5 ms·

The fact that I have to file the return is itself part of the problem. This process should be “irs gives you a refund or tells you what you owe and then you eit

by jwie 4y ago

The fact that I have to file the return is itself part of the problem. This process should be “irs gives you a refund or tells you what you owe and then you either dispute it or take it”. The audit practice invites mischief into a system where someone makes a judgement about when to audit, and the process is the punishment. Just tell me what I owe, and if I feel like it I can dispute it. If they can validate a tax return they obviously know what would be correct.

stetrain 4y ago
Absolutely, but to accomplish that you’d need enough political will to combat the lobbying from TurboTax and the other tax filing businesses.
- abletonlive 4y ago
  It's not like turbotax is some monopoly on tax filing software. There are at least a couple free tax filing options now available. That should in theory mean that turbotax is losing it's political power as time goes on.
mixmastamyk 4y ago
This comment is on the right track, but is inadequate. It invites the typical response that it "can't be done," because X, Y, Z. The truth is closer to yes. Yes, there could be (and is in civilized countries) a web based form that lists everything the government expects to apply this year. And it could be quite accurate. Then you spend fifteen minutes (typically) entering in your deductions or any missing data. Does the math. Reduces the manual process from a week to under an hour. (I understand that third-party software does reduce that time as well, but shouldn't need to exist.) So yes, it can be done, because I've done it when I had a contract in another country.
jksmith 4y ago
That's what they do anyway if you don't file. Yeah, mandating filing is increasingly becoming a control mechanism as filing's only purpose.
- stetrain 4y ago
  If you mean control by corporations who make money on the current process then yes. 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... https://www.nbcnews.com/news/ncna736386 https://www.nbcnews.com/news/ncna736386
  - jksmith 4y ago
    Granted, yes. But as more digital capabilities creep into the financial system, what if gov knows what you owe (and kills turbotax market) but still mandates you file a return?
    - stetrain 4y ago
      Why would they do so? Simply stating what you owe and demanding you pay it seems plenty controlling.
shrimpx 4y ago
IRS has happily kept thousands of dollars of my money when I filed incorrectly. A few years later I went to the IRS office for an unrelated matter and I asked the agent “can you look up year XXXX and see if I was owed a refund?” Agent looks up and says yup, you were owed a large refund. Too late to get it back now, but we strongly encourage you to correctly refile your taxes for that year. So they had done my taxes and knew they owed me money and, basically, stole my money. If I owed them money they would have immediately hit me with a bill or an audit. And on top of it they wanted me to refile my taxes “correctly” after they had already done my taxes. This “do your thing and we’ll do it, too, and we’ll see if you got it wrong” is one of the most stressful aspects of American bureaucracy.
- clumsysmurf 4y ago
  How long ago was the missed year? I missed a filing from 3 years prior, in which I was owned money, and got it back no problem. Also since I do my own taxes, sometimes I make mistakes, and they correct them and I'm pleasantly surprised by a larger refund.
  - shrimpx 4y ago
    It was 4 years. I was told I could not get the money back.
- deleted 4y ago
  [deleted]
beebmam 4y ago
Are there any alternative tax mechanisms to income taxes that you'd support? I've heard many times that VAT or consumption taxes are far more efficient than income taxes. Seems like they're also easier to enforce (except in regions with significant black markets). I've also heard that taxing land & non-invested property is a good idea, too.
synergy20 4y ago
what about the old plan as just-the-sales-tax(local+state+federal), so nobody needs to file anything, and no need of IRS at all. * flat-tax-rate as the default,itemized if you prefer: * charge less for regular food, educational and medical expenses * charge a little more for travel and non-essential leisure expenses * charge even more for luxury expenses * charge nothing before your spend reach a certain point, e.g. $5000 Someone has to figure out how to design the tax rate, point is that, we no longer need the IRS and annual or quarterly tax reports. There are a few states did well with no income tax(just sales tax and property tax), the nation could do the same, don't forget to short Intuit if this happens.
- petersellers 4y ago
  There have been a number of studies done that demonstrate that a consumption tax (which is effectively what this is) is considered to be regressive because they disproportionately affect poor people. I'm all for simplifying the tax code (e.g. eliminating many deductions) as long as we also eliminate loopholes that rich people often use to avoid paying taxes on their income.
- ebiester 4y ago
  It disproportionately taxes poor people over rich people. Also, how do you report how much you've spent to the IRS? That seems even harder. Some people have suggested a "prebate" of a payment that people get that helps with their first part of the sales tax, but that breaks down after a while. There are also the same problems of "under the table" behavior.
  - kcplate 4y ago
    >It disproportionately taxes poor people over rich people. I always hear this said about national sales taxes, but it just doesn’t really jive with me as valid. It really seems to make the assumption that consumption doesn’t actually increase based upon how wealthy you are. When it obviously does. I don’t know many poor folks buying super cars, yachts, airplanes, and multimillion dollar homes. Yet I know a few wealthy folks with multiple of each.
cjensen 4y ago
This is a good first start, but won't work for everyone. E.g. we got a new roof with solar. The solar is tax deductible. But is the roof? My options are (a) no (b) the portion with solar on top (c) all. Asking around, different people have taken different options, and no option is un-taken. Option (c) will probably never get audited and we all know it. I won't be taking it.
- Arborealist 4y ago
  They can generate 95% of returns completely accurately. For people with advanced situations they can feel free to file their own correct copy or pay an accountant. People wanting to deduct their charitable contributions should have to work harder to do that. I shouldn’t be inconvenienced because of that. Of course if they did that you wouldn’t need 80K new feds, and since they tend to vote lockstep for more endless government, well it’s quite convenient isn’t it?
- sys_64738 4y ago
  Solar power shouldn’t be tax deductible. This is another part of the problem.
  - greedo 4y ago
    He was just illustrating the complexity. The tax code has tons of incentives for every Congresscritter's pet project.
thephyber 4y ago
The US government is great as building Dark Patterns in their benefits programs. There is one major party that thinks government doesn’t and can’t work well, so it’s no wonder that lots of the stakeholders design systems that frustrate users.
dpifke 4y ago
For some reasons why this won't work, might I suggest you skim through the other 1,526 comments on HN that have made the exact same suggestion: https://hn.algolia.com/?dateRange=all&page=0&prefix=false&query=irs%20file&sort=byPopularity&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu...

by jwie 4y ago

stetrain 4y ago

Absolutely, but to accomplish that you’d need enough political will to combat the lobbying from TurboTax and the other tax filing businesses.

abletonlive 4y ago
It's not like turbotax is some monopoly on tax filing software. There are at least a couple free tax filing options now available. That should in theory mean that turbotax is losing it's political power as time goes on.

mixmastamyk 4y ago

This comment is on the right track, but is inadequate. It invites the typical response that it "can't be done," because X, Y, Z. The truth is closer to yes. Yes, there could be (and is in civilized countries) a web based form that lists everything the government expects to apply this year. And it could be quite accurate. Then you spend fifteen minutes (typically) entering in your deductions or any missing data. Does the math. Reduces the manual process from a week to under an hour. (I understand that third-party software does reduce that time as well, but shouldn't need to exist.) So yes, it can be done, because I've done it when I had a contract in another country.

jksmith 4y ago

That's what they do anyway if you don't file. Yeah, mandating filing is increasingly becoming a control mechanism as filing's only purpose.

stetrain 4y ago
If you mean control by corporations who make money on the current process then yes. 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... https://www.nbcnews.com/news/ncna736386 https://www.nbcnews.com/news/ncna736386
- jksmith 4y ago
  Granted, yes. But as more digital capabilities creep into the financial system, what if gov knows what you owe (and kills turbotax market) but still mandates you file a return?
  - stetrain 4y ago
    Why would they do so? Simply stating what you owe and demanding you pay it seems plenty controlling.

shrimpx 4y ago

IRS has happily kept thousands of dollars of my money when I filed incorrectly. A few years later I went to the IRS office for an unrelated matter and I asked the agent “can you look up year XXXX and see if I was owed a refund?” Agent looks up and says yup, you were owed a large refund. Too late to get it back now, but we strongly encourage you to correctly refile your taxes for that year. So they had done my taxes and knew they owed me money and, basically, stole my money. If I owed them money they would have immediately hit me with a bill or an audit. And on top of it they wanted me to refile my taxes “correctly” after they had already done my taxes. This “do your thing and we’ll do it, too, and we’ll see if you got it wrong” is one of the most stressful aspects of American bureaucracy.

clumsysmurf 4y ago
How long ago was the missed year? I missed a filing from 3 years prior, in which I was owned money, and got it back no problem. Also since I do my own taxes, sometimes I make mistakes, and they correct them and I'm pleasantly surprised by a larger refund.
- shrimpx 4y ago
  It was 4 years. I was told I could not get the money back.
deleted 4y ago
[deleted]

beebmam 4y ago

Are there any alternative tax mechanisms to income taxes that you'd support? I've heard many times that VAT or consumption taxes are far more efficient than income taxes. Seems like they're also easier to enforce (except in regions with significant black markets). I've also heard that taxing land & non-invested property is a good idea, too.

synergy20 4y ago

what about the old plan as just-the-sales-tax(local+state+federal), so nobody needs to file anything, and no need of IRS at all. * flat-tax-rate as the default,itemized if you prefer: * charge less for regular food, educational and medical expenses * charge a little more for travel and non-essential leisure expenses * charge even more for luxury expenses * charge nothing before your spend reach a certain point, e.g. $5000 Someone has to figure out how to design the tax rate, point is that, we no longer need the IRS and annual or quarterly tax reports. There are a few states did well with no income tax(just sales tax and property tax), the nation could do the same, don't forget to short Intuit if this happens.

petersellers 4y ago
There have been a number of studies done that demonstrate that a consumption tax (which is effectively what this is) is considered to be regressive because they disproportionately affect poor people. I'm all for simplifying the tax code (e.g. eliminating many deductions) as long as we also eliminate loopholes that rich people often use to avoid paying taxes on their income.
ebiester 4y ago
It disproportionately taxes poor people over rich people. Also, how do you report how much you've spent to the IRS? That seems even harder. Some people have suggested a "prebate" of a payment that people get that helps with their first part of the sales tax, but that breaks down after a while. There are also the same problems of "under the table" behavior.
- kcplate 4y ago
  >It disproportionately taxes poor people over rich people. I always hear this said about national sales taxes, but it just doesn’t really jive with me as valid. It really seems to make the assumption that consumption doesn’t actually increase based upon how wealthy you are. When it obviously does. I don’t know many poor folks buying super cars, yachts, airplanes, and multimillion dollar homes. Yet I know a few wealthy folks with multiple of each.

cjensen 4y ago

This is a good first start, but won't work for everyone. E.g. we got a new roof with solar. The solar is tax deductible. But is the roof? My options are (a) no (b) the portion with solar on top (c) all. Asking around, different people have taken different options, and no option is un-taken. Option (c) will probably never get audited and we all know it. I won't be taking it.

Arborealist 4y ago
They can generate 95% of returns completely accurately. For people with advanced situations they can feel free to file their own correct copy or pay an accountant. People wanting to deduct their charitable contributions should have to work harder to do that. I shouldn’t be inconvenienced because of that. Of course if they did that you wouldn’t need 80K new feds, and since they tend to vote lockstep for more endless government, well it’s quite convenient isn’t it?
sys_64738 4y ago
Solar power shouldn’t be tax deductible. This is another part of the problem.
- greedo 4y ago
  He was just illustrating the complexity. The tax code has tons of incentives for every Congresscritter's pet project.

thephyber 4y ago

The US government is great as building Dark Patterns in their benefits programs. There is one major party that thinks government doesn’t and can’t work well, so it’s no wonder that lots of the stakeholders design systems that frustrate users.

dpifke 4y ago

For some reasons why this won't work, might I suggest you skim through the other 1,526 comments on HN that have made the exact same suggestion: https://hn.algolia.com/?dateRange=all&page=0&prefix=false&query=irs%20file&sort=byPopularity&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu...