4 ms·

Here's a fun example of why the government should maintain its own databases and use them to pre-fill your taxes. This year, the state sent me a letter claimin

by jarrett 15y ago

Here's a fun example of why the government should maintain its own databases and use them to pre-fill your taxes. This year, the state sent me a letter claiming I had paid zero taxes in 2010. They said I had to pay 100% of my tax liability right away or face liens, etc.. Of course, this was patently untrue--my employer had actually withheld more than my total tax liability for 2010. (I know this because I still have my 2010 W-2). So I was entitled to a refund for 2010, but the state was saying I owed them the full amount, plus penalties. After contacting the state about this, they said the problem was that my W-2 form had likely become "detached" from my 2010 return. So apparently, the state relies on a paper copy of your W-2 attached to your return to determine whether your employer has paid them the withheld taxes. If they can't find the W-2 you send them, they assume your employer didn't pay them anything on your behalf. Given that employers are already making electronic payments each quarter, why can't the government just derive its W-2 data from that? (I know, I know--they're probably not collecting that data right now. But the point is they could do it as part of the quarterly payment process.) EDIT: Another funny bit to this story. I asked the state to confirm that my employer had indeed paid the amount reflected on my W-2. I figured that if the error was on my employer's end, I could take it up with them. But the state refused to say one way or another, citing confidentiality.

matwood 15y ago
I've wondered the same thing. This year the state asked me to supply a paper copy of my W2 to verify my electronic return submission. Are things so messed up at the state level that they don't know who paid what and when? Why couldn't they just look up in their database that says I paid $X and it matches box 3 on form Y. For extra credit they could do this using this new technology called a computer.
- jarrett 15y ago
  I don't know much about the state forms, but look at the IRS withholding form: http://www.irs.gov/pub/irs-pdf/f941.pdf http://www.irs.gov/pub/irs-pdf/f941.pdf I don't see anything on there where the employer would break down the payroll tax by employee. Does anyone know if there's some other mechanism for this? Do employers send all W-2s to the IRS?
- Drbble 15y ago
  It's a random audit. It is good security practice. Amazon and Google test their systems too, it's because they are good, not because they are bad.
jellicle 15y ago
I think you're misreading "detached". Most likely your employer is withholding your taxes with the wrong SSN, or quite possibly, not actually withholding them at all (keeping them out of your check, but not sending them to the tax authority). This happens fairly frequently with employers that are heading down the road to bankruptcy. But if your employer is still around a year later it's probably the wrong SSN.
- jarrett 15y ago
  No, the state employee said that the sheet of paper was probably quite literally detached from the rest of my return. My (former) employer is an extremely reputable organization that has been around for over a century and probably will be for another one. I even checked with their HR department to verify the error wasn't on their end.
paulhauggis 15y ago
It's not in the government's best interest to make it so they get less money. If they made everything efficient, I would imagine they would lose lots of income. It would also put may people out of jobs and many of those same people decide on these efficiencies. I wish our government could be run more like a lean startup rather than a large corporation with a near unlimited supply of money (part of which is my money).
- bdunbar 15y ago
  I wish our government could be run more like a lean startup rather than a large corporation with a near unlimited supply of money Might as well wish for water to run up hill. The government is run like a large organization because it _is_ a large organization. To get startup-like behavior you need startup-like size. I think this might be the best solution: a government that has to hold bake sales to raise cash would be less likely to get up in my business.
  - paulhauggis 15y ago
    I just wish there was more accountability and less waste. There are plenty of big companies that aren't pissing away money left and right. This is why I oppose most major government programs like health care: Based on previous history, I just can't trust the government with something as important as my life.
    - Drbble 15y ago
      It's not clear why you would trust a private corporayion either. Government is made of people, and reflects the society it exists in. By your logic, you should be in favor of self-provided health care. (Maybe you are. Maybe that is the best way. )
      - bdunbar 15y ago
        I am not the parent, but I'll take a swing at it. I don't trust a private corporation. When private organization acts in ways contrary to how I want, I can fire them. When the government acts in ways contrary to how I want, I have to live with it.
sbov 15y ago
I'm pretty sure that at least in California this isn't true. IIRC if your taxes are normal enough (low enough amount, just a W-2) you can actually login to the California tax site and it can automatically compute your refund for you. I think my girlfriend used this once - I may be remembering incorrectly though.
- sliverstorm 15y ago
  If it's anything like TurboTax, they just pull from ADP, which produces W-2's for many major companies.
nostromo 15y ago
Eugene McCarthy said: "The only thing that saves us from the bureaucracy is inefficiency. An efficient bureaucracy is the greatest threat to liberty."
- DannoHung 15y ago
  Well, obviously. If bureaucracies could become efficient, then we'd have no reason for markets.
- scarmig 15y ago
  I've never understood this logic. We fear bureaucracies, if they became efficient, would become efficiently brutal and callous. We don't want them to become good at being brutal and callous. Therefore we should fight against efficient bureaucracies in favor of brutal and callous inefficient bureaucracies. And if their inefficiencies make them seem brutal and callous, that's just all the evidence to know that making them more efficient would lead to even more brutality and callousness.
  - Drbble 15y ago
    Eugene McCarthy didn't say ineffecient bureaucracy was brutal an callous. It's just annoying and maybe callous. That's the point. Also, um, you know who had an efficient bureaucracy, with computers and everything, in the 1930s? Yeah, --Godwin'd
  - Drbble 15y ago
    Eugene McCarthy didn't say ineffecient bureaucracy was brutal an callous. It's just annoying and maybe callous. That's the point. Also, um, you know who had an efficient bureaucracy, with computers and everything, in the 1930s? Yeah, --Godwin'd
  - Drbble 15y ago
    Eugene McCarthy didn't say ineffecient bureaucracy was brutal an callous. It's just annoying and maybe callous. That's the point. Also, um, you know who had an efficient bureaucracy, with computers and everything, in the 1930s? Yeah, --Godwin'd

by jarrett 15y ago

matwood 15y ago

I've wondered the same thing. This year the state asked me to supply a paper copy of my W2 to verify my electronic return submission. Are things so messed up at the state level that they don't know who paid what and when? Why couldn't they just look up in their database that says I paid $X and it matches box 3 on form Y. For extra credit they could do this using this new technology called a computer.

jarrett 15y ago
I don't know much about the state forms, but look at the IRS withholding form: http://www.irs.gov/pub/irs-pdf/f941.pdf http://www.irs.gov/pub/irs-pdf/f941.pdf I don't see anything on there where the employer would break down the payroll tax by employee. Does anyone know if there's some other mechanism for this? Do employers send all W-2s to the IRS?
Drbble 15y ago
It's a random audit. It is good security practice. Amazon and Google test their systems too, it's because they are good, not because they are bad.

jellicle 15y ago

I think you're misreading "detached". Most likely your employer is withholding your taxes with the wrong SSN, or quite possibly, not actually withholding them at all (keeping them out of your check, but not sending them to the tax authority). This happens fairly frequently with employers that are heading down the road to bankruptcy. But if your employer is still around a year later it's probably the wrong SSN.

jarrett 15y ago
No, the state employee said that the sheet of paper was probably quite literally detached from the rest of my return. My (former) employer is an extremely reputable organization that has been around for over a century and probably will be for another one. I even checked with their HR department to verify the error wasn't on their end.

paulhauggis 15y ago

It's not in the government's best interest to make it so they get less money. If they made everything efficient, I would imagine they would lose lots of income. It would also put may people out of jobs and many of those same people decide on these efficiencies. I wish our government could be run more like a lean startup rather than a large corporation with a near unlimited supply of money (part of which is my money).

bdunbar 15y ago
I wish our government could be run more like a lean startup rather than a large corporation with a near unlimited supply of money Might as well wish for water to run up hill. The government is run like a large organization because it _is_ a large organization. To get startup-like behavior you need startup-like size. I think this might be the best solution: a government that has to hold bake sales to raise cash would be less likely to get up in my business.
- paulhauggis 15y ago
  I just wish there was more accountability and less waste. There are plenty of big companies that aren't pissing away money left and right. This is why I oppose most major government programs like health care: Based on previous history, I just can't trust the government with something as important as my life.
  - Drbble 15y ago
    It's not clear why you would trust a private corporayion either. Government is made of people, and reflects the society it exists in. By your logic, you should be in favor of self-provided health care. (Maybe you are. Maybe that is the best way. )
    - bdunbar 15y ago
      I am not the parent, but I'll take a swing at it. I don't trust a private corporation. When private organization acts in ways contrary to how I want, I can fire them. When the government acts in ways contrary to how I want, I have to live with it.

sbov 15y ago

I'm pretty sure that at least in California this isn't true. IIRC if your taxes are normal enough (low enough amount, just a W-2) you can actually login to the California tax site and it can automatically compute your refund for you. I think my girlfriend used this once - I may be remembering incorrectly though.

sliverstorm 15y ago
If it's anything like TurboTax, they just pull from ADP, which produces W-2's for many major companies.

nostromo 15y ago

Eugene McCarthy said: "The only thing that saves us from the bureaucracy is inefficiency. An efficient bureaucracy is the greatest threat to liberty."

DannoHung 15y ago
Well, obviously. If bureaucracies could become efficient, then we'd have no reason for markets.
scarmig 15y ago
I've never understood this logic. We fear bureaucracies, if they became efficient, would become efficiently brutal and callous. We don't want them to become good at being brutal and callous. Therefore we should fight against efficient bureaucracies in favor of brutal and callous inefficient bureaucracies. And if their inefficiencies make them seem brutal and callous, that's just all the evidence to know that making them more efficient would lead to even more brutality and callousness.
- Drbble 15y ago
  Eugene McCarthy didn't say ineffecient bureaucracy was brutal an callous. It's just annoying and maybe callous. That's the point. Also, um, you know who had an efficient bureaucracy, with computers and everything, in the 1930s? Yeah, --Godwin'd
- Drbble 15y ago
  Eugene McCarthy didn't say ineffecient bureaucracy was brutal an callous. It's just annoying and maybe callous. That's the point. Also, um, you know who had an efficient bureaucracy, with computers and everything, in the 1930s? Yeah, --Godwin'd
- Drbble 15y ago
  Eugene McCarthy didn't say ineffecient bureaucracy was brutal an callous. It's just annoying and maybe callous. That's the point. Also, um, you know who had an efficient bureaucracy, with computers and everything, in the 1930s? Yeah, --Godwin'd