4 ms·

> It's a racket. Yea, possibly (I agree with you). It is as much a racket as lots of other things. Doesn't excuse it being a racket, but TurboTax is not an ano

by lolsal 6y ago

> It's a racket. Yea, possibly (I agree with you). It is as much a racket as lots of other things. Doesn't excuse it being a racket, but TurboTax is not an anomaly. > Government already knows how much you owe them. This is false. If you aren't taking advantage of deductions, sophisticated tax-deferred vehicles for retirement or tax-advantaged accounts for other investments, you're giving the IRS more than you have to. If that doesn't bother you, that's fine too! > So how about US government, like most modern countries, send you a form which says: "we think you owe us xxx$ (because of this and that), if not - provide extra information"? Cool, sounds great. However, you're over-simplifying things and ignoring the complicated parts. For a lot of people, a simple approach like the above would be totally adequate and I personally completely support a system like that.

matz1 6y ago
Then how do IRS know that the duduction is correct?
- goatcode 6y ago
  They probably don't, but when something looks suspicious enough, in comes the audit.
- astura 6y ago
  The companies that you have these accounts with, and your employer have reporting requirements.
  - deleted 6y ago
    [deleted]
- PeterisP 6y ago
  They don't. They request some documentation, verify some facts that they can correlate other sources, but mostly they rely on the fact that intentionally lying in the declarations is a crime - they can trust most reports, audit some, and penalize those violators they caught as a deterrent to make it not worth the risk to lie.
trymas 6y ago
> If you aren't taking advantage of deductions, sophisticated tax-deferred vehicles for retirement or tax-advantaged accounts for other investment, you're giving the IRS more than you have to. I do take advantage and do not lift a finger to achieve it, because the tax man knows about this already. > However, you're over-simplifying things and ignoring the complicated parts. IMHO, you are overcomplicating things. If tax laws are as complex as you wish them to be, if the tax-man cannot know what you owe to it - then it's just a very good environment for the wealthy not to pay anything, while screwing over other 99% with over complicating things. I do not pay taxes in the US and unless you have a company, I guess 99% of individuals do not need to do any taxes at all, i.e. just confirm what the tax agency already knows about them.
- lolsal 6y ago
  > I do take advantage and do not lift a finger to achieve it, because the tax man knows about this already. I think you're mistaken. The tax man does not already know what charitable donations I've made, or depreciation I would like to claim, or .... > IMHO, you are overcomplicating things. If tax laws are as complex as you wish them to be, if the tax-man cannot know what you owe to it - then it's just a very good environment for the wealthy not to pay anything, while screwing over other 99% with over complicating things. As an aside, I do not have any wishes regarding the tax system one way or the other. I'm only subject to the tax laws, I don't really care what they are. The Tax Man® knows what you owe based on income that has been reported to it by places like your job, but only if your work does withholding and reports it to the IRS. It could report it without withholding (I think?), or you could be getting a 1099. If all the income from your 1099s is reported accurately and timely, this would be similar to a place that gives you a W2. This doesn't always happen, or there could be disputes. > I do not pay taxes in the US and unless you have a company, I guess 99% of individuals do not need to do any taxes at all, i.e. just confirm what the tax agency already knows about them. I doubt it's anywhere close to 99% :) Optional things that the government might not know about: kids, charities, investments, depreciation, rebate programs (like solar, cash for clunkers, etc), inheritance, mileage deductions, moving across state lines, getting divorced, getting married, becoming a widow, losing a child, etc. There's a ton of stuff that the government doesn't know about _unless you tell it_. If I make a bunch of money mowing lawns, my neighbors probably aren't sending me 1099s, but I really probably should report that income and pay taxes on it. The government wouldn't know about it unless I reported it (which is why a lot of folks don't bother reporting income like that, especially if it's a small enough amount). I'm not a tax lawyer, nor a tax expert.
systemvoltage 6y ago
Agreed, it sounds insane but I much prefer US system. It is easy to say "simpler == better". I'd much prefer the gov not do things for me and leave the control over my taxes by default. I understand people in other countries can do the same, but the default is big gov giving you a number upfront. Think about taxes as a negotiation process.
- CRConrad 6y ago
  This haggling, suspicious, negative, even hostile mindset towards your own government is a big reason why the US is so generally fucked up. "Negotiation process"?!? That's how shirkers and tax criminals think about it.

by lolsal 6y ago

matz1 6y ago

Then how do IRS know that the duduction is correct?

goatcode 6y ago
They probably don't, but when something looks suspicious enough, in comes the audit.
astura 6y ago
The companies that you have these accounts with, and your employer have reporting requirements.
- deleted 6y ago
  [deleted]
PeterisP 6y ago
They don't. They request some documentation, verify some facts that they can correlate other sources, but mostly they rely on the fact that intentionally lying in the declarations is a crime - they can trust most reports, audit some, and penalize those violators they caught as a deterrent to make it not worth the risk to lie.

trymas 6y ago

> If you aren't taking advantage of deductions, sophisticated tax-deferred vehicles for retirement or tax-advantaged accounts for other investment, you're giving the IRS more than you have to. I do take advantage and do not lift a finger to achieve it, because the tax man knows about this already. > However, you're over-simplifying things and ignoring the complicated parts. IMHO, you are overcomplicating things. If tax laws are as complex as you wish them to be, if the tax-man cannot know what you owe to it - then it's just a very good environment for the wealthy not to pay anything, while screwing over other 99% with over complicating things. I do not pay taxes in the US and unless you have a company, I guess 99% of individuals do not need to do any taxes at all, i.e. just confirm what the tax agency already knows about them.

lolsal 6y ago
> I do take advantage and do not lift a finger to achieve it, because the tax man knows about this already. I think you're mistaken. The tax man does not already know what charitable donations I've made, or depreciation I would like to claim, or .... > IMHO, you are overcomplicating things. If tax laws are as complex as you wish them to be, if the tax-man cannot know what you owe to it - then it's just a very good environment for the wealthy not to pay anything, while screwing over other 99% with over complicating things. As an aside, I do not have any wishes regarding the tax system one way or the other. I'm only subject to the tax laws, I don't really care what they are. The Tax Man® knows what you owe based on income that has been reported to it by places like your job, but only if your work does withholding and reports it to the IRS. It could report it without withholding (I think?), or you could be getting a 1099. If all the income from your 1099s is reported accurately and timely, this would be similar to a place that gives you a W2. This doesn't always happen, or there could be disputes. > I do not pay taxes in the US and unless you have a company, I guess 99% of individuals do not need to do any taxes at all, i.e. just confirm what the tax agency already knows about them. I doubt it's anywhere close to 99% :) Optional things that the government might not know about: kids, charities, investments, depreciation, rebate programs (like solar, cash for clunkers, etc), inheritance, mileage deductions, moving across state lines, getting divorced, getting married, becoming a widow, losing a child, etc. There's a ton of stuff that the government doesn't know about _unless you tell it_. If I make a bunch of money mowing lawns, my neighbors probably aren't sending me 1099s, but I really probably should report that income and pay taxes on it. The government wouldn't know about it unless I reported it (which is why a lot of folks don't bother reporting income like that, especially if it's a small enough amount). I'm not a tax lawyer, nor a tax expert.

systemvoltage 6y ago

Agreed, it sounds insane but I much prefer US system. It is easy to say "simpler == better". I'd much prefer the gov not do things for me and leave the control over my taxes by default. I understand people in other countries can do the same, but the default is big gov giving you a number upfront. Think about taxes as a negotiation process.

CRConrad 6y ago
This haggling, suspicious, negative, even hostile mindset towards your own government is a big reason why the US is so generally fucked up. "Negotiation process"?!? That's how shirkers and tax criminals think about it.