5 ms·

No, they are one of the biggest sources of lead gen for credit products in the US.

lvh 7y ago
That doesn't sound like a terribly convincing reason why a complex tax code made possible only by for-profit services is desirable, unless you only evaluate it from the perspective of an $INTU/$V/$BAC... shareholder. In Belgium, most people's taxes are a postcard that says "here's what we think you owe, do nothing if you agree". Before that it was about the work of a single 1099-EZ. (Belgium is not unique in this.)
- harryh 7y ago
  The biggest source of tax complexity for Americans is our multi level government. Everyone has to file a Federal and State return. Many have to file returns in multiple states and some have taxes at the city level as well. This is mostly due to the size of the country (compared to, say, Switzerland) and doesn't have anything to do with for-profit tax software.
  - meesles 7y ago
    Lets not forget to note that these companies in the USA have actively lobbied against simplifying taxes for citizens. So yes the size of the country adds complexity but our nasty capitalism makes it worse.
    - harryh 7y ago
      People say this, but it's not really clear to me if this is true. When I look at my (more complex than average) tax return I see a lot of ways to simplify things but most of them would involve going against a major interest of one of the two parties. Consider, for example, the deductibility of state and local taxes. This is a source of significant tax code complexity, but various constituencies have howled quite loudly about even reducing the amount of the deduction. I am doubtful that it can be eliminated completely.
      - willvarfar 7y ago
        https://www.propublica.org/article/inside-turbotax-20-year-fight-to-stop-americans-from-filing-their-taxes-for-free https://www.propublica.org/article/inside-turbotax-20-year-f... dives in, but it’s been covered on a gazillion mainstream news coverage over the years.
        harryh 7y ago
        Yes, I've read that before. I think there is some truth that Intuit has had some role in limiting tax software rollouts by the IRS. However I think it's probably overstated. There is a ton of complexity in the US tax code due to various political interests of the DEMs or GOPs. It's this complexity that is really the source of most of the problems. Unfortunately there just isn't much of a constituency in the US for eliminating tax code complexity.
        willvarfar 7y ago
        No matter how complicated the tax code, the government know in advance how much you should pay. (Imagine the code was so complicated that they didn’t know, and they relied on your honesty. How well would that work?) In all the countries I’ve lived, the government simply tells you that number. You can dispute it if you think it wrong. In the US, you have to tell them that number, and you had better have added it up right because they can trivially check. Oh, and you pay for this privilege?
        harryh 7y ago
        No matter how complicated the tax code, the government know in advance how much you should pay. This is not true. Just as an example, I have various business expenses that I incurred while consulting last year. The government has no way of knowing in advance what those expenses are.
        willvarfar 7y ago
        Yes. This is normal in all those countries with free easy tax filing. I regularly adjust the number, claiming various expenses etc. I have been audited twice, which was actually a lot less scary than it sounds. This is normal, easy and doesn’t cost and doesn’t even need complicated software. I have filled in forms, but I believe you can also do it online in the country I’m talking about now.
  - lvh 7y ago
    You're telling me -- I file estimated taxes quarterly in three states plus federally! Anyway: both Switzerland (your example) and Belgium (my example) have multi-layered governments. Belgium's one is particularly complex, with "communities" which are language unions and "regions" that largely overlap but not quite, as well as province-level and city-level taxes. Each of these has their own institutions and most incur taxes. The multi-layered government is far more complex than the US, but this does not result in comparable complexity to my US filing. (I'd also argue it's far more sensitive: secession has been a possible outcome in my lifetime in a way that it really has not been in the US.) Meanwhile: the IRS has simply agreed not to provide free tax filing software. Why is that good for taxpayers?
    - harryh 7y ago
      I suppose I don't really know much about Switzerland[1] or Belgium's tax codes. My working assumption is that the population differences (both are the size of US states) leads to simplicity. But I'm perfectly willing to admit I might be wrong here. I really don't know. I do know that there are weird and frustrating intertwinings of US Federal and State tax codes and I wish I didn't have to deal with that. Kill the SALT deduction! 1. Er, not sure why I brought another small European country into the discussion. I meant to replicate your example but brainfarted.
      - lvh 7y ago
        English-language Wikipedia does not have a great article on Belgian taxation complexity, but it has a great article on structural complexity that highlights the weird "almost-entirely-overlaps" structure: https://en.wikipedia.org/wiki/Communities,_regions_and_language_areas_of_Belgium https://en.wikipedia.org/wiki/Communities,_regions_and_langu... Mind you that this does not even anything at city level. Imagine if Illinois was mostly part of the Midwest Region (a governmental entity that transcends states but is not federal and also has a tax authority), but not including Chicago. That'd be close. Also the largest party in its government wants the Midwest to secede from the Union.
        zamfi 7y ago

lvh 7y ago

That doesn't sound like a terribly convincing reason why a complex tax code made possible only by for-profit services is desirable, unless you only evaluate it from the perspective of an $INTU/$V/$BAC... shareholder. In Belgium, most people's taxes are a postcard that says "here's what we think you owe, do nothing if you agree". Before that it was about the work of a single 1099-EZ. (Belgium is not unique in this.)

harryh 7y ago
The biggest source of tax complexity for Americans is our multi level government. Everyone has to file a Federal and State return. Many have to file returns in multiple states and some have taxes at the city level as well. This is mostly due to the size of the country (compared to, say, Switzerland) and doesn't have anything to do with for-profit tax software.
- meesles 7y ago
  Lets not forget to note that these companies in the USA have actively lobbied against simplifying taxes for citizens. So yes the size of the country adds complexity but our nasty capitalism makes it worse.
  - harryh 7y ago
    People say this, but it's not really clear to me if this is true. When I look at my (more complex than average) tax return I see a lot of ways to simplify things but most of them would involve going against a major interest of one of the two parties. Consider, for example, the deductibility of state and local taxes. This is a source of significant tax code complexity, but various constituencies have howled quite loudly about even reducing the amount of the deduction. I am doubtful that it can be eliminated completely.
    - willvarfar 7y ago
      https://www.propublica.org/article/inside-turbotax-20-year-fight-to-stop-americans-from-filing-their-taxes-for-free https://www.propublica.org/article/inside-turbotax-20-year-f... dives in, but it’s been covered on a gazillion mainstream news coverage over the years.
      - harryh 7y ago
        Yes, I've read that before. I think there is some truth that Intuit has had some role in limiting tax software rollouts by the IRS. However I think it's probably overstated. There is a ton of complexity in the US tax code due to various political interests of the DEMs or GOPs. It's this complexity that is really the source of most of the problems. Unfortunately there just isn't much of a constituency in the US for eliminating tax code complexity.
        willvarfar 7y ago
        No matter how complicated the tax code, the government know in advance how much you should pay. (Imagine the code was so complicated that they didn’t know, and they relied on your honesty. How well would that work?) In all the countries I’ve lived, the government simply tells you that number. You can dispute it if you think it wrong. In the US, you have to tell them that number, and you had better have added it up right because they can trivially check. Oh, and you pay for this privilege?
        harryh 7y ago
        No matter how complicated the tax code, the government know in advance how much you should pay. This is not true. Just as an example, I have various business expenses that I incurred while consulting last year. The government has no way of knowing in advance what those expenses are.
        willvarfar 7y ago
        Yes. This is normal in all those countries with free easy tax filing. I regularly adjust the number, claiming various expenses etc. I have been audited twice, which was actually a lot less scary than it sounds. This is normal, easy and doesn’t cost and doesn’t even need complicated software. I have filled in forms, but I believe you can also do it online in the country I’m talking about now.
- lvh 7y ago
  You're telling me -- I file estimated taxes quarterly in three states plus federally! Anyway: both Switzerland (your example) and Belgium (my example) have multi-layered governments. Belgium's one is particularly complex, with "communities" which are language unions and "regions" that largely overlap but not quite, as well as province-level and city-level taxes. Each of these has their own institutions and most incur taxes. The multi-layered government is far more complex than the US, but this does not result in comparable complexity to my US filing. (I'd also argue it's far more sensitive: secession has been a possible outcome in my lifetime in a way that it really has not been in the US.) Meanwhile: the IRS has simply agreed not to provide free tax filing software. Why is that good for taxpayers?
  - harryh 7y ago
    I suppose I don't really know much about Switzerland[1] or Belgium's tax codes. My working assumption is that the population differences (both are the size of US states) leads to simplicity. But I'm perfectly willing to admit I might be wrong here. I really don't know. I do know that there are weird and frustrating intertwinings of US Federal and State tax codes and I wish I didn't have to deal with that. Kill the SALT deduction! 1. Er, not sure why I brought another small European country into the discussion. I meant to replicate your example but brainfarted.
    - lvh 7y ago
      English-language Wikipedia does not have a great article on Belgian taxation complexity, but it has a great article on structural complexity that highlights the weird "almost-entirely-overlaps" structure: https://en.wikipedia.org/wiki/Communities,_regions_and_language_areas_of_Belgium https://en.wikipedia.org/wiki/Communities,_regions_and_langu... Mind you that this does not even anything at city level. Imagine if Illinois was mostly part of the Midwest Region (a governmental entity that transcends states but is not federal and also has a tax authority), but not including Chicago. That'd be close. Also the largest party in its government wants the Midwest to secede from the Union.
      - zamfi 7y ago