10 ms·

If an entire industry can be killed by a public service, it probably didn't deserve to exist in the first place.

sriram_sun 3y ago
Cost of policing is close to or possibly the highest expense for any city. That did not put security guards out of business.
- woodruffw 3y ago
  Why do you think this? NYC, which spends extraordinary amounts of money on the NYPD, still only spends 10% of its budget on public safety[1]. The 4 largest categories are education (20%), transportation (15%), environmental protection (15%), and housing and economic development (15%). [1]: https://www.ibo.nyc.ny.us/iboreports/understandingthebudget.pdf https://www.ibo.nyc.ny.us/iboreports/understandingthebudget....
toomuchtodo 3y ago
Just as in tech we build things that will get refactored and thrown away, it should be expected certain private sector components might be eventually deprecated when government steps in to provide as a public good.
- wolverine876 3y ago
  > it should be expected certain private sector components might be eventually deprecated when government steps in to provide as a public good I support many public goods, including this one, but they are a tool with appropriate uses just like private enterprise is. I don't want operating systems to be a government-provided 'public good'. Also, I think freedom is the core, but not only, value here, including in commerce. When government takes over, it's no longer a free market with free people.
  - jabbany 3y ago
    > I don't want operating systems to be a government-provided 'public good'. Huh. Interesting example. I actually do want to see a government produced public good operating system. Where we're going, operating systems will either be ad filled messes or locked down walled gardens. A public good option would be required to meet high bars for interoperability while also not ad funded. It's one thing to regulate away a market (make things illegal) and a very different situation if the government is just setting a bar for quality within a market.
    - wolverine876 3y ago
      > Where we're going, operating systems will either be ad filled messes or locked down walled gardens. Linux?
      - RIMR 3y ago
        Funny you bring that up, because 27% of all US Government systems run Linux. The problem is that the government doesn't give back any money, or contribute much code to the FOSS projects that they rely on. If they gave back proportionally like Linux Foundation Platinum sponsors do, they would get a return on their investment just in that they run enough Linux to benefit from contributing. China has given money to FOSS projects far more than the US does, and there is an official Chinese Linux distro available to Chinese users. Nobody is forced to use it, outside of Chinese government employees on their work machines, but like a library, it is something of value that the state can provide to those who might need it.
        throwaway2037 3y ago
        Most US gov't systems probably run RedHat Enterprise Linux. So, yeah, they do pay to develop GNU+Linux and lots of other FOSS.
  - RIMR 3y ago
    I don't think governmental functions like tax collection should be subject to the free market. Where does this end? Do we end up with private militias that compete with municipal police departments? Do we end up with private militaries that compete with the US military? Do we end up with private court systems that compete with the DoJ? Some things should not be privatized. The government allowing corporations to profit off of a civic duty like taxation, while offering no free public alternative, just anoints a handful of corporations with the gift of extracting profit from a mandatory governmental process. You should not be required to understand the intricacies of tax code, or pay for someone who does, just to file your taxes as required by law. If a criminal has the right to be provided a public defender, then every American with an income should have the right to be provided with public tax preparation service from the same government that mandated tax collection in the first place.
markkanof 3y ago
That seems like an overly broad statement. If the companies producing tax filing software were solving a problem for their users then why shouldn't they exist. Even with this new option being offered by the IRS there is still likely room for private companies to solve the same problem (tax filing) in a way which is perceived as better by some users and so still justify their existence.
- skyyler 3y ago
  >If the companies producing tax filing software were solving a problem for their users then why shouldn't they exist Because the "problem" they're solving has been solved in other countries without a profitable middleman. Intuit's continued existence in this space is dependent on their lobbying team.
  - markkanof 3y ago
    That's a slightly different issue though. Just saying that because the government has offered a solution to the problem of filing taxes doesn't automatically imply that no other organizations that are solving the same problem deserve to exist. I suppose if you are arguing that the one and only reason that tax preparation software is needed is because of Intuit's lobbying then that could be true, but Intuit's lobbying is only part of what has led to a complex tax code.
    - skyyler 3y ago
      Yes, the one and only reason tax preparation software is needed for normal people with normal incomes and expenses in 2023 is because of Intuit's lobbying. That's why people are upset about it.
- stetrain 3y ago
  If they can provide value on top of the public service and find customers willing to pay it, then they weren't killed by the public service.
- chowells 3y ago
lr4444lr 3y ago
Maybe. Or maybe a lot of people will leave refunds on the table because the software will be bad at helping people identify their deductions. Also, my wife paid a joint filing online under my SSN, and the system couldn't figure that out and claimed we were in arrears. I'm not hopeful.
- stetrain 3y ago
  How will I know the software is properly optimizing my deductions without a 30 second animated progress bar with the words "Optimizing Deductions" flashing on screen, while also advertising to me that I could be leaving savings on the table unless I upgrade to the TurboTax Pro Ultimate package for no up-front cost* * cost of TurboTax Pro Ultimate will be deducted from your refund amount, plus interest.
  - Alupis 3y ago
    Generally speaking, if you are in a position where deductions and credits matter (ie. not standard deduction), you really aught to seek a professional to review your filing before submission, or at a minimum use two different softwares to compute your taxes and look for any disagreement (in theory, they should have the same output). Either way, the $49 to use the software is trivial (under this situation) and often is only paid if you use that software to submit your taxes (meaning you can "get a second opinion" for free).
    - ghaff 3y ago
      The model is that someone with a W-2 and a 1099 or two and just taking the standard deduction should be "Yep, looks OK." If it gets more complicated than that you probably need to either spend a bunch of your own time or hire a professional.
      - nightski 3y ago
        That's basically how the services work today for that segment of citizens, and they are free.
wolverine876 3y ago
The government could theoretically make anything a public service; that standard doesn't distinguish between one industry and another. I support the IRS's new service, as a general matter (i.e., without knowing details), but you raise a serious issue.
- kdmccormick 3y ago
  Here's a better / more nuanced standard: If an industry exists because of the government and it can be replaced by a public service, then it doesn't deserve to exist. FWIW, public defenders are a public service used to interact with a government-created system, but the private legal defense industry is alive and well. So, it's not like making a public service is sufficient to kill any government-created industry.
  - wolverine876 3y ago
    > If an industry exists because of the government and it can be replaced by a public service, then it doesn't deserve to exist. It's a start, but I'd need to think of examples. I'd say if the government creates inefficiencies, such as for basic tax filing, it should remove them if possible regardless of the effect on businesses profiting from them. Off the top if my head, there could be cases where government makes a change that shifts the demand from one industry to another (that donates more to politicians).
    - kdmccormick 3y ago
      > I'd say if the government creates inefficiencies, such as for basic tax filing, it should remove them if possible The complexity of the US tax code is certainly inefficient from the perspective of someone trying to get through their taxes, but many economists would argue that it enables a very economically efficient way to soft-enforce policy and influence behavior without resorting to regulation and law enforcement. Whether the economic efficiency outweighs the bureaucratic inefficiency... I'm not sure. I guess that's where public tax software comes in.
Alupis 3y ago
I disagree. If anything, this will compel the tax preparation software companies to get even better than before, and offer an increased value proposition. Competition benefits the consumer, and for a long while there's been limited, mostly fixed competition (via Brand awareness mostly). FreeTaxUSA is amazing, and cheap, but it does not yet have the brand power the incumbents do. It's unlikely the IRS offering will be as easy to use or as pleasant as the existing offerings, but it will be a huge shot across all of their collective bows. Keep in mind the IRS offering a free online service for tax filing does not reduce the complexities of the current tax code - nor does it make for a more fair tax system (one where having means to access professionals reduces your perceived tax liability). This system merely means fewer people need to pay $49 a year to file taxes...
- LeafItAlone 3y ago
  Then it doesn’t sound like you disagree, because you don’t see this killing the industry.
- TylerE 3y ago
  Lobbying by the tax prep companies is a big part of how it got so byzantine in the first place.
  - l33t7332273 3y ago
    Can you elaborate on that, perhaps with some substantive example? I believe that these companies lobby to keep IRS from providing free tax prep, but I do not think that they lobby to make the tax code more complicated. It’s my understanding that the tax code is complicated as a result of disparate efforts to increase support among voting blocks, to encourage/discourage behaviors, and to reward supporters/backers.
    - RIMR 3y ago
      https://billmoyers.com/story/how-lobbying-by-tax-preparer-helps-keep-tax-day-complicated/ https://billmoyers.com/story/how-lobbying-by-tax-preparer-he...
deleted 3y ago
[deleted]
SanderNL 3y ago
There is a good chance it sucks and is wonky as hell, making the value proposition of proprietary solutions even more attractive.
- enraged_camel 3y ago
  It might suck initially, but that doesn't mean a lot. Healthcare.gov works pretty well today (not perfect but gets the job done for most people), despite the shoddy rollout.
- dheera 3y ago
  That and also it's not so useful if it can't import from bitcoin.tax and TurboTax exports, since there's so much in tax prep that depends on numbers from the year before, and ultimately the value of tax prep software to me is roughly the time I spend on tax prep vs. what I could get in terms of hourly rate as a hypothetical software consultant outside my day job. If I have to manually input 5 billion crypto and stock transactions including every damn weekly staking reward just to pay taxes it's just bleh.
- PaulDavisThe1st 3y ago
  NM state tax filing online is an absolute gem of web-based government interaction. The last 3 years, my state tax filing (I'm self employed) have taken less than 5 minutes each time. It doesn't to suck.
czbond 3y ago
Only the free'ish customers (eg: Easy 1040) will care - and they were low profit to companies like Intuit, etc anyways. All other taxpayers will continue to use systems that ideally maximize deductions as government continues to tax endlessly.
not2b 3y ago
Businesses will still need tax assistance. But there is no reason for a person whose income comes only from a salary, interest on savings and a brokerage account to need paid help to file taxes. The IRS already has all of the numbers. They could pre-fill the forms with those numbers and just have the taxpayer approve them.
- sokoloff 3y ago
  The IRS processing of the data sent to them by various reporting requirements is much more like what we'd call "eventually consistent". If you ask for a transcript of your tax account ("what does the IRS know about my tax situation?") on April 15th and again 6 months later, the second report is very likely to be complete, while the first is not nearly as likely.
  - not2b 3y ago
    So, do it anyway and let the IRS eventually send a correction (refund or bill) in the rare cases where it makes a difference. Or allow the taxpayer to make corrections if they know about them. But probably the number of errors will go down; well-intended taxpayers often copy numbers wrong, and that probably happens more often than "eventually consistent" issues.
whyenot 3y ago
Will the IRS version also do my state taxes? Can it "slurp" in the statements from my brokerage accounts? Can it do rental income? I have no love for Intuit and all the rest, but even with the constant up-selling and the other BS you have to put up with, it does help me tremendously with what would otherwise be a complicated task that I dread doing every year.
RicoElectrico 3y ago
Enriching oneself at the cost of others really seems like the business modus operandi in the USA these days. It is a win, although only a beginning of what should come.
A4ET8a8uTh0 3y ago
I would not go that far, but it is hard not to notice how bad the main competitors in that space have gotten. They are using just about every single dark pattern they can possibly get away with. Some competition from a public service may be warranted in this case.
robertlagrant 3y ago
> If an entire industry can be killed by a public service, it probably didn't deserve to exist in the first place. It was created by a public service. It would be better if they'd just made a rule that those with super simple tax affairs just didn't need to file, as we have in the UK. But there's probably no pork in just making things better.
- sys_64738 3y ago
  The Tory government introduced this filing BS in Britain a while back. You never used to have to file anything with the Inland Revenue before the Tories.
  - robertlagrant 3y ago
    Can you cite this? I thought you just have to file if you make over a certain amount, or you have a setup that requires filing (e.g. you rent part of your house out, or you're a sole trader).
    - sys_64738 3y ago
      What the heck do you mean can I cite it??? I LIVED there so I don't need to cite anything.
      - robertlagrant 3y ago
        You cite things to give evidence for other people to check, as opposed to taking your word for it.

Cost of policing is close to or possibly the highest expense for any city. That did not put security guards out of business.

woodruffw 3y ago
Why do you think this? NYC, which spends extraordinary amounts of money on the NYPD, still only spends 10% of its budget on public safety[1]. The 4 largest categories are education (20%), transportation (15%), environmental protection (15%), and housing and economic development (15%). [1]: https://www.ibo.nyc.ny.us/iboreports/understandingthebudget.pdf https://www.ibo.nyc.ny.us/iboreports/understandingthebudget....

toomuchtodo 3y ago

Just as in tech we build things that will get refactored and thrown away, it should be expected certain private sector components might be eventually deprecated when government steps in to provide as a public good.

wolverine876 3y ago
> it should be expected certain private sector components might be eventually deprecated when government steps in to provide as a public good I support many public goods, including this one, but they are a tool with appropriate uses just like private enterprise is. I don't want operating systems to be a government-provided 'public good'. Also, I think freedom is the core, but not only, value here, including in commerce. When government takes over, it's no longer a free market with free people.
- jabbany 3y ago
  > I don't want operating systems to be a government-provided 'public good'. Huh. Interesting example. I actually do want to see a government produced public good operating system. Where we're going, operating systems will either be ad filled messes or locked down walled gardens. A public good option would be required to meet high bars for interoperability while also not ad funded. It's one thing to regulate away a market (make things illegal) and a very different situation if the government is just setting a bar for quality within a market.
  - wolverine876 3y ago
    > Where we're going, operating systems will either be ad filled messes or locked down walled gardens. Linux?
    - RIMR 3y ago
      Funny you bring that up, because 27% of all US Government systems run Linux. The problem is that the government doesn't give back any money, or contribute much code to the FOSS projects that they rely on. If they gave back proportionally like Linux Foundation Platinum sponsors do, they would get a return on their investment just in that they run enough Linux to benefit from contributing. China has given money to FOSS projects far more than the US does, and there is an official Chinese Linux distro available to Chinese users. Nobody is forced to use it, outside of Chinese government employees on their work machines, but like a library, it is something of value that the state can provide to those who might need it.
      - throwaway2037 3y ago
        Most US gov't systems probably run RedHat Enterprise Linux. So, yeah, they do pay to develop GNU+Linux and lots of other FOSS.
- RIMR 3y ago
  I don't think governmental functions like tax collection should be subject to the free market. Where does this end? Do we end up with private militias that compete with municipal police departments? Do we end up with private militaries that compete with the US military? Do we end up with private court systems that compete with the DoJ? Some things should not be privatized. The government allowing corporations to profit off of a civic duty like taxation, while offering no free public alternative, just anoints a handful of corporations with the gift of extracting profit from a mandatory governmental process. You should not be required to understand the intricacies of tax code, or pay for someone who does, just to file your taxes as required by law. If a criminal has the right to be provided a public defender, then every American with an income should have the right to be provided with public tax preparation service from the same government that mandated tax collection in the first place.

markkanof 3y ago

That seems like an overly broad statement. If the companies producing tax filing software were solving a problem for their users then why shouldn't they exist. Even with this new option being offered by the IRS there is still likely room for private companies to solve the same problem (tax filing) in a way which is perceived as better by some users and so still justify their existence.

skyyler 3y ago
>If the companies producing tax filing software were solving a problem for their users then why shouldn't they exist Because the "problem" they're solving has been solved in other countries without a profitable middleman. Intuit's continued existence in this space is dependent on their lobbying team.
- markkanof 3y ago
  That's a slightly different issue though. Just saying that because the government has offered a solution to the problem of filing taxes doesn't automatically imply that no other organizations that are solving the same problem deserve to exist. I suppose if you are arguing that the one and only reason that tax preparation software is needed is because of Intuit's lobbying then that could be true, but Intuit's lobbying is only part of what has led to a complex tax code.
  - skyyler 3y ago
    Yes, the one and only reason tax preparation software is needed for normal people with normal incomes and expenses in 2023 is because of Intuit's lobbying. That's why people are upset about it.
stetrain 3y ago
If they can provide value on top of the public service and find customers willing to pay it, then they weren't killed by the public service.
chowells 3y ago

lr4444lr 3y ago

Maybe. Or maybe a lot of people will leave refunds on the table because the software will be bad at helping people identify their deductions. Also, my wife paid a joint filing online under my SSN, and the system couldn't figure that out and claimed we were in arrears. I'm not hopeful.

stetrain 3y ago
How will I know the software is properly optimizing my deductions without a 30 second animated progress bar with the words "Optimizing Deductions" flashing on screen, while also advertising to me that I could be leaving savings on the table unless I upgrade to the TurboTax Pro Ultimate package for no up-front cost* * cost of TurboTax Pro Ultimate will be deducted from your refund amount, plus interest.
- Alupis 3y ago
  Generally speaking, if you are in a position where deductions and credits matter (ie. not standard deduction), you really aught to seek a professional to review your filing before submission, or at a minimum use two different softwares to compute your taxes and look for any disagreement (in theory, they should have the same output). Either way, the $49 to use the software is trivial (under this situation) and often is only paid if you use that software to submit your taxes (meaning you can "get a second opinion" for free).
  - ghaff 3y ago
    The model is that someone with a W-2 and a 1099 or two and just taking the standard deduction should be "Yep, looks OK." If it gets more complicated than that you probably need to either spend a bunch of your own time or hire a professional.
    - nightski 3y ago
      That's basically how the services work today for that segment of citizens, and they are free.

wolverine876 3y ago

The government could theoretically make anything a public service; that standard doesn't distinguish between one industry and another. I support the IRS's new service, as a general matter (i.e., without knowing details), but you raise a serious issue.

kdmccormick 3y ago
Here's a better / more nuanced standard: If an industry exists because of the government and it can be replaced by a public service, then it doesn't deserve to exist. FWIW, public defenders are a public service used to interact with a government-created system, but the private legal defense industry is alive and well. So, it's not like making a public service is sufficient to kill any government-created industry.
- wolverine876 3y ago
  > If an industry exists because of the government and it can be replaced by a public service, then it doesn't deserve to exist. It's a start, but I'd need to think of examples. I'd say if the government creates inefficiencies, such as for basic tax filing, it should remove them if possible regardless of the effect on businesses profiting from them. Off the top if my head, there could be cases where government makes a change that shifts the demand from one industry to another (that donates more to politicians).
  - kdmccormick 3y ago
    > I'd say if the government creates inefficiencies, such as for basic tax filing, it should remove them if possible The complexity of the US tax code is certainly inefficient from the perspective of someone trying to get through their taxes, but many economists would argue that it enables a very economically efficient way to soft-enforce policy and influence behavior without resorting to regulation and law enforcement. Whether the economic efficiency outweighs the bureaucratic inefficiency... I'm not sure. I guess that's where public tax software comes in.

Alupis 3y ago

I disagree. If anything, this will compel the tax preparation software companies to get even better than before, and offer an increased value proposition. Competition benefits the consumer, and for a long while there's been limited, mostly fixed competition (via Brand awareness mostly). FreeTaxUSA is amazing, and cheap, but it does not yet have the brand power the incumbents do. It's unlikely the IRS offering will be as easy to use or as pleasant as the existing offerings, but it will be a huge shot across all of their collective bows. Keep in mind the IRS offering a free online service for tax filing does not reduce the complexities of the current tax code - nor does it make for a more fair tax system (one where having means to access professionals reduces your perceived tax liability). This system merely means fewer people need to pay $49 a year to file taxes...

LeafItAlone 3y ago
Then it doesn’t sound like you disagree, because you don’t see this killing the industry.
TylerE 3y ago
Lobbying by the tax prep companies is a big part of how it got so byzantine in the first place.
- l33t7332273 3y ago
  Can you elaborate on that, perhaps with some substantive example? I believe that these companies lobby to keep IRS from providing free tax prep, but I do not think that they lobby to make the tax code more complicated. It’s my understanding that the tax code is complicated as a result of disparate efforts to increase support among voting blocks, to encourage/discourage behaviors, and to reward supporters/backers.
  - RIMR 3y ago
    https://billmoyers.com/story/how-lobbying-by-tax-preparer-helps-keep-tax-day-complicated/ https://billmoyers.com/story/how-lobbying-by-tax-preparer-he...

deleted 3y ago

[deleted]

SanderNL 3y ago

There is a good chance it sucks and is wonky as hell, making the value proposition of proprietary solutions even more attractive.

enraged_camel 3y ago
It might suck initially, but that doesn't mean a lot. Healthcare.gov works pretty well today (not perfect but gets the job done for most people), despite the shoddy rollout.
dheera 3y ago
That and also it's not so useful if it can't import from bitcoin.tax and TurboTax exports, since there's so much in tax prep that depends on numbers from the year before, and ultimately the value of tax prep software to me is roughly the time I spend on tax prep vs. what I could get in terms of hourly rate as a hypothetical software consultant outside my day job. If I have to manually input 5 billion crypto and stock transactions including every damn weekly staking reward just to pay taxes it's just bleh.
PaulDavisThe1st 3y ago
NM state tax filing online is an absolute gem of web-based government interaction. The last 3 years, my state tax filing (I'm self employed) have taken less than 5 minutes each time. It doesn't to suck.

czbond 3y ago

Only the free'ish customers (eg: Easy 1040) will care - and they were low profit to companies like Intuit, etc anyways. All other taxpayers will continue to use systems that ideally maximize deductions as government continues to tax endlessly.

not2b 3y ago

Businesses will still need tax assistance. But there is no reason for a person whose income comes only from a salary, interest on savings and a brokerage account to need paid help to file taxes. The IRS already has all of the numbers. They could pre-fill the forms with those numbers and just have the taxpayer approve them.

sokoloff 3y ago
The IRS processing of the data sent to them by various reporting requirements is much more like what we'd call "eventually consistent". If you ask for a transcript of your tax account ("what does the IRS know about my tax situation?") on April 15th and again 6 months later, the second report is very likely to be complete, while the first is not nearly as likely.
- not2b 3y ago
  So, do it anyway and let the IRS eventually send a correction (refund or bill) in the rare cases where it makes a difference. Or allow the taxpayer to make corrections if they know about them. But probably the number of errors will go down; well-intended taxpayers often copy numbers wrong, and that probably happens more often than "eventually consistent" issues.

whyenot 3y ago

Will the IRS version also do my state taxes? Can it "slurp" in the statements from my brokerage accounts? Can it do rental income? I have no love for Intuit and all the rest, but even with the constant up-selling and the other BS you have to put up with, it does help me tremendously with what would otherwise be a complicated task that I dread doing every year.

RicoElectrico 3y ago

Enriching oneself at the cost of others really seems like the business modus operandi in the USA these days. It is a win, although only a beginning of what should come.

A4ET8a8uTh0 3y ago

I would not go that far, but it is hard not to notice how bad the main competitors in that space have gotten. They are using just about every single dark pattern they can possibly get away with. Some competition from a public service may be warranted in this case.

robertlagrant 3y ago

> If an entire industry can be killed by a public service, it probably didn't deserve to exist in the first place. It was created by a public service. It would be better if they'd just made a rule that those with super simple tax affairs just didn't need to file, as we have in the UK. But there's probably no pork in just making things better.

sys_64738 3y ago
The Tory government introduced this filing BS in Britain a while back. You never used to have to file anything with the Inland Revenue before the Tories.
- robertlagrant 3y ago
  Can you cite this? I thought you just have to file if you make over a certain amount, or you have a setup that requires filing (e.g. you rent part of your house out, or you're a sole trader).
  - sys_64738 3y ago
    What the heck do you mean can I cite it??? I LIVED there so I don't need to cite anything.
    - robertlagrant 3y ago
      You cite things to give evidence for other people to check, as opposed to taking your word for it.