30 ms·

IRS tests free e-filing system that could compete with tax prep giants

• edgyquant 3y ago
  Hopefully it does. The tax system here is ridiculous to say the least.
  • colmmacc 3y ago
    I lived in four countries before moving to the USA and none of them required me to file at all. As an ordinary employee, taxes were PAYE (Pay as you Earn) and there was no complicated system of tax exemptions that aren't either handled directly at source, or as separate rebates (like child allowance payments). I long for that day in the USA.
    • jeffwask 3y ago
      It seems especially ridiculous since the US raised the standard deduction in 2017 fewer and fewer of us can itemize enough to meet it.
      • jandrese 3y ago
        Not only did they raise the standard deduction, but there's that $10k limit that you slam into when trying to itemize. My total tax burden went up about 2% after that change, but it does make filing theoretically easier, except that my wife is always holding out hope so we go through all the work to itemize only to discover yet again that we're over the cap and wouldn't benefit.
        • bubbleRefuge 3y ago
          10K limit on mortgage interest from primary residence , right ?
          • jandrese 3y ago
            It's a $10k limit on deductions so dependents, charitable contributions, mortgage interest, and probably some more stuff has to stay under that cap or it doesn't count. Since that change went in we've never been able to even match the standard deduction. It increased our tax bill by about 2% and my wife has still never forgiven Trump. I think we are directly in the middle of "squeeze the middle class" part of that tax change.
            • gamblor956 3y ago
              That's simply wrong. The I.R.S. specifically notes that there is no limit on overall deductions, and hasn't been for years. https://www.irs.gov/newsroom/irs-provides-tax-inflation-adjustments-for-tax-year-2023#:~:text=For%202023%2C%20as%20in%202022,Tax%20Cuts%20and%20Jobs%20Act https://www.irs.gov/newsroom/irs-provides-tax-inflation-adju.... However, there are now limits on individual deductions that didn't previously exist, like the SALT cap of $10,000. It also appears you were affected by the cap on the (loan) value of homes which for which you could take the mortgage interest deduction, which was lowered to $750k from $1m by the TCJA (meaning, if your home is worth more than $750k for loan purposes you can only deduct the mortgage interest attributable to the first $750k of the loan), or by the elimination of a number of 2% items (items that pre-TCJA could be deducted only if they exceeded 2% of your AGI).
            • jandrese 3y ago
              My home is nowhere near $750k, not even half of that. But every tax filing solution I've used has capped me at $10k deductions ever since the change.
        • gamblor956 3y ago
          there's that $10k limit that you slam into when trying to itemize This is...incompletely stated...the only $10,000 limit when itemizing is on SALT taxes (state and local income and property taxes). There is no $10,000 limit on deductions in general. And indeed, the IRS itself states "For 2023, as in 2022, 2021, 2020, 2019 and 2018, there is no limitation on itemized deductions, as that limitation was eliminated by the Tax Cuts and Jobs Act." (https://www.irs.gov/newsroom/irs-provides-tax-inflation-adjustments-for-tax-year-2023#:~:text=For%202023%2C%20as%20in%202022,Tax%20Cuts%20and%20Jobs%20Act https://www.irs.gov/newsroom/irs-provides-tax-inflation-adju....) The increase in the standard deduction means that it became more beneficial for many taxpayers that used to itemize. But many things that could be itemized in the past can no longer be itemized, which is probably what affected you (however, due to the way the TCJA was written, that prohibition only applies until 2025 unless extended by Congress, which will depend on who wins the 2024 election).
    • dboreham 3y ago
      "...do the right thing, after exhausting all possible alternatives"
    • elicash 3y ago
      Does that work when the percent you're supposed to pay depends on income bracket? (Genuine question!)
      • rsynnott 3y ago
        Yes. Now, there are edge-cases; in particular, things get messy when you move job and you may end up temporarily overpaying. But it works.
  • dennis_jeeves1 3y ago
    Meta observation: Taxes itself are ridiculous.
• easton 3y ago
  https://archive.is/UfW8A https://archive.is/UfW8A
• ShadowBanThis01 3y ago
  It is WAY past time for this. It's absurd that we have to regurgitate tax information that has already been reported to the government. But it's even more absurd that the government gives us no way to do so electronically. And then there's the disgusting shell game that IS the entire U.S. tax system, which is the root of the whole problem. But... didn't Congress pass some corrupt legislation years ago that made it illegal for the government to set up a tax-filing Web site? What happened to this: 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-...
  • lelandfe 3y ago
    Never happened. Thanks Propublica! https://www.propublica.org/article/irs-reforms-free-file-program-drops-agreement-not-to-compete-with-turbotax https://www.propublica.org/article/irs-reforms-free-file-pro...
    • ShadowBanThis01 3y ago
      Indeed. This is why a free press exists. Too bad fewer and fewer people appreciate it.
      • gowld 3y ago
        It doesn't need your appreciation so much as your donation. But you could donate appreciated stocks.
        • no-reply 3y ago
          [flagged]
          • dang 3y ago
            Please don't do this here.
• msla 3y ago
  I'm sure this will be killed in a lawsuit. Can't have the government destroying jobs.
  • deleted 3y ago
    [deleted]
  • AlexandrB 3y ago
    If the government destroys jobs: it's creeping communism. If the private sector destroys jobs (e.g. via automation): it's innovation and the free market at work. I wonder if a politician could get away with calling these "bullshit jobs" in response.
• lapetitejort 3y ago
  I paid ~$100 to file my taxes this year. At the end they said because I had one particular form that I couldn't file electronically, and I would have to send it in. So I had to print everything out, write checks, package everything up, visit the post office, and check that the letters arrived. I still had to pay full price of course.
  • dheera 3y ago
    Pro tip: If you have a tax bill over a few thousand dollars, sign up for some credit cards with big fat bonuses just to pay the taxes, and you can easily make up the $100. When the system of {government, financial institutions, credit cards, etc.} sucks, shove it back to the system. Obviously, calculate whether it really works out in your favor with the credit card payment fees, but in many cases it will.
    • throw9away6 3y ago
      If you pay taxes with a card the processor charges a fee. You won’t come out ahead
      • pb7 3y ago
        The credit card fee is around 1.9% (e.g. Pay1040), most credit cards will fall somewhere between 1-2% cash back which will make up for the fee alone without even considering the sign up bonus. Example: Chase Ink Unlimited[0] has a 75K points ($750 at minimum, more if you have a Preferred or Reserve to transfer to; was a 90K/$900 offer up until tax time this year) bonus and 1.5% cash back. It's free (untaxed!) money to pay your taxes. https://creditcards.chase.com/business-credit-cards/ink/unlimited https://creditcards.chase.com/business-credit-cards/ink/unli...
        • jimbob45 3y ago
          PSA: There are helpful websites[0] that can enable you to quickly compare credit cards to determine which fits your lifestyle best. [0]https://www.nerdwallet.com/best/credit-cards/cash-back https://www.nerdwallet.com/best/credit-cards/cash-back
• no_wizard 3y ago
  Are they going to also coordinate this with the states so Federal and State can be done for free for most people?
  • jandrese 3y ago
    Nope. States are all their special snowflakes when it comes to taxes. Many years ago, over a decade now, Virginia had an incredibly easy and free tax filing system. H&R block got one of their people elected for one term and they quietly killed it off and now we have one of the highest filing fees in the country.
• brocklobsta 3y ago
  What I don't understand about these programs is the added income clause. In California the state provides a free tool to file state income taxes (CalFile), but you can't use it if you make over $230,000 a year. Does it really make sense? It's similar with the federal free file program I believe. You would think they would want to encourage high income citizens to use their tool so they can control the deductions/credits/process.
  • AlexandrB 3y ago
    American legislators seem to loooove "means testing" every government-provided service. Maybe it's a misguided version of that?
    • brocklobsta 3y ago
      Agreed, but I don't see this as a service as much as a tool to perform a mandatory task. I don't WANT to do my taxes, I am forced to. At least don't deny me a tool because I pay the government a higher share of my income.
    • mountainofdeath 3y ago
      It's probably more-so that above a certain income threshold, your tax return becomes exponentially more complex. Free-file is useful when all you have is 1-2 above-board wage earning jobs, maybe with a 1099 contract job where the employer is nice nice enough to pre-fill the form out for you. Once you start dealing with non-trivial amounts of dividends, interest, securities, partnerships, real-estate, you really do need a professional to keep things organized.
      • brocklobsta 3y ago
        I get that, but why use income as a proxy for complex tax items? A W2 that takes home 400k using standard deduction for example is easier than someone self employed with several deductions that makes 100k.
      • runako 3y ago
• jandrese 3y ago
  For what it is worth, even with my medium-complex tax return I have had great results with freetaxusa.com for the past few years. The first couple of times we used it we ran the taxes through TurboTax and FreeTax at the same time and due to better UI the FreeTax version was faster and less confusing. That said, at the end of the process after entering all of the same information in the same places the TurboTax one did offer about $50 more in returns for unexplained reasons (The calculated figures were just plain different even with the same inputs, and doing the math by hand we got the FreeTax figures), but would have cost me $60 to use so we went with FreeTax instead. The second year we did the same thing and had a similar result so this year we didn't even bother. The process is still way too hard and confusing, but at least it feels like I'm feeding one less parasite this way.
  • pb7 3y ago
    Curious, does your medium-complexity tax return include investments?
    • jandrese 3y ago
      Yes. And green energy credit rollover. Also children and tax deferred savings accounts. My wife is also a self-employed contractor. FreeTax was able to handle all of that, albeit that some parts are still confusing. Most of the confusion comes from the contract work, but some of that is because she is actually working for a company that classifies her as a contractor to avoid paying benefits and taxes.
    • ye-olde-sysrq 3y ago
      I've used freetaxusa for 3 years now and have the same positive experience as the parent poster. And yeah my scenario includes investments. off the top of my head my return featured: * income from 2 employers for the same person * income in 2 states * kids and the stuff that comes with that (child tax credits etc) * capital losses (it's that time of the business cycle :< ) * interest (US treasury products) * dividends * mortgage stuff So if tons of americans can just do a 1040-EZ, then I feel like my usage probably covers like 99% of the remaining folks (which I would characterize as "I could do a 1040-EZ but I have kids and stocks").
• Melatonic 3y ago
  FINALLY
• dudul 3y ago
  Mostly off topic, but every time the subject of US taxes comes up I can't help but think about Tom Clancy's Executive Orders. (Spoiler coming) At the beginning of the book the entire US administration except Jack Ryan is killed in a terrorist attack, leaving him President and with the entire government to rebuild. Later in the book one of his advisors tells him something like "This is the only chance in History we will have to make all the hard decisions, all the hard choices we've been too afraid to make. We need to completely overhaul our tax system. This is our chance". As the years go by and all these plans are killed one after the other I realize how right this guy was.
• RektBoy 3y ago
  Wait what? Here in EU I've been filling out taxes for years electronically. Form and automatic guide is provided by our country. Btw should I mention this is mandatory only for self-employed. If you're an employee, it's required by law that your employer must provided you a free service of filling the taxes and everything for you.
  • jcfariadias 3y ago
    In Portugal, every transaction should, by law, be sent to the tax authority. Every employer should also report what paid to their employees and also retain in source part of the income Everything is then setup centraly by tax authority which enables the process of submiting tax reports being automatic for most or either, if you have a more complex tax situation, taking you a couple hours tops to self-fill and submit. It's rather surprising how progressive USA can be in some fields but so far behind in others...
    • RektBoy 3y ago
      I'm from CZ and we have an electornic tax filling only for a few years. You're light years ahead of us in this.
    • aksss 3y ago
      > every transaction should, by law, be [reported to the gov.] Conceptually, and in principle, this freaks a lot of Americans out. But the burden of not doing it is exceeding the alternative, I think. While it may be progressive to automate tax filing, having the government know everything about your financial transactions without proper cause is not considered very progressive (I guess it depends on what you are trying to progress towards).
      • jcfariadias 3y ago
        It's the only (that I know of) way to avoid tax evasion and paralel economy. There are incentives (tax deductions) that are granted to citizens who ask for invoices with their fiscal details It is indeed progressive because it unburdens citizens from a massive yearly headache when submiting taxes. It's progressive because it avoids physical printing of receipts, thus reducing waste and paper consumption. It is progressive because less tax evasion means more taxes to apply in free healthcare and social security. Having people not dying because they can't afford insurance, or being restful that the state will cover up part of their expenses if they can't work (for eg: if they have a flu and can't work for a week) seems pretty progressive to me and a good tradeoff for leting the government know about a few purchases you make. Also, if you want go paperless, your bank also knows about all your financial transactions and I don't see people caring too much about it as they care with government...
• throwaway85858 3y ago
  Some notes about the official system in Germany called "Elster" 1. Sign in via chip card or certificate based authentication for which the activation codes come in the post. 2. All forms are neatly laid out and guide you through the process of filing them, the quality of the frontend is really top notch, they even have a dark mode. 3. All insurances (health, life etc.) and wage statements have already been submitted and you just import them to your filing for that year, there's no guessing on what the correct deduction should be etc. 4. You add in your extra deductibles and submit, you'll have a response in the post within 2-4 weeks. 5. If anything is wrong I can call my dedicated guy at the local Finanzamt, I've had the same tax official for the last 10 years. 6. I still use tax advisors for some years because they just know more tricks then I do, and the legalese German is a bit of a pain to grok. 7. Best of all there's no requirement to do a yearly tax statement if you work a normal job.
  • jjcm 3y ago
    Australia is very similar to this, with the exception of activation codes in the post. Australia is pretty digital-first for their services, so you just sign in with your government ID and navigate to your taxes. Everything is pre-filled. If you have no additional deductions to add in, taxes take around 5 minutes total to file. They have a fairly robust banking system as well so any additional tax you have to pay takes around 60s to send through any bank's mobile app.
  • whimsicalism 3y ago
    The US basically has a privatized version of this. Pretty much all I need to do is upload a 1099 for my bank account interest & cap gains, everything else is autouploaded. The main difference you have to realize is not that our system is actually super shitty, we just have 4x the number of people to complain about things.
    • bestcoder69 3y ago
      In the US, if you fail to file then you won’t receive your EITC. In practice, in the US poor neighborhoods are littered with scammy tax preparers for this reason. I’d call our systems substantially different.
• mikeortman 3y ago
  I bet the SEO, dark patterns, and advertisement bullshit by Intuit et al. is going to be ridiculous if this releases to the masses. I bet they can get the IRS tool on page 3 of Google/Bing with enough effort
  • projektfu 3y ago
    I hope they use a ".gov" address instead of something ridiculous like "freefilefillableforms.com" which looks inauthentic, complete with GoDaddy TLS certificate, even though it is the official version.
• bluSCALE4 3y ago
  The only thing that sucks is that HR Blocks and they’re equivalent fill what otherwise would be a vacant or slot machine spots in many neighborhoods. Either way, good riddance.
  • booleandilemma 3y ago
    In NYC at least I expect we'll see yet more smoke shops open in their place.
  • coev 3y ago
    More space for spirit halloween and hastily made escape rooms.
• linuxftw 3y ago
  The IRS has no incentive to make sure you get all the deductions you're allowed. They don't have incentives to make sure the software works well under load and at scale. Whatever they put out will likely be half-baked, and the software will degrade rapidly because the tax laws change each year. I suspect, that given the currently complexity of the tax system itself (rather than the filing, which seems to be pretty straight forward), the private based system saves the tax payers money each year over any system the government could create.
  • mixmastamyk 3y ago
    Defeatism. Every other civilized country (and US states) manage to do it, and IRS has always been helpful and knowledgeable if you ask them. They've been using electronic systems for several decades already. Oh, and USDS is involved, so shouldn't be a contractor shitshow.
  • Finnucane 3y ago
    Obviously, what the tax preparers are afraid of is that the IRS could provide system that works perfectly well for a large majority of their customers, leaving them only the people with more complex needs, or need to manage a lot of deductions, etc. No one would be forcing you to use the IRS system if you think it doesn't work for you.
    • linuxftw 3y ago
      No, but I would be forced to pay for the system whether I use it or not. I prefer not to pay for the system.
      • Finnucane 3y ago
        Yeah, I know, tax money going for stuff that other people might benefit from more than we do ourselves, the great tragedy of our times. Never mind that any system that improves compliance could raise more money than it costs.
      • elicash 3y ago
• themagician 3y ago
  Does the IRS actually know what everyone owes? I know it's true for W-2 employees, but what about everyone else? I've always had this feeling that you could ask the IRS what they believe any given SSN/EIN owes and they'd be able to tell you (not that they would, but that it's already calculated somewhere). I don't know if this actually true though. I know almost all W-2 information is sent electronically. They know about most 1099 transactions too. But is all this information pre-compiled against someone's SSN, or do they only run that calculation as part of random audits?
  • clintonb 3y ago
    They know when you don't pay enough, so they have to know what you owe. All of the forms we receive (e.g., W-2, 1099) are transmitted to the IRS. They can use them to determine if a tax payer underpaid. I know this firsthand because a broker transmitted proceeds without transmitting a cost basis, resulting in a scary letter from the IRS a few months after I filed. The problem, as I understand it, is that the IRS' technology is very dated, so processing is quite slow, hence the months-long wait between filing and a CP2000 letter.
    • gowld 3y ago
      They want to spook you into being honest, by not telling you what they know. If you knew the IRS missed something , you could safely not report it.
      • themagician 3y ago
        It honestly seems like the revenue lost to this would be trivial against the cost savings of not having to play the weird game that we play.
  • balls187 3y ago
    > Does the IRS actually know what everyone owes? I know it's true for W-2 employees, but what about everyone else? Not quite. The IRS knows the income that is reported, and the taxes you have paid. It doesn't know which credits and deductions you qualify for. It can guess based on your previous returns, but it isn't accurate and needs to be updated annually. Once you provide your credits and deductions, the IRS can calculate what your tax liability should be vs what you actually paid.
• macinjosh 3y ago
  The fact that we have to report anything about our personal finances to the Federal Government is a violation of the 5th Amendment. The fact that they've forced employers to be their snitches is even more gruesome. Isn't it a sure sign of fascism when corporations and government work hand in glove?
  • Finnucane 3y ago
    If you are taking the Fifth on your taxes ("No person ... shall be compelled in any criminal case to be a witness against himself") you might want to reconsider your life choices.
  • elicash 3y ago
    The 16th Amendment allows for an income tax: > The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.
    • jcranmer 3y ago
      Actually, it doesn't: Congress already had the power to levy income taxes. The power to levy an income tax predates the 16th Amendment. What the 16th Amendment did was to explicitly overturn the Pollock SCOTUS decision, which said that a tax on rental income is basically a tax on property, and a tax on property is a direct tax which requires specifically apportionment among the states per the Constitution.
      • deleted 3y ago
        [deleted]
  • callalex 3y ago
    I recommend that you re-read the constitution.
• mattwad 3y ago
  This is amazing. Pigs do fly
• runako 3y ago
  "The IRS currently refers people seeking no-cost filing options to a consortium of companies that provide free e-filing for taxpayers below a certain income level. Though 70 percent of taxpayers qualify for those products, fewer than 3 percent of taxpayers use them, according to a Government Accountability Office report." This low uptake absolutely has to be one of the impediments to a rollout of a free IRS-run tax service. The argument is simple: why should we invest resources in expanding our free services when taxpayers don't use what we already make available? Is there data to support the notion that usage would meaningfully increase if we supported 100% of filing cases? (I would expect the opposite to be true; as tax situations get more complex, filers have more incentive and means to hire specialized help.)
  • elicash 3y ago
    It would save taxpayer dollars if we encourage folks filing by paper to do so electronically. Administratively, having the agency staff folks dealing with paper takes much longer.
  • petsfed 3y ago
    This is because every member of that consortium uses some combination of dark patterns and nonsensical restrictions to divert users away from the free option towards their pay options. Propublica did a report on this (linked several times in this discussion) that showed how difficult it was to get to the actually-free version of TurboTax.
  • akira2501 3y ago
    > why should we invest resources in expanding our free services when taxpayers don't use what we already make available? It's not a service. It's an obligation. You want my money? Why do I have to find a "service" to get you to take it? If you've never used one of those services, you should. Some of them have gotten better only very recently, some still look like fly-by-night scam operations that are trying to filch your personal information. The old adage "you get what you pay for" has never been more true. > Is there data to support the notion that usage would meaningfully increase if we supported 100% of filing cases? Yes. The billions of dollars spent lobbying the congress to prevent this very thing from happening.
• sys_64738 3y ago
  I hope H&R Block, Intuit and all the other parasites die as a result of this. They are a menace to society.
• alfalfasprout 3y ago
  The software is nice and all... but the real problem is that the tax code is just way too complex. If you have properties, RSU income, other investment income, W2 income, and have to deal with multiple states you can have three different CPAs come up with three different numbers. At the end of the day, if you're a billionaire earned income is a teeny tiny part of your earnings and most of it is kept unrealized for tax purposes. As a result, the doctor or software engineer ends up bearing a 50+% tax burden while ultra high net worth individuals are lucky to pay even close to the LTCG rate on all their income. The tax system is oppressive under the guise of being "progressive" but really it prevents social mobility.
  • gowld 3y ago
    Paying 50% is a complaint about the tax rate, not complexity. Billionaires not paying tax on unearned gains is a complaint about the tax policy and its basis in $ not assets, not complexity. Doctors and Software Engineers earning >$500K/yr and paying 50% of it in tax proves that social mobility is quite enabled.
    • adra 3y ago
      The number of engineers making 500k USD per capita is a rounding error. Social mobility in the US is not great despite the purported American dream. Just because one can be wealthy from any background, the statistics prove you're unlikely do do so. The needle for social mobility has moved significantly globally since the times of kings and aristocrats.
  • wefarrell 3y ago
    The lower hanging fruit is to fix the filing method. The government has all of the data available to them, they should be able to send you a pre filled tax return that you can amend for whatever reason. In 98% of situations their numbers won't need changing and filing can be a 30 second process. I believe that's how it works in most other countries. Of course there are powerful lobbies who want the tax process to be painful and that's why it doesn't work like that currently.
  • newhotelowner 3y ago
• deleted 3y ago
  [deleted]
• CodeWriter23 3y ago
  You all are so cute thinking the government is going to perform this function when in reality they are simply going to choose a third party to outsource to. Probably without even giving Intuit a chance to bid on it. Not that I like Intuit, they suck IMO. But I do think a vendor selection process such as this should be an open one. Instead we will have more back room-brokered graft.
  • elicash 3y ago
    That might be true later! But so far: "The system was developed by the IRS and U.S. Digital Service, the White House’s technology consulting agency." You can learn more about the U.S. Digital Service here: https://www.usds.gov/mission https://www.usds.gov/mission
    • CodeWriter23 3y ago
      Well that totally disproves the idea because the USDS would never outsource anything.
      • elicash 3y ago
        I suggested in my comment that they might!
  • beisner 3y ago
    Yeah the USDS is one of the only romantic/bright spots for good application of tech in the US government.
• dgudkov 3y ago
  With so many software developers filing taxes, why isn't there a decent open-source tax filing application?
  • adra 3y ago
    Because it's largely a boring coding task that requires painfully complete understanding of stupidly obscure tax codes, running research into tax courts to see how these codes have been interpreted into law, etc. I'm not sure about the US, but other countries have certification that must be passed before they're even allowed to sell/provide their product to meet the government tax guidelines.
  • eYrKEC2 3y ago
    It's incredibly complex, it changes every year, there is huge amount of gray area, if you do it wrong and the customer gets audited and fined by the IRS there is a possiblity of liability (regardless of clauses such as "AS IS" et c.)
  • rcktmrtn 3y ago
    I was considering the same question this year. I've been doing mine with freefilefillableforms (basically just an online version of paper) for several years and have gradually been getting better at it. Here's my breakdown of what took the most time/stress (I didn't use a stopwatch, so it's heavily impacted by how it felt): 2% creating a spreadsheet that did the simple arithmetic to add up sums for investment boxes and that did the final tax calculation 90% spent trying to understand/fix one stupid mistake with an HSA account that was very confusing in the tax code. I am nearly certain that TurboTax wouldn't have helped. 5% reviewing all our other accounts, saving copies of the statements, and inserting relevant values into a spreadsheet 3% copying and reviewing my copying of other numbers, including the long stupid EIN numbers from W-2s that I miscopied and caused the IRS to automatically reject my return ... and here are my conclusions: * The thing I personally would most love but don't believe is easily possible is a way to avoid all the mistakes copying and to simplify some of the data collection and staring at 1099s from different accounts that arrange the boxes slightly differently, but I can see why this hasn't really been automated in an open source way. While some sort of image processing or by trying to scope out APIs with the financial institutions might help, it's hard to envision an open source project that would do this. * I actually value tax time as a time to review accounts and finances. So even if the data collection stress was reduced, I would still want to have a good feel for the numbers. * The most serious problems I seem to run into never feel like software problems. I have had problems like the HSA issue in the past with turbotax and the "helpful" UI can only do so much to answer tough questions. * Last year I filled out the Qualified Dividends worksheet by hand, the spreadsheet is a million times better though. It's basically the same thing as those online calculators, but I wanted to be able to see what calculations it was doing and review it and also not put my tax info online. * Overall, what I'm most inspired to do would be to share the spreadsheet or a similarly scoped program and document/continue to refine my process for entering and collecting data. Working towards an end-to-end solution feels to me like a loser, at least to start off. Modular seems like the way to go. Solve one problem at a time. There is already an https://opentaxsolver.sourceforge.net/ https://opentaxsolver.sourceforge.net/. Haven't tried it out yet, but I feel like it isn't what I'm looking for.
• luxuryballs 3y ago
  are they going to collect data as you enter things into the interface and scrutinize behavior? I kind of like how a third party will wait until I am good and ready to send data over to the IRS
• jeron 3y ago
  intuit down 1.63% today
• makestuff 3y ago
  I hate turbo tax. Every year there is some bug with importing stock transactions which requires me to dig around on their support forums.
  • Aperocky 3y ago
    LOL a box has to be manually filled out. I can't believe they didn't fix that for 3 straight years.
• tyingq 3y ago
  If it would just pre-fill with the numbers and various sources they already have and think belong there, that would be helpful.
• deleted 3y ago
  [deleted]
• NoblePublius 3y ago
  We’ve completely lost the plot if we’re arguing about whether the government or private companies should maintain a system for filing taxes when ~80% of filers could be sent a bill or refund automatically based on info the IRS already has.
• junipertea 3y ago
  As long as the system is correct and I don't get jailed I would use it out of principle regardless of UX.
• aimor 3y ago
  "The Internal Revenue Service has quietly built its own prototype system to allow Americans to file tax returns digitally and free of charge" I think opening the article this way is misleading, although they explain it better later on. This isn't about filing for free, it's about guided tax preparation. Those automated systems that ask a series of simple questions and magically submit your tax return. That's why tax complexity is the underlying issue. To do your taxes you "just" have to follow along a 100+ page instruction booklet (plus instruction booklets for any additional forms). Even with the Free Fillable Forms (free government electronic filing for everyone with digital forms and some automated calculations) it's a pain in the butt. By rephrasing the questions, automating the calculations, and checking for errors, fairly complex taxes can be done in under an hour. So we're playing this stupid game where the government spends the time and money to write complex taxes and all the forms and instructions to go with them, just for us to pay businesses to simplify it all so we can tell the government what our taxes really are. I hope this change takes a big chunk out of the $14 billion tax prep industry (that's more than the IRS's expenditures), because maybe when they're out of the game Congress will be a little more motivated.
• _8j50 3y ago
  How can I put this, you don't want this free thing or big name tax preparing companies. Everyone from poor people to billionaires needs a guy who can game the system. The popular sentiment on HN and similar sites is strange to me, yes the IRS knows how much I owe them, no I don't want to pay that, I want to pay less or get more refund (same thing, taking into account witholdings). Do you all have so much money you think everyone else also thinks the convenience of filing tax is not worth the extra money? The right guy has saved me 10K+, this is especially true when you contract. The thing is, the government doesn't know everything I do, and I won't be able to even think of those things when filing. I need a guy asking me "did you work from home or take toll way to work?" And the works his magic. You think you're doing poor people a service but they'll file it on irs's website and get a lot less because they don't know to ask the right questions to get all the nice deductions. I swear everything on HN political these days is "big gov and corp bad,never trust". It's never that simple. Oh and get this, maybe all these people behind this movement don't know this but every poor person I have known files taxes for free. Not only are there volunteer ngo's, individuals also do that at libraries and such. "The government already knows how much I make and how much I owe, why don't they send me the bill?" So you can tell them you owe less! There is just no way around the fact that there are tax deductions and exemptions and all that.
• andrewla 3y ago
  The steelman case for opposing "auto-filing" or having the IRS provide tax preparation is that the intention of requiring everyone to file is that all citizens should be directly aware of the amount of taxes being assessed and the complexity of the tax code itself, with the objective of making people oppose legislative increases in the complexity of the tax code, and to make tax increases more intrusive so that legislators cannot increase taxes without people noticing. I think, though, that this philosophy does not accomplish its ends -- people are mad at the IRS for making them do this work, not at the legislators for creating and maintaining a byzantine tax code. Ideally we would all choose politicians that favored removing complexity and reducing the amount of taxes, but the reality is that this is not usually a politically viable strategy.
  • BugsJustFindMe 3y ago
    > The steelman case for opposing "auto-filing" or having the IRS provide tax preparation is that the intention of requiring everyone to file is that all citizens should be directly aware of the amount of taxes being assessed and the complexity of the tax code itself That's a very weak case when they could just send me a letter telling me how much they took and why, which would accomplish the same thing but better and without saddling me with a bunch of unnecessary labor and/or expense.
    • chimeracoder 3y ago
      > That's a very weak case when they could just send me a letter telling me how much they took and why, which would accomplish the same thing but better and without saddling me with a bunch of unnecessary labor and/or expense. Furthermore, the amount of money that people pay is not very strongly correlated with the time or effort (or frustration) involved in filing the taxes. In fact, there's often (though not always) a correlation in the other direction: most of the "optional" complexity in the tax code comes from the various tax deductions that people are able to file for, making it more effort and frustration not to overpay - this is essentially the opposite of what GP is saying would be the "steelman" argument.
      • 3y ago
• karaterobot 3y ago
  Granted: Intuit sucks, H&R block sucks, they are blocking tax reform, they are evil, the tax system in the U.S. makes no sense. Having stipulated that, I do not understand why the government is creating a free product to compete with Turbotax, et al. instead of making tax returns unnecessary in the first place. I assume it is because it would have been much harder for Biden to sneak that change into the bill. But, sadly, nothing short of reform is an actual solution. And, I'm much less comfortable with the government spending tax dollars competing directly with a private company than I am with them legislating or regulating that company's reason for existing away. That feels like it's much closer to their remit.
• stjohnswarts 3y ago
  Why don't they simply buy some "middle-sized" company like FreeTaxUsa.com and build on that? Government has an awful history of "clean room" start of virtually all large scale software projects. They sell it to the lowest bidder and then they fail and billions get wasted, when they could just have bought something.
• graypegg 3y ago
  Really hope this puts pressure on the CRA (Canada) to do the same! It’s comical how accurate CRA’s Auto-Fill system [0] is when filing my (admittedly simple) taxes. They’re so close to their own solution, “just” needs some UI. (Famous last words, but still…) I’d be content with “here’s what the CRA has on file.” with a big list of everything already in auto-fill. Then two buttons [accept] which just send it to the CRA with NETFILE, or [file myself] which directs you to a private service instead. 7/7 years I’ve been required to file taxes I would’ve clicked [accept]. [0] https://www.canada.ca/en/revenue-agency/services/e-services/about-auto-fill-return.html https://www.canada.ca/en/revenue-agency/services/e-services/...
• deepzn 3y ago
  Intuit has a $120 B market cap. And it is a monopoly. It's been rightly found misleading users to pay for services. I'd been deceived to pay for it my first year or so dealing with taxes, as I ended up entering all the information, and then being told I had to pay when it initially was advertising as free. With ChatGPT models, we can perhaps have our own tax agent who can assist us -seems likely in the near future in any case. Also as other pointed out, the tax system is at fault, it should just be automatically done and billed by the IRS.
• papertrail-work 3y ago
  I thought the US already has ways to file stuff for free like using Cash App/CreditKarma?
• kernal 3y ago
  Will there be a limit on who can use it based on income discrimination? If so, it's a waste of time.
• justizin 3y ago
  i am of two minds on this. FIRST, obviously, there are probably fewer dark patterns in anything than the intuit / us tax situation. there are so many problems with our tax system and the way it eats away at working people while barely touching the wealthiest folks. i’ve had some unfortunate interactions with the CA Franchise Tax Board in recent years that have made me question whether the IRS will choose to be transparent and treat us fairly if this passes. I’m certainly no tax expert, so the notion that I may have made a small mistake in past tax years that needed to be corrected is not unreasonable. that i was not provided with any detailed information, or really any communication at all, and the money was siezed from my paycheck without notice. The first time this happened was the second paycheck in the month of december. This sucked, but I was probably wrong, maybe I failed to update my contact address somewhere, and I always want to pay what I owe. Fast forward to 2021/2022, somewhere in there, IIRC, the CA FTB, during a budget crisis, found that I was short a couple thousand over multiple years from several years back. I had never heard anything about this before, and they came at me for 2-3 years all at the same time. No information on what was incorrect. CA has an, “Office of the Taxpayer Advocate”, because of course at some point we legislated that there should be someone paid by the state whose job is to help taxpayers who feel they have been wronged. Obviously there’s a weird conflict of interest here, but it’s better than nothing. My interaction with the taxpayer advocate many years ago involved them trying to tax me for work I performed in an office in San Antonio, Texas, over a year before moving to California. certainly part of this is about the fact that CA is a bit grabby at the entire lifetime income of anyone who relocates here, which is absolutely the fucking truth, but I also found these situations to give me pause on whether I want to trust the government to tell me whether or not I have correctly paid my taxes. Even though I am single, live alone, no dependents, and claim 0, somehow I am always off. If we want to simplify this, get out from under Intuit’s thumb, and have like 95% of the country or whatever not even have to worry about taxes, we have to fundamentally rethink how they are calculated. Why isn’t my employer liable for not calculating the appropriate deduction? Why is this something I have to worry about? On balance, at this point in my career, a thousand bucks a year isn’t a big deal, the problem is asking me for it all at once, when there’s no great way for me to know to expect it. I have, for the first time in my life, a small amount of savings, but I still don’t consider it a nest egg. That is my insurance for when I somehow manage to owe taxes even though I have done every single thing that I should do, correctly. another knock on TurboTax is that they often end up calculating that you owe more tax than you do, and I think it backs up my concern that in those cases, the IRS does not say, “Hello, kind person, you gave us an extra $3,000, we would like to return it to you.” It’s basically just fucking all bad.
• metaphor 3y ago
  You know those bills that summarily end with "and for other purposes"? Well... Worth noting that the GOP-led House is trying to silently kill this with haste (along with funding for IRS enforcement) by burying defunding language in H.R. 2811 (a.k.a. the House's proposal to raise the debt ceiling) § 251 under a backhanded title named "Family and Small Business Taxpayer Protection"[1]: > The unobligated balances of amounts appropriated or otherwise made available for activities of the Internal Revenue Service by paragraphs (1)(A)(ii), (1)(A)(iii), (1)(B), (2), (3), (4), and (5) of section 10301 of Public Law 117–169 (commonly known as the “Inflation Reduction Act of 2022”) as of the date of the enactment of this Act are rescinded. The $15 million budget mentioned in the article was appropriated[2] by § 10301 p. (1)(B) of the Inflation Reduction Act of 2022 and will expire at the end of this fiscal year: > TASK FORCE TO DESIGN AN IRS-RUN FREE "DIRECT EFILE" TAX RETURN SYSTEM.—For necessary expenses of the Internal Revenue Service to deliver to Congress, within nine months following the date of the enactment of this Act, a report on (I) the cost (including options for differential coverage based on taxpayer adjusted gross income and return complexity) of developing and running a free direct efile tax return system, including costs to build and administer each release, with a focus on multi-lingual and mobile-friendly features and safeguards for taxpayer data; (II) taxpayer opinions, expectations, and level of trust, based on surveys, for such a free direct efile system; and (III) the opinions of an independent third-party on the overall feasibility, approach, schedule, cost, organizational design, and Internal Revenue Service capacity to deliver such a direct efile tax return system, $15,000,000, to remain available until September 30, 2023: Provided, That these amounts shall be in addition to amounts otherwise available for such purposes. What the GOP really wants to quietly snuff is the IRS's enforcement budget...something about IRS examinations and collections having very real capacity to deliver positive revenue increases for the Treasury[3], and higher-income taxpayers facing the largest increase in audit rates[4]. Alas, games will be played[5]. [1] https://www.congress.gov/bill/118th-congress/house-bill/2811/text#toc-H3F4BEEF0295B43E3A7C0F32EE9C8D041 https://www.congress.gov/bill/118th-congress/house-bill/2811... [2] https://www.congress.gov/117/plaws/publ169/PLAW-117publ169.pdf https://www.congress.gov/117/plaws/publ169/PLAW-117publ169.p... [3] https://www.cbo.gov/publication/56467 https://www.cbo.gov/publication/56467 [4] https://www.cbo.gov/publication/57444 https://www.cbo.gov/publication/57444 [5] https://www.nber.org/papers/w28542 https://www.nber.org/papers/w28542
• FireBy2024 3y ago
  https://archive.ph/UfW8A https://archive.ph/UfW8A
• bilekas 3y ago
  I used to work for HRB on their workflow engine basically. And I can say to all the comments about how it's ridiculous that this isn't already free, the IRS delegate the responsibility to the private companies and removes overhead for the IRS. If HRB mess up with the forma they're liable and you're not out of pocket at all. The US taxes are not trivial each state will change frequently and federal also throughout the year. Given I've experienced how much is actually involved i don't think i would trust a government body to be the only option for me who is not an accountant.
• rmathot 3y ago
  It exists in Belgium for years, called Tax-on-web... the UX is not fancy but it works pretty well, and you don't have to enter again information that is already known by the Revenue Services
• dang 3y ago
  Related: Call on the IRS to provide libre tax-filing software - https://news.ycombinator.com/item?id=35705469 https://news.ycombinator.com/item?id=35705469 - April 2023 (129 comments) 60M Americans have taxes so simple the IRS could do them automatically - https://news.ycombinator.com/item?id=35476709 https://news.ycombinator.com/item?id=35476709 - April 2023 (277 comments) Lobbyists begin chipping away at Biden’s $80B IRS overhaul - https://news.ycombinator.com/item?id=35381701 https://news.ycombinator.com/item?id=35381701 - March 2023 (214 comments) Intuit pouring money into lobbying amid push for free government-run tax filing - https://news.ycombinator.com/item?id=34840039 https://news.ycombinator.com/item?id=34840039 - Feb 2023 (178 comments) IRS builds task force to explore running its own free e-file system - https://news.ycombinator.com/item?id=34764952 https://news.ycombinator.com/item?id=34764952 - Feb 2023 (199 comments) IRS Free File: Do Your Taxes for Free - https://news.ycombinator.com/item?id=34462122 https://news.ycombinator.com/item?id=34462122 - Jan 2023 (247 comments) IRS will look into setting up a free e-filing system - https://news.ycombinator.com/item?id=32753099 https://news.ycombinator.com/item?id=32753099 - Sept 2022 (408 comments) The IRS could be on the verge of changing the way Americans file their taxes - https://news.ycombinator.com/item?id=32550841 https://news.ycombinator.com/item?id=32550841 - Aug 2022 (17 comments) IRS will study free tax filing options - https://news.ycombinator.com/item?id=32502321 https://news.ycombinator.com/item?id=32502321 - Aug 2022 (25 comments) TurboTax’s fight against free tax filing - https://news.ycombinator.com/item?id=31072202 https://news.ycombinator.com/item?id=31072202 - April 2022 (394 comments) Filing taxes could be free & simple. H&R Block & Intuit lobby against it (2017) - https://news.ycombinator.com/item?id=30856968 https://news.ycombinator.com/item?id=30856968 - March 2022 (114 comments) FTC sues Intuit for its deceptive TurboTax “free” filing campaign - https://news.ycombinator.com/item?id=30846071 https://news.ycombinator.com/item?id=30846071 - March 2022 (587 comments) Ask HN: How does TurboTax get away with dark patterns? - https://news.ycombinator.com/item?id=30409523 https://news.ycombinator.com/item?id=30409523 - Feb 2022 (122 comments) Why do Americans have to pay much to file their tax returns when the IRS knows? - https://news.ycombinator.com/item?id=30267361 https://news.ycombinator.com/item?id=30267361 - Feb 2022 (22 comments) Filing Taxes Could Be Free and Simple. But H&R Block and Intuit Lobby Against It (2017) - https://news.ycombinator.com/item?id=30185484 https://news.ycombinator.com/item?id=30185484 - Feb 2022 (18 comments) California tried to save the nation from tax filing, then Intuit stepped in - https://news.ycombinator.com/item?id=28944200 https://news.ycombinator.com/item?id=28944200 - Oct 2021 (283 comments) The IRS has a big opportunity to fix the way Americans file taxes - https://news.ycombinator.com/item?id=28177289 https://news.ycombinator.com/item?id=28177289 - Aug 2021 (12 comments) UsTaxes – open-source tax filing web application - https://news.ycombinator.com/item?id=27998452 https://news.ycombinator.com/item?id=27998452 - July 2021 (53 comments) Good Riddance, TurboTax. Americans Need a Real ‘Free File’ Program - https://news.ycombinator.com/item?id=27902380 https://news.ycombinator.com/item?id=27902380 - July 2021 (248 comments) Intuit will no longer be a part of IRS Free File program - https://news.ycombinator.com/item?id=27865625 https://news.ycombinator.com/item?id=27865625 - July 2021 (140 comments) Killing TurboTax - https://news.ycombinator.com/item?id=26330584 https://news.ycombinator.com/item?id=26330584 - March 2021 (662 comments) Show HN: ustaxes.org – open-source tax filing webapp - https://news.ycombinator.com/item?id=26138446 https://news.ycombinator.com/item?id=26138446 - Feb 2021 (219 comments) TurboTax Tricked You into Paying to File Your Taxes (2019) - https://news.ycombinator.com/item?id=26102695 https://news.ycombinator.com/item?id=26102695 - Feb 2021 (306 comments) TurboTax’s 20-Year Fight to Stop Americans from Filing Taxes for Free (2019) - https://news.ycombinator.com/item?id=26060414 https://news.ycombinator.com/item?id=26060414 - Feb 2021 (199 comments) FTC Is Investigating Intuit over TurboTax Practices - https://news.ycombinator.com/item?id=24409093 https://news.ycombinator.com/item?id=24409093 - Sept 2020 (194 comments) IRS stops firms like TurboTax from hiding free tax-filing products in searches - https://news.ycombinator.com/item?id=21948935 https://news.ycombinator.com/item?id=21948935 - Jan 2020 (25 comments) IRS Reforms Free File Program, Drops Agreement Not to Compete with TurboTax - https://news.ycombinator.com/item?id=21923220 https://news.ycombinator.com/item?id=21923220 - Dec 2019 (448 comments) IRS Tried to Hide Emails That Show Tax Industry Influence over Free File Program - https://news.ycombinator.com/item?id=21393758 https://news.ycombinator.com/item?id=21393758 - Oct 2019 (188 comments) TurboTax’s 20-Year Fight to Stop Americans from Filing Taxes for Free - https://news.ycombinator.com/item?id=21281411 https://news.ycombinator.com/item?id=21281411 - Oct 2019 (447 comments) TurboTax to charge more lower-income customers - https://news.ycombinator.com/item?id=20461169 https://news.ycombinator.com/item?id=20461169 - July 2019 (81 comments) Congress Scraps Provision to Restrict IRS from Competing with TurboTax - https://news.ycombinator.com/item?id=20119916 https://news.ycombinator.com/item?id=20119916 - June 2019 (18 comments) TurboTax Uses a “Military Discount” to Trick Troops into Paying to File Taxes - https://news.ycombinator.com/item?id=19994118 https://news.ycombinator.com/item?id=19994118 - May 2019 (42 comments) Listen to TurboTax Lie to Get Out of Refunding Overcharged Customers - https://news.ycombinator.com/item?id=19870242 https://news.ycombinator.com/item?id=19870242 - May 2019 (44 comments) TurboTax and H&R Block Saw Free Tax Filing as a Threat - https://news.ycombinator.com/item?id=19810981 https://news.ycombinator.com/item?id=19810981 - May 2019 (143 comments) TurboTax Hides Its Free File Page from Search Engines - https://news.ycombinator.com/item?id=19758126 https://news.ycombinator.com/item?id=19758126 - April 2019 (262 comments) TurboTax Uses Dark Patterns to Trick You into Paying to File Your Taxes - https://news.ycombinator.com/item?id=19718284 https://news.ycombinator.com/item?id=19718284 - April 2019 (274 comments) Congress Is About to Ban the US Government from Offering Free Online Tax Filing - https://news.ycombinator.com/item?id=19613725 https://news.ycombinator.com/item?id=19613725 - April 2019 (696 comments) Filing Your Taxes Is an Expensive Time Sink. That’s Not an Accident - https://news.ycombinator.com/item?id=19572917 https://news.ycombinator.com/item?id=19572917 - April 2019 (155 comments) How the Maker of TurboTax Fought Free, Simple Tax Filing (2013) - https://news.ycombinator.com/item?id=19392673 https://news.ycombinator.com/item?id=19392673 - March 2019 (253 comments) H&R Block and Intuit Lobby Against Free and Simple Tax Filing (2017) - https://news.ycombinator.com/item?id=18956883 https://news.ycombinator.com/item?id=18956883 - Jan 2019 (190 comments) Would You Let the I.R.S. Prepare Your Taxes? (2015) - https://news.ycombinator.com/item?id=17751383 https://news.ycombinator.com/item?id=17751383 - Aug 2018 (424 comments) IRS electronic filing system breaks down hours before midnight deadline - https://news.ycombinator.com/item?id=16860086 https://news.ycombinator.com/item?id=16860086 - April 2018 (97 comments) Why I'm boycotting TurboTax this year - https://news.ycombinator.com/item?id=16844458 https://news.ycombinator.com/item?id=16844458 - April 2018 (23 comments) H&R Block and Intuit Lobbying Against Simpler Tax Filing (2017) - https://news.ycombinator.com/item?id=16841449 https://news.ycombinator.com/item?id=16841449 - April 2018 (232 comments) Stanford Professor Loses Political Battle To Simplify Tax Filing Process - https://news.ycombinator.com/item?id=13990391 https://news.ycombinator.com/item?id=13990391 - March 2017 (386 comments) H&R Block and Intuit Are Lobbying Against Making Tax Filling Free and Easy - https://news.ycombinator.com/item?id=13922482 https://news.ycombinator.com/item?id=13922482 - March 2017 (234 comments) How the Maker of TurboTax Fought Free, Simple Tax Filing (2013) - https://news.ycombinator.com/item?id=13853150 https://news.ycombinator.com/item?id=13853150 - March 2017 (439 comments) US Senator Warren Introduces Bill to Simplify Tax Filing - https://news.ycombinator.com/item?id=11492025 https://news.ycombinator.com/item?id=11492025 - April 2016 (155 comments) TurboTax Takes Aim at Smaller Rival in Fight for Filers - https://news.ycombinator.com/item?id=11150694 https://news.ycombinator.com/item?id=11150694 - Feb 2016 (87 comments) Would You Let the I.R.S. Prepare Your Taxes? - https://news.ycombinator.com/item?id=9381437 https://news.ycombinator.com/item?id=9381437 - April 2015 (150 comments) Would You Let the I.R.S. Prepare Your Taxes? - https://news.ycombinator.com/item?id=9380232 https://news.ycombinator.com/item?id=9380232 - April 2015 (124 comments) TurboTax Maker Intuit Funnels Millions to Lobby Against Easier Tax Returns - https://news.ycombinator.com/item?id=7595440 https://news.ycombinator.com/item?id=7595440 - April 2014 (182 comments) Filing taxes: It shouldn't be so hard - https://news.ycombinator.com/item?id=5488084 https://news.ycombinator.com/item?id=5488084 - April 2013 (56 comments) How the Maker of TurboTax Fought Free, Simple Tax Filing - https://news.ycombinator.com/item?id=5443203 https://news.ycombinator.com/item?id=5443203 - March 2013 (330 comments) Intuit lobbies against California's free tax filing service - https://news.ycombinator.com/item?id=1569169 https://news.ycombinator.com/item?id=1569169 - Aug 2010 (29 comments)
• opzz 3y ago
  They should open source this. I would actually contribute to making this usable.
  • Y_Y 3y ago
    Who else should own the code but the citizens of the country that made it?
  • amelius 3y ago
    Makes you wonder why there wasn't an open source tool for this to begin with. Why did nobody feel the urge to make this?
    • staringback 3y ago
      https://ustaxes.org https://ustaxes.org
    • deleted 3y ago
      [deleted]
    • samrus 3y ago
      I would imagine because of the self barter nature of open source. Open source only works when the group that can make the tools are also the group that uses them. So they are bartering with themselves. That's how they "pay" for it. But contributing back to the shared pool of resources Taxpayers can't contribute back to the pool that software engineers use. The people who build it will not be "compensated" with other tools that they can the use for free. So they don't build them
      • deeg 3y ago
        Maybe it should be open source but read-only. The only opposition to a government filing system that I think makes any sense is that we shouldn't necessarily trust the government to get the taxes right*. Making the tax software open source (or public) would mitigate that concern. * - It's not something that I'm concerned about but I think some skepticism of the government is healthy if easily addressed.
• gigatexal 3y ago
  Who cares what incumbent tax prepares think? They ARE the problem. They and their lobbyists.
  • mperham 3y ago
    It's NPR, gotta give both sides equal time.
    • smeagull 3y ago
      That is the stupidest thing I have ever heard.
      • joshstrange 3y ago
        An yet I've watched NPR do exactly that many, many times. It's why I stopped listening to their podcasts. It's the whole "One side says it's raining the other side says it's not, more news at 11"-bullshit that I can't stand. They present the facts better than most (CNN, Fox, MSNBC) but fall prey to the "both sides" bullshit time and time again trying to appear unbiased instead of living in reality.
      • bell-cot 3y ago
        "Dial up the stupid" is probably NPR's S.O.P. for politically contentious news. I recall hearing them do a news story ~~15 years ago, where "balanced" coverage was "Democratic spokesman says 2 + 2 = 3, Republican spokesman says 2 + 2 = 5". No hint from the NPR reporter that something else might be the correct answer to "2 + 2 = ?". Let alone dropping a hint as to what that right answer was. I didn't bother listening to NPR News (nor donating to them) after that.
• noturno_mind 3y ago
  no shit!
• rocketbop 3y ago
  > A direct-to-IRS e-file system is wholly redundant and is nothing more than a solution in search of a problem," said Rick Heineman, a spokesman for Intuit, the company behind TurboTax. "That solution will unnecessarily cost taxpayers billions of dollars and especially harm the most vulnerable Americans." Extraordinary that he could say that sentence with what I assume was a straight face.
  • pcurve 3y ago
    Just a paid shill with no credibility. Reminds me of David Lereah who was the spokesperson for National Association of Realtors during the biggest housing bubble who claimed there was no bubble.
    • toomuchtodo 3y ago
      He could do this job poorly from the beach collecting a check until moving on to the next corporate behemoth needing to shovel dreck to the masses. I encourage him to do so while the policy ratchet gets pulled forward and IRS gains this capability. Just look the other way while the lives of 150 million+ taxpayers gets improved ever so slightly.
  • deleted 3y ago
    [deleted]
  • mttjj 3y ago
    Exactly. I read that statement and now I think I need to go to the ER because I strained my eyes from rolling them so hard. I'm curious what he means by this solution harming vulnerable Americans. Are they the same vulnerable Americans that TurboTax tricked into paying for their product after enticing them in with promises of "completely free filing"?
    • anaganisk 3y ago
      Nah, it's the shareholders and execs of TurboTax and the likes. How are they supposed to afford another Yacht.
• jcadam 3y ago
  On the upside, if the tax-preparation industry is destroyed or severely diminished, it would make it easier to reform/simplify the tax code at a later date should a future government be so inclined. On the downside... no way would I use a tax preparation system provided by the IRS. It's bound to be a UX nightmare, like all government software, there's an obvious conflict of interest (the IRS has no reason to help find deductions and/or assist me in minimizing my tax bill), and I'd rather not give them any more visibility than I have to into my personal finances. Update for downvoters: Woah! Sorry for casting aspersions at the Tax Man.
  • BigCryo 3y ago
    Looks like the tax return industry Shills have downvoted you.. corporate Shills are all over the Internet they control everything
  • pcurve 3y ago
    Just curious, why not?
  • wlesieutre 3y ago
    > On the downside... no way would I use a tax preparation system provided by the government. Seems to work for every other developed country
  • xmodem 3y ago
    > no way would I use a tax preparation system provided by the government. As someone who has used government-provided tax preparation systems my entire life, I'm curious what your threat model here is exactly.
    • sircastor 3y ago
      In the US we have a history of government-made websites and tools that fail the user. Additionally, our revenue dept has an unforgiving reputation if you fail to complete your tax information properly.
    • gathersnow 3y ago
• ck2 3y ago
  Wait until ChatGPT is doing tax returns. Until some lobbyists bribe congress to ban that.
  • ed25519FUUU 3y ago
    There’s absolutely zero chance I would trust chatGPT to file my taxes right now
    • joshstrange 3y ago
      That's fair, though ChatGPT did better than my googling in trying to figure out what I need to file for my LLC. > Kentucky Single Member Limited Liability Company Income Tax Return: As a sole proprietorship LLC, your business income and expenses are reported on your personal tax return (Form 1040), Schedule C. However, Kentucky requires you to file a separate state tax return for your LLC income. You will need to complete and file the Kentucky Single Member Limited Liability Company Income Tax Return (Form 720S) along with your personal tax return. It's wrong, I needed to use form 725 since 720S is for an s-corp but it might have pointed me in the right direction. Instead I paid a couple hundred dollars to H&R Block and they messed up a handful of my forms and told me to "use whiteout" to remove the incorrect phone number and address they put on the form (725) and I also had to mail it in (they sent in my state/federal taxes). They said there wasn't a way to e-file 725, not sure if they were right. This year I'm just going to get an accountant (I was in a rush for my 2022 taxes).
      • ajmurmann 3y ago
        I hired an independent accountant a few years ago who came recommended and had great reviews. I spent more time preparing and delivering documentation for her than I'd spent doing taxes in Turbo Tax. No new insights about tax savings or anything else distinguishable from my Turbo Tax filings came from this. However, she was very excited about my explanation of how a Mega Backdoor Roth works since she apparently hadn't known about it...
        • 3y ago
• chrsw 3y ago
  The tax system in the USA is too complicated. I don't have any easy solutions. I don't deal with enough money to make spending a lot of money on tax professionals or spending a lot of time myself dealing with all the details a good value proposition for me. One day out of the year, at most, is what I feel like I should be concerned with here, for all levels of the tax system: federal, state and local. Instead what I'm left with is a dizzying array of information to keep track of and a vulturous private tax preperation industry trying to lock me into their products. I get it, people with serious money moving around want the flexability to make sure every last penny stays out of Uncle Sam's hands. That's not what I'm concerned with. I'd gladly opt in to a simplified system where maybe I don't save every dollar but I don't have the hassle of dealing with a complex system and I can easily stay compliant and up-to-date.
• smeagull 3y ago
  In my country I don't need to do anything. They calculate the tax, and if I owe anything extra, or am owed a return, I get mail about it. But there are downsides too, we also have free healthcare and the last school shooting was more than 80 years ago.
  • Omatic810 3y ago
    Yeah, but are you free, though? /s
  • latchkey 3y ago
    I know in Vietnam, they kind of do this too. Employers pay employee tax directly from the paychecks and it is based on salary. So a lot of the companies report that their employees make less, or they pay the employee part of their salary in cash (if it a cash business). I'm curious how you know they aren't cheating you somehow? Also, how could their numbers be off (high/low)? In the US, there are all sorts of 'deductions' you can take and potential areas where you may owe more, which is why you can't just rely on the IRS to do it for you... they wouldn't know the data. > But there are downsides too, we also have free healthcare and the last school shooting was more than 80 years ago. sigh...
    • digging 3y ago
      > I'm curious how you know they aren't cheating you somehow? How do we know that now, in the US? I don't know the details of tax calculations; I get money deducted from my paychecks, I pay a website so I can copy information from many confusing forms onto one confusing form, and then I get some money. It's inscrutable to most people. And frankly, the for-profit system is currently cheating us, so...
      • renlo 3y ago
        I think PP is saying that the government won't know what deductions to give you if it's a "one-click file" system. Sounds like the proposed solution by the IRS won't be a one-click file system, but something like TurboTax where the filer can elect their own deductions.
• ChrisArchitect 3y ago
  [dupe] https://news.ycombinator.com/item?id=35950836 https://news.ycombinator.com/item?id=35950836
• sieongioetnio 3y ago
  The executives and lobbyists involved can go straight to hell (better yet, prison), but I am somewhat concerned by how this might affect employees. There are some 80,000 tax preparers in the U.S.. These people did not invent this scam and are not getting rich from it. [1] There are more people involved if you include software developers, cleaners, receptionists, and so forth. https://www.bls.gov/oes/current/oes132082.htm https://www.bls.gov/oes/current/oes132082.htm The industry should be destroyed and the earth salted, but doing so will hurt some decent people. >The IRS estimates that setting up and operating a direct file system would cost the government between $64 million and $249 million annually, depending on the number of users and the complexity of returns it could handle. For all practical purposes, it's free. Intuit alone has some $12.7 billion in revenue, so we could spend fifty times the estimated cost and still be in the black.
• BigCryo 3y ago
  [flagged]
  • dboreham 3y ago
    Such as the US Navy?
  • anonymouskimmer 3y ago
    Most government failures come about from too many people trying to add too many features for too many purposes. This is simply to file federal taxes. There might be some mission creep, but there can't be that much. Worse case scenario is that it's abandoned if the other party takes the Presidency.
• BigCryo 3y ago
  The real problem is that Congress is bought and paid for by the tax return industry so that they can create an ever more complicated tax system that forces people to use the tax return industry
  • Ensorceled 3y ago
    The "ever more complicated tax system" is actually intended to make it easier for rich donors (with lawyers and tax accountants) to pay less taxes. That the complexity also props up the tax return industry is just gravy.
  • onetimeusename 3y ago
    I don't think this is true. The total lobbying dollars of H&R Block and Intuit is not really a lot of money[1][2] although it is something. I think there is an incentive for these companies to support more complicated taxes but I doubt they are the cause of complicated taxes. The IRS brings in a lot of profit on extra collections and penalties.[3] [1]: https://www.opensecrets.org/orgs/h-r-block/lobbying?id=D000022016 https://www.opensecrets.org/orgs/h-r-block/lobbying?id=D0000... [2]: https://www.opensecrets.org/orgs/intuit-inc/totals?id=D000026667 https://www.opensecrets.org/orgs/intuit-inc/totals?id=D00002... [3]: https://www.irs.gov/statistics/collections-activities-penalties-and-appeals https://www.irs.gov/statistics/collections-activities-penalt...
• bcraven 3y ago
  The (fantastic) Reply All podcast episode #144, "Dark Pattern" covers tax returns.[0] In summary, the US government made a deal with private industry that as long as that industry offered a free tier of tax returns, the government would never create its own tax filing system. I wonder what has changed! [0]https://gimletmedia.com/shows/reply-all/6nhgol https://gimletmedia.com/shows/reply-all/6nhgol
  • digging 3y ago
    Yes, I remember reading all about the for-profit tax filing scheme/scam on ProPublica years ago. Weirdly, I remember coming away from it thinking that the federal gov't had actually entered a binding agreement, so I thought it was illegal to make the move they're making now. I don't know where I got that idea and I'm so glad it was wrong.
  • DANmode 3y ago
    The free tier has never been universally recognized (for most, you can only file half of what you need to file for free), and users still pile into places like H&R Block yearly. People are less interested in important financial processes happening without their input. Public sentiment may have shifted far enough by now that the "duty" from that deal could now be considered derelict.
  • nulbyte 3y ago
    Following controversy about the dark patterns tax preparers engaged in (thanks, ProPublica), the IRS negotiated a new agreement that eliminated the restriction on entering the tax prep software market themselves. https://www.theverge.com/2020/1/1/21045779/irs-turbotax-free-file-h-r-block-tax-preparation-new-rules https://www.theverge.com/2020/1/1/21045779/irs-turbotax-free...
• bradfa 3y ago
  If the federal government really wanted to save money on tax collection, improve the accuracy of tax collection, and drive the tax preparation industry out of business which would save every person and company significant money, then the federal government would just simplify the tax code. Any high school graduate should be smart enough to file their own taxes. That this is not true today is simply insane. For tax incentives such as buying a qualifying electric vehicle, just provide the incentive directly to the car dealership at the time of purchase. Businesses which want to pass along such savings to their customers will need to do some paperwork and it'll be much harder to restrict benefits only to specific income brackets, but it would be much simpler and cheaper for taxpayers.
  • ajmurmann 3y ago
    The income bracket stuff is so crazy. It's just another way to redistribute wealth, but that's not palatable to the US public so it takes weird forms like this. It would be much more practical to abandon these piecemeal, market-distorting interventions and instead just do some smallish UBI. The money saved on overhead alone would probably be enormous.
    • prottog 3y ago
      > just do some smallish UBI Smallish UBI is an oxymoron; I'm assuming by "smallish" you mean something that's insufficient to cover basic living expenses (the B in UBI). I agree that we should do away with market-distorting interventions in places that aren't strategically critical to the nation as a whole (like food production), but politicians are woefully inadequate to the task of resisting the urge to meddle.
      • LegionMammal978 3y ago
        > Smallish UBI is an oxymoron; I'm assuming by "smallish" you mean something that's insufficient to cover basic living expenses (the B in UBI). Like it or not, the term UBI has been overloaded in common usage to refer to both forms. (Wikipedia notes that sometimes a "full basic income" vs. a "partial basic income" is used to disambiguate the two forms.) "Basic" in this sense just means that there is a set "basis" from which income can only increase; it does not necessarily have anything to do with "basic" living expenses, although many proposals do tie that particular connection.
• ogig 3y ago
  More and more I think the relative resilience of my country welfare has to be in big part caused by the excellent tax collection system we have. Hacienda, the Spanish IRS, website works perfectly with a national digital id certificate. You can solve any issues there, but for the majority of people there is nothing to think about, you receive a draft of the anual declaration and say yes. They will even go ahead and get information directly from some actors, like casinos and big corps, about who they are paying to, so you will get those automatically reflected in your declaration, or kindly be reminded they know about it. Big companies have strict requirements, in some cases daily declaration of transactions. I can find obvious optimization flaws in every other branch of the government, but man, tax collection seems close to perfection here. Of course we could argue about this been a good or bad thing, but the engine is running perfectly tuned.
• cumshitpiss 3y ago
  [dead]
• whiplash451 3y ago
  I live in EU, and it still beats me that the U.S. IRS still hasn't developed its own software for filing taxes. This should be the only entry point IMO. In my country: 1. our IRS owns the software 2. the forms are pre-filled with all the data they already have about me 3. they send me an email if they spot an error (both ways) I could not imagine it differently.
  • zdragnar 3y ago
    Since the tax reforms under Trump, the standard deduction is high enough that there's not much point in anyone else doing my taxes. Prior to that, though, the tax code is so encumbered with all of the various exemptions and deductions and carve outs that it was easier and less stressful to have someone else do it. I somewhat recently bought a house, so the mortgage interest deduction comes close on its own to not take the old standard deduction. There are plenty of these things that the government isn't going to know about- health expenses, state and local taxes (state would be easy enough to keep up with, but local taxes change all the time), even things like a deduction if you keep a home office. The operating theory is that the federal government isn't incentivized to hunt down all of these things for you (or cannot legally know about ahead of time without violating your privacy), and will over-charge you by pre-filling out the paperwork. This is where commercial companies believe (or claim) that they are doing good- they ostensibly have a motivation to provide better results than their competitors, and so will do the best job to ensure you are paying the legally required amount of taxes without overpaying.
• Longlius 3y ago
  I like how the one thing Hacker News can agree upon is that the tax prep software business is unabashed rent-seeking.
  • NoMoreNicksLeft 3y ago
    I'd hope that we could all agree on something so empirically verifiable and obvious.
• codeulike 3y ago
  In the UK the equivalent to IRS is called HMRC. People who are just in normal employment dont need to submit their taxes because it Pay As You Earn (PAYE) and so its all obvious. But if you are self employed or get paid dividends or made a capital gain or sundry other exceptions then you have to submit a tax return. HMRC provide a web app for you to submit your tax return should you need to. Its a pretty good app. Its long and complicated because thats how taxes are, but its pretty good. There's also an API where 3rd parties can develop their own software for submitting your taxes. I guess you have to get some sort of approval to use it, but its there. There are a few doubly-exceptional cases that are not covered by the default HMRC web app. E.g. if youre in a partnership (a sortof type of ad-hoc company) and need to do a special sort of return. A bunch of other edge cases too. For those you go and search out a third party software supplier from an approved list. Or fill in a paper form. TDLR: something sane is possible
  • habosa 3y ago
    This. The HMRC system is excellent and should be in the realm of possibility for America. The UK economy is very similar to ours. And as an American who lived in the UK for a few years I did have to file a self assessment, which had me pretty scared. My UK tax return was ~5 pages long and took me ~2 hours to complete. My US tax return for the same year was ~200 pages long and took an accountant weeks to complete. I don't do anything interesting (I have a wage-earning job and some stock investments, I own no property in any country).
• swayvil 3y ago
  I suspect that this is just one prong of a 2-pronged economic renovation. The other being an end to hard currency. Just got back from Austin. Cashiers telling me "card only". Because it's more hygienic. For my health. Yeah.
• deleted 3y ago
  [deleted]
• chpatrick 3y ago
  In Hungary the tax authority just calculates what you owe automatically and you can make amendments online if you want. It's pretty embarrassing that the world's richest country can't solve this problem.
• waterlilies 3y ago
  This should have been started a decade ago. The in person tax preparation companies in particular have a shady pricing model and make their money off of two groups - People with more complex returns (to be expected), and helping themselves to a slice of welfare from Earned Income tax credit filers (not ok).
• mtoner23 3y ago
  Cant belive the average person spends 140$ seems way too high, free options exist for so many americans. FreeTaxUsa works great, even if it isnt as easy as turbotax
• secret-noun 3y ago
  Taxpayers are in an adversarial relationship with the IRS. If the IRS then makes the tax filing software, how could taxpayers be sure it would provide the maximum benefit? The IRS would be incentivized to refund less money, etc.
• tmaly 3y ago
  Is it a honeypot or a way for regular citizens to sign up to be audited?