7 ms·

FWIW, Turbotax/H&R's hiding of their Free File site pages was discussed here about a week ago: https://news.ycombinator.com/item?id=19758126 https://news.ycombi

by danso 8y ago

FWIW, Turbotax/H&R's hiding of their Free File site pages was discussed here about a week ago: https://news.ycombinator.com/item?id=19758126 https://news.ycombinator.com/item?id=19758126 They have since made their pages discoverable by search engines and have denied that it was intentional obfuscation. But the news in TFA is that apparently someone at (or formerly at) H&R leaked internal documents with explicit guidance: > “Do not send clients to this Web Site unless they are specifically calling about the Free File program,” the guidance states, referring to the site with the company’s free option. “We want to send users to our paid products before the free product, if at all possible.” (there's also interviews with former employees recalling meetings) This is all "news" because Congress is considering a bipartisan tax reform bill that includes a law that would block the IRS from creating its own official Free File program. Senator Ron Wyden, the bill's co-sponsor, is now having second thoughts [0] and yesterday, NY Gov. Cuomo ordered a state investigation into the tax prep companies [1]. [0] https://www.huffpost.com/entry/taxpayer-first-act-free-file_n_5cc9fb90e4b0d123954db6f4 https://www.huffpost.com/entry/taxpayer-first-act-free-file_... [1] https://www.governor.ny.gov/news/governor-cuomo-calls-department-financial-services-and-department-taxation-and-finance https://www.governor.ny.gov/news/governor-cuomo-calls-depart... edit: changed "permanently block" to "block"

lern_too_spel 8y ago
There is nothing in the law that would permanently prohibit the IRS from creating its own Free File program. Your first article even suggests that one modification would be to simply add that a sentence saying that the IRS is allowed to do that, and the change is that simple because that sentence would not contradict anything else in the bill, as Wyden initially explained. The concern is that putting the Free File program into law would somehow make it less likely that the IRS would create its own program.
- danso 8y ago
  Yes you're right, I meant to write "block" and remove "permanently", because Sen. Wyden said he was told that the law would allow the IRS to make a proposal: https://www.vox.com/2019/4/9/18301943/last-minute-tax-preparation-h-r-block-turbotax https://www.vox.com/2019/4/9/18301943/last-minute-tax-prepar... > (UPDATE: After this post was published, Senate finance ranking member Ron Wyden’s office pushed back on Elliott’s report, saying they’d received confirmation from the IRS chief tax counsel that the bill as written does not bar the IRS from designing their own direct filing product, if they give 12 months’ notice. It’s likely the tax prep industry would challenge the IRS if it tried to do that.) According to Bloomberg, rewriting the law might require sending it back to the House for a new vote: https://news.bloombergtax.com/daily-tax-report/senate-may-not-ease-qualms-over-irs-free-file-grassley https://news.bloombergtax.com/daily-tax-report/senate-may-no...
asdff 8y ago
Is there even a reason we have to file? My understanding is that if you don't file, the IRS knows about your W2 or 1099s anyway and will punish you, so what's even the point of filing yourself? Just have the IRS send a check or bill in the mail in April and end this nonsense industry.
- brianpayne2 8y ago
  This is how many of the countries around the world treat it. You can thank the folks that lobby the government on behalf of tax prep companies for this convoluted mess we have. The more confused we are, the more money they make.
  - Twirrim 8y ago
    It's more complicated than that. There are very influential anti-tax and small government think tanks that vehemently argue against it, from the perspective that it reduces oversight. Their position is that people just won't pay much attention to how much taxes they're paying if they don't have to fill in tax paperwork themselves each year. Their position is that if you make it invisible to end users, governments will just keep creeping up that tax percentage on end users and people will just accept it. They're not wrong as regards to visibility, in the UK where tax is PAYE (Pay As You Earn), I don't think I ever paid more than a moments glance at the P60 (but I'd often check month to month that things were in the ballpark I'd expect. I'm a little more unusual in that regard probably). In the US I've had to pay close attention.
    - antidesitter 8y ago
      This argument never made sense to me. How is the amount on a check or bill, if made clearly visible, somehow “not visible”?
      - vonmoltke 8y ago
        Their actual goal is to make people resent taxes by forcing them to calculate themselves just how much money they are giving the government. It's less painful if you get something akin to a credit card statement from the IRS.
mehrdadn 8y ago
Does anybody know why in the world Wyden was behind this? I thought he had a pretty good grasp of things until now.
- danso 8y ago
  The bill encompasses many things besides this provision. But Wyden did write a letter on April 14 to the NYT in response to an editorial criticizing the tax-prep provision: https://www.nytimes.com/2019/04/14/opinion/letters/taxes-congress-internal-revenue-service.html https://www.nytimes.com/2019/04/14/opinion/letters/taxes-con...
GordonS 8y ago
As a Brit, I know little about the US tax system - does every citizen need to file a tax return? In the UK, income tax is handled between employers and the government, so the vast majority of people don't need to file one.
- spc476 8y ago
  Yes [1]. And prior to WWII, there was no withholding and everyone had to file quarterly. During WWII, withholding was introduced so the employer is now responsible for filing quarterly tax estimates, although if you are self-employed, you need to do that anyway (as you are your own employer). [1] Unless you made below a certain threshold (which is quite low), but you are still encouraged to file anyway.
HenryBemis 8y ago
> The H&R Block spokeswoman said the company’s Free File offering grew 8.3% this year.. I wonder what was the growth of the paid products. Gut feeling tells me that it was far more than 8.3%. I have said before (and it didn't do good to my karma but this is more important). I feel that USA Democracy (not the political party) has been corrupted and injured by Lobbying. "Corporate America" rules and the people are there just to get their blood sucked. Healthcare is ran by insurance companies with insane pricing. Talking to the state should be free. Submitting your taxes should be free. I am using (in the UK) a software, but it is my choice to use it. I could be using Excel files and have my accountant submitting printed papers. My choice. It is called freedom. Those companies are playing the people for fools. They will keep pushing so that the vast majority of the people will need to pay to pay taxes. It doesn't make sense :)
- eric_cc 8y ago
  I agree with the fact that lobbying is a big problem. I think just about everybody agrees with that. However, the rest of your points aren’t so great. The tax services are quite convenient and useful paid services. Submitting free taxes in the USA is obviously an option. And to your point on health care: health insurance companies are not the only bad actors in the health care system.
  - zmarty 8y ago
    Not convenient or useful at all. You know what would be actually convenient and useful? The government pre-filling most of your taxes for you, like in other countries.
    - ulfw 8y ago
      No kidding. Especially if said government and audit and hence sue you when you made a mistake where your calculated numbers don’t match up with the government’s calculated numbers. Insane, if you think about it!
    - eric_cc 8y ago
      I agree. My comment was relative to the situation in which we live in.
4ntonius8lock 8y ago
The disregard for facts by power groups is amazing. And the fact that it works... is even more amazing. It's like 1984. I mean, it's not even a bad fact. There's no reason to hide the fact that they push people to the paid product. That is what is expected of businesses. I mean, why lie about it? For me it's more insulting to get lied to like this. It's so weird. But then I see what happens all around me and I remember it works for the majority, or it wouldn't happen. This isn't directed at political parties, it is about how power is handled by those who wield it, and how those who receive its influence act. You'll see the same dynamics in any large powerful entity and it's admirers: political parties, companies, religious institutions, even NGOs... talk to their fervent supporters and the conversation becomes super polarized where obvious facts are denied, obscured, minimized, or in general disregarded in favor of a vision. Even things that come up on mainstream news outlets will be dubbed 'conspiracy'. Even saying something completely true and factual which someone won't disagree with, if it casts a negative light on powerful institutions they admire, a major percentage of the population will attack you verbally and put out every answer as if it was a personal attack. I guess most people lack self identity outside of their affiliations? I don't know that part. But I believe the reaction of the admirers pushes companies and other powerful entities to act in a way that disregards facts. They are speaking to the admirers. They are engaging in persuasion.

by danso 8y ago

lern_too_spel 8y ago

There is nothing in the law that would permanently prohibit the IRS from creating its own Free File program. Your first article even suggests that one modification would be to simply add that a sentence saying that the IRS is allowed to do that, and the change is that simple because that sentence would not contradict anything else in the bill, as Wyden initially explained. The concern is that putting the Free File program into law would somehow make it less likely that the IRS would create its own program.

danso 8y ago
Yes you're right, I meant to write "block" and remove "permanently", because Sen. Wyden said he was told that the law would allow the IRS to make a proposal: https://www.vox.com/2019/4/9/18301943/last-minute-tax-preparation-h-r-block-turbotax https://www.vox.com/2019/4/9/18301943/last-minute-tax-prepar... > (UPDATE: After this post was published, Senate finance ranking member Ron Wyden’s office pushed back on Elliott’s report, saying they’d received confirmation from the IRS chief tax counsel that the bill as written does not bar the IRS from designing their own direct filing product, if they give 12 months’ notice. It’s likely the tax prep industry would challenge the IRS if it tried to do that.) According to Bloomberg, rewriting the law might require sending it back to the House for a new vote: https://news.bloombergtax.com/daily-tax-report/senate-may-not-ease-qualms-over-irs-free-file-grassley https://news.bloombergtax.com/daily-tax-report/senate-may-no...

asdff 8y ago

Is there even a reason we have to file? My understanding is that if you don't file, the IRS knows about your W2 or 1099s anyway and will punish you, so what's even the point of filing yourself? Just have the IRS send a check or bill in the mail in April and end this nonsense industry.

brianpayne2 8y ago
This is how many of the countries around the world treat it. You can thank the folks that lobby the government on behalf of tax prep companies for this convoluted mess we have. The more confused we are, the more money they make.
- Twirrim 8y ago
  It's more complicated than that. There are very influential anti-tax and small government think tanks that vehemently argue against it, from the perspective that it reduces oversight. Their position is that people just won't pay much attention to how much taxes they're paying if they don't have to fill in tax paperwork themselves each year. Their position is that if you make it invisible to end users, governments will just keep creeping up that tax percentage on end users and people will just accept it. They're not wrong as regards to visibility, in the UK where tax is PAYE (Pay As You Earn), I don't think I ever paid more than a moments glance at the P60 (but I'd often check month to month that things were in the ballpark I'd expect. I'm a little more unusual in that regard probably). In the US I've had to pay close attention.
  - antidesitter 8y ago
    This argument never made sense to me. How is the amount on a check or bill, if made clearly visible, somehow “not visible”?
    - vonmoltke 8y ago
      Their actual goal is to make people resent taxes by forcing them to calculate themselves just how much money they are giving the government. It's less painful if you get something akin to a credit card statement from the IRS.

mehrdadn 8y ago

Does anybody know why in the world Wyden was behind this? I thought he had a pretty good grasp of things until now.

danso 8y ago
The bill encompasses many things besides this provision. But Wyden did write a letter on April 14 to the NYT in response to an editorial criticizing the tax-prep provision: https://www.nytimes.com/2019/04/14/opinion/letters/taxes-congress-internal-revenue-service.html https://www.nytimes.com/2019/04/14/opinion/letters/taxes-con...

GordonS 8y ago

As a Brit, I know little about the US tax system - does every citizen need to file a tax return? In the UK, income tax is handled between employers and the government, so the vast majority of people don't need to file one.

spc476 8y ago
Yes [1]. And prior to WWII, there was no withholding and everyone had to file quarterly. During WWII, withholding was introduced so the employer is now responsible for filing quarterly tax estimates, although if you are self-employed, you need to do that anyway (as you are your own employer). [1] Unless you made below a certain threshold (which is quite low), but you are still encouraged to file anyway.

HenryBemis 8y ago

> The H&R Block spokeswoman said the company’s Free File offering grew 8.3% this year.. I wonder what was the growth of the paid products. Gut feeling tells me that it was far more than 8.3%. I have said before (and it didn't do good to my karma but this is more important). I feel that USA Democracy (not the political party) has been corrupted and injured by Lobbying. "Corporate America" rules and the people are there just to get their blood sucked. Healthcare is ran by insurance companies with insane pricing. Talking to the state should be free. Submitting your taxes should be free. I am using (in the UK) a software, but it is my choice to use it. I could be using Excel files and have my accountant submitting printed papers. My choice. It is called freedom. Those companies are playing the people for fools. They will keep pushing so that the vast majority of the people will need to pay to pay taxes. It doesn't make sense :)

eric_cc 8y ago
I agree with the fact that lobbying is a big problem. I think just about everybody agrees with that. However, the rest of your points aren’t so great. The tax services are quite convenient and useful paid services. Submitting free taxes in the USA is obviously an option. And to your point on health care: health insurance companies are not the only bad actors in the health care system.
- zmarty 8y ago
  Not convenient or useful at all. You know what would be actually convenient and useful? The government pre-filling most of your taxes for you, like in other countries.
  - ulfw 8y ago
    No kidding. Especially if said government and audit and hence sue you when you made a mistake where your calculated numbers don’t match up with the government’s calculated numbers. Insane, if you think about it!
  - eric_cc 8y ago
    I agree. My comment was relative to the situation in which we live in.

4ntonius8lock 8y ago

The disregard for facts by power groups is amazing. And the fact that it works... is even more amazing. It's like 1984. I mean, it's not even a bad fact. There's no reason to hide the fact that they push people to the paid product. That is what is expected of businesses. I mean, why lie about it? For me it's more insulting to get lied to like this. It's so weird. But then I see what happens all around me and I remember it works for the majority, or it wouldn't happen. This isn't directed at political parties, it is about how power is handled by those who wield it, and how those who receive its influence act. You'll see the same dynamics in any large powerful entity and it's admirers: political parties, companies, religious institutions, even NGOs... talk to their fervent supporters and the conversation becomes super polarized where obvious facts are denied, obscured, minimized, or in general disregarded in favor of a vision. Even things that come up on mainstream news outlets will be dubbed 'conspiracy'. Even saying something completely true and factual which someone won't disagree with, if it casts a negative light on powerful institutions they admire, a major percentage of the population will attack you verbally and put out every answer as if it was a personal attack. I guess most people lack self identity outside of their affiliations? I don't know that part. But I believe the reaction of the admirers pushes companies and other powerful entities to act in a way that disregards facts. They are speaking to the admirers. They are engaging in persuasion.