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TurboTax’s 20-Year Fight to Stop Americans from Filing Taxes for Free

1519 points by danso 7y ago

vonmoltke 7y ago
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.
- lidHanteyk 7y ago
  Who else lobbies like Intuit? Who else spends millions of dollars on defeating measures intended to make paying taxes simpler and easier?
  - flyosity 7y ago
    > Who else lobbies like Intuit? Google 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-2018-google-facebook-amazon/ https://www.engadget.com/2019/01/23/tech-companies-lobbying-...
    - Mtinie 7y ago
      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.
    - josefresco 7y ago
      Numbers quoted in comment and link are total spent on lobbying, not on preventing easy tax filing.
  - cannonedhamster 7y ago
    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. https://www.politico.com/agenda/story/2018/07/18/tax-filing-congress-irs-000683 https://www.politico.com/agenda/story/2018/07/18/tax-filing-... https://www.businessinsider.com/house-bans-free-government-tax-preparation-software-turbotax-hr-block-2019-4 https://www.businessinsider.com/house-bans-free-government-t... https://www.npr.org/sections/money/2017/03/22/521132960/episode-760-tax-hero https://www.npr.org/sections/money/2017/03/22/521132960/epis...
    - lidHanteyk 7y ago
      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? [0] https://www.opensecrets.org/lobby/clientlbs.php?id=D000047095&year=2019 https://www.opensecrets.org/lobby/clientlbs.php?id=D00004709... [1] https://www.opensecrets.org/lobby/clientbills.php?id=D000026667&year=2019 https://www.opensecrets.org/lobby/clientbills.php?id=D000026...
  - vonmoltke 7y ago
    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.
- Ensorceled 7y ago
  In this article on how Intuit is working to prevent free filing, ProPublica focuses on Intuit? Why is this surprising? ProPublica seems really broad in the topics they cover: https://www.propublica.org/topics/ 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.
  - vonmoltke 7y ago
    > 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.
    - Ensorceled 7y ago
      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.
      - vonmoltke 7y ago
        > This is "whataboutism" at it's finest. 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.
- Aloha 7y ago
  No one else really has the same lobbying might as intuit. Even HR Block is smaller (and targets a different market)
  - mac01021 7y ago
    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.
    - Aloha 7y ago
      I'd argue that the corporate income tax being complex and the individual income tax being complex have little to do with each other
- danso 7y ago
  They've done various stories on the IRS and tax policy: https://www.propublica.org/article/irs-political-dark-money-groups-501c4-tax-regulation https://www.propublica.org/article/irs-political-dark-money-... https://www.propublica.org/article/irs-now-audits-poor-americans-at-about-the-same-rate-as-the-top-1-percent https://www.propublica.org/article/irs-now-audits-poor-ameri... https://projects.propublica.org/nonprofits/ 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.
- justin66 7y ago
  > 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. ProPublica is trusting the reader to understand that responsibility for the current state of US tax laws lies with the US government.
  - vonmoltke 7y ago
    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.
    - Ensorceled 7y ago
      Are you saying that Intuit isn't lobbying to keep the current tax code, and tax filing, complex? Do you have information that refutes this article?
      - vonmoltke 7y ago
        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.
- juped 7y ago
  This topic hits people in the wallet and makes them stupid as a result - I think they're being sincere, not malicious.
  - vonmoltke 7y ago
    I didn't say they were being malicious, just myopic.
- danmg 7y ago
  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.
  - vonmoltke 7y ago
    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.
    - danmg 7y ago
      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.
- rolltiide 7y ago
  Turbotax is my cheapest option to doing taxes. 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.
  - bluGill 7y ago
    There are other tax programs that are generally cheaper than turbotax.
    - rolltiide 7y ago
      yes, at this point I just don't want additional organizations having my data credit karma having more comprehensive financial data on me? no thanks! just stick with the credit line approvals from self-reported income
  - tathougies 7y ago
    Easiest way to do taxes is to do them by hand. There are copious amounts of guides from the irs explaining in detail how to fill in each box.
    - rolltiide 7y ago
      yes, for me the interrelated nature of some of the calculations on different forms is what I prefer a computer to do. 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.
u801e 7y ago
Free fillable forms[1] has been around for a number of years and van be used by anyone regardless of income level. [1] https://en.m.wikipedia.org/wiki/Free_File#Free_File_Fillable_Forms https://en.m.wikipedia.org/wiki/Free_File#Free_File_Fillable...
- grepthisab 7y ago
  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.
  - HeWhoLurksLate 7y ago
    This, a thousand times over.
  - Frost1x 7y ago
    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.
  - stagger87 7y ago
    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.
- justin66 7y ago
  It does not have the dialogs to walk you through the weird parts of filing a tax return. It's not really comparable to something like TurboTax.
flyosity 7y ago
The crux of this article is a PowerPoint slide from 12 years ago? Really?
- hudibras 7y ago
  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.
- ejstronge 7y ago
  > The crux of this article is a PowerPoint slide from 12 years ago? Really? 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.
gjvnq 7y ago
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.
- lqet 7y ago
  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. [0] https://www.elster.de/eportal/login https://www.elster.de/eportal/login
  - Anarch157a 7y ago
    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".
    - marcosdumay 7y ago
      It's because of an old popular joke in that the government is a lion that will always take a lion-sized bite from your income. 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.
ttn 7y ago
Can someone from US explain how come there is still no open source alternative to TurboTax?
- cjoelrun 7y ago
  Probably because accountants aren't silly enough to work for free.
- robbiemitchell 7y ago
  It takes work to keep up with changes to the tax laws in every state and at the federal level. I don’t know many open source accountants.
- danso 7y ago
  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 https://www.irs.gov/filing/e-file-options
- jrockway 7y ago
  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.
- throwaway_law 7y ago
  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.
HeWhoLurksLate 7y ago
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.
- mywittyname 7y ago
  > 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.
  - _jal 7y ago
    This. It is a special combination of sadistic and stupid, an American classic.
    - cloverich 7y ago
      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.
      - nameless912 7y ago
        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.
    - logfromblammo 7y ago
      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.
twoodfin 7y ago
This seems to make the hn front page every 60 days or so. Is there anything new here?
- elygre 7y ago
  No, it's just still amusing to the rest of the world. We're like "This is 2019, not 1920".
perseusprime11 7y ago
We are living in a conflicted world full of quid pro quos powered by lobbying congress.
candyman 7y ago
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.
- cat199 7y ago
  Your statement: > ... 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.
- Accujack 7y ago
  >Elizabeth Warren to get in office and stop some of this anti-competitive behavior. 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)
  - untog 7y ago
    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.
candyman 7y ago
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.
MarketingJason 7y ago
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.
isostatic 7y ago
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.
rb808 7y ago
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.
Triiglav 7y ago
Just use credit karma.
js2 7y ago
I recently learned about this volunteer maintained spreadsheet for helping with your 1040. https://sites.google.com/site/excel1040/ https://sites.google.com/site/excel1040/
- snackematician 7y ago
  I've been using this for last couple years and it's a great piece of "software", I prefer it over TurboTax. 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.
aunty_helen 7y ago
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.
fedups 7y ago
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 https://gimletmedia.com/shows/reply-all/6nhgol
- ISL 7y ago
  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.
  - chrismeller 7y ago
    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.
    - sergiosgc 7y ago
      > 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.
KoftaBob 7y ago
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.
muterad_murilax 7y ago
Anyone else read that as TurboGrafx?
tombert 7y ago
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?
- pwinnski 7y ago
  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. But please, stop using TurboTax to do so!
- 0xffff2 7y ago
  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.
  - Chris_Chambers 7y ago
    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.
  - pm215 7y ago
    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.
mattferderer 7y ago
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.
- gwd 7y ago
  > Intuit's main argument has always been that if the government provided such a service many people would overpay their taxes. If that's true, then most people would use Intuit anyway, once they realized how much they'd save.
- anticensor 7y ago
  > if the government provided such a service many people would overpay their taxes. This is tax payer's problem, not tax office's.
r0m4n0 7y ago
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?
- nojvek 7y ago
  There’s a ton of this little silly companies delegated by government. It’s akin to lobbying in a way. They depend on inefficiencies. Best argument I’ve heard is “gotta keep people employed somehow, can’t be too efficient”
- 0xffff2 7y ago
  Maybe I'm missing something obvious, but why can't you just call up the newspapers directly and list whatever it is that the law requires?
  - CDRdude 7y ago
    The newspapers will charge you to run the ad. They have no reason to print that info for free.
    - 0xffff2 7y ago
      Of course, but surely that aren't going to charge you anywhere near $1000.
djsumdog 7y ago
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.
- GordonS 7y ago
  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.
black6 7y ago
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%. 0: http://www.cosmicweenie.com/wealth_tax.pdf http://www.cosmicweenie.com/wealth_tax.pdf (don't let the domain name fool you...)
MR4D 7y ago
Ok, I have a really dumb question... 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-for-free 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.
- xivzgrev 7y ago
  You CAN, if... 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?”.
  - vonmoltke 7y ago
    Free fillable forms are available to everyone, and referenced repeatedly in the Form 1040 instructions.
    - thrwn_frthr_awy 7y ago
      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..
      - vonmoltke 7y ago
        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.. Where did I contradict this?
mars4rp 7y ago
I am the developer in charge of CalFile, the free filing software that everyone asks for here for state of California. https://www.ftb.ca.gov/file/ways-to-file/online/calfile/index.asp https://www.ftb.ca.gov/file/ways-to-file/online/calfile/inde... I am pushing so hard to make it better and more useful to more people, like being able to add capital gain that is not currently supported. these are the push backs that I am getting: 1. Last time they tried to do what all of you ask, a ready return. TurboTax and others hired bunch of lobbyist and put so much pressure on people here and killed the project. People are still afraid and don't want to do too much to grab the attention of their lobbyist! 2. Use of CalFile goes down every year and if trend continues, it would be killed in the near future. when you have your Federal return it is much easier to pay a little more and file your state tax with it too. No body even knows CalFile exist because we don't have a marketing budget to promote it. 3. Even people here buy the argument that free software exist and people could file their taxes for free.
- imagiko 7y ago
  I thought calfile was the go-to place for cal state taxes? I use it every year and I think it's a fairly nice tool
- xivzgrev 7y ago
  Dude I salute you. There are so many edge cases to support. For number 2 can you import fed return with calfile? IRS free returns going down too so you are not alone: https://taxpayeradvocate.irs.gov/Free_File_Program_Is_Failing_to_Achieve_Objectives https://taxpayeradvocate.irs.gov/Free_File_Program_Is_Failin... This is a large reason why Prorepublica keeps digging at this - it’s fucking crazy actual free filing is going down while these paid shenanigan products are holding strong with their ginormous marketing budgets.
  - rubicon33 7y ago
    Is it really as simple as that? Budget trumps all? With all due respect to the OP, most state run software operations are complete, utter, garbage. I'd happily pay money to avoid some of the clunky, poor UI/UX, and downright broken web tools that the state of California produces. TurboTax on the other hand, is a relatively nice experience.
xivzgrev 7y ago
Credit karma tax is (actually) free. I’ve used for past 3 years. Why is it free? Because credit karma uses your financial data (including tax returns) to make better credit card / loan recommendations to you. So it ultimately benefits me as well, that’s why I share my return with them. BUT you don’t have to share your tax return with CK to file. There’s a box you can uncheck when starting each year.
- dentemple 7y ago
  I gave Credit Karma a shot last year, and it worked out pretty great. It's definitely a good alternative to Turbo Tax
vgetr 7y ago
Ultimately the problem is that the tax code is altogether too complex. I filed by hand up until a couple of years ago when I had to start accounting for things like capital gains and dividends from stock sales, and at that point it became too difficult and I started paying for TurboTax. At the end of the day they solve a problem that is entirely manufactured by government. The main area where the system seems to be gamed from a software standpoint is that the federal government provides software if your income is below a certain threshold. More than that and you’re on your own. _That_ has lobbying written all over it.
- alexmingoia 7y ago
  A flat income tax as the sole tax would eliminate tax filing complexity. It would also eliminate the inequality in the tax code (sales tax is a larger income tax on lower incomes, tax credits disproportionally benefit people in lower cost of living areas, etc.). A flat income tax is equal in that everyone pays the same rate, and fair in that the more money a person earns the more they pay.
sb057 7y ago
Is it that time of the week again? https://www.propublica.org/article/turbotax-just-tricked-you-into-paying-to-file-your-taxes https://www.propublica.org/article/turbotax-just-tricked-you... https://www.propublica.org/article/turbotax-military-discount-trick-troops-paying-to-file-taxes https://www.propublica.org/article/turbotax-military-discoun... https://www.propublica.org/article/irs-funded-review-confirms-turbotax-hid-free-filing-from-search-engines-but-says-theres-no-need-for-major-changes https://www.propublica.org/article/irs-funded-review-confirm... https://www.propublica.org/article/turbotax-deliberately-hides-its-free-file-page-from-search-engines https://www.propublica.org/article/turbotax-deliberately-hid... https://www.propublica.org/article/intuit-turbotax-h-r-block-gutted-free-tax-filing-internal-memo https://www.propublica.org/article/intuit-turbotax-h-r-block... https://www.propublica.org/article/congress-is-about-to-ban-the-government-from-offering-free-online-tax-filing-thank-turbotax https://www.propublica.org/article/congress-is-about-to-ban-... https://www.propublica.org/article/listen-to-turbotax-lie-to-get-out-of-refunding-overcharged-customers https://www.propublica.org/article/listen-to-turbotax-lie-to... https://www.propublica.org/article/trump-tax-law-threatened-turbotax-profits-started-charging-disabled-unemployed-and-students https://www.propublica.org/article/trump-tax-law-threatened-... https://www.propublica.org/article/congress-scraps-provision-to-restrict-irs-from-competing-with-turbotax https://www.propublica.org/article/congress-scraps-provision... https://www.propublica.org/article/how-to-get-turbotax-refund https://www.propublica.org/article/how-to-get-turbotax-refun... https://www.propublica.org/article/intuit-ceo-in-internal-video-hiding-free-turbotax-was-in-best-interest-of-taxpayers https://www.propublica.org/article/intuit-ceo-in-internal-vi... https://www.propublica.org/article/here-are-your-stories-of-being-tricked-into-paying-by-turbotax-you-often-need-the-money https://www.propublica.org/article/here-are-your-stories-of-... https://www.propublica.org/article/turbotax-maker-intuit-h-r-block-new-york-regulator-launches-investigation https://www.propublica.org/article/turbotax-maker-intuit-h-r... https://www.propublica.org/article/elizabeth-warren-and-other-senators-call-for-refunds-and-investigations-of-turbotax-and-h-r-block https://www.propublica.org/article/elizabeth-warren-and-othe... https://www.propublica.org/article/senior-irs-leaders-launch-review-of-partnership-with-turbotax-and-h-r-block https://www.propublica.org/article/senior-irs-leaders-launch... https://www.propublica.org/article/bill-to-limit-irs-ability-to-offer-free-tax-filing-service-is-getting-new-scrutiny https://www.propublica.org/article/bill-to-limit-irs-ability... And that's just ones from this year. I'm not saying TurboTax isn't a scummy company, but this is just getting ridiculous.
ycombonator 7y ago
How about a change.org petition and starting a github project to counter the lobbying.
turk73 7y ago
Sigh. I use TurboTax because I had an accountant who retired and sold his bussiness to some Class A assholes who managed to fuck up what should have been a fairly simple return for them given I explained everything in detail if they had bothered to read it. I had to fire them over it, leaving me with no return for 2017 about a week before April 15. It was extremely stressful because it involves a lot of stock cost basis issues related to some inherited equities and capital gains, etc. I could have filed an extension, but I was able to figure it all out using TT and get my taxes done correctly. The assholes would have had me paying $15K incorrectly! Shitheads! So even accounting firms are not at all reliable. If someone came along and made a free (e.g. open source) version that was halfway decent, I would use it. I could do the paper forms, it's not really that difficult, just time consuming. Time is money. TT charged me like $100 for the whole dealie. I don't want TT standing in the way of needed reform. I think our tax code is patently ridiculous and only computers have allowed it to be that way and lobbyists keep it that way. Forget the "wealth tax"--that is bullshit, too. Inflation will bring you dead center into whatever tax scheme is cooked up which is already why we're in the mess we're in.
sgustard 7y ago
Google "free tax filing" and these organizations all promise free tax filing on the first page: IRS, eFile, FreeTaxUSA, TurboTax, H&R Block, TaxAct, and others. Intuit's not the top organic or paid slot. Are all of these equally misleading or is Intuit just called out for being the market leader?
dghughes 7y ago
In Canada the CRA has a list of free tax software listed on its website. For the last two years I literally filed my tax return with two mouse clicks. Click 1 Autofill Click 2 Efile. At some point I expect the government to just send a notice "your taxes have been filed. If you have concerns contact us". I could have been doing it for ten years but I was stuck in the past of only using electronic tax software. And I still made a paper copy for myself.
nan0 7y ago
Who is going to build this "free" tax filing system? I hope not the IRS [0] 0: https://spectrum.ieee.org/riskfactor/computing/it/irs-predicted-tax-filing-failure https://spectrum.ieee.org/riskfactor/computing/it/irs-predic...
- n-exploit 7y ago
  "On 17 April 2018, the final day for U.S. citizens to file 2017 tax returns, the U.S. Internal Revenue Service (IRS) suffered a major system failure related to the hardware supporting its 58-year old, 20-million-line Cobol-based Individual Master File system [PDF], which is still being used today to process the vast majority of individual tax returns. As a result of the failure, the IRS extended by a day the filing due date." Maybe that's because a decades-old system hit capacity, and has nothing to do with the system design?
  - nan0 7y ago
    "While it’s true that the IRS has experienced budget reductions over the past several years, those cuts hardly explain a failure of an 18-month-old piece of computer hardware. More important, those claims conveniently ignore that the IRS has spent untold billions since the late 1960s on numerous attempts to modernize its IT systems, all centered on trying to replace the ancient IMF system, with minimum success." I assume you didn't read the whole source
- ratata 7y ago
  There is a branch of government in charge of large software projects: https://www.usds.gov https://www.usds.gov
  - nan0 7y ago
    This looks very promising! I read more into this agency and it looks like they are looking to put a price tag on some of their services [0] From the article: "The hope is that by putting a price tag on some of USDS services, that will encourage agencies to develop their own native digital service teams, as the Departments of Defense and Veterans Affairs have already done. That in turn will free up capacity so that more agencies can tap USDS personnel for their own needs." 0: https://fcw.com/articles/2019/06/17/weichert-usds-funding-mazmanian.aspx https://fcw.com/articles/2019/06/17/weichert-usds-funding-ma... Update: Services offered to other government branches, not to end-users.
deleted 7y ago
[deleted]
kyrra 7y ago
Not a direct counter-point to this piece, but: https://www.wsj.com/articles/irs-commissioned-report-responds-to-criticism-over-free-file-program-11570576703?mod=rsswn https://www.wsj.com/articles/irs-commissioned-report-respond... It's a high-level view of the 2 sides arguing about the Free File program.
pzs 7y ago
Yet another data point: Hungary. For most people the National Tax Bureau (NAV) prepares the filing based on the data they receive from employers, banks, etc. You can check the content on a web page, and approve, if you agree. For those who have income that must be self-reported, there is the free Java app provided by NAV. I have used the latter for several years and it has been working reasonably well for me.
MH15 7y ago
I refuse to use TurboTax for my (albeit simple) tax filings. I used FreeTaxUSA last year and it was pretty solid.
AcerbicZero 7y ago
I'm likely in the minority here, but as a product TurboTax hasn't really bothered me that much. It makes filling my taxes pretty easy, and saves most of the info year of year so I don't have to re-enter it. Compared to the thousands of dollars in taxes I've paid, the $100 or so turbo tax gets doesn't seem too bad. My issue is with all this is pretty simple - I pay too much in tax, and/or the quality of government those taxes are buying is subpar at best. I also strongly suspect leaving the government in charge of comping up with a solution to filing taxes electronically would continue the trend of disappointment. If my choice is between paying a private company a couple bucks to make my interaction with the government easier, or going back to the old paper way of doing things until the government gets its shit together.....well I'm going to stick with the former, unless I'm missing something here?
0000011111 7y ago
I am all for free filing software for the people! What TurboTax offers that a free version may not is the ability for a CPA to sign off on one's taxes. That is worth paying for in my opinion. B/C they carry the liability if I were to be audited. I think the IRS needs to simplify the filing process so that a CPA is not needed. Sadly, this issue is more complex than intuits lobbying power.
tamaharbor 7y ago
Just get a list of the politicians that have voted against filing taxes for free, and vote for their opponent in the next election.
rdiddly 7y ago
Is there not an option that has all of the advantages of electronic filing, EXCEPT actually submitting the return? i.e. you print everything out at the end and mail it? Because I mean, that would make it immune to all lobbying but still be a huge improvement over filling it out by hand.
jammygit 7y ago
“ ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up for ProPublica’s Big Story newsletter to receive stories like this one in your inbox as soon as they are published.” Is propublica good/reliable news source? Always looking for good news sources
dsalzman 7y ago
Paying taxes is so frustrating. Gov : “Please pay us the taxes I owe” Tax Payer : “Ok. How much do I owe?” Gov : “We can’t tell you that. Hire an accountant if you need help” Tax Payer : “fu*k fine. (Files hinder and makes one mistake) Gov : “You owe us money!! You didn’t pay enough. You owe us interest on what’s due as well!” Tax Payer : “I thought you didn’t know how much I owe! Just tell me!!!!” Fin
tomohawk 7y ago
Missing option: repeal the 16th amendment and get rid of the income tax. It's intrusive and complicated.
thomasfl 7y ago
In norway, filing taxes is optional. Citisens are highly encouraged too log in to a website called AltInn (wich means literally everything in) and check the data, and do adjustments. Income, bank loans and investments are usually registered correctly.
hkai 7y ago
I'm not in the US, but I'm not seeing the reason for all the anger. Yes, they are hiding the free option, similarly to how Google for example was hiding the free option for the Gsuite - you had to dig for it in the menu. Plus there are multiple alternatives. What's wrong with a company using little tricks and dark patterns to nudge more people into paying for their service?
matiszek23 7y ago
Hello
toddh 7y ago
Isn’t tax filing complicated because of the tax system? If your income is low enough it is free. Below $66000. You just have to say no to add ons. State filing can be free if you shop around. Free File: Do Your Federal Taxes for Free https://www.irs.gov/filing/free-file-do-your-federal-taxes-for-free https://www.irs.gov/filing/free-file-do-your-federal-taxes-f...
rfhjt 7y ago
I like to look at things from Buddhist point if view. Calfile "buys" you the saved 50 bucks (3 hours of work for most people?) x the number if people use it, especially if you understand the implications and your intent is clear. Of course, a practical Buddhist never "spends" the earned opportunities, but reinvests them to get even more opportunities, until the impact is measured in trillions of years. But that's philosophy. On the practical side, if I were you, I'd do two things: (1) open source this on behalf of the gov - it's important to get the "official" status; (2) advertise this over official channels: send them a green letter from ca.gov/irs that say there is such a tool. The software doesn't need to be perfect: the website that manages toll fees in my state is in stone age, yet it's official and it's better to have this site than not.

1519 points by danso 7y ago

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.

lidHanteyk 7y ago
Who else lobbies like Intuit? Who else spends millions of dollars on defeating measures intended to make paying taxes simpler and easier?
- flyosity 7y ago
  > Who else lobbies like Intuit? Google 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-2018-google-facebook-amazon/ https://www.engadget.com/2019/01/23/tech-companies-lobbying-...
  - Mtinie 7y ago
    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.
  - josefresco 7y ago
    Numbers quoted in comment and link are total spent on lobbying, not on preventing easy tax filing.
- cannonedhamster 7y ago
  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. https://www.politico.com/agenda/story/2018/07/18/tax-filing-congress-irs-000683 https://www.politico.com/agenda/story/2018/07/18/tax-filing-... https://www.businessinsider.com/house-bans-free-government-tax-preparation-software-turbotax-hr-block-2019-4 https://www.businessinsider.com/house-bans-free-government-t... https://www.npr.org/sections/money/2017/03/22/521132960/episode-760-tax-hero https://www.npr.org/sections/money/2017/03/22/521132960/epis...
  - lidHanteyk 7y ago
    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? [0] https://www.opensecrets.org/lobby/clientlbs.php?id=D000047095&year=2019 https://www.opensecrets.org/lobby/clientlbs.php?id=D00004709... [1] https://www.opensecrets.org/lobby/clientbills.php?id=D000026667&year=2019 https://www.opensecrets.org/lobby/clientbills.php?id=D000026...
- vonmoltke 7y ago
  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.
Ensorceled 7y ago
In this article on how Intuit is working to prevent free filing, ProPublica focuses on Intuit? Why is this surprising? ProPublica seems really broad in the topics they cover: https://www.propublica.org/topics/ 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.
- vonmoltke 7y ago
  > 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.
  - Ensorceled 7y ago
    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.
    - vonmoltke 7y ago
      > This is "whataboutism" at it's finest. 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.
Aloha 7y ago
No one else really has the same lobbying might as intuit. Even HR Block is smaller (and targets a different market)
- mac01021 7y ago
  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.
  - Aloha 7y ago
    I'd argue that the corporate income tax being complex and the individual income tax being complex have little to do with each other
danso 7y ago
They've done various stories on the IRS and tax policy: https://www.propublica.org/article/irs-political-dark-money-groups-501c4-tax-regulation https://www.propublica.org/article/irs-political-dark-money-... https://www.propublica.org/article/irs-now-audits-poor-americans-at-about-the-same-rate-as-the-top-1-percent https://www.propublica.org/article/irs-now-audits-poor-ameri... https://projects.propublica.org/nonprofits/ 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.
justin66 7y ago
> 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. ProPublica is trusting the reader to understand that responsibility for the current state of US tax laws lies with the US government.
- vonmoltke 7y ago
  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.
  - Ensorceled 7y ago
    Are you saying that Intuit isn't lobbying to keep the current tax code, and tax filing, complex? Do you have information that refutes this article?
    - vonmoltke 7y ago
      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.
juped 7y ago
This topic hits people in the wallet and makes them stupid as a result - I think they're being sincere, not malicious.
- vonmoltke 7y ago
  I didn't say they were being malicious, just myopic.
danmg 7y ago
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.
- vonmoltke 7y ago
  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.
  - danmg 7y ago
    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.
rolltiide 7y ago
Turbotax is my cheapest option to doing taxes. 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.
- bluGill 7y ago
  There are other tax programs that are generally cheaper than turbotax.
  - rolltiide 7y ago
    yes, at this point I just don't want additional organizations having my data credit karma having more comprehensive financial data on me? no thanks! just stick with the credit line approvals from self-reported income
- tathougies 7y ago
  Easiest way to do taxes is to do them by hand. There are copious amounts of guides from the irs explaining in detail how to fill in each box.
  - rolltiide 7y ago
    yes, for me the interrelated nature of some of the calculations on different forms is what I prefer a computer to do. 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.

u801e 7y ago

Free fillable forms[1] has been around for a number of years and van be used by anyone regardless of income level. [1] https://en.m.wikipedia.org/wiki/Free_File#Free_File_Fillable_Forms https://en.m.wikipedia.org/wiki/Free_File#Free_File_Fillable...

grepthisab 7y ago
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.
- HeWhoLurksLate 7y ago
  This, a thousand times over.
- Frost1x 7y ago
  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.
- stagger87 7y ago
  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.
justin66 7y ago
It does not have the dialogs to walk you through the weird parts of filing a tax return. It's not really comparable to something like TurboTax.

flyosity 7y ago

The crux of this article is a PowerPoint slide from 12 years ago? Really?

hudibras 7y ago
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.
ejstronge 7y ago
> The crux of this article is a PowerPoint slide from 12 years ago? Really? 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.

gjvnq 7y ago

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.

lqet 7y ago
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. [0] https://www.elster.de/eportal/login https://www.elster.de/eportal/login
- Anarch157a 7y ago
  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".
  - marcosdumay 7y ago
    It's because of an old popular joke in that the government is a lion that will always take a lion-sized bite from your income. 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.

ttn 7y ago

Can someone from US explain how come there is still no open source alternative to TurboTax?

cjoelrun 7y ago
Probably because accountants aren't silly enough to work for free.
robbiemitchell 7y ago
It takes work to keep up with changes to the tax laws in every state and at the federal level. I don’t know many open source accountants.
danso 7y ago
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 https://www.irs.gov/filing/e-file-options
jrockway 7y ago
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.
throwaway_law 7y ago
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.

HeWhoLurksLate 7y ago

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.

mywittyname 7y ago
> 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.
- _jal 7y ago
  This. It is a special combination of sadistic and stupid, an American classic.
  - cloverich 7y ago
    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.
    - nameless912 7y ago
      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.
  - logfromblammo 7y ago
    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.

twoodfin 7y ago

This seems to make the hn front page every 60 days or so. Is there anything new here?

elygre 7y ago
No, it's just still amusing to the rest of the world. We're like "This is 2019, not 1920".

perseusprime11 7y ago

We are living in a conflicted world full of quid pro quos powered by lobbying congress.

candyman 7y ago

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.

cat199 7y ago
Your statement: > ... 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.
Accujack 7y ago
>Elizabeth Warren to get in office and stop some of this anti-competitive behavior. 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)
- untog 7y ago
  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.

candyman 7y ago

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.

MarketingJason 7y ago

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.

isostatic 7y ago

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.

rb808 7y ago

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.

Triiglav 7y ago

Just use credit karma.

js2 7y ago

I recently learned about this volunteer maintained spreadsheet for helping with your 1040. https://sites.google.com/site/excel1040/ https://sites.google.com/site/excel1040/

snackematician 7y ago
I've been using this for last couple years and it's a great piece of "software", I prefer it over TurboTax. 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.

aunty_helen 7y ago

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.

fedups 7y ago

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 https://gimletmedia.com/shows/reply-all/6nhgol

ISL 7y ago
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.
- chrismeller 7y ago
  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.
  - sergiosgc 7y ago
    > 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.

KoftaBob 7y ago

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.

muterad_murilax 7y ago

Anyone else read that as TurboGrafx?

tombert 7y ago

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?

pwinnski 7y ago
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. But please, stop using TurboTax to do so!
0xffff2 7y ago
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.
- Chris_Chambers 7y ago
  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.
- pm215 7y ago
  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.

mattferderer 7y ago

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.

gwd 7y ago
> Intuit's main argument has always been that if the government provided such a service many people would overpay their taxes. If that's true, then most people would use Intuit anyway, once they realized how much they'd save.
anticensor 7y ago
> if the government provided such a service many people would overpay their taxes. This is tax payer's problem, not tax office's.

r0m4n0 7y ago

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?

nojvek 7y ago
There’s a ton of this little silly companies delegated by government. It’s akin to lobbying in a way. They depend on inefficiencies. Best argument I’ve heard is “gotta keep people employed somehow, can’t be too efficient”
0xffff2 7y ago
Maybe I'm missing something obvious, but why can't you just call up the newspapers directly and list whatever it is that the law requires?
- CDRdude 7y ago
  The newspapers will charge you to run the ad. They have no reason to print that info for free.
  - 0xffff2 7y ago
    Of course, but surely that aren't going to charge you anywhere near $1000.

djsumdog 7y ago

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.

GordonS 7y ago
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.

black6 7y ago

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%. 0: http://www.cosmicweenie.com/wealth_tax.pdf http://www.cosmicweenie.com/wealth_tax.pdf (don't let the domain name fool you...)

MR4D 7y ago

Ok, I have a really dumb question... 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-for-free 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.

xivzgrev 7y ago
You CAN, if... 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?”.
- vonmoltke 7y ago
  Free fillable forms are available to everyone, and referenced repeatedly in the Form 1040 instructions.
  - thrwn_frthr_awy 7y ago
    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..
    - vonmoltke 7y ago
      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.. Where did I contradict this?

mars4rp 7y ago

I am the developer in charge of CalFile, the free filing software that everyone asks for here for state of California. https://www.ftb.ca.gov/file/ways-to-file/online/calfile/index.asp https://www.ftb.ca.gov/file/ways-to-file/online/calfile/inde... I am pushing so hard to make it better and more useful to more people, like being able to add capital gain that is not currently supported. these are the push backs that I am getting: 1. Last time they tried to do what all of you ask, a ready return. TurboTax and others hired bunch of lobbyist and put so much pressure on people here and killed the project. People are still afraid and don't want to do too much to grab the attention of their lobbyist! 2. Use of CalFile goes down every year and if trend continues, it would be killed in the near future. when you have your Federal return it is much easier to pay a little more and file your state tax with it too. No body even knows CalFile exist because we don't have a marketing budget to promote it. 3. Even people here buy the argument that free software exist and people could file their taxes for free.

imagiko 7y ago
I thought calfile was the go-to place for cal state taxes? I use it every year and I think it's a fairly nice tool
xivzgrev 7y ago
Dude I salute you. There are so many edge cases to support. For number 2 can you import fed return with calfile? IRS free returns going down too so you are not alone: https://taxpayeradvocate.irs.gov/Free_File_Program_Is_Failing_to_Achieve_Objectives https://taxpayeradvocate.irs.gov/Free_File_Program_Is_Failin... This is a large reason why Prorepublica keeps digging at this - it’s fucking crazy actual free filing is going down while these paid shenanigan products are holding strong with their ginormous marketing budgets.
- rubicon33 7y ago
  Is it really as simple as that? Budget trumps all? With all due respect to the OP, most state run software operations are complete, utter, garbage. I'd happily pay money to avoid some of the clunky, poor UI/UX, and downright broken web tools that the state of California produces. TurboTax on the other hand, is a relatively nice experience.

xivzgrev 7y ago

Credit karma tax is (actually) free. I’ve used for past 3 years. Why is it free? Because credit karma uses your financial data (including tax returns) to make better credit card / loan recommendations to you. So it ultimately benefits me as well, that’s why I share my return with them. BUT you don’t have to share your tax return with CK to file. There’s a box you can uncheck when starting each year.

dentemple 7y ago
I gave Credit Karma a shot last year, and it worked out pretty great. It's definitely a good alternative to Turbo Tax

vgetr 7y ago

Ultimately the problem is that the tax code is altogether too complex. I filed by hand up until a couple of years ago when I had to start accounting for things like capital gains and dividends from stock sales, and at that point it became too difficult and I started paying for TurboTax. At the end of the day they solve a problem that is entirely manufactured by government. The main area where the system seems to be gamed from a software standpoint is that the federal government provides software if your income is below a certain threshold. More than that and you’re on your own. _That_ has lobbying written all over it.

alexmingoia 7y ago
A flat income tax as the sole tax would eliminate tax filing complexity. It would also eliminate the inequality in the tax code (sales tax is a larger income tax on lower incomes, tax credits disproportionally benefit people in lower cost of living areas, etc.). A flat income tax is equal in that everyone pays the same rate, and fair in that the more money a person earns the more they pay.

sb057 7y ago

Is it that time of the week again? https://www.propublica.org/article/turbotax-just-tricked-you-into-paying-to-file-your-taxes https://www.propublica.org/article/turbotax-just-tricked-you... https://www.propublica.org/article/turbotax-military-discount-trick-troops-paying-to-file-taxes https://www.propublica.org/article/turbotax-military-discoun... https://www.propublica.org/article/irs-funded-review-confirms-turbotax-hid-free-filing-from-search-engines-but-says-theres-no-need-for-major-changes https://www.propublica.org/article/irs-funded-review-confirm... https://www.propublica.org/article/turbotax-deliberately-hides-its-free-file-page-from-search-engines https://www.propublica.org/article/turbotax-deliberately-hid... https://www.propublica.org/article/intuit-turbotax-h-r-block-gutted-free-tax-filing-internal-memo https://www.propublica.org/article/intuit-turbotax-h-r-block... https://www.propublica.org/article/congress-is-about-to-ban-the-government-from-offering-free-online-tax-filing-thank-turbotax https://www.propublica.org/article/congress-is-about-to-ban-... https://www.propublica.org/article/listen-to-turbotax-lie-to-get-out-of-refunding-overcharged-customers https://www.propublica.org/article/listen-to-turbotax-lie-to... https://www.propublica.org/article/trump-tax-law-threatened-turbotax-profits-started-charging-disabled-unemployed-and-students https://www.propublica.org/article/trump-tax-law-threatened-... https://www.propublica.org/article/congress-scraps-provision-to-restrict-irs-from-competing-with-turbotax https://www.propublica.org/article/congress-scraps-provision... https://www.propublica.org/article/how-to-get-turbotax-refund https://www.propublica.org/article/how-to-get-turbotax-refun... https://www.propublica.org/article/intuit-ceo-in-internal-video-hiding-free-turbotax-was-in-best-interest-of-taxpayers https://www.propublica.org/article/intuit-ceo-in-internal-vi... https://www.propublica.org/article/here-are-your-stories-of-being-tricked-into-paying-by-turbotax-you-often-need-the-money https://www.propublica.org/article/here-are-your-stories-of-... https://www.propublica.org/article/turbotax-maker-intuit-h-r-block-new-york-regulator-launches-investigation https://www.propublica.org/article/turbotax-maker-intuit-h-r... https://www.propublica.org/article/elizabeth-warren-and-other-senators-call-for-refunds-and-investigations-of-turbotax-and-h-r-block https://www.propublica.org/article/elizabeth-warren-and-othe... https://www.propublica.org/article/senior-irs-leaders-launch-review-of-partnership-with-turbotax-and-h-r-block https://www.propublica.org/article/senior-irs-leaders-launch... https://www.propublica.org/article/bill-to-limit-irs-ability-to-offer-free-tax-filing-service-is-getting-new-scrutiny https://www.propublica.org/article/bill-to-limit-irs-ability... And that's just ones from this year. I'm not saying TurboTax isn't a scummy company, but this is just getting ridiculous.

ycombonator 7y ago

How about a change.org petition and starting a github project to counter the lobbying.

turk73 7y ago

Sigh. I use TurboTax because I had an accountant who retired and sold his bussiness to some Class A assholes who managed to fuck up what should have been a fairly simple return for them given I explained everything in detail if they had bothered to read it. I had to fire them over it, leaving me with no return for 2017 about a week before April 15. It was extremely stressful because it involves a lot of stock cost basis issues related to some inherited equities and capital gains, etc. I could have filed an extension, but I was able to figure it all out using TT and get my taxes done correctly. The assholes would have had me paying $15K incorrectly! Shitheads! So even accounting firms are not at all reliable. If someone came along and made a free (e.g. open source) version that was halfway decent, I would use it. I could do the paper forms, it's not really that difficult, just time consuming. Time is money. TT charged me like $100 for the whole dealie. I don't want TT standing in the way of needed reform. I think our tax code is patently ridiculous and only computers have allowed it to be that way and lobbyists keep it that way. Forget the "wealth tax"--that is bullshit, too. Inflation will bring you dead center into whatever tax scheme is cooked up which is already why we're in the mess we're in.

sgustard 7y ago

Google "free tax filing" and these organizations all promise free tax filing on the first page: IRS, eFile, FreeTaxUSA, TurboTax, H&R Block, TaxAct, and others. Intuit's not the top organic or paid slot. Are all of these equally misleading or is Intuit just called out for being the market leader?

dghughes 7y ago

In Canada the CRA has a list of free tax software listed on its website. For the last two years I literally filed my tax return with two mouse clicks. Click 1 Autofill Click 2 Efile. At some point I expect the government to just send a notice "your taxes have been filed. If you have concerns contact us". I could have been doing it for ten years but I was stuck in the past of only using electronic tax software. And I still made a paper copy for myself.

nan0 7y ago

Who is going to build this "free" tax filing system? I hope not the IRS [0] 0: https://spectrum.ieee.org/riskfactor/computing/it/irs-predicted-tax-filing-failure https://spectrum.ieee.org/riskfactor/computing/it/irs-predic...

n-exploit 7y ago
"On 17 April 2018, the final day for U.S. citizens to file 2017 tax returns, the U.S. Internal Revenue Service (IRS) suffered a major system failure related to the hardware supporting its 58-year old, 20-million-line Cobol-based Individual Master File system [PDF], which is still being used today to process the vast majority of individual tax returns. As a result of the failure, the IRS extended by a day the filing due date." Maybe that's because a decades-old system hit capacity, and has nothing to do with the system design?
- nan0 7y ago
  "While it’s true that the IRS has experienced budget reductions over the past several years, those cuts hardly explain a failure of an 18-month-old piece of computer hardware. More important, those claims conveniently ignore that the IRS has spent untold billions since the late 1960s on numerous attempts to modernize its IT systems, all centered on trying to replace the ancient IMF system, with minimum success." I assume you didn't read the whole source
ratata 7y ago
There is a branch of government in charge of large software projects: https://www.usds.gov https://www.usds.gov
- nan0 7y ago
  This looks very promising! I read more into this agency and it looks like they are looking to put a price tag on some of their services [0] From the article: "The hope is that by putting a price tag on some of USDS services, that will encourage agencies to develop their own native digital service teams, as the Departments of Defense and Veterans Affairs have already done. That in turn will free up capacity so that more agencies can tap USDS personnel for their own needs." 0: https://fcw.com/articles/2019/06/17/weichert-usds-funding-mazmanian.aspx https://fcw.com/articles/2019/06/17/weichert-usds-funding-ma... Update: Services offered to other government branches, not to end-users.

deleted 7y ago

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kyrra 7y ago

Not a direct counter-point to this piece, but: https://www.wsj.com/articles/irs-commissioned-report-responds-to-criticism-over-free-file-program-11570576703?mod=rsswn https://www.wsj.com/articles/irs-commissioned-report-respond... It's a high-level view of the 2 sides arguing about the Free File program.

pzs 7y ago

Yet another data point: Hungary. For most people the National Tax Bureau (NAV) prepares the filing based on the data they receive from employers, banks, etc. You can check the content on a web page, and approve, if you agree. For those who have income that must be self-reported, there is the free Java app provided by NAV. I have used the latter for several years and it has been working reasonably well for me.

MH15 7y ago

I refuse to use TurboTax for my (albeit simple) tax filings. I used FreeTaxUSA last year and it was pretty solid.

AcerbicZero 7y ago

I'm likely in the minority here, but as a product TurboTax hasn't really bothered me that much. It makes filling my taxes pretty easy, and saves most of the info year of year so I don't have to re-enter it. Compared to the thousands of dollars in taxes I've paid, the $100 or so turbo tax gets doesn't seem too bad. My issue is with all this is pretty simple - I pay too much in tax, and/or the quality of government those taxes are buying is subpar at best. I also strongly suspect leaving the government in charge of comping up with a solution to filing taxes electronically would continue the trend of disappointment. If my choice is between paying a private company a couple bucks to make my interaction with the government easier, or going back to the old paper way of doing things until the government gets its shit together.....well I'm going to stick with the former, unless I'm missing something here?

0000011111 7y ago

I am all for free filing software for the people! What TurboTax offers that a free version may not is the ability for a CPA to sign off on one's taxes. That is worth paying for in my opinion. B/C they carry the liability if I were to be audited. I think the IRS needs to simplify the filing process so that a CPA is not needed. Sadly, this issue is more complex than intuits lobbying power.

tamaharbor 7y ago

Just get a list of the politicians that have voted against filing taxes for free, and vote for their opponent in the next election.

rdiddly 7y ago

Is there not an option that has all of the advantages of electronic filing, EXCEPT actually submitting the return? i.e. you print everything out at the end and mail it? Because I mean, that would make it immune to all lobbying but still be a huge improvement over filling it out by hand.

jammygit 7y ago

“ ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up for ProPublica’s Big Story newsletter to receive stories like this one in your inbox as soon as they are published.” Is propublica good/reliable news source? Always looking for good news sources

dsalzman 7y ago

Paying taxes is so frustrating. Gov : “Please pay us the taxes I owe” Tax Payer : “Ok. How much do I owe?” Gov : “We can’t tell you that. Hire an accountant if you need help” Tax Payer : “fu*k fine. (Files hinder and makes one mistake) Gov : “You owe us money!! You didn’t pay enough. You owe us interest on what’s due as well!” Tax Payer : “I thought you didn’t know how much I owe! Just tell me!!!!” Fin

tomohawk 7y ago

Missing option: repeal the 16th amendment and get rid of the income tax. It's intrusive and complicated.

thomasfl 7y ago

In norway, filing taxes is optional. Citisens are highly encouraged too log in to a website called AltInn (wich means literally everything in) and check the data, and do adjustments. Income, bank loans and investments are usually registered correctly.

hkai 7y ago

I'm not in the US, but I'm not seeing the reason for all the anger. Yes, they are hiding the free option, similarly to how Google for example was hiding the free option for the Gsuite - you had to dig for it in the menu. Plus there are multiple alternatives. What's wrong with a company using little tricks and dark patterns to nudge more people into paying for their service?

matiszek23 7y ago

Hello

toddh 7y ago

Isn’t tax filing complicated because of the tax system? If your income is low enough it is free. Below $66000. You just have to say no to add ons. State filing can be free if you shop around. Free File: Do Your Federal Taxes for Free https://www.irs.gov/filing/free-file-do-your-federal-taxes-for-free https://www.irs.gov/filing/free-file-do-your-federal-taxes-f...

rfhjt 7y ago

I like to look at things from Buddhist point if view. Calfile "buys" you the saved 50 bucks (3 hours of work for most people?) x the number if people use it, especially if you understand the implications and your intent is clear. Of course, a practical Buddhist never "spends" the earned opportunities, but reinvests them to get even more opportunities, until the impact is measured in trillions of years. But that's philosophy. On the practical side, if I were you, I'd do two things: (1) open source this on behalf of the gov - it's important to get the "official" status; (2) advertise this over official channels: send them a green letter from ca.gov/irs that say there is such a tool. The software doesn't need to be perfect: the website that manages toll fees in my state is in stone age, yet it's official and it's better to have this site than not.