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this is not how taxes work with the IRS. If you make a calculation error in their favour they will correct it and issue you a refund. If you make a compilation
by skeeter2020 5y ago
this is not how taxes work with the IRS. If you make a calculation error in their favour they will correct it and issue you a refund. If you make a compilation error in their favour and get reviewed or audited, you will get a refund. They also audit based more on discrepencies vs. "likelihood of a big payout".
If they precalculated your taxes and sent you a bill (or refund) it would (a) be easier, (b) be more accurate and (c) encourage simplification of the entire system. I consider that both more effective and more fair.
- jtc331 5y agoYou’re missing the point. The point is that the IRS isn’t aware of a good amount of income (trivial example is tips) unless you tell them about it.
- ModernMech 5y agoAlso income from illegal activity is taxed like any other. If you get caught for doing illegal things and not reporting it on your tax bill, you're in trouble for that too. Harder to prove you're stiffing the IRS when you pay the bill they send you.