7 ms·

Why are we bothering with the small potatoes in the room (TurboTax not putting URLs to free tax filing, etc. etc) when the elephant is: "Why isn't the IRS givi

Why are we bothering with the small potatoes in the room (TurboTax not putting URLs to free tax filing, etc. etc) when the elephant is: "Why isn't the IRS giving people a way to prepopulate and file taxes for free with the financial info that the IRS already has on everyone?" Well, I suppose it's just a product of the corporate interests and congressional deadlock that prevents us from doing a multitude of things right now. Other countries manage to do this just fine.

scott_s 6y ago
Because we know the answer: the IRS is prevented from doing that by law. Lobbied by Intuit. If you google around, you can find stories on it. edit: save_ferris linked to an excellent story below: https://www.propublica.org/article/filing-taxes-could-be-free-simple-hr-block-intuit-lobbying-against-it https://www.propublica.org/article/filing-taxes-could-be-fre...
- rootusrootus 6y ago
  Grover Norquist is probably more of the reason than Intuit.
- dbalbright 6y ago
  Yep. One such story is a podcast episode from Planet Money https://www.npr.org/sections/money/2019/04/03/709656642/episode-760-tax-hero https://www.npr.org/sections/money/2019/04/03/709656642/epis...
- apta 6y ago
  It's outright ludicrous how a private company is able to introduce a law that prevents a government agency from doing its job.
- crispyporkbites 6y ago
  Ok so I don’t know much about the us legal and political system, but a couple of questions: - why does a judge in a lawsuit get to make the decision here? I.e. why is this kind of law not debated as part of public discourse and a decision made through a democratic path? - given this benefits a tiny fraction of people in the US, why doesn’t a particular party/politician take a stand on it as a policy to win a chunk of votes? For the first point, a UK former judge spoke extensively on the topic of the courts overstepping their remit as part of the 2019 Reith lectures: https://www.bbc.co.uk/programmes/m00057m8 https://www.bbc.co.uk/programmes/m00057m8
  - scott_s 6y ago
    When it comes to understanding why some politician doesn’t take up an issue as their primary cause, I think it’s not useful to consider what the good-faith debate would look like. That doesn’t happen. Often the untrue things your opponents can accuse you of matter more in the discourse than your stated reasons for supporting an issue. When it comes to taxes and tax policy in the US, those untrue things are vast.
  - drtillberg 6y ago
    > - given this benefits a tiny fraction of people in the US, why doesn’t a particular party/politician take a stand on it as a policy to win a chunk of votes? Because national politics in the U.S. in 2020 is big business. It's not about votes or public policy, it's about redirecting funds to party coffers, paid consultants, and ideally the office-holders themselves (or at least their advisors, family and friends).
  - comex 6y ago
    > - why does a judge in a lawsuit get to make the decision here? I.e. why is this kind of law not debated as part of public discourse and a decision made through a democratic path? What judge? The FTC investigation mentioned in the article may end with the FTC filing a lawsuit, but that would be about whether Intuit deceived taxpayers (by directing them towards a paid version even if they were eligible to file for free), not whether the Free File program should exist or whether the IRS should develop its own software. The Free File program as it currently exists is the result of executive action, a “memorandum of understanding” between the IRS and tax software companies. [1] Last year there was a bill in Congress that would have codified it into law, but that part of the bill was dropped due to concerns it would permanently bar the IRS from developing its own software. ProPublica’s reporting about Intuit’s obfuscation played a part in that outcome. So there was a “public discourse” of sorts, although it’s a pretty obscure issue. Also: > given this benefits a tiny fraction of people in the US Keep in mind that a large fraction of Congress follows the ideology that, broadly speaking, the government can’t do anything right and it’s best to outsource as much as possible to private companies. Intuit’s lobbying was obviously a major factor, but they were playing for a receptive audience. Congress is also not particularly tech-savvy, by and large. [1] https://www.journalofaccountancy.com/news/2019/jun/congress-approves-irs-reform-bill-201921474.html https://www.journalofaccountancy.com/news/2019/jun/congress-...
- aschatten 6y ago
  Free File Act the article talks about was not passed and did not make it out of the Committee. A similar bill was passed in 2019: 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-...
OJFord 6y ago
Or just taxing at source for the common things, so that 'filling taxes' isn't something most people have to do.
- supernova87a 6y ago
  Given how much our system taxes based on brackets and deductions, etc that are only apparent at the end of a year, that is probably not possible for the bulk of tax revenue. Also, people have many, many different thoughts on VAT, etc.
  - IshKebab 6y ago
    Erm, loads of countries don't require employees to file taxes. Your employer takes care of it for you. If you have an unusual tax situation you have to do it still, but 99% of people just have 1 job with 1 salary.
    - supernova87a 6y ago
      A lot of people have stocks, mortgage deductions, credits, etc. that cannot be computed by your employer and filed automatically.
- Broken_Hippo 6y ago
  I'm pretty sure payroll taxes are things taxed at the source: I'm not sure there is a less painful way to tax for, say, social security or military spending. I'd honestly be happy changing some things into payroll taxes, honestly: Gasoline taxes, for example, aren't going to fund roads as much in the future (and efficient cars are already causing issues). Folks that work use roads in most cases, though, even if they use public transportation. We (Americans) still, in general, don't need to file taxes like we do, though. The US has tons of paperwork: Norway sends me an electronic document to look over and unless I want to file, I owe money, or something is wrong, I don't have to do anything. They will automatically pay out refunds. Sure, I still "file taxes", but realistically, I just look over some electronic paperwork. This method of "filing taxes" makes it easy to comply with filing and I'm guessing it makes collection rates better with less work.
deleted 6y ago
[deleted]
sokoloff 6y ago
The IRS doesn’t have all the information needed to file our returns (they lack basis information for many securities transactions, they lack basis information for my real estate, they lack all/almost all the information about schedule C small business or schedule E real estate investments, they have no information about my charitable giving, etc.). Even the information they do have is not all available on your account transcript until mid/late summer. With some substantial investments they could probably generate pre-filled forms for the simple cases by late March. I’d support that, even though it wouldn’t help me at all.
- jolux 6y ago
  Most people’s finances aren’t nearly as complex as yours.
Karuhanga 6y ago
https://youtu.be/Nn_Zln_4pA8 https://youtu.be/Nn_Zln_4pA8 John Oliver dives into why.

scott_s 6y ago

Because we know the answer: the IRS is prevented from doing that by law. Lobbied by Intuit. If you google around, you can find stories on it. edit: save_ferris linked to an excellent story below: https://www.propublica.org/article/filing-taxes-could-be-free-simple-hr-block-intuit-lobbying-against-it https://www.propublica.org/article/filing-taxes-could-be-fre...

rootusrootus 6y ago
Grover Norquist is probably more of the reason than Intuit.
dbalbright 6y ago
Yep. One such story is a podcast episode from Planet Money https://www.npr.org/sections/money/2019/04/03/709656642/episode-760-tax-hero https://www.npr.org/sections/money/2019/04/03/709656642/epis...
apta 6y ago
It's outright ludicrous how a private company is able to introduce a law that prevents a government agency from doing its job.
crispyporkbites 6y ago
Ok so I don’t know much about the us legal and political system, but a couple of questions: - why does a judge in a lawsuit get to make the decision here? I.e. why is this kind of law not debated as part of public discourse and a decision made through a democratic path? - given this benefits a tiny fraction of people in the US, why doesn’t a particular party/politician take a stand on it as a policy to win a chunk of votes? For the first point, a UK former judge spoke extensively on the topic of the courts overstepping their remit as part of the 2019 Reith lectures: https://www.bbc.co.uk/programmes/m00057m8 https://www.bbc.co.uk/programmes/m00057m8
- scott_s 6y ago
  When it comes to understanding why some politician doesn’t take up an issue as their primary cause, I think it’s not useful to consider what the good-faith debate would look like. That doesn’t happen. Often the untrue things your opponents can accuse you of matter more in the discourse than your stated reasons for supporting an issue. When it comes to taxes and tax policy in the US, those untrue things are vast.
- drtillberg 6y ago
  > - given this benefits a tiny fraction of people in the US, why doesn’t a particular party/politician take a stand on it as a policy to win a chunk of votes? Because national politics in the U.S. in 2020 is big business. It's not about votes or public policy, it's about redirecting funds to party coffers, paid consultants, and ideally the office-holders themselves (or at least their advisors, family and friends).
- comex 6y ago
  > - why does a judge in a lawsuit get to make the decision here? I.e. why is this kind of law not debated as part of public discourse and a decision made through a democratic path? What judge? The FTC investigation mentioned in the article may end with the FTC filing a lawsuit, but that would be about whether Intuit deceived taxpayers (by directing them towards a paid version even if they were eligible to file for free), not whether the Free File program should exist or whether the IRS should develop its own software. The Free File program as it currently exists is the result of executive action, a “memorandum of understanding” between the IRS and tax software companies. [1] Last year there was a bill in Congress that would have codified it into law, but that part of the bill was dropped due to concerns it would permanently bar the IRS from developing its own software. ProPublica’s reporting about Intuit’s obfuscation played a part in that outcome. So there was a “public discourse” of sorts, although it’s a pretty obscure issue. Also: > given this benefits a tiny fraction of people in the US Keep in mind that a large fraction of Congress follows the ideology that, broadly speaking, the government can’t do anything right and it’s best to outsource as much as possible to private companies. Intuit’s lobbying was obviously a major factor, but they were playing for a receptive audience. Congress is also not particularly tech-savvy, by and large. [1] https://www.journalofaccountancy.com/news/2019/jun/congress-approves-irs-reform-bill-201921474.html https://www.journalofaccountancy.com/news/2019/jun/congress-...
aschatten 6y ago
Free File Act the article talks about was not passed and did not make it out of the Committee. A similar bill was passed in 2019: 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-...

OJFord 6y ago

Or just taxing at source for the common things, so that 'filling taxes' isn't something most people have to do.

supernova87a 6y ago
Given how much our system taxes based on brackets and deductions, etc that are only apparent at the end of a year, that is probably not possible for the bulk of tax revenue. Also, people have many, many different thoughts on VAT, etc.
- IshKebab 6y ago
  Erm, loads of countries don't require employees to file taxes. Your employer takes care of it for you. If you have an unusual tax situation you have to do it still, but 99% of people just have 1 job with 1 salary.
  - supernova87a 6y ago
    A lot of people have stocks, mortgage deductions, credits, etc. that cannot be computed by your employer and filed automatically.
Broken_Hippo 6y ago
I'm pretty sure payroll taxes are things taxed at the source: I'm not sure there is a less painful way to tax for, say, social security or military spending. I'd honestly be happy changing some things into payroll taxes, honestly: Gasoline taxes, for example, aren't going to fund roads as much in the future (and efficient cars are already causing issues). Folks that work use roads in most cases, though, even if they use public transportation. We (Americans) still, in general, don't need to file taxes like we do, though. The US has tons of paperwork: Norway sends me an electronic document to look over and unless I want to file, I owe money, or something is wrong, I don't have to do anything. They will automatically pay out refunds. Sure, I still "file taxes", but realistically, I just look over some electronic paperwork. This method of "filing taxes" makes it easy to comply with filing and I'm guessing it makes collection rates better with less work.

deleted 6y ago

[deleted]

sokoloff 6y ago

The IRS doesn’t have all the information needed to file our returns (they lack basis information for many securities transactions, they lack basis information for my real estate, they lack all/almost all the information about schedule C small business or schedule E real estate investments, they have no information about my charitable giving, etc.). Even the information they do have is not all available on your account transcript until mid/late summer. With some substantial investments they could probably generate pre-filled forms for the simple cases by late March. I’d support that, even though it wouldn’t help me at all.

jolux 6y ago
Most people’s finances aren’t nearly as complex as yours.

Karuhanga 6y ago

https://youtu.be/Nn_Zln_4pA8 https://youtu.be/Nn_Zln_4pA8 John Oliver dives into why.