4 ms·

I wish this would get a lot more attention. The world could be rather simple, majority of people would just be happy with a straight forward process. What annoy

by kerng 8y ago

I wish this would get a lot more attention. The world could be rather simple, majority of people would just be happy with a straight forward process. What annoys me is not the money I have to spend on filing taxes nor to pay my fair share, but the actual time I waste every year doing so.

justapassenger 8y ago
This so much. I’m fine with taxes (I benefited a lot from services provided by them, when I needed). But the whole process is made complex for no good reason. I want to show to government all my money, have them tell me what I owe, and if I don’t agree, have an appeal process.
- hueving 8y ago
  The problem usually isn't the knowing how much you made bit. It's the knowing how much you can deduct because that's all based on expenses.
  - SparklingCotton 8y ago
    In a simple tax system there aren't that many deductions. This is especially true for low-tax jurisdictions. If you want non-standard deductions, create a company and do normal accounting. 50-100 standard deductions can be handled centrally by the IRS with no issues. It's been done in other countries for decades.
    - sokoloff 8y ago
      The IRS does not get a feed with the details of our charitable giving. They also don’t get a feed of various ad valorem taxes I pay. Those are common, non-business cases where the IRS doesn’t have enough info to properly prepare a return. Small business returns (even simple Schedule C “hobby businesses”) definitely can’t be done correctly in an automated fashion.
      - justapassenger 8y ago
        With current tax code it's not possible. But that's the thing - tax code needs to be updated. It works now because of weird combination of stockholm syndrome and giving people a feeling of getting a deal. Tax code is messy and complex, with tons of loop holes. And those loop holes mean most of the people pay much less anyway, but they get to feel good that they're getting a great deal. It's brilliant from psychology point of view.
        sokoloff 8y ago
        Well, I can’t see any feasible way to automate Schedule C and preserve a tax system that taxes income/profit (rather than revenue). I’m not sure which part of my reply you think is amenable to tax code changes (and I don’t want to erect a strawman). If it’s just ad valorem taxes, you might be able to compel every jurisdiction seeking to impose one to provide a data feed to the feds. I’m not sure I think that’s Constitutional. You could also block the deductibility of charitable giving and property taxes (and likely hurt charities who are currently struggling; the Gates Foundation will be fine; the local soup kitchen may suffer.) That still leaves Schedule C as unsolvable, Schedule D as only partially (though increasingly) solvable, and Schedule E as likely unsolvable [having many of the same complexities as Schedule C and then some additional ones around basis, depreciation, and some real estate specific taxes/expenses that are not necessarily reported to the IRS today]. For the record, I don’t think I’m getting a great deal at all despite having a quite complicated return.
omarforgotpwd 8y ago
The counter argument would be that you don't want the government calculating your taxes for you.
- pgeorgi 8y ago
  In the end that's what the government will do anyway: you file a return, they double check it on their end and they will be rather nasty to you if your numbers disagree substantially from theirs. The "optional pre-filled forms" scheme forces the governments hand (to show what it has on you) before you have to show your cards. In a way that reduces the IRS' power.
  - sokoloff 8y ago
    You already have this power. Around August every year, request a “transcript” of your account. It will show you everything the IRS got for that prior tax year. (Your return is not really due until mid-October in practical terms.)
Symmetry 8y ago
The people who know and care most about the issue are the ones familiar with the tax system and who are able to game it to pay less in taxes than others. To me it looks like another case of concentrated benefits and diffuse costs, though the costs/benefits is remarkably high in this case.
nojvek 8y ago
I usually use intuit and pay them $50 for taxes, their UX is decent. How does one even file free taxes in the US? I’d love to do that. I used to do my own taxes in Australia. I tried to do some googling around to no avail.
- tschwimmer 8y ago
  This is not tax advice. You just have to fill out and mail the IRS some forms. If you have income just from regular 9-5 wages it's very simple. If you have income from Options or RSUs it's more complicated and if you're an independent contractor or business owner it's very complex. Here's an okay place to start: https://www.irs.com/articles/how-to-file-your-income-tax-return https://www.irs.com/articles/how-to-file-your-income-tax-ret...

by kerng 8y ago

justapassenger 8y ago

This so much. I’m fine with taxes (I benefited a lot from services provided by them, when I needed). But the whole process is made complex for no good reason. I want to show to government all my money, have them tell me what I owe, and if I don’t agree, have an appeal process.

hueving 8y ago
The problem usually isn't the knowing how much you made bit. It's the knowing how much you can deduct because that's all based on expenses.
- SparklingCotton 8y ago
  In a simple tax system there aren't that many deductions. This is especially true for low-tax jurisdictions. If you want non-standard deductions, create a company and do normal accounting. 50-100 standard deductions can be handled centrally by the IRS with no issues. It's been done in other countries for decades.
  - sokoloff 8y ago
    The IRS does not get a feed with the details of our charitable giving. They also don’t get a feed of various ad valorem taxes I pay. Those are common, non-business cases where the IRS doesn’t have enough info to properly prepare a return. Small business returns (even simple Schedule C “hobby businesses”) definitely can’t be done correctly in an automated fashion.
    - justapassenger 8y ago
      With current tax code it's not possible. But that's the thing - tax code needs to be updated. It works now because of weird combination of stockholm syndrome and giving people a feeling of getting a deal. Tax code is messy and complex, with tons of loop holes. And those loop holes mean most of the people pay much less anyway, but they get to feel good that they're getting a great deal. It's brilliant from psychology point of view.
      - sokoloff 8y ago
        Well, I can’t see any feasible way to automate Schedule C and preserve a tax system that taxes income/profit (rather than revenue). I’m not sure which part of my reply you think is amenable to tax code changes (and I don’t want to erect a strawman). If it’s just ad valorem taxes, you might be able to compel every jurisdiction seeking to impose one to provide a data feed to the feds. I’m not sure I think that’s Constitutional. You could also block the deductibility of charitable giving and property taxes (and likely hurt charities who are currently struggling; the Gates Foundation will be fine; the local soup kitchen may suffer.) That still leaves Schedule C as unsolvable, Schedule D as only partially (though increasingly) solvable, and Schedule E as likely unsolvable [having many of the same complexities as Schedule C and then some additional ones around basis, depreciation, and some real estate specific taxes/expenses that are not necessarily reported to the IRS today]. For the record, I don’t think I’m getting a great deal at all despite having a quite complicated return.

omarforgotpwd 8y ago

The counter argument would be that you don't want the government calculating your taxes for you.

pgeorgi 8y ago
In the end that's what the government will do anyway: you file a return, they double check it on their end and they will be rather nasty to you if your numbers disagree substantially from theirs. The "optional pre-filled forms" scheme forces the governments hand (to show what it has on you) before you have to show your cards. In a way that reduces the IRS' power.
- sokoloff 8y ago
  You already have this power. Around August every year, request a “transcript” of your account. It will show you everything the IRS got for that prior tax year. (Your return is not really due until mid-October in practical terms.)

Symmetry 8y ago

The people who know and care most about the issue are the ones familiar with the tax system and who are able to game it to pay less in taxes than others. To me it looks like another case of concentrated benefits and diffuse costs, though the costs/benefits is remarkably high in this case.

nojvek 8y ago

I usually use intuit and pay them $50 for taxes, their UX is decent. How does one even file free taxes in the US? I’d love to do that. I used to do my own taxes in Australia. I tried to do some googling around to no avail.

tschwimmer 8y ago
This is not tax advice. You just have to fill out and mail the IRS some forms. If you have income just from regular 9-5 wages it's very simple. If you have income from Options or RSUs it's more complicated and if you're an independent contractor or business owner it's very complex. Here's an okay place to start: https://www.irs.com/articles/how-to-file-your-income-tax-return https://www.irs.com/articles/how-to-file-your-income-tax-ret...