5 ms·
>The question I have is whether a government provided automatic filing would actually be cheaper (or more effective) than say, Turbotax. The question is valid,
by gambler 8y ago
>The question I have is whether a government provided automatic filing would actually be cheaper (or more effective) than say, Turbotax.
The question is valid, but the numbers do not add up. TT asks ~$50 for federal return. If everyone in US used the service, the cost would amount to over 16 billion dollars. That is more than the entire IRS budget[1] right now.
[1] https://www.irs.gov/statistics/irs-budget-and-workforce https://www.irs.gov/statistics/irs-budget-and-workforce
- ascagnel_ 8y agoOn the other hand, the IRS generally already does many of these calculations, since they receive many forms of income directly (W-2s from your employer, 1099-INT from your bank, etc). The better question is how much it costs TT to operate returns, and how much of that $50 is profit-taking.
- vonmoltke 8y agoEvery single living person does not file a tax return. You can't just multiply the cost of preparing a return by the population.
- gambler 8y agoIt's an order-of-magnitude estimation. Turbo Tax offers multiple products with different prices. Even if you plug in more exact numbers and use the cheapest product you get a hefty sum of 9 billion (150M individual returns * $60). IRS total budget is 11.5 billion and they do way more than just process returns. There is no way an e-File system run by IRS would costs additional 9 billion dollars per year. They already do most of the calculation internally.