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Quote from the article: Today, the average taxpayer has one chance in 200 of getting audited. The downward trend has led to concerns that the IRS needs more fu

Quote from the article: Today, the average taxpayer has one chance in 200 of getting audited. The downward trend has led to concerns that the IRS needs more funding to do its job correctly and competently. That’s true ... Does anyone here believe that the IRS is a good thing? The tax code could be greatly simplified helping business owners to boost the economy. If you need more auditors, perhaps you're doing it wrong. Imagine a "Revenue Service" that actually helped companies increase their revenue instead of being a parasite. A one page form, simple questions, simple tax code. Make tax day a celebration instead of a confusing trick of loopholes.

davidw 9y ago
The IRS just runs things; they don't make the rules, that's on congress. And yes, it's a good thing to have a well-run, competent bureaucracy that ensures that the rules are applied to everyone, fairly.
dec0dedab0de 9y ago
I wish there was only a corporate tax, and maybe a sales tax. Only because I don't want to have to do this paperwork every year.
azhenley 9y ago
I've always wondered: Is the tax code kept complex because large accounting firms lobby for it? Much profit (and many jobs) would be lost if it was simplified.
- TallGuyShort 9y ago
  In case you missed the thread about H&R Block on here the other day, the do lobby for it. It may not be entirely that though - there's also plenty of political capital to be had by pushing for special loopholes for special people.
- redbeard0x0a 9y ago
  The tax-prep industry is active in lobbying to keep the tax system from becoming too simple. Think H&R Block and Intuit, not Pricewaterhouse Coopers (however I'm sure they are just as involved, but have less on the line compared to the retail companies since companies will always need accountants).
- bluGill 9y ago
  That is one factor. Another factor is the tax code does drive behavior. People with month who are considering doing one of two things will add preference to the cheaper one, the more complex tax code can make something cheaper after taxes are considered. Companies can deduct R&D money because the the country doesn't want to risk falling behind if the short term "bean counters" win and stop doing R&D. By making R&D cheaper the argument for doing it is stronger.
- topkai22 9y ago
  It's not just the accountancies. Planet Money did a bit about how right leaning organizations like Grover Norquist's "Americans for Tax Reform" opposed pre-filed income tax returns because they believed that making tax compliance less painful would lead people to be less opposed to taxes generally (I can't say they are totally wrong there). Special interest groups (including some thay aren't so special, like anyone with childcare costs) on both sides love "their" special tax deductions. The accounting firms aren't campaigning for simplification, but they are joined by a legion of others opposing it in various ways as well.
- leeter 9y ago
  Yes, but not that's not the whole problem. There are plenty of special interests that want their carve out. But honestly that's not even the major source of cost. The major source of cost is processing returns at all. If the IRS was allowed to do return free filing then it would massively simplify the majority of people's taxes because they don't have anything that requires the full 1040 for. That means only people who have significant and complex finances actually need to file a return.
dastbe 9y ago
Simplifying the tax code is a win for everyone including the IRS because it will drastically cut down on the number of people who accidentally get taxes wrong, but you still need some entity to audit for fraud.
jgmmo 9y ago
It's a big racket to give free money to accountants and TurboTax. No reason we need any of this craziness, just let me pay a flat rate and do my taxes on a postcard.
- josefresco 9y ago
  Based on what I've read, this is the reason why we don't have meaningful change. I remember Paul Ryan showing the "postcard" tax return form on TV - of course we all knew/know that was complete BS.
mu_killnine 9y ago
Good? Meh. Necessary? Probably. No one likes paying taxes and, given the chance, people will either willfully or accidentally take advantage of the system. There needs to be a system in place to keep people and companies honest so that the system is fairly applied. I think that's a subject entirely independent from the simplicity of the tax system. It needs to be as straightforward as legislators can make it.
jjeaff 9y ago
Simplifying the tax code won't negate the need for auditors. People will still try to cheat. Additionally, if the alternative to auditors is a tax code that seruptitiously and automatically collects taxes, then I would much prefer auditors. Citizens should feel the true pain of paying taxes, so that they can think long and hard before allowing a politician to raise them. Which is actually why I prefer the American system of adding sales tax after the fact. As opposed to many other countries that just hide the tax in the price of the product.
- powvans 9y ago
  I agree with a lot of what you are saying, but I think GP's frustration is with the pain of the process and not the pain of paying. Think about, there are two pains occurring here: 1) the pain of parting w/ money 2) the pain of preparing taxes and fearing you made a mistake The pain of preparation is caused in large part by the complexity of the code. Nothing in the American system is deterring politicians from adding new rules and more complexity. In fact, creating loopholes in the tax code is one of their biggest sources of lobbying dollars.
  - bluGill 9y ago
    it isn't just lobbying dollars. Loopholes are created to drive behavior. An example, if you want to do something about global warming you need to get people/companies to buy efficient things, but such things have a higher up front cost (in many cases the difference is not repaid if you invest the difference). One thing you can do to encourage the behavior of buying more efficient things is to make the tax code encourage it. There are of course many other options, and each will get a different class of people to change behavior. Debating which is best is a side discussion you may have.
froindt 9y ago
I'm all for simplification of taxes, though there will always be some degree of people evading taxes. Having no deterrent factor allows people to cut corners and not get caught. There's a good chance the waiter/waitress you tipped in cash is not reporting it, particularly if you went to a small non-chain restaurant. I believe there are people who work hard in construction, factories, and restaurants, and that people should pay taxes on what they earn whether it's paid in cash or not. It benefits the restaurants to not fully properly report it because they need to pay their portion of Social Security, Medicare, and Medicaid. The ROI for the IRS conducting audits is very high, estimated to be 7x in 2012. [1] [1] https://www.irs.gov/newsroom/national-taxpayer-advocate-delivers-2012-annual-report-to-congress https://www.irs.gov/newsroom/national-taxpayer-advocate-deli...
s73v3r_ 9y ago
>Does anyone here believe that the IRS is a good thing? I do. >The tax code could be greatly simplified helping business owners to boost the economy. How? What exact, concrete steps would you take to simplify the tax code that would not be extremely regressive, would not be easily game-able, and would bring in close to the same amount of revenue?
dragonwriter 9y ago
> Does anyone here believe that the IRS is a good thing? Maybe. > The tax code could be greatly simplified helping business owners to boost the economy. Simplification might be good, but I'd the focus is on tipping the system more in favor of capitalists, probably not. But you still need the IRS; The complexity of the tax code is not their issue, anyhow, it's Congress's. > If you need more auditors, perhaps you're doing it wrong. Undefunding compliance monitoring is “doing it wrong”,yes. > Imagine a "Revenue Service" that actually helped companies increase their revenue instead of being a parasite. Even if you have an office designed to promote returns on domestic capital to reinforce the wealth of the domestic capitalist class (and we do have several agenciy with this overt purpose in the US government, including the Office of the US Trade Representative and the Department of Commerce, among others) you still need an office dedicate to assuring that the funding to support that effort comes in as required. > A one page form, simple questions, simple tax code. The main lobby against a one page form with simple questions, which given the requirements for information to be submittes to the IRS separate from tax filing can be done with the existing tax code, is business owners—specifically, owners of businesses that make their money selling tax preparation software and services.

davidw 9y ago

The IRS just runs things; they don't make the rules, that's on congress. And yes, it's a good thing to have a well-run, competent bureaucracy that ensures that the rules are applied to everyone, fairly.

dec0dedab0de 9y ago

I wish there was only a corporate tax, and maybe a sales tax. Only because I don't want to have to do this paperwork every year.

azhenley 9y ago

I've always wondered: Is the tax code kept complex because large accounting firms lobby for it? Much profit (and many jobs) would be lost if it was simplified.

TallGuyShort 9y ago
In case you missed the thread about H&R Block on here the other day, the do lobby for it. It may not be entirely that though - there's also plenty of political capital to be had by pushing for special loopholes for special people.
redbeard0x0a 9y ago
The tax-prep industry is active in lobbying to keep the tax system from becoming too simple. Think H&R Block and Intuit, not Pricewaterhouse Coopers (however I'm sure they are just as involved, but have less on the line compared to the retail companies since companies will always need accountants).
bluGill 9y ago
That is one factor. Another factor is the tax code does drive behavior. People with month who are considering doing one of two things will add preference to the cheaper one, the more complex tax code can make something cheaper after taxes are considered. Companies can deduct R&D money because the the country doesn't want to risk falling behind if the short term "bean counters" win and stop doing R&D. By making R&D cheaper the argument for doing it is stronger.
topkai22 9y ago
It's not just the accountancies. Planet Money did a bit about how right leaning organizations like Grover Norquist's "Americans for Tax Reform" opposed pre-filed income tax returns because they believed that making tax compliance less painful would lead people to be less opposed to taxes generally (I can't say they are totally wrong there). Special interest groups (including some thay aren't so special, like anyone with childcare costs) on both sides love "their" special tax deductions. The accounting firms aren't campaigning for simplification, but they are joined by a legion of others opposing it in various ways as well.
leeter 9y ago
Yes, but not that's not the whole problem. There are plenty of special interests that want their carve out. But honestly that's not even the major source of cost. The major source of cost is processing returns at all. If the IRS was allowed to do return free filing then it would massively simplify the majority of people's taxes because they don't have anything that requires the full 1040 for. That means only people who have significant and complex finances actually need to file a return.

dastbe 9y ago

Simplifying the tax code is a win for everyone including the IRS because it will drastically cut down on the number of people who accidentally get taxes wrong, but you still need some entity to audit for fraud.

jgmmo 9y ago

It's a big racket to give free money to accountants and TurboTax. No reason we need any of this craziness, just let me pay a flat rate and do my taxes on a postcard.

josefresco 9y ago
Based on what I've read, this is the reason why we don't have meaningful change. I remember Paul Ryan showing the "postcard" tax return form on TV - of course we all knew/know that was complete BS.

mu_killnine 9y ago

Good? Meh. Necessary? Probably. No one likes paying taxes and, given the chance, people will either willfully or accidentally take advantage of the system. There needs to be a system in place to keep people and companies honest so that the system is fairly applied. I think that's a subject entirely independent from the simplicity of the tax system. It needs to be as straightforward as legislators can make it.

jjeaff 9y ago

Simplifying the tax code won't negate the need for auditors. People will still try to cheat. Additionally, if the alternative to auditors is a tax code that seruptitiously and automatically collects taxes, then I would much prefer auditors. Citizens should feel the true pain of paying taxes, so that they can think long and hard before allowing a politician to raise them. Which is actually why I prefer the American system of adding sales tax after the fact. As opposed to many other countries that just hide the tax in the price of the product.

powvans 9y ago
I agree with a lot of what you are saying, but I think GP's frustration is with the pain of the process and not the pain of paying. Think about, there are two pains occurring here: 1) the pain of parting w/ money 2) the pain of preparing taxes and fearing you made a mistake The pain of preparation is caused in large part by the complexity of the code. Nothing in the American system is deterring politicians from adding new rules and more complexity. In fact, creating loopholes in the tax code is one of their biggest sources of lobbying dollars.
- bluGill 9y ago
  it isn't just lobbying dollars. Loopholes are created to drive behavior. An example, if you want to do something about global warming you need to get people/companies to buy efficient things, but such things have a higher up front cost (in many cases the difference is not repaid if you invest the difference). One thing you can do to encourage the behavior of buying more efficient things is to make the tax code encourage it. There are of course many other options, and each will get a different class of people to change behavior. Debating which is best is a side discussion you may have.

froindt 9y ago

I'm all for simplification of taxes, though there will always be some degree of people evading taxes. Having no deterrent factor allows people to cut corners and not get caught. There's a good chance the waiter/waitress you tipped in cash is not reporting it, particularly if you went to a small non-chain restaurant. I believe there are people who work hard in construction, factories, and restaurants, and that people should pay taxes on what they earn whether it's paid in cash or not. It benefits the restaurants to not fully properly report it because they need to pay their portion of Social Security, Medicare, and Medicaid. The ROI for the IRS conducting audits is very high, estimated to be 7x in 2012. [1] [1] https://www.irs.gov/newsroom/national-taxpayer-advocate-delivers-2012-annual-report-to-congress https://www.irs.gov/newsroom/national-taxpayer-advocate-deli...

s73v3r_ 9y ago

>Does anyone here believe that the IRS is a good thing? I do. >The tax code could be greatly simplified helping business owners to boost the economy. How? What exact, concrete steps would you take to simplify the tax code that would not be extremely regressive, would not be easily game-able, and would bring in close to the same amount of revenue?

dragonwriter 9y ago

> Does anyone here believe that the IRS is a good thing? Maybe. > The tax code could be greatly simplified helping business owners to boost the economy. Simplification might be good, but I'd the focus is on tipping the system more in favor of capitalists, probably not. But you still need the IRS; The complexity of the tax code is not their issue, anyhow, it's Congress's. > If you need more auditors, perhaps you're doing it wrong. Undefunding compliance monitoring is “doing it wrong”,yes. > Imagine a "Revenue Service" that actually helped companies increase their revenue instead of being a parasite. Even if you have an office designed to promote returns on domestic capital to reinforce the wealth of the domestic capitalist class (and we do have several agenciy with this overt purpose in the US government, including the Office of the US Trade Representative and the Department of Commerce, among others) you still need an office dedicate to assuring that the funding to support that effort comes in as required. > A one page form, simple questions, simple tax code. The main lobby against a one page form with simple questions, which given the requirements for information to be submittes to the IRS separate from tax filing can be done with the existing tax code, is business owners—specifically, owners of businesses that make their money selling tax preparation software and services.