 2019 sheet shows $390k spread across 6 lobbyists who did not hide their representation; they had opinions on a variety of issues and bills, all related somehow to taxation. [0] Intuit's sheet shows spending of $1.28m in that same time period, spread across at least ten firms, including dozens of revolving-door politicos and industry insiders, all aimed at one single piece of legislation: The Taxpayer First Act of 2019, an attempt to modernize tax legislation and filing processes. [1] Surprisingly, ATR has officially said nothing about the Taxpayer First Act, despite Norquist's well-publicized position against such efforts.
To recap: Intuit spent 3x what Norquist's group spent, and focused that spend on one specific bill which would have eased tax filing. If Norquist is a piece of shit, what does that make Intuit?
Republicans are not a lobbying group, but as a political party Americans have spent a heck of a lot of money on them, especially when you include PACs. Since you've limited it to specifically lobbying groups I don't know that the PACs qualify either. They definitely aren't as narrow either. It's certainly an interesting question.
That's hard to disentangle, because there are lots of individuals and large corporations that benefit from complex holes in the tax code that would go away if the code were made simpler. Intuit's efforts are just easier to ascribe to that purpose.
There's also the block of special interests that advance their agendas via the tax code. Things like the capital gains tax regime, Child Tax Credit, and mortgage interest deduction.
> In this article on how Intuit is working to prevent free filing, ProPublica focuses on Intuit? Why is this surprising?
My issue is that the article, and many posters here, make it sound like all the ills of the US tax system trace back to Intuit. Statements like (emphasis mine)
> Intuit fended off the government’s attempts to make tax filing free and easy
and
> But the success of TurboTax rests on a shaky foundation, one that could collapse overnight if the U.S. government did what most wealthy countries did long ago and made tax filing simple and free for most citizens.
These statements ignore the vested interests that got all the complexity inserted into the tax code in the first place. Intuit didn't create the capital gains tax structure, the laundry list of special interest deductions available to itemizers, the complicated business income/loss rules, or any of the other elements that make preparing taxes a confusing game of hopscotch between various forms and schedules. They also would not be the loudest voice of opposition if any of those elements were to be removed to simplify taxes.
This is "whataboutism" at it's finest. This article is on Intuit. It's focused on Intuit's bad behaviour. ProPublica has other articles on the issues you are complaining about.
That's not "whataboutism" at all, as I'm not defending Intuit's behavior.
> This article is on Intuit. It's focused on Intuit's bad behaviour. ProPublica has other articles on the issues you are complaining about.
I'm saying ProPublica should have referenced those articles, rather than making statements that imply everything is the tax preparation industry's fault.
So are aren't defending Intuit but, you are just saying that ProPublic must reference other material before focusing on Intuit? What about... This sounds like industry lobbying that will make it harder and more expensive for me to file my tax and increase the net worth of Sasan Goodarzi.
You're right. I think I'm mostly aggravated by the HN lens I'm viewing this through, which seems to be focusing on the tax prep industry while ignoring the forces that made the tax code a mess in the first place. That is evident from the people saying the IRS could just pre-fill the existing forms (which itself is an oversimplification of the situation).
The GP's point (I think) is that many companies have much greater lobbying might than Intuit (Amazon, Google, Cocacola, Unilever, ...). Those companies may not care so much about how taxes are filed the way Intuit does, but they do care about keeping complicated tax codes in place that include all their favorite loopholes. So they lobby for that, without much regard for the details of the filing procedure.
The reporting on Intuit has been going on for years, but the recent onslaught is likely because their recent initial report on Turbotax obfuscating Google search results led to federal and state investigations, and possibly attracted whistleblowers who passed along the inside documents that make up this newer report (i.e. the snowball effect)
Disclosure: I used to work at ProPublica years ago. My tenure overlapped the authors', but I never worked on these stories.
Then ProPublica should not be making statements in the article that explicitly tie Intuit lobbying to fighting efforts to improve the current tax code. See another of my replies for examples.
The article doesn't present any evidence that Intuit is lobbying to keep the tax code complex, just tax filing. The code complexity, as I have already stated multiple times, stems from a myriad of special interests.
Most of the other people gaming the system are doing it to benefit themselves personally. Intuit is gaming the system so it can continue its rent-seeking behavior against the American tax payer at large. There is an element of direct unjust enrichment against the tax payer at large which is absent from other forms of tax code manipulation.
I agree. The article just doesn't seem to acknowledge that these other manipulations exist, or reference any of their other work on the subject. It's written as a standalone piece, and when taken as such seems to blame all the ills of the US tax code on the tax preparation industry.
Payday loans and financial derivative products both exist at opposite ends of 'creative finance' that can come back to bite you.
Payday loans, like what Intuit is doing, seeks to directly profit off of those who have the least. While they're both bad when they go wrong, it would muddy the waters to say 'but also there are other areas that are just as bad or worse depending on how you look at it.'
I'd go further to say what Intuit is doing is worse than the payday loan industry because it does it through regulatory capture instead of just desperation for capital.
My tax lawyer would cost me probably $40,000 to do the same thing just for the hours and their obsession with analyzing parallel legal theories and case law. I use my tax lawyer to construct the whole business model before any tax filings actually have to occur. Yes I could also consider a different lawyer and cpa for actually filing the tax return. They would also be more expensive than Turbotax and I would be paying two lawyer then.
Reading comprehension gives the biggest advantage with taxes. It is worth it for me.
The IRS is more of an ally than an adversary when you are using them to basically approve exactly how you wont pay them taxes, in advance.
Barrier of entry is pretty high to unlock that level, I dont mind, its what I always aspired to do.
Haven't read the article yet, but I assume they're probably talking about the lobbying to remove free filing or TurboTax's attempts to hide the free option as much as possible with a thousand ways to upsell you by using dark patterns during the tax filing process.
It's hilarious how groups like Intuit market their tax filing product as free, then make it nearly impossible to go through a free path to filing for pretty much anyone.
Personally, I avoid companies that use dishonest practices like this and hope they go under, but so much for "voting with my checkbook" in today's society. Power has shifted too much that it's going to be quite hard to pull it back to the average citizen.
I'm only responding so others who decide not to read the article don't make incorrect assumptions like yourself. The free file-able online forms are easy to find and are not part of turbo taxes offerings. Turbo tax uses shady tactics to hide their own free offerings which they are supposed to be offering as part of a deal with the government. Free file forms are basically digital tax forms and are much more convenient over paper. Up to certain incomes they will even do most of the work for you.
There are a few things that are always extremely odd to figure out (or at least, I always waste a lot of time on them) when preparing the forms. What's deductible vs what isn't with retirement accounts, student loan repayments, and - for the love of God - the Health Savings Account stuff. It's been a long time since I had to think about it but I'm sure some hn users have struggles figuring out their stock options.
TurboTax asks you questions and guides you through entering the data. It's all fairly intuitive and you'll have a feel for whether you've done everything completely. Free Fillable Forms, which I've used the last couple of times, is just one step up from doing everything on paper. It is not bad if you know what you're in for, but it is not the same experience as something like TurboTax or the H&R Block tool.
Copy line 13 of form 8765 to line 32 of form 5432... This is more tedious, except that it gets very easy to miss one of those steps in the list of things that don't apply. (most people have never worked for the railroad and skip a bunch of steps for railroad retirees)
It's a mere 17 pages including lookup tables. Pretty lightweight. Some go way longer.
Now, is all of this information and logic put into the free form calculator? It's not. So you need to read along with these instructions and follow all of the conditionals and detours described inside.
This is what you're buying when you buy a tax prep program, and this is what's missing from the free options.
I did do these last year to finally kick TurboTax to the curb. However, they’re shamefully complex especially considering how they’re already a piece of software. They barely do basic arithmetic.
The restrictions are entirely artificial, and the system is gamed so that you either spend a lot of time learning tax form rules and lingo or you just pay TurboTax to do it for you.
The IRS could very easily send a pre-filled tax form for most Americans to verify and sign like other countries do. All the relevant information is already reported to the IRS. Only business owners and people with exotic tax situations would ever have to fill anything out - especially considering our now-higher standard deduction that most people don’t hit.
Despite my complaints I still highly recommend everyone use free fillable forms. You’ll actually understand what is happening with your taxes by the end of it. And without that understanding you have no idea if TurboTax is doing it right.
What about the free forms is painful? I have only ever filed via these forms - I've never used TurboTax, and my AGI exceeds the limits on the federal free file software.
To me, it's pretty simple: you read the instruction book and go through it line by line. If you have odd forms to complete, like paperwork for an HSA, a quick google search will set you in the right direction.
People with more complicated tax returns will always need a professional's expertise. But for 90% of people who have one income source for one household, the paper forms are very intuitive.
I think people think they are "painful" because they need to read and comprehend more.
('intuitive' is over used as a goal, but a form where you look up the instructions line by line in a separate book and where you occasionally have to search out how to fill out a subform is not intuitive at all.)
The first time I used FreeFillableForms, it was also my first time doing taxes manually. Reading all the instructions and then going off and computing whether or not the AMT applies to me, researching whether I was eligible for this and that deduction, etc was very time consuming. I estimate it must have taken me over 12 hours which was definitely not worth my time financially, but I did it anyway as a matter of principle.
THEN I ran into a nasty snag: I had put a "0" in a bunch of the fields that I'd decided didn't apply to me, but the IRS validation script expected those fields to be blank and repeatedly rejected my submissions with cryptic error messages about form validation errors. It takes at least a day to hear back after you submit, so it took me weeks after I was "done" with my taxes before I could figure out the problem and get all the fields changed from zeros to blanks that the IRS needed in order to actually accept my taxes.
>I think people think they are "painful" because they need to read and comprehend more.
That's part of it, but FreeFillableForms is not user-friendly at all. The whole federal tax process is an absolute mess. Doing my state taxes is so much easier, thanks to CalFile doing 99% of the work for me. It's a shining example of what our federal tax returns process should be like.
The painful bit is having to fill out anything at all. I lived and worked in the UK for 11 years and I didn't have to fill out a form once in all those 11 years.
My brother who had rental income only needed to fill out a small form for this additional rental income.
Your point about how the IRS already has all of the relevant information is something that has always puzzled me. Why are we performing this bizarre, ever-changing ritual with the threat of IRS audits hanging over us if they already know everything?
I think that is part of why TurboTax has such a foothold. I use it because it walks me through the frankly byzantine process and explains a good deal of the arcane terminology for me.
The IRS doesn’t have all the relevant information though.
A lot of deductions and credits are based on events or transactions that aren’t reported to the IRS. State and local tax deduction, charity deduction, medical expense deduction, and so on. There are also various penalties that need to be self reported - the IRS can find them, but only if they do an audit and are looking through bank accounts and other stuff they normally don’t know about.
I’m not sure if the IRS even knows how many kids you have for the child tax credit. How would they?
> I’m not sure if the IRS even knows how many kids you have for the child tax credit. How would they?
You have to report the SSN of your dependents on your tax return, still open to fraud but it’s not like you just fill in a number. This was actually a huge issue for the IRS before they co-opted the SSN as a tax identifier, and pretty much the only reason people get one assigned at birth instead of when they begin working.
CGP Grey’s video on the US’ lack of a national ID covers a lot of this, worth a watch.
They'll have it from the previous year. So, for each dependent, you'll likely only send a correction to the IRS twice: the year you gain the dependent, and the year they stop being a dependent.
> The IRS could very easily send a pre-filled tax form for most Americans to verify and sign like other countries do. All the relevant information is already reported to the IRS.
One of the current problems is that the information is reported in parallel by those providers. Many small businesses print off their employees' W-2s at the same time they print their own tax returns.
Yes, the IRS knows eventually. They don't know by April 15th under the current set of filing deadlines, though. That's a solvable problem, but not as trivial as you make it sound.
IRS has your W2s and 1099s by February. It could compute and suggest your takes based on your previous year age & family profile. It already does this verify your filing.
You could miss forms like AMT and NET with FFF. Until recent tax reform I was borderline most years, so defer to tax software to determine if I had these taxes. ACA penalty a mess too.
If you hover your mouse cursor over the underlined words in the article (these are called 'hyperlinks' or, more informally, 'links') and then hit the left mouse button, your World Wide Web browser will display other documents which ProPublica used for their reporting.
Just for comparison: in Brazil the _Receita Federal_ (IRS equivalent) provides a free multi-platform* Java desktop app for filing your taxes.
The UI isn't great* and if you do complex stock trading it can be a pain to add the necessary information, but for the vast majority of people it works just fine.
It also shows if it is better to use the standard deduction or the itemized deductions for your particular case and also calculates your effective tax rate.
In fact, the Java App has for years been the only way to file personal income federal* tax. The paper forms were abolished because (almost) no one used them and they had a large rate of mistakes.
* The Java desktop app runs on Linux, macOS and Windows. (And possibly others)
* There is a separate mobile app but I haven't actually used it.
* In macOS there was bug in last year's version: it used ctrl instead of command for things like copy and paste.
* There is no state income tax in Brazil.
Fun fact: the official tax filing application in Germany which has been around for a few decades is called "ELSTER" (apronym for Elektronische Steuererklärung, "Electronic Tax Return") which literally translates to "MAGPIE", as in "thieving magpie" ("Diebische Elster"). This is a form of self-irony which is quite unusual for the German tax offices.
OS portability has greatly improved with their online app [0], which is actually very good and easy to use. Before, the only stable way to run their Desktop application on Linux was through wine.
Here in Brazil the mascot of the Income Tax is a Lion, it's of an old ad campaign the government ran, comparing taxes with lions and saying "the lion is tame".
ELSTER is one of the few examples that come into my mind in terms of "software done right": It's stable and "just works", at least for me.
It's first version was released to the public in 1999, so... Yes, ELSTER is around for almost 20 years now, getting constantly refined at least in the front-end.
All in all, it's something you wouldn't have expected here in Germany in terms of software projects from the government.
AFAIK, it is mostly developed in-house, at least the original version was developed by the Bavarian tax office. In my experience, if government software (for schools, tax offices, political participation, etc.) is developed by an external company, the primary objective of the company often quickly transforms from "creating usable software for all citizens" to "drain the most amount of money out of the infinite resources of the federal government".
The danish tax authority is called skat. It has a double meaning of taxes and loved one, it's as if the German one was called Schatz/Schätzle, I think it's cute.
Isn't skat more like treasure that's also used for people? At least that's how it is in Norwegian. No idea why taxes use the same word, it sure so in Norwegian too.
In Holland we have the word schat which also means treasure (and loved one).
As an extension of schat we also have schatkist, which means treasure chest, which is also used as the translation for treasury.
When I look up the meaning of schat the dictionary says: A large collection of valuables. I see how an organization gets named after the very thing they are supposed to handle.
skat/skatt is common to danish/norwegian/swedish, and in all countries it means both taxes and treasure. In danish/norwegian it also means loved one, but swedes would miss that point.
The danes have chosen to name their tax authority not "skat authority" or something like that, just "skat" which evokes the friendly/funny pun.
Having moved from Sweden to Germany I appreciate Elster existing (and not being solely paper based unlike the other many many German beaurocratic exercises one has to Wade through).
However it misses the most important part. In Sweden your tax declaration comes pre-populated with data they already have, like salary/pension/savings/stock sales/etc., and you can either just accept it as it is or make changes to the already existing data.
It's so easy that you in fact just can send an SMS (that is verified to be from you) to the taxation agency saying that their suggestion is right.
In Germany, it's actually similar. You can opt in to include the data submitted for you by various sources and include them in your tax declaration. The only drawback is you need to select each one (salary, basic info, church tax info) to import it into your declaration, and that you need to wait until end of February since that's the deadline for third parties to submit your data.
Also, some things, like capital gains, you don't even need to declare if you used only German brokers, since they are legally required to submit it for you.
It takes many clicks and requires to wait for a letter once but Elster offers that too (under the term "Belegabruf"). It then prepopulates the tax return with the data they have.
Banks send you letter the weeks before with capital gains, interest payments and employers send you letters with totals of taxes paid. They note if anything needs to be done manually.
The total time spend combined for me filing taxes for the last 10 years is less than 15 minutes. And the reason it isn't less than 3 is because I've logged in (using biometrics and password on my phone that is a hardware token to my bank wich is used for instant secure identification) to check that everything looks OK and to add the commuting at least 10 km/day on bike deduction.
In Brazil we have that option, but one must have a cryptographic token accepted by the government to access it. People usually don't have them, while companies are required to have one.
In Sweden, the government does the work for most normal cases. They send you a suggestion of “this is all we know about” and you just say “yeah, seems right” via SMS.
In Ireland you don’t do anything in the usual case, unless you think it’s wrong, everything is taxed at source by the employers/banks.
It seems a bit naive of the government to reveal to you your income sources they know about. If you have any hidden ones you can confidently not report them and pay less taxes than you would otherwise.
I assume this would still be a crime, and you'd be held responsible for lying on the past forms in discovered. The only difference is, this is optimized for making the common case easier - the case of typical income of regular, honest individuals.
It's the same in Denmark and it feels right to me. It's not like they are doing detective work (per default). If you have a concealed source of income, I'd expect them not to know about it. Of course, you'd still be breaking the law by not reporting it and it could turn up if they notice something that doesn't add up somewhere.
Do note that it the responsibility of the employer to report who is employed, so if anything is missing, then it will generally be the company that is the one in the wrong. Especially as the company also pay employer fees for employees, so it would be a flagrant case for the tax agency anyhow.
> Brazil the _Receita Federal_ (IRS equivalent) provides a free multi-platform Java desktop app for filing your taxes.
Other fun stuff about that desktop app...
* Originally, it was a DOS-only program (yes, it's that old). Then for a while, it was Windows-only, then for some time (probably due to the Linux users complaining) there was both the Windows-only version and the Java multi-platform version, and later the Windows-only version was discontinued.
* The original way of sending the output of this program to Receita Federal was to write it to a floppy disk and take it to a bank, which would read and upload it. Later functionality was added to send it through the Internet instead, and some time later the floppy disk option was removed.
For a while a lot of non-aligned countries were mandating the exclusive use of open-source software by government agencies, because the idea of their government being beholden to a US corporation was anathema. I suspect this was the motivation behind eliminating the Microsoft-only government service.
I haven't heard much about that open-source requirement lately. I suspect the Long Reach has been making quiet moves behind the scenes, and the ascendancy of neofascist regimes in many of those countries will do what fascist regimes always do (ie. cater to the cartel making up the fasces).
> The original way of sending the output of this program to Receita Federal was to write it to a floppy disk and take it to a bank
My cousin started work as a company messenger back in the early 80s and these are the sort of tasks he used to do. Its amazing that the profession has died out in in such relatively short space of time. I guess courier companies have filled in the slot but courier companies would never have coped with the number of documents that needed to be ferried about town in the old days.
In the Netherlands we had (for a very short while at least as far as I remember) a DOS program as well on diskette. I never used it but my dad did when internet explorer was not yet evil and msn was a network. You could send it in via modem (9k6 baud yay!) and it would work ... sometimes or hand it in via the diskette. Once the internet got going you could send it more easily as you could send the created files directly instead of relying on the modem dial-in via dos.
For myself I never filed on paper (2002 first one). After the introduction of windows programs they ported it to linux the next year (filed the first one on windows only on a library pc, program might have existed earlier) and have now switched to web based. If you had a company which did their taxes on time everything was (and is) filled out mostly correct. You check it and sign off. As a student it took a while to fill in all the deductibles but if you just have to pay you are done in minutes.
Is/was it perfect? Far from. Does it work for most people? Yes.
The old Australian online tax filing system, through to the early 2010s, was an extremely 90s-looking Delphi application, Windows only for most of that time until they released an OS X port towards the end. Linux support consisted of a note on the website saying "some users have reported success with Wine". I don't believe they ever did floppy disk output though.
It's been replaced by something far nicer and web based! Though the old application was still definitely better than doing taxes by hand or having to pay for some third-party thing.
In Australia a sort of spreadsheet-like app is published each year. It pulls in data from a variety of sources (banks and employers mostly, IIRC), fills in everything it can and then lets you do the rest.
Windows only last time I did it (7 years ago?), things may have improved further since then.
All Web based now, no thick client. It still pools in all of your data from various sources as the old e tax client did. It was only Windows too from what I recall. It's all been centralised in myGov for a few years.
In Israel employee taxes are calculated and paid by the employer.
Only self-employed, people with side-jobs or people who make over a certain threshold need to file their taxes manually (and in that case things are a bit complicated).
Healthcare, pensions and benefits are paid as part of the paycheck if you are employed (they are universal and mandatory, so not the same as in the U.S.), there are no other deductibles that a regular person can claim.
Same in Chile. If you have a regular, salaried job, your employer reports your earnings and all income taxes that have been paid, your bank reports your interest income, etc.
It takes less than 5 minutes to do your taxes unless you have unusual sources of income.
All invoices are digital. Every person who gets a TaxId also gets a Private/Public keypair and generating invoices means signing the document with that key. The amazing thing is that now accountants talk about the XML, which is the legal representation of the invoice.
As a result, every year if you file your taxes, you go I to the government freely provided website , get into your account and most of the data is there for the exercise, including deducted money that you can get back.
If you are a standard worker earning less than certain amount (very sensible, so the vast majority of workers fall in there) you don't even have to file your taxes.
What you have just said has thrown me into a tizz trying to understand what you have said. Could you please give a bit more practical details. Say I want to claim rent/transport/medical expenses. Will doctors, car rental place and landlords all issue me an electronic receipt?
Not from Mexico, so it might be different for them, but one way how this works in some places is that the tax office gets all the electronic receipts from all the cash register/POS systems anyway, since that's how they monitor sales/vat/excise/etc taxes paid by the merchant and reduce the risks of "under the counter" sales where fake receipts are issued but taxes not paid on the sale.
So if the doctor's office punches in my legal ID number with the receipt (or if the ID gets added automatically from the billing system that a large hospital would have), then when the office sends all their receipt files to the tax office, the tax office will automatically add that electronic receipt to my tax deduction.
Yes. Not all spending can be deducted. But for the ones you do, you have the right to ask for the "electronic invoice" and the business has to give it to you.
When that happens they ask you for your TAX ID and then the business generates the invoice and your taxid and their taxid makes the tie. The Mexican IRS systems see all of this. So at the tax reporting moment, the system will have all that info.
It is pretty neat actually. However I think it is possible bc in Mexico people are not that concerned with privacy and all that.
Tangential curiosity: how is this part done? Do you download the keys from a government website? How do they handle key reissues if a private key is compromised?
You can download a java app which generates the key pair taking mouse movement as entropy and then you to go to a SAT(IRS equivalent) office with the key in a USB drive, they take your biometrics and save the public key to your profile. However, as most people only bring the USB drive, they usually create the key pair in the in the office. If your key is compromised or lost, you have to go to the office and they change it in very much the same way.
It's a somewhat tedious process, but if you keep the key safe, which they very much advice, most of the procedures, including tax fillings, are pretty easy and fast.
I also want to brag about Tax-On-Web for Belgium.
Development started over 15 years ago, it's been steadily improving over the years, it even works for linux users, it already fills in all tax details they already know (like wages)
Similar in NL; it used to be a desktop app (which IIRC was even distributed via diskettes or a CD-ROM but later just a download), nowadays it's a webapp. Also prefills most information from employers (who already pay your income tax for you every month), mortgages, banks, etc.
The only complexity for me came when I bought my house (some costs are deductible) and when I had to report Bitcoin held at Coinbase (and for that I had to report the (EUR) on January 1st 2018 specifically).
Canada doesn't release its own software, but it certifies a selection of free and paid software of varying complexity.
I'd like it if we could take up other, simpler models of sorting out income tax but I use software out of this pool† every year and its served me just fine:
† usually StudioTax. I donated to them last year. It's not pretty software but it's effective and easy to use. https://www.studiotax.com/en/
"Our business model is similar to that of a street performer. You can use and enjoy our software and later decide if the experience was worth it and you can afford a donation.
However, based on many users’ feedback, you should be wary of recent free offerings from big commercial organizations. To use our previous analogy, they are big circuses that send their clowns out to the street to attract unsuspecting customers to their tents and pressure them in paying for their overpriced shows."
I used SimpleTax for the first time this year and it's a lot more intuitive than StudioTax which I used in the past.
It may not be ideal for every situation, but it was much simpler for me.
Its simple if your are an employee and complex if you are an employer. For the self employed there is a super simple filling up to a certain threshold. Companies also have additional requirements based on revenue brackets, number of employees and type of economic activities they do.
Anything sligth complex eill require multiple agencies fees and byzanthine laws.
There's a lot of players involved. IMO for regular people it's simple/cheap, but for companies/employers it's complex/expensive
Federal government charges taxes on income, production, import/export and over bank operations; states charge consumption and vehicle taxes; cities charge service and property taxes. Then there's also contributions that employers pay for workers, and some that workers pay.
However, consumption tax can compound itself (because of sales between distributors, or taxes over raw materials), so there's a "substitution" formula which can get pretty weird (but companies take care of it).
In Spain it used to be a Java desktop app as well, the last incarnation of a software that started as a DOS program distributed in diskettes back in 1988. Now it's no longer a standalone program, but a website (not sure which technology, but it runs in current browsers without requiring Java installed, AFAIR).
The government makes a draft declaration for you, if it's OK you just have to digitally sign your agreement and provide a bank account to pay or receive your return (if you haven't already done that in the past). Otherwise you need to edit it adding whatever they've missed, but this is only needed if you do complex stock trading, operate with money abroad, etc. For most people it's just skimming through it in case there is an obvious error, and confirming the draft.
Once you confirm the draft, it takes only around 2-4 days for the tax return money to appear in your bank account.
The website's UI is good. Spanish e-administration webapps are a bit hit-and-miss, some are dreadful (digital certificate request, I'm looking at you), but that particular one is fine and has always worked well for me.
Same in France, it's a simple website. You receive a notification email, connect with a simple login and password, check that the pre-filled form is correct, and validate.
UK provides a web form. Pretty well done one considering the complexity. I think you can use your own software too if you like and theres some sort of submission api.
The only out-of-date thing I've noticed on the UK one is stuff like 'this PDF of your tax return is 1.5mb, on a dial up modem this might take 5 mins to download' etc. And I guess some people might still be on that kind of link so fair enough
edit: And yeah in the UK you dont have to file at all if your situation is simple (e.g. you just have one job and one source of income).
It's probably worth noting that most people in the UK don't have to file at all (if you're on a wage and not in the top tax band, it's all automatic in your paycheck), and if you have a dispute/complication you just write a simple letter to the tax office laying out your case.
As an American living in Kanton Zürich, I used both (paid) TurboTax and (free) Privat Tax (straight from the cantonal government).
Swiss one was way easier to understand by far. As a side effect of doing those taxes, it was easy to see my actual wealth and my actual net income for the year. Which in America is a sin.
I've used the mobile app on Android, it wasn't a joy (it still lacks some polishing), but it was certainly VERY straightforward.
Personally I don't have lots of stuff to file, but I did everything under 1 hour, while still discovering how to use the app and learning a bunch of taxes nomenclature.
In Ukraine there is a government webapp where you can fill all possible tax forms, and they come mostly pre-filled. The only small hurdle is getting the private/public key, it's fast, but only happens upon request or if you have a bank account at supported banks. If you were only on a payroll, you don't need to declare anything at all, it happens automatically.
I'm a TurboTax user myself (b/c I almost always procrastinate to the last day/week), but my guess is because tax forms and rules change every year. Maybe the general situation for free filers is easy enough to code for, though? Though one of Turbotax's purported features is that it'll tell you how easy/complex your taxes can or should be, depending on your situation.
Also, one of TurboTax's features is e-filing. Maybe there are free e-file alternatives (as in free, with no upsell or strings-attached whatsoever), but it seems you have to be an "authorized IRS e-file provider" to do this, i.e. there's not a developer API: https://www.irs.gov/filing/e-file-options
Typically open source projects come from two places; a company needs software, or an individual thinks writing it would be fun or at least save them time. Preparing individual tax returns falls into neither category; companies have no interest in individual tax returns (they don't pay that kind of tax), and individuals only have to do it once a year so it's not time-efficient to write a program to do it.
There are...you can download any tax form for free and fill it in by hand or in a PDF program.
You will see articles regularly attacking TurboTax because SV has been wildly unsuccessful in producing a startup that can compete with TurboTax, so instead a lot of effort is spent attacking them in the media.
Google, Microsoft, Facebook all spend significantly more on lobbying to ensure market hegemony. Don't be surprised at the pattern, attack TurboTax in the media, then up pops a new startup that will disrupt the industry. Rinse and repeat.
I can just imagine the YouTube advertising campaign...
> Do you hate doing you taxes? Try Simple, we made it easy! Just put in a few personal details and we'll take care of all the rest. We'll download your W2 information from your employer and send it to the IRS. With our Simple Guarantee, you can feel confident that your return will be correct.
Or maybe we could call it Tophat. That's a good tax software name.
I disagree with this simply because the idea that competition exists or could exist is not an excuse for the system to function the way it does.
There are new players in the space, like CreditKarma. Many competitors offer more features for free than Intuit as well. But that doesn’t mean we should have to rely on private companies (who are data hoarding) to file our taxes. That doesn’t mean that free fillable forms need to be unnecessarily more difficult to use than commercial solutions.
In reality, the IRS already has all the relevant forms reported to them. For most people the IRS could send a tax form already filed out to read, verify, and return. For business owners and other more complex situations, these are still the same people who are already hiring a tax accountant and are probably skipping TurboTax as it is.
In other words, commercial tax preparation software for most users is filling an artificial need that only exists because the government has been lobbied not to provide the (basic) service itself.
> That doesn’t mean that free fillable forms need to be unnecessarily more difficult to use than commercial solutions.
They aren't. The IRS form is the exact for completed by TurboTax or any other accountant/service provider. The IRS only accepts their own forms.
>For most people the IRS could send a tax form already filed out to read, verify, and return.
Thats what is really being asked...the Government to do tax returns for you for free. Even if TurboTax and accountants weren't lobbying the Government not to do taxpayers tax returns for them for free, its a major jump to say the government/IRS would unilaterally begin doing this for taxpayers as a free service.
Well, the government was clearly interested in providing free online filing, back around 2002. But they were lobbied out of the idea by Intuit and a few other companies in the tax prep space.
Telling us that the end result of the form is the same is meaningless. You don’t fill out the form manually on TurboTax. It automatically imports W2 information, it asks layperson’s questions, and generates the final form.
If you do this yourself, it’s far more time consuming.
I don’t understand why you think it’s a major jump for the IRS to provide this service. Other countries already do this. Other federal agencies also provide complex web services like My Social Security and Healthcare.gov.
The IRS already has your W2 and 1099 data. The IRS already knows when you make a mistake, automatically, often live as you e-file. I have had e-files rejected instantly due to mistakes. They clearly already know how much I’m supposed to owe them.
The project is not easy. It requires carefully reading tax codes and implementing them, handling presumably thousands of explicit legal requirements plus whatever edge cases exist that may or may not be explicit in the law. Not to mention keeping up with annual changes. If you screw it up, whether or not you are legally liable, people are probably coming after you anyway. And the support nightmare...
That said, I think a programming-languages approach might be a good one to try to execute on this. Keeping the source code as close to the tax code as possible seems the only way to stay sane with respect to long-term maintenance.
It isn't the software that is complicated, it's the intricate knowledge of the tax laws at the Federal and state level that goes behind building it. If you can find a team of lawyers and tax accountants willing to work on it for free (and update it every year) then building something like TurboTax wouldn't be too difficult.
Open source software can be paid for. With a bit of funding, I bet an OSS-clone of TT could be produced and the organization can host and offer e-filing for a nominal fee.
I think the IRS will actually pay a service fee to small companies that file the free federal returns for individuals.
The exact conditions that would enable a simple FOSS tax software or portal is what TurboTax has been lobbying to make sure stays broken and can't easily exist.
Also, taxes in the US are really complicated, and while our governments know how much we owe, the burden of determination and filing is placed wholly on the citizen.
Should we be able to log in to our IRS profile page and track and manage our taxes ourselves throughout the year? Yes. Is this techically possible today? Also yes. Would this make TurboTax and some other bloodsucking middlemen less TurboRich?
There are dozens of alternatives. However, tax prep software needs to be certified for correctness, and that's expensive and onerous. This is made harder due to the many many different tax jurisdictions in the US.
There are "tax help" open source programs out there, but online filing (which is the main goal here) is impossible without a corporation working with the IRS to set up access, negotiate protocols, and such.
There's no open standard/API/infrastructure or protocol for online filing, so the only option for an open source program to help with that is "print out the whole thing and send it in" which is usually a lot more trouble (more expensive in time and money) than just paying Turbotax or similar services.
Turbotax and the rest of the tax prep industry have lobbied for years to prevent easy/free options for citizens to file taxes... it isn't just them preventing other companies from building products to do it, they're suppressing all competition and modernization, basically anything that would threaten the money they get from charging people to prep taxes.
At this point the entire system is set up with high barriers to entry, and open source solutions/free software don't typically work well in that kind of setting.
Essentially, no open source program has any chance of facilitating online filing in the US because of corruption in the US government.
> There's no open standard/API/infrastructure or protocol for online filing, so the only option for an open source program to help with that is "print out the whole thing and send it in" which is usually a lot more trouble (more expensive in time and money) than just paying Turbotax or similar services.
That is the least burdensome part of the process, to me. In fact I used to do that from H&R Block Tax Cut back when there was an additional charge for e-file.
Maybe I'm totally wrong here, but I don't see much of a difference between extorsionist tax filing software and scam callers warning me about the IRS suing me.
Can the government please make something that's easy to use? Filing taxes isn't something that requires a separate company to help with, and I see no reason why these products have a right to exist (and especially not be canonized), especially with how exploitive they are or can be.
I'm skeptical. I think more likely its an intentional diversion to create and protect sophisticated loopholes for high income earners and companies. Its a reasonable strategy that obviously works and clearly explains their otherwise contradictory position.
Porqúe no los dos? One thing I've learned about American politics is that if there's a sadistic answer that screws the poor and a greedy answer that advantages the rich, often _both_ are correct.
While sadism and stupidity may be two of the reasons for the US tax code, there are surely others. I also suggest extending special privileges to the rich without making that obvious to the poor, forging a weapon to use against political enemies, creating a huge number of bureaucratic jobs, benefiting a legislator's constituent state at the expense of the others, obfuscating the sources of government revenues, and as a means to launder dirty money into clean. There are almost certainly others.
I sort of agree with the pain guys. I'm currently self employed (US) and have to separately pay estimated taxes quarterly. Since I've been doing this, I'm a lot more sensitive to politicians who want to raise my taxes.
Similarly, there is a group in the US whose main goal is to change the law so that employers can't pay your taxes on your behalf. Instead, you would get your full salary, and then have to write a check to pay your taxes. The group believes this would raise tax awareness.
I'm just imagining applying this principle more broadly. Perhaps before every meal I could be forced to calculate the number of calories in each item, total them up and submit them. Maybe before every car journey I could fill out an estimate of the wear and tear on the tyres, gearbox and suspension, and record that in a big log book of car events.
Doesn't seem like a particularly useful way to approach life, to me.
> Perhaps before every meal I could be forced to calculate the number of calories in each item, total them up and submit them.
That's called Weight Watchers. The general principle was pretty effective for me. Most people don't keep a log of wear and tear on their car, but we definitely operate airplanes that way. That also seems pretty productive to me.
But yeah, it's not the only way to operate. I don't really like the idea of putting more responsibility on people in order to "raise awareness". I take that to really mean someone would like everyone to be more upset about taxes, and would like to make them less convenient to increase upsetness.
The technique is actually used a lot in diets and budgeting. Manually writing down everything you pay for helps you to notice that taxi you take every day or how often you "splurge" for coffee. Same with calories and that afternoon or midnight snack.
But forcing it just wastes everyones time, adds red tape, and additional bureaucracy they purport to rail against.
I don't understand why the pain of filing is connected to the pain of spending money.
If a politician raises taxes, and all it does is change the value of a annual withdrawal on your account, I think that pain would be the same, regardless of difficulty of filing.
Here in the US there are actually individuals who view their IRS tax refund check that they get back each year from filing their taxes as "getting free money from the government".
They simply do not understand the fact that, no, that check is not "free government money" but is instead money that the government took, held onto for free all year, interest free, and then let you have back after you filed the proper forms.
So the suggestions to have people cut checks to the government (quarterly, monthly, annually) is generally made from trying to overcome that viewpoint that too many folks view their tax return as some form of "gift" from the government, and instead get them to recognize just how much tax money is being consumed.
Conversely, on my property tax they itemize where the money goes. Presumably showing what I'm getting for my tax money. Or maybe just making me angry how much local schools cost if I don't have kids? (that was the vibe I got when living in FL)
I appreciate transparency like that, but I hate other examples that add additional steps or paperwork to the process.
I am not denying your experience, but I am from the US and this is not my experience at all. It's called a "refund".
Which individuals? How do you know these people?
Also I don't agree with your perspective on tax withholding. If you don't want your employer to withhold taxes, I think they have to stop withholding taxes. It's a convenient default, in my opinion.
I understand where their coming from, but adding useless paperwork just inhibits business growth. I'm more sympathetic to writing a check, like you say, but people are horrible with budgeting--which is why you pre-pay quarterly instead of just paying a lump sum at the end of the year.
I suggest we stop taking taxes out of paychecks and have people pay their full taxes once a year. It would help them see the total amount of taxes they pay. It would have a positive effect on government policy.
It used to be that way in France until last year. The income taxes are now substracted directly on your paycheck.
I personnaly prefer having a small amout taken each month than an enormous sum as a one-time payment.
You can already see this on your pay stub (if you look at it, I know I don't bother with mine)
In principle I like your suggestion but in actuality I think many Americans will not like their "yearly tax bill." Just think about people who are already living paycheck to paycheck; not saving much, or just overall spending every penny that comes into their bank account. They would be in trouble come April if they had to pay it at that point.
Perhaps they could do a monthly installment payment for last year's taxes... And the taxpayer would auto pay once or twice a month when they get paid... But then, we're back to where we started.
Tldr in an ideal world where every citizen is disciplined about not spending every penny they get, this suggestion would be great.
I would argue in an ideal world money wouldn't exist but I think people have different ideals in that sense :)
I know some people _have_ to spend every penny because they need to to survive, but there are also plenty of people who spend every penny because they just have no discipline and buy anything they want without regard to whether or not they could afford it. Ideally the people in the former category would get some sort of welfare. Not sure what, if anything, to do with the people in the latter.
You can set your withholding to nothing and end up with a fat bill every year. Financially, this makes sense. You could be making interest on the money you owe in taxes. However, not everyone is really able to be that disciplined or just financially need every dollar coming in. I think having both options, withholding and no withholding, is the best way.
FYI, if you do this you will incur penalties. The United States requires payment quarterly. You cannot pay it all at the end of the year unless you want to pay penalties.
Can we do the same with health insurance premiums? The average cost of an employer plan is up to $20,000+/year in premiums alone but most people are oblivious to the true cost.
One of the best sites to 'do stuff' in the UK is gov.uk
I've just filled in a new ESTA application on the US gov site too, simple (albeit stupid), and worked.
This morning however I tried using enterprise b2b to book a hire car, it took 6 attempts before it actually worked. Almost all corporate tools seem to be terrible.
Filing taxes does not actually require a separate company to help with. You can download the PDFs (or go to the post office), read the directions and fill them out yourself.
I have never actually done that; but my parents did well after I was using software, which sure is more convenient.
My point was more that these companies offer a solution that is just barely workable so that the IRS does not just create their own usable, free software. I honestly consider them a leech on the economy.
I used to do that. Because I'm a proud software engineer and why should this stuff be complicated? It's just numbers you add or subtract...
wait, does the Transmogrifier Deduction for Frobnubilors apply when you claim to be Single-and-Only Highlander? pauses and takes 1 hour to read up on the IRS rules for this and compares with the advice of $random_internet_guy
And after the personal satisfaction of having completed everything myself, I file and a few months later get a letter from the IRS to the effect of "Dear Mr Bonehead, you totally forgot this obvious item, so we're going to refund you a bit more. You're welcome."
Taxes are not hard if you know how all of the rules apply to your special situation. If you don't, like most people, you're in the dark and it becomes a very poor use of time, with lost money at stake—or worse if your intentions are deemed to be fraudulent.
One of the problems I have with the software is you need to mostly understand a lot of this arcana anyway. It's just that it makes entering things into the form slightly easier.
The only time I didn't do my own taxes and paid a CPA, he messed up even though I told him that I withheld more than required (and gave him last year's return so he could see what last year's taxes were and that I had more than 110% withheld).
He still filled the form out wrong so that I would have had to pay a penalty. Then when I told him he filled it out wrong, he just took the penalty off, without properly updating the 1040. When I ended up getting the inevitable "you owe us a penalty letter", I just ended up dealing with it myself rather than use his boneheaded explanation basically "pretty please" as opposed to the actual "I made more money, and withheld enough more money, so penalties are waived."
Honestly, the IRS makes these kind of questions pretty much impossible.
For example, I've been considering installing solar panels on my house. There is a federal tax credit for installing solar, and it includes associated costs like repairing your roof to support the panels. But as a normal person the entirety of the guidance is this:
"No costs relating to a solar panel or other property installed as a roof (or portion thereof) will fail to qualify solely because the property constitutes a structural component of the structure on which it is installed."
So if you get a new roof to support the panels will the tax credit cover the entire roof job, or only the part covered by the panels? I've heard from two accountants on this who had two diametrically opposed opinions on this. And if I guess wrong it's potentially Felony Tax Fraud, the kind that put Al Capone in jail for 11 years. Ignorance of the law is no excuse.
So I call the IRS help line to get the official guidance on this and the official IRS position is: "We can not give guidance on this subject." It's not like TurboTax is going to have any more official of an opinion on this either. The only way to safely handle this is to pass liability off to a third party, which makes filling out your own taxes not an option.
I did this for the first time a few years ago, and it took me about eighteen hours to figure out all of the forms and terminology. And I'm not even running a business, or anything extra-ordinarily complicated. So possible, but time-consuming.
How many pages of the supposed eight thousand plus pages of tax law apply to the majority of those who file taxes? The IRS certainly can tell me when I am wrong but they won't do it except when the result is in their favor; in my case I was improperly not filing HSA expenditures which would have resulted in me getting more back.
It comes down to this and I do not blame Turbo Tax or any other company in this area. The Federal and State Tax codes are weaponized by politicians and until that stops the system will be too complex for many to do the the filing on their own and some of that is because there is always that "did I forget something" feeling.
At least the changes made recently helped the lower and middle classes out a lot, that doubling of the personal deduction was a god send in reducing the work needed as many will never need to itemize again
> The IRS certainly can tell me when I am wrong but they won't do it except when the result is in their favor
Yes they will. I don't know why you bother to make up a lie so easily disproved.
On September 9, 2019, I received a CP16 that stated
"We believe there are miscalculations on your 2018 Form 1040, which affect the following areas of your return:
- Tax Computation
We made changes to your return that correct these errors. As a result, your overpayment is $21,886.35.
Information was changed because of the following:
We changed the amount of tax reported on your tax return because the tax rates on Qualified Dividends and Capital Gains are generally lower than the standard rates. It
appears your tax was not computed using these rates or the amount of tax was computed incorrectly. (211D)"
Silicon Valley... Would it be nice to have an extra $140k? Yeah. Would it be life changing in any way? Not really. I still wouldn't even be able to afford to buy a house.
I would sure as fuck would blame TurboTax, assuming you filed with them. Why else would you (be forced to) pay them if they can't perform their primary function of navigating overly complex tax law correctly?
I find it interesting that these scam callers warning about IRS suing only works in countries where making an honest mistake on your taxes can result you being threatened with or going to prison.
Which countries are those? I've never been in the position personally, but everything I've ever read says that the IRS is very unlikely to do anything more than demand that you pay the taxes you owe in the case of honest mistakes.
> Can the government please make something that's easy to use?
Many law makers don't want the Government to make this process easy on the assumption that the easier it is for the Government to tax, the more it will do so.
I guess this is why some voters are eager for someone like Elizabeth Warren to get in office and stop some of this anti-competitive behavior. It's odd to me because TurboTax is good software (at least when I used it) and it saves time. So to me it's worth the money. But to force someone who as a job and no real deductions to not simply file a 1040 EZ online is just a rent seeker making sure they get paid.
> ... it saves time. So to me it's worth the money.
is (unless I'm missing some alternative), based a in comparison to paper-based forms, which are in turn a horribly inefficient way for the IRS (which all taxpayers pay for) to operate.
The question is not only the anti-competitive behavior of entrenched 'supported electronic filing services', but that these are 'required' and facilitated due to horribly inefficient processes that the IRS refuses to fix properly by simply creating a way for individuals to e-file in the first place.
Based on recent history Warren certainly isn't a run of the mill middle of the pack Democrat. Her positions on banking, big business, healthcare and big tech companies is a leftward lean even when compared to Obama's tenure.
> The government needs to be reformed, electing one party or another President isn't going to change much
And pontificating about how "the system is broken" doesn't change anything. There are no actual concrete steps to reforming government that doesn't involve elections and gradual process, or revolution and sudden progress. If you think the latter is in any way likely then you're deluded.
> Based on recent history Warren certainly isn't a run of the mill middle of the pack Democrat. Her positions on banking, big business, healthcare and big tech companies is a leftward lean even when compared to Obama's tenure.
Obama is a conservative democrat (or a liberal republican, you can't really tell these days) so you're not putting the bar high.
He didn't, though. He advocated improving healthcare, but not to the extent that Warren does. And he castigated the banking industry but never proposed anything at the level Warren is proposing.
Besides, this isn't even the question. The OP said that Warren is a middle of the road Democrat. Compared to the positions held by the average Democrat Senator/Congressperson she isn't at all. Whether she'd follow through on those promises when elected is a valid question (though much like Obama, it wouldn't be under her sole control), but that doesn't mean she isn't left-leaning.
To what extent does Warren advocate improving healthcare? She went from "medicarefor all" to "actually medicare is just a framework" in just a month. On her platform page she seems to have abandoned single-payer entirely.
How can you trust a candidate who changes platform from progressive to milquetoast centrist so quickly? How can you trust a candidate who said several months ago that she wants to eliminate billionaires, and yet who continues to get major contributions from at least twenty billionaires?
I find it very hard to believe that Warren is genuinely left-leaning. Based on her behavior, it seems to me much more like she is a centrist candidate wrapping centrist ideas in left rhetoric.
Both parties are constantly changing and jockeying for position in response to shifts in the political tastes of both the general public and the general public with money.
Warren might have seemed barely to the left in historic eras. She only seems left now because the recent stretches with the "left" party in control have all been very centrist. Big businesses have been allowed to grow bigger, and organized labor unions have been just treading water federally, as the individual states have been pulling their teeth with "right to work" and "at will" employment laws.
Media consolidation and campaign finance has been driving it. The median voter does not have a reliable, unbiased source of information to drive their decisions, so it's "Garbage In, Garbage Out" politics. Control the inputs to influence the outputs. One faction seems to be experimenting with packing all the main channels with misinformation, disinformation, propaganda, and psyops, and that seems to be worth about 40% of the vote, if the polling is honest and accurate.
The antipodal position to this would be to invest more into public education, independent journalism, legislation penalizing prevarication or material omissions by public officeholders and appointees, anti-secrecy and public disclosure (or "sunshine") laws, and overhaul of broadcast licensing. The issues Warren is focusing on seem more concerned with the flows of money than the flows of information. It's the latter that will produce government reform in a democracy.
Going after Facebook is easy. They're a big, obvious target, and Zuckerberg isn't tremendously charismatic. But Facebook is just one business. Political disinformation is an entire industry.
Well, that run-of-the-mill democrat helped make CFPB a reality and that's pertinent to what OP was trying to say. She's much more vocal about these anti-competitive practices than most other politicians.
Okay, fine, but "your taxes are automatically filed for you" is a specific campaign issue for Elizabeth Warren, and in addition she's introduced legislation specifically aimed at this issue (https://www.congress.gov/bill/115th-congress/senate-bill/912). Pointing her out as a potential solution in a thread about this particular issue is appropriate.
On the other hand, "everybody in every party sucks and it doesn't matter who anyone votes for because it won't change anything" is a comment that could go on any post about any aspect of politics and doesn't contribute to a productive conversation.
I guess this is why some wish to vote for Elizabeth Warren. This kind of crap goes on all the time. FWIW I think TurboTax is pretty useful and because it saves time worth paying for in many cases. However someone with very simple taxes, like working a job with no itemized deductions they should be able to file an online 1040EZ or = for free and in a few minutes. It's very simple. This is probably why the whole money-in-politics thing is so powerful as well.
Their efforts to block return-free filing is the important issue here. Filing taxes, even on paper, would be orders of magnitude easier if the government had to pre-fill it before sending - removing the complexity that makes tax filing applications necessary for most.
It's a webpage in the UK, takes about 10 minutes if you have all the data you need (how much interest etc you earned, how many charitable deductions) -- that's assuming you're self assessed. Most people don't need to fill in anything.
This is just a convenient excuse for 3 layers of politicians with their own filing requirements, each one trying to get tax breaks for their favorite constituents. If we had a simple tax system there would be less power for politicians and less they can negotiate with. Blaming Turbo Tax is silly.
In New Zealand, the involvement that I had with my tax department this year since they have switched to an automated system was checking my bank balance one day to find that I had received a tax refund.
I like propublica's reporting on this but geez, this needs an award for one of the top HN obsessions. Within the past 7 months:
TurboTax’s 20-Year Fight to Stop Americans from Filing Taxes for Free; 211 points -- 54 minutes ago
TurboTax to charge more lower-income customers; 144 points -- 3 months ago
Congress Scraps Provision to Restrict IRS from Competing with TurboTax; 82 points -- 4 months ago
Listen to TurboTax Lie to Get Out of Refunding Overcharged Customers; 171 points -- 5 months ago
TurboTax Uses a “Military Discount” to Trick Troops into Paying to File Taxes; 170 points -- 5 months ago
TurboTax and H&R Block Saw Free Tax Filing as a Threat; 355 points -- 6 months ago
TurboTax Hides Its Free File Page from Search Engines; 881 points -- 6 months ago
TurboTax Uses Dark Patterns to Trick You into Paying to File Your Taxes; 608 points -- 6 months ago
How the Maker of TurboTax Fought Free, Simple Tax Filing (2013); 462 points -- 7 months ago
edit: if you _still_ haven't gotten enough TurboTax reporting, there's a great Reply All episode that covers propublica's reporting as well https://gimletmedia.com/shows/reply-all/6nhgol
And yet the cost of implementing a government algorithm has not yet fallen to near-zero.
Furthermore, the government has surely implemented the algorithm itself in order to verify submitted tax returns, so the implementation cost of pre-computing everyone's tax should be comparatively small.
Maybe I’m overly cynical, but creating tax returns for everyone for free would prevent the IRS from allowing you to incriminate yourself by mis-filing (intentionally or not) and then levying huge penalties and interest on you 10 years later.
Everyone is hating on TurboTax for making money, but they’re pretending the government tax machine has no such motivation, which simply is not true.
> Maybe I’m overly cynical, but creating tax returns for everyone for free would prevent the IRS from allowing you to incriminate yourself by mis-filing (intentionally or not) and then levying huge penalties and interest on you 10 years later.
Many countries pre-fill the tax return, but require the citizen to submit it. The citizen is responsible for the submitted information, not the government.
That would expose the level of identity theft that the IRS does nothing about and actively tries to hide by refusing to provide identity theft victims with documentation.
It’s just sad that you can’t see a difference between an example and an exaggeration. I wasn’t giving tax advice, I was making a point about the IRS penalizing people.
The specific amount of time involved could not possibly matter any less... the point is still valid.
I’m sure you never round your income down or your donations up and you never, ever! go even a mile over the posted speed limit.
I’m glad you can take this as an example of your own self-richeousness. Don’t confuse that with real life.
Sure, it’s “exaggeration” if you have no imagination. Maybe someone is hit with penalties 3 or 6 years later, but then they’re consequently permanently flagged to get aggressively audited for the rest of their life and continue to deal with penalties for much longer than 10 years.
There’s a word for what you’re doing: Pedantry. There’s also another word for what you’re doing: Bootlicking. The person you’re responding to is gracefully opening the door to questioning authority and you’re not only pushing it closed on his foot on behalf of your masters but you’re doing it for free.
People like you are absolute garbage. And your little condescending cherry on top “Time for some reflection” is just nauseating. Maybe it’s time for you to look up some suicide techniques.
We aren’t going to get anywhere in this thread, my friend. TurboTax is evil. Ignore the fact that there are a dozen other companies offering the same service and that prices have actually fallen because of that competition.
Also no mention of filling out the free 1040 form... that’s too difficult. As if the companies charging you to do that for you just existed because they were forcing people to pay them...
Yeah, that's overly cynical. :) If they switched to a pre-filled system, the revenue from penalties would go down, but it's quite likely the amount they would bring in would actually go up, assuming this reduced tax fraud. In 2016, they charged $24.1 billion in penalties -- but they estimate tax fraud cost them around $458 billion. If they lost 90% of the revenue for the penalties but cut the tax fraud even by 25%, they would be way, way ahead.
The government tax machine is in the business of collecting taxes, not running up fines. I've had several interactions where the IRS was totally with in their rights to fine me but they waved each fine because they understood it was unintentional.
The only times I've heard of the IRS going after people who unintentionally violated the rules, they were intentionally and obviously violating the spirit of the law but thought they were within the letter and were wrong.
In my experience you can make a good faith effort to figure out what your supposed to owe and pay it. In this case the IRS will treat you fairly and waive all types of fines. Or you can try to aggressively avoid taxes that you should owe in spirit. And in this case you have to be damn sure you're within the letter of the law because the IRS will try to hammer you if you color outside the lines. These seem like two fair options to me. And everyone I know who was slammed by the IRS was doing the latter.
I haven't looked this up, but I'm pretty sure audits are way down. There was a recent an article saying the IRS was focusing on auditing poorer people because it's too expensive to audit rich people. Since their budget is completely separate from tax income (and their budget has consistently been reduced), it was driven by their local incentives even if that means total tax income was way lower.
Sure, that's always an option, but due the complexity of the tax codes, it's very easy to make a mistake when doing everything yourself.
For example, I used to work in New Jersey, and live in New York, meaning I would have to file two state tax returns, in addition to the federal. There are weird rules that you can deduct one state's taxes from the other, and then deduct the remainder from the federal taxes. The rules get complex really quickly, and even with helpful software I made a mistake one year resulting in a fine. I can't imagine how frequently I'd make mistakes if I had to do it manually.
TurboTax definitely provides a service by making it so that schmucks like me can do taxes, but if the tax code is that complex, shouldn't we have a software like this for free? At the very least, to provide some motivations to politicians to help simplify the tax code?
It wasn't actually directly due to the multi-state thing. I paid for my wife's college, and NY has a thing to let you deduct tuition from dependents on taxes. I had forgotten to attach the proof of payment for tuition, leading to me getting audited (in the most technical send of the word) and fined slightly. The biggest pain in the ass was the back-and-forth I had to do to close my case, which involved me faxing things multiple times.
> to provide some motivations to politicians to help simplify the tax code?
You speak of NJ, NY, taxes, "mistakes", fines, potential "audits" by the IRS, then wonder why politicians would want to simplify and improve something that many of them likely grift from or cheat on themselves, due to that same complexity...
...and one of the biggest of these tax cheats hails from NY, likely has had his now (on again, off again) lawyer, who used to be mayor of NYC and before that as a US AG - probably ran interference for his cheating and other scams.
But all of them - and plenty of others - benefit from the complexity and other issues, and don't want it any other way, unfortunately. No real good solutions to that.
Tax code complexity and the mechanics of filing are orthogonal. Fixing both is not a requirement for fixing either separately, or an excuse for not doing it.
There have been a couple of years where I worked several different out-of-state contract gigs, and a couple of years where I received unemployment due to me from an out-of-state employer. I was not trying to do anything monstrously complicated, nor was I some millionaire - I just did the jobs that I was able to land to feed my family and pay our mortgage.
I went to experienced tax professionals to help me with those returns, and _they_ were baffled, spent hours pulling out phone book-sized paper guidebooks, and debating with each other, and making phone calls to colleagues, and I had to file amended returns - in one case, _twice_. Fortunately they never charged me anything to correct the errors, but... wow.
What hope would I have had to get it right myself, trying to fill out the various schedules?
I do that because I think it's inappropriate that any third party should have access to private financial information that's no one's business but mine and the IRS's.
Still, it's an irksome chore that I would prefer not to have to do.
It's an issue that affects almost every American, why not obsess? I've seen two stories in the past day about Google Nest which affects maybe 10%? What a bizarre obsession.
That's an average of 5.28 months ago, which would've been around the beginning of May, less than a month after taxes were due to be filed. Three of the articles are from 6 months ago (mid-April), and one from 7 months ago (before filing was due). It shouldn't come as a surprise that taxes, and the cost to file them, would be fresh on peoples minds at that time.
Americans are starting to wake up to the fact they live in what is by far the richest country, but that the systems in place just make the rich richer, while nothing is done to improve the lives of the middle and lower classes.
In this particular case, the rich are actively using the system to stop an improvement to the quality of life of regular people.
What's the point in living in the richest country in the world when your quality of life is lower than many countries that don't have nearly so much money?
The fact that America has the 10th highest GDP per capita [1] and huge swaths of it are little better off than a third world nation is a complete disgrace.
1: (its 4 micro city states above it, which are economically special, and 5 nations that could reasonably be considered full sized countries, however all of them still have relatively small populations)
I would argue that there are few, if any, countries in the world that this description would not apply to.
However, I agree with the point that you're making wholeheartedly. There's a very serious amount of wealth disparity around the world, and the rich have gotten so rich that they can't even feasibly spend all of their money if they had to.
The lives of middle and lower class people in Australia, Canada, Scandinavia, etc. are much, much, much better than Americans, and improving all the time.
Do you think so? I live in Toronto and wealth inequality is still constantly at the forefront of political discourse. Obviously Toronto isn't indicative of the rest of Canada, but I don't feel as if poor Canadians are especially better off than poor Americans.
Until garbage like this stops, you don't get to call our economic system a free market. This is plutocracy, plain and simple. It's not a free market when large incumbents can bribe the government into forcing their product to be needed.
I really don't understand why I have to file my taxes to begin with.
I have a W2 job, and my employer presumably has sent my paystubs and tax information to the government already. I then have to copy down the information from my W2 into some kind of tax filing software, and then they have to check to make sure that what I typed matches what they have, presumably paying someone to do that if I make any kind of serious mistake. Why do I have to do anything?
I'd understand if I have a lot of complex deductions or if I were running my own business, but as it stands I do the basic standard deduction (or whatever the default options on TurboTax are).
I'm genuinely asking this...is there some utility that I'm missing here to me doing the taxes myself?
You are dealing with a consequence of TurboTax's 20-Year Fight to Stop Americans from Filing Taxes for Free.
There have been proposals to mail cards to taxpayers with their financial information (as known to the government) pre-printed, and if everything is accurate, the recipient does nothing at all. TurboTax (and a few others) lobbied heavily to make sure such efforts were defeated, and so you have to keep doing your own taxes.
It's not terribly difficult to construct circumstances in which the government doesn't know how much you owe them. It's simpler to have a single policy for everyone. Therefore, everyone has to do their own taxes. I really don't think it's more complicated than that.
Pointing out the problem is the first step toward creating pressure to solve it. I don’t understand why people like you always side with the bad guys to push back against progress. Pretending there’s some innocent angle to their conduct is even worse.
Simpler for who? It's not simpler for the vast bulk of people whose only significant income is from their employer. It's not simpler for the tax authorities either, who now have to process a lot more tax returns rather than just doing something more straightforward for the common-case.
I wonder what percent of taxpayers actually owe a different amount than the IRS can compute on its own. My guess is it’s not much more than 30% (the percentage who itemize deductions).
Is it really worth making 100% of taxpayers do their own just to handle the edge case of people who actually have to?
Nope. In New Zealand you log into a website and it shows all your employers filings. You can send in requests for corrections if things are wrong, but it shows you taxes paid and anything you owe the IRD. It has an interface for transferring money to/from your bank account for payments/returns.
It's a little more complex if you own a business, but I think you can file and maintain all your business taxes throughout the year using an IRD website as well.
The US IRS has all the information to do the exact same thing. It's lobbying from the tax software companies that's kept them from doing so.
Think of it like a high school test, you submit your test to the IRS, who has the answers, and they tell you if you are correct. Also, the US is the only class who's teacher doesn't either show them the key or skip the test entirely.
When I realized that some other countries have no concept of a tax day and don't understand the yearly hype train of US taxes, that's when I got really bummed out on how broken our system is.
Sadly you can't even file a simple quarterly estimate tax return online without paying a fee. If you want to do it for free, you have to print it out & mail it. Not sure how that benefits citizens or the IRS.
Intuit's main argument has always been that if the government provided such a service many people would overpay their taxes.
Honestly it's much cheaper, easier & better to just find a good accountant to do your taxes instead of Turbo Tax.
The government could do a lot to make filing taxes & starting businesses easier. All the politicians talking about being pro-small business could really start at these 2 steps. Otherwise, imho, their talk is nothing but empty promises. Creating hurdles like this is just a way of gate-keeping lower incomes out of small businesses.
A few weeks ago I started an LLC in New York. I followed all the simple instructions online and the process was actually very straightforward and easy. I had an official digital copy of proof my LLC existed within an hour. I went to sleep with and thought that there is hope for our government.
Within a few days I received a letter from a private company informing me that unless I pay them $1000 to publish the name of my LLC in two public newspapers for six weeks, one daily newspaper and one weekly newspaper, in 120 days my LLC would need to cease doing business in NY. I pull out my phone and did a quick online search. Lo and behold, there is a law that says the same.
In this golden age, the government has chosen to require me to pay a private archaic company to print in ink thousands of times on paper the silly name of an LLC I just came up with, then proceed to distribute it by truck to a bunch of old people that then proceed to throw it in the garbage.
No fancy tax algorithms would be required for NY to simply drop this nonsensical requirement. Maybe this process exists because there are groups of people making a small fortune from it?
”unless I pay them $1000 to publish the name of my LLC in two public newspapers for six weeks, one daily newspaper and one weekly newspaper”
Reading that as “one daily newspaper and one weekly newspaper”, that would be 6 (weeks) times at least (6 + 1) = 42 adverts in a newspaper (I can also read it as “2 public, one daily and one weekly”. That would increase the number of adverts). Price per advert would be about $25.
I guess most LLCs get incorporated in an at least somewhat large city, so the circulation of the paper will be somewhat high. $25 per advert then doesn’t sound that bad to me.
I know zilch of advertising prices, though, so let’s google it. Reading https://fitsmallbusiness.com/newspaper-advertising-costs/ (a link that google gave me, but that I don’t know the quality of), I see the price per “column inch” go down from about €18 to about €13 when you advertise more often.
⇒ it could well be that $1,000 is a fair price, giving the higher price you would have to pay and the amount of work you would have to do if you did it alone.
(Still seems a weird law, though. I can imagine that one should give people to object if your company will be noisy, stinky, or the like, but then, the city, IMO, should require a permit)
I think the law made sense in the past so that the formation of a company would be well-known and not a secret. Now that everything is available online, less so. That the publication servicing companies know you exist, advertise directly to you because of that, and need no other information than your payment to do the publication is proof that the law is no longer useful.
I think part of it is the assumption that affected citizens (who might object to the new shop/cafe/…) are more likely to read such papers than government publications.
That likely still is true, but less so (fewer people subscribe to papers), and the assumption that people who read the paper would spot your advert probably only held back in the time when papers had reasonably small coverage (so that your advert wouldn’t appear in a large section of the paper, but stand on its own), and were about the only source of news (which made them much better read)
You can do it cheaper through a publication company, because they've already negotiated rates with the publishers. Though $1000 seems excessive. In Westchester County, I paid $300. There is a large spread in fees that will be charged.
I wrote to my state assembly person; she wrote back saying A8125 was introduced to repeal the requirement, but no action taken. I would encourage you to write to your assembly person and senator, because this is just a drag on NY businesses.
In VA, if you want an alcohol license for your restaurant, you are required to print an ad in a local newspaper stating that you intend to get a license. I'm guessing it's so some prohibitionist can call up the ABC and complain? It's completely ridiculous. I wondering what will happen when print newspaper ceases to exist.
I've noticed a lot of "public notice" laws. Either a physical sign on the property or something published in the newspaper. I'm not quite sure what the digital equivalent would be--a government run "announce" page that gets indexed and archived? Not really much different from press releases governments and businesses already do required by other laws.
I do see the value in publicly announcing things, but I do see newspapers as archaic.
Yeah, that works for changes at a physical location. What about founding of an LLC or other less tangible changes? Even with a physical sign it would be nice to have a searchable long term record. That seems to be what newspapers fulfilled; public broadcast and a reasonable long-term archive.
Around here the Company Court (which decides that a company formation was lawful and registers the company) has a journal/gazette, and that's the official record. Nowadays it's of course fully on-line. And lawyers (who submit the paperwork of the new company) do it exclusively on-line (they basically upload a signed ZIP of the scanned pages and an XML)!
The clerks at this court look at the scanned pages and confirm that yes they do say what the XML says, and then this gets published.
People can search for company histories, look at their bylaws, etc.
Similarly there's a different gov service for publishing corporate yearly financial reports.
Don’t falter that easy. If the law is stated so clearly, then start 3 more LLC’s and offer the news posting service for $10 in your new publications that only publish new LLC’s.
Don't forget about the publication certificate fee too:
> After you get done publishing, the newspaper will provide an Affidavit of Publication, and you send that to the New York Division of Corporations with a Certificate of Publication that carries a $50 filing fee.
I live in NY but never filed an LLC, but I Google'd that. I can't believe such nonsense exists to get money in a state that already has high state / sales taxes.
In the UK, if you want to close a company you must do the same (pay ~£300 to post notice in a paper that your company is closing).
I think the idea is that anyone who the company owes money to can file a claim before any remaining funds are distributed.
Of course there are much better and more cost-effective ways of doing this (even pre-internet). It’s just absurd rent-seeking by unproductive leeches on the economy as far as I can tell.
It's not a notice in just a paper. It's a notice in the paper of public record. Which in the UK is the London Gazette, that you are almost certainly never going to see in a newsagents. There are laws requiring notices in that publication, and IIRC it's still government owned.
They publish notice of all laws, all insolvencies, all changes of name, new holder of certain public offices etc. I don't think there is any news or anything beyond the UK.
I bet it would be 5x more if you had to take out an ad in the Times or Telegraph. :)
1. Please ignore almost all the mail you get initially. There are public companies that troll NYS business registration logs and send TONS of false and highly misleading if not illegal advertisements. "You totally need this $900 OSHA poster you can just print for free and paste on the wall". "Ignore the fact we copied NYS' letterhead but aren't a governemnt entity", etc.
2. The NYS tax department will send you one real piece of mail as a questionnaire.
3. Yes, the newspaper requirement is real and fucking terrible. It's a very old holdover however politicians don't want to get rid of it because quite literally, it's a handout program for newspapers. It would make alot of "local" papers nobody reads, close up shops.
4. Shop around, there are a few ways to save money on it.
Honestly, I made a LLC 2 years ago in NYS and haven't even used it business wise. I have yet to do the publicatinon requirement. You just can't legally do business until you do so BUT it doesn't give a deadline.
When I lived in New Zealand, you didn't have to file at all. You could create an account on a website with your tax ID and see all the reports employers sent in. You could requests corrections if things were wrong and have any return transferred to a normal bank account.
In Australia, they had a desktop application you could download, provided by the government. It wasn't pretty, but it was straight forward and took less than an hour to go through the whole thing.
I once met an Aussie at a security meetup who worked at immigration and I told him how surprised I was that I got my visa in like two days. He was like, "oh I worked on that piece. Yea that use to take two weeks; but we were able to fix a lot of that process." I wouldn't be surprised if Australia taxes were all web based and even faster today.
Surely that's only for employees though, not for companies? This is how it works in several countries, including the UK - your employer tells the tax service about your salary and pension payments, and you only need to fill a tax return if you have "something else" to tell them about, such as another source of income.
The income tax, designed to prevent the accumulation of wealth, needs to be replaced with a wealth tax[0]. This would simplify filing for the 99% of Americans who are not the 1%.
2) you go seek out that particular page (vs searching free file in google and clicking on intuit)
Or you go directly to intuit and qualify as a “free filer” which you only qualify for if you have a dead simple return - w2 and no deductions or extra forms.
The problem isn’t that you can’t file free. The problem is that intuit is doing what it can to bury it while promoting its conveniently named “free” edition that bumps you up into a paid edition faster than you can say “what?”.
This is correct. The problem is the lobbying has stopped making forms easier or non-existent. They are complex because of private corporate influence, not the constituents of the I.R.S..
What does that have to do with the ability to e-file for free? I didn't say it was a good option, just that it existed. There's plenty to complain about without making things up ("You CAN, if... [...] 1) you are under a certain income threshold").
> The problem is the lobbying has stopped making forms easier or non-existent. They are complex because of private corporate influence, not the constituents of the I.R.S..
Sorry, I didn’t mean to imply anything you wrote was incorrect. I was agreeing with you and this my opinion on the top level comment. Sorry for the confusion.
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[ 5.1 ms ] story [ 375 ms ] threadGoogle spent $21 million in 2018. Facebook spent $12 million. Amazon spent $14 million. Microsoft spent $9 million.
https://www.engadget.com/2019/01/23/tech-companies-lobbying-...
Yes, companies like the ones you cited spend significant amounts of money to educate and persuade lawmakers. Academically I’d like to see what a world without lobbying looks like, but honestly, I’m not confident it would be significantly better for citizens (and may be significantly worse in some ways).
But that’s a tangential topic for a different discussion.
https://www.politico.com/agenda/story/2018/07/18/tax-filing-...
https://www.businessinsider.com/house-bans-free-government-t...
https://www.npr.org/sections/money/2017/03/22/521132960/epis...
Norquist is a great example of a lobbyist worth examining. He's a real piece of shit. His group is Americans for Tax Reform (ATR). Their 2019 sheet shows $390k spread across 6 lobbyists who did not hide their representation; they had opinions on a variety of issues and bills, all related somehow to taxation. [0] Intuit's sheet shows spending of $1.28m in that same time period, spread across at least ten firms, including dozens of revolving-door politicos and industry insiders, all aimed at one single piece of legislation: The Taxpayer First Act of 2019, an attempt to modernize tax legislation and filing processes. [1] Surprisingly, ATR has officially said nothing about the Taxpayer First Act, despite Norquist's well-publicized position against such efforts.
To recap: Intuit spent 3x what Norquist's group spent, and focused that spend on one specific bill which would have eased tax filing. If Norquist is a piece of shit, what does that make Intuit?
[0] https://www.opensecrets.org/lobby/clientlbs.php?id=D00004709...
[1] https://www.opensecrets.org/lobby/clientbills.php?id=D000026...
There's also the block of special interests that advance their agendas via the tax code. Things like the capital gains tax regime, Child Tax Credit, and mortgage interest deduction.
ProPublica seems really broad in the topics they cover: https://www.propublica.org/topics/
They also have multiple articles covering other types of tax reform and on closing tax loopholes if you search their database.
My issue is that the article, and many posters here, make it sound like all the ills of the US tax system trace back to Intuit. Statements like (emphasis mine)
> Intuit fended off the government’s attempts to make tax filing free and easy
and
> But the success of TurboTax rests on a shaky foundation, one that could collapse overnight if the U.S. government did what most wealthy countries did long ago and made tax filing simple and free for most citizens.
These statements ignore the vested interests that got all the complexity inserted into the tax code in the first place. Intuit didn't create the capital gains tax structure, the laundry list of special interest deductions available to itemizers, the complicated business income/loss rules, or any of the other elements that make preparing taxes a confusing game of hopscotch between various forms and schedules. They also would not be the loudest voice of opposition if any of those elements were to be removed to simplify taxes.
That's not "whataboutism" at all, as I'm not defending Intuit's behavior.
> This article is on Intuit. It's focused on Intuit's bad behaviour. ProPublica has other articles on the issues you are complaining about.
I'm saying ProPublica should have referenced those articles, rather than making statements that imply everything is the tax preparation industry's fault.
No, I'm saying ProPublica shouldn't make the situation sound like it's all Intuit's fault.
Nobody except you is taking the article to imply that.
https://www.propublica.org/article/irs-political-dark-money-...
https://www.propublica.org/article/irs-now-audits-poor-ameri...
https://projects.propublica.org/nonprofits/
The reporting on Intuit has been going on for years, but the recent onslaught is likely because their recent initial report on Turbotax obfuscating Google search results led to federal and state investigations, and possibly attracted whistleblowers who passed along the inside documents that make up this newer report (i.e. the snowball effect)
Disclosure: I used to work at ProPublica years ago. My tenure overlapped the authors', but I never worked on these stories.
ProPublica is trusting the reader to understand that responsibility for the current state of US tax laws lies with the US government.
Payday loans, like what Intuit is doing, seeks to directly profit off of those who have the least. While they're both bad when they go wrong, it would muddy the waters to say 'but also there are other areas that are just as bad or worse depending on how you look at it.'
I'd go further to say what Intuit is doing is worse than the payday loan industry because it does it through regulatory capture instead of just desperation for capital.
My tax lawyer would cost me probably $40,000 to do the same thing just for the hours and their obsession with analyzing parallel legal theories and case law. I use my tax lawyer to construct the whole business model before any tax filings actually have to occur. Yes I could also consider a different lawyer and cpa for actually filing the tax return. They would also be more expensive than Turbotax and I would be paying two lawyer then.
Reading comprehension gives the biggest advantage with taxes. It is worth it for me.
The IRS is more of an ally than an adversary when you are using them to basically approve exactly how you wont pay them taxes, in advance.
Barrier of entry is pretty high to unlock that level, I dont mind, its what I always aspired to do.
credit karma having more comprehensive financial data on me? no thanks! just stick with the credit line approvals from self-reported income
100 pages that I had to print twice and couldn't e-file, fun! but by hand? not fun
I did read the comprehensive instructions for some forms.
[1] https://en.m.wikipedia.org/wiki/Free_File#Free_File_Fillable...
Personally, I avoid companies that use dishonest practices like this and hope they go under, but so much for "voting with my checkbook" in today's society. Power has shifted too much that it's going to be quite hard to pull it back to the average citizen.
TurboTax asks you questions and guides you through entering the data. It's all fairly intuitive and you'll have a feel for whether you've done everything completely. Free Fillable Forms, which I've used the last couple of times, is just one step up from doing everything on paper. It is not bad if you know what you're in for, but it is not the same experience as something like TurboTax or the H&R Block tool.
Now go look at the IRS instructions for a typical schedule. Here's a common one, Schedule A for itemized deductions:
https://www.irs.gov/pub/irs-pdf/i1040sca.pdf
It's a mere 17 pages including lookup tables. Pretty lightweight. Some go way longer.
Now, is all of this information and logic put into the free form calculator? It's not. So you need to read along with these instructions and follow all of the conditionals and detours described inside.
This is what you're buying when you buy a tax prep program, and this is what's missing from the free options.
The article focuses on many issues, and the existence of such forms doesn't diminish from its importance.
I did do these last year to finally kick TurboTax to the curb. However, they’re shamefully complex especially considering how they’re already a piece of software. They barely do basic arithmetic.
The restrictions are entirely artificial, and the system is gamed so that you either spend a lot of time learning tax form rules and lingo or you just pay TurboTax to do it for you.
The IRS could very easily send a pre-filled tax form for most Americans to verify and sign like other countries do. All the relevant information is already reported to the IRS. Only business owners and people with exotic tax situations would ever have to fill anything out - especially considering our now-higher standard deduction that most people don’t hit.
Despite my complaints I still highly recommend everyone use free fillable forms. You’ll actually understand what is happening with your taxes by the end of it. And without that understanding you have no idea if TurboTax is doing it right.
To me, it's pretty simple: you read the instruction book and go through it line by line. If you have odd forms to complete, like paperwork for an HSA, a quick google search will set you in the right direction.
People with more complicated tax returns will always need a professional's expertise. But for 90% of people who have one income source for one household, the paper forms are very intuitive.
I think people think they are "painful" because they need to read and comprehend more.
You also have to understand that many people may not have the same reading comprehension skills as you do.
('intuitive' is over used as a goal, but a form where you look up the instructions line by line in a separate book and where you occasionally have to search out how to fill out a subform is not intuitive at all.)
The first time I used FreeFillableForms, it was also my first time doing taxes manually. Reading all the instructions and then going off and computing whether or not the AMT applies to me, researching whether I was eligible for this and that deduction, etc was very time consuming. I estimate it must have taken me over 12 hours which was definitely not worth my time financially, but I did it anyway as a matter of principle.
THEN I ran into a nasty snag: I had put a "0" in a bunch of the fields that I'd decided didn't apply to me, but the IRS validation script expected those fields to be blank and repeatedly rejected my submissions with cryptic error messages about form validation errors. It takes at least a day to hear back after you submit, so it took me weeks after I was "done" with my taxes before I could figure out the problem and get all the fields changed from zeros to blanks that the IRS needed in order to actually accept my taxes.
>I think people think they are "painful" because they need to read and comprehend more.
That's part of it, but FreeFillableForms is not user-friendly at all. The whole federal tax process is an absolute mess. Doing my state taxes is so much easier, thanks to CalFile doing 99% of the work for me. It's a shining example of what our federal tax returns process should be like.
My brother who had rental income only needed to fill out a small form for this additional rental income.
I think that is part of why TurboTax has such a foothold. I use it because it walks me through the frankly byzantine process and explains a good deal of the arcane terminology for me.
A lot of deductions and credits are based on events or transactions that aren’t reported to the IRS. State and local tax deduction, charity deduction, medical expense deduction, and so on. There are also various penalties that need to be self reported - the IRS can find them, but only if they do an audit and are looking through bank accounts and other stuff they normally don’t know about.
I’m not sure if the IRS even knows how many kids you have for the child tax credit. How would they?
You have to report the SSN of your dependents on your tax return, still open to fraud but it’s not like you just fill in a number. This was actually a huge issue for the IRS before they co-opted the SSN as a tax identifier, and pretty much the only reason people get one assigned at birth instead of when they begin working.
CGP Grey’s video on the US’ lack of a national ID covers a lot of this, worth a watch.
The point is that the IRS does not have this information available to pre-fill your form with.
One of the current problems is that the information is reported in parallel by those providers. Many small businesses print off their employees' W-2s at the same time they print their own tax returns.
Yes, the IRS knows eventually. They don't know by April 15th under the current set of filing deadlines, though. That's a solvable problem, but not as trivial as you make it sound.
The article definitely focuses on more than a single Powerpoint slide. In fact, in the same sentence you cite, there's a reference to a 2014 slide.
The UI isn't great* and if you do complex stock trading it can be a pain to add the necessary information, but for the vast majority of people it works just fine.
It also shows if it is better to use the standard deduction or the itemized deductions for your particular case and also calculates your effective tax rate.
In fact, the Java App has for years been the only way to file personal income federal* tax. The paper forms were abolished because (almost) no one used them and they had a large rate of mistakes.
* The Java desktop app runs on Linux, macOS and Windows. (And possibly others) * There is a separate mobile app but I haven't actually used it. * In macOS there was bug in last year's version: it used ctrl instead of command for things like copy and paste. * There is no state income tax in Brazil.
OS portability has greatly improved with their online app [0], which is actually very good and easy to use. Before, the only stable way to run their Desktop application on Linux was through wine.
[0] https://www.elster.de/eportal/login
It's really an old joke. On any reference I have ever found, no matter how old, the joke is already old and the readership is expected to know it.
Which is obviously intentionally ironic considering that
> The lion's share is an idiomatic expression which refers to the major share of something.
I wonder what other countries tuck these kinds of harmlessly blatant humor in similarly unexpected places. It's nice.
It's first version was released to the public in 1999, so... Yes, ELSTER is around for almost 20 years now, getting constantly refined at least in the front-end.
All in all, it's something you wouldn't have expected here in Germany in terms of software projects from the government.
It presents as the equivalent of the paper form but with many of the fields autocalculating for you, and offering contextual help. Quite nifty.
Love it.
As an extension of schat we also have schatkist, which means treasure chest, which is also used as the translation for treasury.
When I look up the meaning of schat the dictionary says: A large collection of valuables. I see how an organization gets named after the very thing they are supposed to handle.
The danes have chosen to name their tax authority not "skat authority" or something like that, just "skat" which evokes the friendly/funny pun.
However it misses the most important part. In Sweden your tax declaration comes pre-populated with data they already have, like salary/pension/savings/stock sales/etc., and you can either just accept it as it is or make changes to the already existing data.
It's so easy that you in fact just can send an SMS (that is verified to be from you) to the taxation agency saying that their suggestion is right.
Also, some things, like capital gains, you don't even need to declare if you used only German brokers, since they are legally required to submit it for you.
The total time spend combined for me filing taxes for the last 10 years is less than 15 minutes. And the reason it isn't less than 3 is because I've logged in (using biometrics and password on my phone that is a hardware token to my bank wich is used for instant secure identification) to check that everything looks OK and to add the commuting at least 10 km/day on bike deduction.
In Ireland you don’t do anything in the usual case, unless you think it’s wrong, everything is taxed at source by the employers/banks.
Both cases different if you’re a company ofc.
However, they require a digital certificate to download (probably for privacy reasons) and I don't have one so I couldn't test it.
Other fun stuff about that desktop app...
* Originally, it was a DOS-only program (yes, it's that old). Then for a while, it was Windows-only, then for some time (probably due to the Linux users complaining) there was both the Windows-only version and the Java multi-platform version, and later the Windows-only version was discontinued.
* The original way of sending the output of this program to Receita Federal was to write it to a floppy disk and take it to a bank, which would read and upload it. Later functionality was added to send it through the Internet instead, and some time later the floppy disk option was removed.
For a while a lot of non-aligned countries were mandating the exclusive use of open-source software by government agencies, because the idea of their government being beholden to a US corporation was anathema. I suspect this was the motivation behind eliminating the Microsoft-only government service.
I haven't heard much about that open-source requirement lately. I suspect the Long Reach has been making quiet moves behind the scenes, and the ascendancy of neofascist regimes in many of those countries will do what fascist regimes always do (ie. cater to the cartel making up the fasces).
My cousin started work as a company messenger back in the early 80s and these are the sort of tasks he used to do. Its amazing that the profession has died out in in such relatively short space of time. I guess courier companies have filled in the slot but courier companies would never have coped with the number of documents that needed to be ferried about town in the old days.
In the Netherlands we had (for a very short while at least as far as I remember) a DOS program as well on diskette. I never used it but my dad did when internet explorer was not yet evil and msn was a network. You could send it in via modem (9k6 baud yay!) and it would work ... sometimes or hand it in via the diskette. Once the internet got going you could send it more easily as you could send the created files directly instead of relying on the modem dial-in via dos.
For myself I never filed on paper (2002 first one). After the introduction of windows programs they ported it to linux the next year (filed the first one on windows only on a library pc, program might have existed earlier) and have now switched to web based. If you had a company which did their taxes on time everything was (and is) filled out mostly correct. You check it and sign off. As a student it took a while to fill in all the deductibles but if you just have to pay you are done in minutes.
Is/was it perfect? Far from. Does it work for most people? Yes.
It's been replaced by something far nicer and web based! Though the old application was still definitely better than doing taxes by hand or having to pay for some third-party thing.
Windows only last time I did it (7 years ago?), things may have improved further since then.
Only self-employed, people with side-jobs or people who make over a certain threshold need to file their taxes manually (and in that case things are a bit complicated).
Healthcare, pensions and benefits are paid as part of the paycheck if you are employed (they are universal and mandatory, so not the same as in the U.S.), there are no other deductibles that a regular person can claim.
It takes less than 5 minutes to do your taxes unless you have unusual sources of income.
All invoices are digital. Every person who gets a TaxId also gets a Private/Public keypair and generating invoices means signing the document with that key. The amazing thing is that now accountants talk about the XML, which is the legal representation of the invoice.
As a result, every year if you file your taxes, you go I to the government freely provided website , get into your account and most of the data is there for the exercise, including deducted money that you can get back.
If you are a standard worker earning less than certain amount (very sensible, so the vast majority of workers fall in there) you don't even have to file your taxes.
That's one thing that is good about this country.
So if the doctor's office punches in my legal ID number with the receipt (or if the ID gets added automatically from the billing system that a large hospital would have), then when the office sends all their receipt files to the tax office, the tax office will automatically add that electronic receipt to my tax deduction.
When that happens they ask you for your TAX ID and then the business generates the invoice and your taxid and their taxid makes the tie. The Mexican IRS systems see all of this. So at the tax reporting moment, the system will have all that info.
It is pretty neat actually. However I think it is possible bc in Mexico people are not that concerned with privacy and all that.
Tangential curiosity: how is this part done? Do you download the keys from a government website? How do they handle key reissues if a private key is compromised?
It's a somewhat tedious process, but if you keep the key safe, which they very much advice, most of the procedures, including tax fillings, are pretty easy and fast.
I love it!
The only complexity for me came when I bought my house (some costs are deductible) and when I had to report Bitcoin held at Coinbase (and for that I had to report the (EUR) on January 1st 2018 specifically).
I'd like it if we could take up other, simpler models of sorting out income tax but I use software out of this pool† every year and its served me just fine:
https://www.canada.ca/en/revenue-agency/services/e-services/...
† usually StudioTax. I donated to them last year. It's not pretty software but it's effective and easy to use. https://www.studiotax.com/en/
"Our business model is similar to that of a street performer. You can use and enjoy our software and later decide if the experience was worth it and you can afford a donation. However, based on many users’ feedback, you should be wary of recent free offerings from big commercial organizations. To use our previous analogy, they are big circuses that send their clowns out to the street to attract unsuspecting customers to their tents and pressure them in paying for their overpriced shows."
Federal government charges taxes on income, production, import/export and over bank operations; states charge consumption and vehicle taxes; cities charge service and property taxes. Then there's also contributions that employers pay for workers, and some that workers pay.
However, consumption tax can compound itself (because of sales between distributors, or taxes over raw materials), so there's a "substitution" formula which can get pretty weird (but companies take care of it).
The government makes a draft declaration for you, if it's OK you just have to digitally sign your agreement and provide a bank account to pay or receive your return (if you haven't already done that in the past). Otherwise you need to edit it adding whatever they've missed, but this is only needed if you do complex stock trading, operate with money abroad, etc. For most people it's just skimming through it in case there is an obvious error, and confirming the draft.
Once you confirm the draft, it takes only around 2-4 days for the tax return money to appear in your bank account.
The website's UI is good. Spanish e-administration webapps are a bit hit-and-miss, some are dreadful (digital certificate request, I'm looking at you), but that particular one is fine and has always worked well for me.
The only out-of-date thing I've noticed on the UK one is stuff like 'this PDF of your tax return is 1.5mb, on a dial up modem this might take 5 mins to download' etc. And I guess some people might still be on that kind of link so fair enough
edit: And yeah in the UK you dont have to file at all if your situation is simple (e.g. you just have one job and one source of income).
Swiss one was way easier to understand by far. As a side effect of doing those taxes, it was easy to see my actual wealth and my actual net income for the year. Which in America is a sin.
Personally I don't have lots of stuff to file, but I did everything under 1 hour, while still discovering how to use the app and learning a bunch of taxes nomenclature.
I think the best I've seen so far is Andrew Yang's plan:
https://www.yang2020.com/policies/making-taxes-fun/
Opt in to have your taxes automatically done. National celebration of projects completed. Ability to specify where 1% of your taxes go.
So not only make it easy to do, but try to make it fun and shift the mindset from burden to societal contribution.
Also, one of TurboTax's features is e-filing. Maybe there are free e-file alternatives (as in free, with no upsell or strings-attached whatsoever), but it seems you have to be an "authorized IRS e-file provider" to do this, i.e. there's not a developer API: https://www.irs.gov/filing/e-file-options
You will see articles regularly attacking TurboTax because SV has been wildly unsuccessful in producing a startup that can compete with TurboTax, so instead a lot of effort is spent attacking them in the media.
Google, Microsoft, Facebook all spend significantly more on lobbying to ensure market hegemony. Don't be surprised at the pattern, attack TurboTax in the media, then up pops a new startup that will disrupt the industry. Rinse and repeat.
> Do you hate doing you taxes? Try Simple, we made it easy! Just put in a few personal details and we'll take care of all the rest. We'll download your W2 information from your employer and send it to the IRS. With our Simple Guarantee, you can feel confident that your return will be correct.
Or maybe we could call it Tophat. That's a good tax software name.
There are new players in the space, like CreditKarma. Many competitors offer more features for free than Intuit as well. But that doesn’t mean we should have to rely on private companies (who are data hoarding) to file our taxes. That doesn’t mean that free fillable forms need to be unnecessarily more difficult to use than commercial solutions.
In reality, the IRS already has all the relevant forms reported to them. For most people the IRS could send a tax form already filed out to read, verify, and return. For business owners and other more complex situations, these are still the same people who are already hiring a tax accountant and are probably skipping TurboTax as it is.
In other words, commercial tax preparation software for most users is filling an artificial need that only exists because the government has been lobbied not to provide the (basic) service itself.
They aren't. The IRS form is the exact for completed by TurboTax or any other accountant/service provider. The IRS only accepts their own forms.
>For most people the IRS could send a tax form already filed out to read, verify, and return.
Thats what is really being asked...the Government to do tax returns for you for free. Even if TurboTax and accountants weren't lobbying the Government not to do taxpayers tax returns for them for free, its a major jump to say the government/IRS would unilaterally begin doing this for taxpayers as a free service.
If you do this yourself, it’s far more time consuming.
I don’t understand why you think it’s a major jump for the IRS to provide this service. Other countries already do this. Other federal agencies also provide complex web services like My Social Security and Healthcare.gov.
The IRS already has your W2 and 1099 data. The IRS already knows when you make a mistake, automatically, often live as you e-file. I have had e-files rejected instantly due to mistakes. They clearly already know how much I’m supposed to owe them.
The project is not easy. It requires carefully reading tax codes and implementing them, handling presumably thousands of explicit legal requirements plus whatever edge cases exist that may or may not be explicit in the law. Not to mention keeping up with annual changes. If you screw it up, whether or not you are legally liable, people are probably coming after you anyway. And the support nightmare...
That said, I think a programming-languages approach might be a good one to try to execute on this. Keeping the source code as close to the tax code as possible seems the only way to stay sane with respect to long-term maintenance.
I think the IRS will actually pay a service fee to small companies that file the free federal returns for individuals.
Also, taxes in the US are really complicated, and while our governments know how much we owe, the burden of determination and filing is placed wholly on the citizen.
Should we be able to log in to our IRS profile page and track and manage our taxes ourselves throughout the year? Yes. Is this techically possible today? Also yes. Would this make TurboTax and some other bloodsucking middlemen less TurboRich?
Well, you can see why it's impossible.
There's no open standard/API/infrastructure or protocol for online filing, so the only option for an open source program to help with that is "print out the whole thing and send it in" which is usually a lot more trouble (more expensive in time and money) than just paying Turbotax or similar services.
Turbotax and the rest of the tax prep industry have lobbied for years to prevent easy/free options for citizens to file taxes... it isn't just them preventing other companies from building products to do it, they're suppressing all competition and modernization, basically anything that would threaten the money they get from charging people to prep taxes.
At this point the entire system is set up with high barriers to entry, and open source solutions/free software don't typically work well in that kind of setting.
Essentially, no open source program has any chance of facilitating online filing in the US because of corruption in the US government.
I think our leaders spend way too much figuring out how to block the other party from moving forward than solving hard problems.
China’s a bully but my god, it gets shit done at an insane pace.
That being said, how do people file Taxes in China?
That is the least burdensome part of the process, to me. In fact I used to do that from H&R Block Tax Cut back when there was an additional charge for e-file.
I haven't used it, so cant comment on how well it works.
Actually there is one (depending on your definition of 'alternate'): http://opentaxsolver.sourceforge.net/
I have used it for the last two years to do my Fed and State taxes.
Can the government please make something that's easy to use? Filing taxes isn't something that requires a separate company to help with, and I see no reason why these products have a right to exist (and especially not be canonized), especially with how exploitive they are or can be.
But if we remove the annual pain of dealing with taxes, then Americans will get complacent and may stop being bothered by having to pay taxes.
- The serious ideology of a major American political party vis-a-vis taxes.
Similarly, there is a group in the US whose main goal is to change the law so that employers can't pay your taxes on your behalf. Instead, you would get your full salary, and then have to write a check to pay your taxes. The group believes this would raise tax awareness.
Doesn't seem like a particularly useful way to approach life, to me.
That's called Weight Watchers. The general principle was pretty effective for me. Most people don't keep a log of wear and tear on their car, but we definitely operate airplanes that way. That also seems pretty productive to me.
But yeah, it's not the only way to operate. I don't really like the idea of putting more responsibility on people in order to "raise awareness". I take that to really mean someone would like everyone to be more upset about taxes, and would like to make them less convenient to increase upsetness.
But forcing it just wastes everyones time, adds red tape, and additional bureaucracy they purport to rail against.
If a politician raises taxes, and all it does is change the value of a annual withdrawal on your account, I think that pain would be the same, regardless of difficulty of filing.
The pain is estimating and filing 4 times a year.
They simply do not understand the fact that, no, that check is not "free government money" but is instead money that the government took, held onto for free all year, interest free, and then let you have back after you filed the proper forms.
So the suggestions to have people cut checks to the government (quarterly, monthly, annually) is generally made from trying to overcome that viewpoint that too many folks view their tax return as some form of "gift" from the government, and instead get them to recognize just how much tax money is being consumed.
I appreciate transparency like that, but I hate other examples that add additional steps or paperwork to the process.
Which individuals? How do you know these people?
Also I don't agree with your perspective on tax withholding. If you don't want your employer to withhold taxes, I think they have to stop withholding taxes. It's a convenient default, in my opinion.
In principle I like your suggestion but in actuality I think many Americans will not like their "yearly tax bill." Just think about people who are already living paycheck to paycheck; not saving much, or just overall spending every penny that comes into their bank account. They would be in trouble come April if they had to pay it at that point.
Perhaps they could do a monthly installment payment for last year's taxes... And the taxpayer would auto pay once or twice a month when they get paid... But then, we're back to where we started.
Tldr in an ideal world where every citizen is disciplined about not spending every penny they get, this suggestion would be great.
I know some people _have_ to spend every penny because they need to to survive, but there are also plenty of people who spend every penny because they just have no discipline and buy anything they want without regard to whether or not they could afford it. Ideally the people in the former category would get some sort of welfare. Not sure what, if anything, to do with the people in the latter.
But it doesn't work for low-income people that are already living paycheck-to-paycheck.
To be frank, the government has issues making things usable, and "usable" is a pretty small target when you're talking about the entire US workforce.
They brought in a bunch of dedicated experienced software pros who among other things rescued the federal health insurance exchange site.
I think they could do a fine job with tax software.
I've just filled in a new ESTA application on the US gov site too, simple (albeit stupid), and worked.
This morning however I tried using enterprise b2b to book a hire car, it took 6 attempts before it actually worked. Almost all corporate tools seem to be terrible.
https://www.npr.org/sections/money/2017/03/22/521132960/epis...
Also Reply All did an episode recently on the Propublica Intuit story.
https://gimletmedia.com/shows/reply-all/6nhgol
I have never actually done that; but my parents did well after I was using software, which sure is more convenient.
https://apps.irs.gov/app/freeFile/jsp/index.jsp
wait, does the Transmogrifier Deduction for Frobnubilors apply when you claim to be Single-and-Only Highlander? pauses and takes 1 hour to read up on the IRS rules for this and compares with the advice of $random_internet_guy
And after the personal satisfaction of having completed everything myself, I file and a few months later get a letter from the IRS to the effect of "Dear Mr Bonehead, you totally forgot this obvious item, so we're going to refund you a bit more. You're welcome."
Taxes are not hard if you know how all of the rules apply to your special situation. If you don't, like most people, you're in the dark and it becomes a very poor use of time, with lost money at stake—or worse if your intentions are deemed to be fraudulent.
The only time I didn't do my own taxes and paid a CPA, he messed up even though I told him that I withheld more than required (and gave him last year's return so he could see what last year's taxes were and that I had more than 110% withheld).
He still filled the form out wrong so that I would have had to pay a penalty. Then when I told him he filled it out wrong, he just took the penalty off, without properly updating the 1040. When I ended up getting the inevitable "you owe us a penalty letter", I just ended up dealing with it myself rather than use his boneheaded explanation basically "pretty please" as opposed to the actual "I made more money, and withheld enough more money, so penalties are waived."
For example, I've been considering installing solar panels on my house. There is a federal tax credit for installing solar, and it includes associated costs like repairing your roof to support the panels. But as a normal person the entirety of the guidance is this:
"No costs relating to a solar panel or other property installed as a roof (or portion thereof) will fail to qualify solely because the property constitutes a structural component of the structure on which it is installed."
So if you get a new roof to support the panels will the tax credit cover the entire roof job, or only the part covered by the panels? I've heard from two accountants on this who had two diametrically opposed opinions on this. And if I guess wrong it's potentially Felony Tax Fraud, the kind that put Al Capone in jail for 11 years. Ignorance of the law is no excuse.
So I call the IRS help line to get the official guidance on this and the official IRS position is: "We can not give guidance on this subject." It's not like TurboTax is going to have any more official of an opinion on this either. The only way to safely handle this is to pass liability off to a third party, which makes filling out your own taxes not an option.
It comes down to this and I do not blame Turbo Tax or any other company in this area. The Federal and State Tax codes are weaponized by politicians and until that stops the system will be too complex for many to do the the filing on their own and some of that is because there is always that "did I forget something" feeling.
At least the changes made recently helped the lower and middle classes out a lot, that doubling of the personal deduction was a god send in reducing the work needed as many will never need to itemize again
Yes they will. I don't know why you bother to make up a lie so easily disproved.
On September 9, 2019, I received a CP16 that stated
"We believe there are miscalculations on your 2018 Form 1040, which affect the following areas of your return:
- Tax Computation
We made changes to your return that correct these errors. As a result, your overpayment is $21,886.35.
Information was changed because of the following:
We changed the amount of tax reported on your tax return because the tax rates on Qualified Dividends and Capital Gains are generally lower than the standard rates. It appears your tax was not computed using these rates or the amount of tax was computed incorrectly. (211D)"
Many law makers don't want the Government to make this process easy on the assumption that the easier it is for the Government to tax, the more it will do so.
> ... it saves time. So to me it's worth the money.
is (unless I'm missing some alternative), based a in comparison to paper-based forms, which are in turn a horribly inefficient way for the IRS (which all taxpayers pay for) to operate.
The question is not only the anti-competitive behavior of entrenched 'supported electronic filing services', but that these are 'required' and facilitated due to horribly inefficient processes that the IRS refuses to fix properly by simply creating a way for individuals to e-file in the first place.
Warren is a run of the mill middle of the pack Democrat. She only looks good because at present the GOP looks so bad.
The government needs to be reformed, electing one party or another President isn't going to change much, unless you set the bar really low (Trump)
> The government needs to be reformed, electing one party or another President isn't going to change much
And pontificating about how "the system is broken" doesn't change anything. There are no actual concrete steps to reforming government that doesn't involve elections and gradual process, or revolution and sudden progress. If you think the latter is in any way likely then you're deluded.
Obama is a conservative democrat (or a liberal republican, you can't really tell these days) so you're not putting the bar high.
Besides, this isn't even the question. The OP said that Warren is a middle of the road Democrat. Compared to the positions held by the average Democrat Senator/Congressperson she isn't at all. Whether she'd follow through on those promises when elected is a valid question (though much like Obama, it wouldn't be under her sole control), but that doesn't mean she isn't left-leaning.
How can you trust a candidate who changes platform from progressive to milquetoast centrist so quickly? How can you trust a candidate who said several months ago that she wants to eliminate billionaires, and yet who continues to get major contributions from at least twenty billionaires?
I find it very hard to believe that Warren is genuinely left-leaning. Based on her behavior, it seems to me much more like she is a centrist candidate wrapping centrist ideas in left rhetoric.
Warren might have seemed barely to the left in historic eras. She only seems left now because the recent stretches with the "left" party in control have all been very centrist. Big businesses have been allowed to grow bigger, and organized labor unions have been just treading water federally, as the individual states have been pulling their teeth with "right to work" and "at will" employment laws.
Media consolidation and campaign finance has been driving it. The median voter does not have a reliable, unbiased source of information to drive their decisions, so it's "Garbage In, Garbage Out" politics. Control the inputs to influence the outputs. One faction seems to be experimenting with packing all the main channels with misinformation, disinformation, propaganda, and psyops, and that seems to be worth about 40% of the vote, if the polling is honest and accurate.
The antipodal position to this would be to invest more into public education, independent journalism, legislation penalizing prevarication or material omissions by public officeholders and appointees, anti-secrecy and public disclosure (or "sunshine") laws, and overhaul of broadcast licensing. The issues Warren is focusing on seem more concerned with the flows of money than the flows of information. It's the latter that will produce government reform in a democracy.
Going after Facebook is easy. They're a big, obvious target, and Zuckerberg isn't tremendously charismatic. But Facebook is just one business. Political disinformation is an entire industry.
On the other hand, "everybody in every party sucks and it doesn't matter who anyone votes for because it won't change anything" is a comment that could go on any post about any aspect of politics and doesn't contribute to a productive conversation.
https://sites.google.com/site/excel1040/
The dedication of the maintainer to this project is truly impressive.
I'm on linux but it works fine in the browser version of Excel.
TurboTax’s 20-Year Fight to Stop Americans from Filing Taxes for Free; 211 points -- 54 minutes ago
TurboTax to charge more lower-income customers; 144 points -- 3 months ago
Congress Scraps Provision to Restrict IRS from Competing with TurboTax; 82 points -- 4 months ago
Listen to TurboTax Lie to Get Out of Refunding Overcharged Customers; 171 points -- 5 months ago
TurboTax Uses a “Military Discount” to Trick Troops into Paying to File Taxes; 170 points -- 5 months ago
TurboTax and H&R Block Saw Free Tax Filing as a Threat; 355 points -- 6 months ago
TurboTax Hides Its Free File Page from Search Engines; 881 points -- 6 months ago
TurboTax Uses Dark Patterns to Trick You into Paying to File Your Taxes; 608 points -- 6 months ago
How the Maker of TurboTax Fought Free, Simple Tax Filing (2013); 462 points -- 7 months ago
edit: if you _still_ haven't gotten enough TurboTax reporting, there's a great Reply All episode that covers propublica's reporting as well https://gimletmedia.com/shows/reply-all/6nhgol
Furthermore, the government has surely implemented the algorithm itself in order to verify submitted tax returns, so the implementation cost of pre-computing everyone's tax should be comparatively small.
Everyone is hating on TurboTax for making money, but they’re pretending the government tax machine has no such motivation, which simply is not true.
Many countries pre-fill the tax return, but require the citizen to submit it. The citizen is responsible for the submitted information, not the government.
https://web.archive.org/web/20161209003500/http://www.ayotte...
[0] https://www.americanbar.org/groups/business_law/publications...
Now you are criticizing someone for giving a factual response. Time for some reflection.
The specific amount of time involved could not possibly matter any less... the point is still valid.
I’m sure you never round your income down or your donations up and you never, ever! go even a mile over the posted speed limit.
I’m glad you can take this as an example of your own self-richeousness. Don’t confuse that with real life.
There’s a word for what you’re doing: Pedantry. There’s also another word for what you’re doing: Bootlicking. The person you’re responding to is gracefully opening the door to questioning authority and you’re not only pushing it closed on his foot on behalf of your masters but you’re doing it for free.
People like you are absolute garbage. And your little condescending cherry on top “Time for some reflection” is just nauseating. Maybe it’s time for you to look up some suicide techniques.
Also no mention of filling out the free 1040 form... that’s too difficult. As if the companies charging you to do that for you just existed because they were forcing people to pay them...
The only times I've heard of the IRS going after people who unintentionally violated the rules, they were intentionally and obviously violating the spirit of the law but thought they were within the letter and were wrong.
In my experience you can make a good faith effort to figure out what your supposed to owe and pay it. In this case the IRS will treat you fairly and waive all types of fines. Or you can try to aggressively avoid taxes that you should owe in spirit. And in this case you have to be damn sure you're within the letter of the law because the IRS will try to hammer you if you color outside the lines. These seem like two fair options to me. And everyone I know who was slammed by the IRS was doing the latter.
For example, I used to work in New Jersey, and live in New York, meaning I would have to file two state tax returns, in addition to the federal. There are weird rules that you can deduct one state's taxes from the other, and then deduct the remainder from the federal taxes. The rules get complex really quickly, and even with helpful software I made a mistake one year resulting in a fine. I can't imagine how frequently I'd make mistakes if I had to do it manually.
TurboTax definitely provides a service by making it so that schmucks like me can do taxes, but if the tax code is that complex, shouldn't we have a software like this for free? At the very least, to provide some motivations to politicians to help simplify the tax code?
It wasn't actually directly due to the multi-state thing. I paid for my wife's college, and NY has a thing to let you deduct tuition from dependents on taxes. I had forgotten to attach the proof of payment for tuition, leading to me getting audited (in the most technical send of the word) and fined slightly. The biggest pain in the ass was the back-and-forth I had to do to close my case, which involved me faxing things multiple times.
You speak of NJ, NY, taxes, "mistakes", fines, potential "audits" by the IRS, then wonder why politicians would want to simplify and improve something that many of them likely grift from or cheat on themselves, due to that same complexity...
...and one of the biggest of these tax cheats hails from NY, likely has had his now (on again, off again) lawyer, who used to be mayor of NYC and before that as a US AG - probably ran interference for his cheating and other scams.
But all of them - and plenty of others - benefit from the complexity and other issues, and don't want it any other way, unfortunately. No real good solutions to that.
That’s absolutely not acceptable in this thread (I tried)!
I went to experienced tax professionals to help me with those returns, and _they_ were baffled, spent hours pulling out phone book-sized paper guidebooks, and debating with each other, and making phone calls to colleagues, and I had to file amended returns - in one case, _twice_. Fortunately they never charged me anything to correct the errors, but... wow.
What hope would I have had to get it right myself, trying to fill out the various schedules?
Still, it's an irksome chore that I would prefer not to have to do.
In this particular case, the rich are actively using the system to stop an improvement to the quality of life of regular people.
What's the point in living in the richest country in the world when your quality of life is lower than many countries that don't have nearly so much money?
1: (its 4 micro city states above it, which are economically special, and 5 nations that could reasonably be considered full sized countries, however all of them still have relatively small populations)
However, I agree with the point that you're making wholeheartedly. There's a very serious amount of wealth disparity around the world, and the rich have gotten so rich that they can't even feasibly spend all of their money if they had to.
The lives of middle and lower class people in Australia, Canada, Scandinavia, etc. are much, much, much better than Americans, and improving all the time.
I have a W2 job, and my employer presumably has sent my paystubs and tax information to the government already. I then have to copy down the information from my W2 into some kind of tax filing software, and then they have to check to make sure that what I typed matches what they have, presumably paying someone to do that if I make any kind of serious mistake. Why do I have to do anything?
I'd understand if I have a lot of complex deductions or if I were running my own business, but as it stands I do the basic standard deduction (or whatever the default options on TurboTax are).
I'm genuinely asking this...is there some utility that I'm missing here to me doing the taxes myself?
There have been proposals to mail cards to taxpayers with their financial information (as known to the government) pre-printed, and if everything is accurate, the recipient does nothing at all. TurboTax (and a few others) lobbied heavily to make sure such efforts were defeated, and so you have to keep doing your own taxes.
But please, stop using TurboTax to do so!
Is it really worth making 100% of taxpayers do their own just to handle the edge case of people who actually have to?
It's a little more complex if you own a business, but I think you can file and maintain all your business taxes throughout the year using an IRD website as well.
The US IRS has all the information to do the exact same thing. It's lobbying from the tax software companies that's kept them from doing so.
When I realized that some other countries have no concept of a tax day and don't understand the yearly hype train of US taxes, that's when I got really bummed out on how broken our system is.
Intuit's main argument has always been that if the government provided such a service many people would overpay their taxes.
Honestly it's much cheaper, easier & better to just find a good accountant to do your taxes instead of Turbo Tax.
The government could do a lot to make filing taxes & starting businesses easier. All the politicians talking about being pro-small business could really start at these 2 steps. Otherwise, imho, their talk is nothing but empty promises. Creating hurdles like this is just a way of gate-keeping lower incomes out of small businesses.
If that's true, then most people would use Intuit anyway, once they realized how much they'd save.
This is tax payer's problem, not tax office's.
Within a few days I received a letter from a private company informing me that unless I pay them $1000 to publish the name of my LLC in two public newspapers for six weeks, one daily newspaper and one weekly newspaper, in 120 days my LLC would need to cease doing business in NY. I pull out my phone and did a quick online search. Lo and behold, there is a law that says the same.
In this golden age, the government has chosen to require me to pay a private archaic company to print in ink thousands of times on paper the silly name of an LLC I just came up with, then proceed to distribute it by truck to a bunch of old people that then proceed to throw it in the garbage.
No fancy tax algorithms would be required for NY to simply drop this nonsensical requirement. Maybe this process exists because there are groups of people making a small fortune from it?
Best argument I’ve heard is “gotta keep people employed somehow, can’t be too efficient”
Reading that as “one daily newspaper and one weekly newspaper”, that would be 6 (weeks) times at least (6 + 1) = 42 adverts in a newspaper (I can also read it as “2 public, one daily and one weekly”. That would increase the number of adverts). Price per advert would be about $25.
I guess most LLCs get incorporated in an at least somewhat large city, so the circulation of the paper will be somewhat high. $25 per advert then doesn’t sound that bad to me.
I know zilch of advertising prices, though, so let’s google it. Reading https://fitsmallbusiness.com/newspaper-advertising-costs/ (a link that google gave me, but that I don’t know the quality of), I see the price per “column inch” go down from about €18 to about €13 when you advertise more often.
⇒ it could well be that $1,000 is a fair price, giving the higher price you would have to pay and the amount of work you would have to do if you did it alone.
(Still seems a weird law, though. I can imagine that one should give people to object if your company will be noisy, stinky, or the like, but then, the city, IMO, should require a permit)
That likely still is true, but less so (fewer people subscribe to papers), and the assumption that people who read the paper would spot your advert probably only held back in the time when papers had reasonably small coverage (so that your advert wouldn’t appear in a large section of the paper, but stand on its own), and were about the only source of news (which made them much better read)
I wrote to my state assembly person; she wrote back saying A8125 was introduced to repeal the requirement, but no action taken. I would encourage you to write to your assembly person and senator, because this is just a drag on NY businesses.
Unfortunately the numbers are year specific.
I do see the value in publicly announcing things, but I do see newspapers as archaic.
The clerks at this court look at the scanned pages and confirm that yes they do say what the XML says, and then this gets published.
People can search for company histories, look at their bylaws, etc.
Similarly there's a different gov service for publishing corporate yearly financial reports.
Why isn't something like that for US states?
I think this is fairly common.
> After you get done publishing, the newspaper will provide an Affidavit of Publication, and you send that to the New York Division of Corporations with a Certificate of Publication that carries a $50 filing fee.
I live in NY but never filed an LLC, but I Google'd that. I can't believe such nonsense exists to get money in a state that already has high state / sales taxes.
I think the idea is that anyone who the company owes money to can file a claim before any remaining funds are distributed.
Of course there are much better and more cost-effective ways of doing this (even pre-internet). It’s just absurd rent-seeking by unproductive leeches on the economy as far as I can tell.
They publish notice of all laws, all insolvencies, all changes of name, new holder of certain public offices etc. I don't think there is any news or anything beyond the UK.
I bet it would be 5x more if you had to take out an ad in the Times or Telegraph. :)
1. Please ignore almost all the mail you get initially. There are public companies that troll NYS business registration logs and send TONS of false and highly misleading if not illegal advertisements. "You totally need this $900 OSHA poster you can just print for free and paste on the wall". "Ignore the fact we copied NYS' letterhead but aren't a governemnt entity", etc.
2. The NYS tax department will send you one real piece of mail as a questionnaire.
3. Yes, the newspaper requirement is real and fucking terrible. It's a very old holdover however politicians don't want to get rid of it because quite literally, it's a handout program for newspapers. It would make alot of "local" papers nobody reads, close up shops.
4. Shop around, there are a few ways to save money on it. Honestly, I made a LLC 2 years ago in NYS and haven't even used it business wise. I have yet to do the publicatinon requirement. You just can't legally do business until you do so BUT it doesn't give a deadline.
In Australia, they had a desktop application you could download, provided by the government. It wasn't pretty, but it was straight forward and took less than an hour to go through the whole thing.
I once met an Aussie at a security meetup who worked at immigration and I told him how surprised I was that I got my visa in like two days. He was like, "oh I worked on that piece. Yea that use to take two weeks; but we were able to fix a lot of that process." I wouldn't be surprised if Australia taxes were all web based and even faster today.
0: http://www.cosmicweenie.com/wealth_tax.pdf (don't let the domain name fool you...)
Why does everyone say you can't file taxes for free? The IRS has a site for it here: https://www.irs.gov/filing/free-file-do-your-federal-taxes-f...
I get that Intuit is fighting tooth and nail to keep their business, but "hiding" a page from google - seriously, is that to be considered evil now?
Seriously, I'm missing something in this conversation.
1) you are under a certain income threshold
2) you go seek out that particular page (vs searching free file in google and clicking on intuit)
Or you go directly to intuit and qualify as a “free filer” which you only qualify for if you have a dead simple return - w2 and no deductions or extra forms.
The problem isn’t that you can’t file free. The problem is that intuit is doing what it can to bury it while promoting its conveniently named “free” edition that bumps you up into a paid edition faster than you can say “what?”.
> The problem is the lobbying has stopped making forms easier or non-existent. They are complex because of private corporate influence, not the constituents of the I.R.S..
Where did I contradict this?