24 ms·

TurboTax’s 20-year fight to stop Americans from filing taxes for free (2019)

913 points by lelandfe 1y ago

bobbyprograms 1y ago
I do not work here so this is just tip. I have used freetaxusa for years amazing including schedule c. Since in Texas truly free haha!
ChrisArchitect 1y ago
(2019) Some previous discussion: 2021 https://news.ycombinator.com/item?id=26060414 https://news.ycombinator.com/item?id=26060414 2019 https://news.ycombinator.com/item?id=21281411 https://news.ycombinator.com/item?id=21281411
- tomhow 1y ago
  And some others, macroexpanded. TurboTax’s 20-Year Fight to Stop Americans from Filing Taxes for Free (2019) - https://news.ycombinator.com/item?id=34594832 https://news.ycombinator.com/item?id=34594832 - Jan 2023 (1 comment) 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 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) 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) 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) 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) 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) 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) 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) 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)
  - porridgeraisin 1y ago
    Jeez, 13 years of history.
    - Pikamander2 1y ago
      Yeah, there's been a lot of talk about it for years. What's especially sad is that some major progress was made toward having a free official system just a few years ago, but now it's being torn apart. https://www.pbs.org/newshour/politics/irs-moves-forward-with-a-new-free-file-tax-return-system-that-has-both-supporters-and-critics-mobilizing https://www.pbs.org/newshour/politics/irs-moves-forward-with... https://home.treasury.gov/news/press-releases/jy2629 https://home.treasury.gov/news/press-releases/jy2629 https://apnews.com/article/irs-direct-file-tax-returns-free-trump-4bb0bca02fab9b3d06ae6f45ac67b7ab https://apnews.com/article/irs-direct-file-tax-returns-free-...
      - deleted 1y ago
        [deleted]
jameslk 1y ago
It seems their business model is more existentially challenged by LLMs these days. I’m waiting for the regulations preventing AI being used for taxes and legal counsel Edit: This is timely being on the homepage: https://news.ycombinator.com/item?id=45601230 https://news.ycombinator.com/item?id=45601230
- f33d5173 1y ago
  There are many things I would trust an AI with, but my taxes are not one of them.
  - tempestn 1y ago
    Certainly not to do your taxes, but they're useful for tax questions, as long as your verify the responses.
  - Ferret7446 1y ago
    Taxes are actually not a bad problem for AI, because a lot of the final calculations can be easily verified/sanity checked. The AI won't be able to get away with any math errors, the issues you'll likely see are incorrect categorisation of income or suboptimal deductions. The substeps like categorisation shouldn't be too difficult to manually verify
    - eloisant 1y ago
      Don't use AI for tasks where you don't have the qualifications to verify that the result is correct.
    - nickjj 1y ago
      The problem is if you need to verify everything you might as well do it yourself. I'm not convinced an AI will ever know how to distinguish a personal and business expense from a CSV dump of your credit card too. If you're going to go down the rabbit hole of creating a CSV, you can already parse and categorize it pretty easily without AI. I've built and have been using https://github.com/nickjj/plutus https://github.com/nickjj/plutus for a bit now and I've gotten quarterly taxes down to less than 10 minutes.
zkmon 1y ago
I never understood why the Revenue can't provide a set of simple online forms for tax returns like India does. Heck, India provided Excel sheets with VBA script for many years, that produced an XML which can be submitted as tax filing. Tax filing is now a 15-minute affair for a salary-only income in India.
- jameslk 1y ago
  The complexity is a feature not a bug. If you have more complexity, you have more opportunities for loopholes. Those loopholes are currently used by those wealthy enough to hire creative firms to help them get through them and minimize owed taxes If there’s one outcome I really hope from AI automating work, it’s taking away the advantage the monied class has in this regard. Then perhaps there’s less purpose for the complexity
  - dennis_jeeves2 1y ago
    >The complexity is a feature not a bug. If you have more complexity, you have more opportunities for loopholes. Those loopholes are currently used by those wealthy enough to hire creative firms to help you get through them Agreed that the complexity is a feature but it's not for the rich ( though the rich will take advantage of it, and why not? ) . It's mostly for the powers that be. If there were a 'flat' tax ( and one could argue what constitutes a flat tax) the rich will be more willing to pay that flat tax. I'd say complexity support a very large govt, keeping several people employed including accountants, tax software companies etc. It serves the parasite class.
    - deleted 1y ago
      [deleted]
    - DiogenesKynikos 1y ago
      The tax brackets are not what make taxes complicated. Knowing how to categorize different types of income is what makes taxes complicated. The flat tax would not make tax preparation any bit easier. They only thing it would do would be to eliminate progressive taxation. In other words, the rich would pay less. The poor would pay more.
jopsen 1y ago
Paying to file taxes, and then getting you tax refund as an Amazon gift card -- that's very American :)
- zkmon 1y ago
  What? I just googled, and found it is actually a real thing. Holy molly! Has Amazon become a federal system for distribution of money and goods? What next? coupons for burgers, Netflix credit?
  - saagarjha 1y ago
    I assume this is done by the company, not the IRS.
    - Steve16384 1y ago
      But where is the company getting the refund from?
      - edm0nd 1y ago
        I think its usually like a person is due to receive a $1,000 refund and the company they did their taxes through will give them the offer to immediately get an Amazon gift card for $800 instead of waiting for fed and state refunds to hit their bank accounts.
      - CSMastermind 1y ago
        In the US it's legal for the person filing the taxes on behalf of another person to collect the refund for them. This allows tax prep companies to give people 'instant refunds' (essentially loans for the expected refund amount) so people don't have to wait weeks for the IRS to send them a check in the mail. The IRS only pays out via check or direct deposit but the company who did your taxes can pay out in cash, gold, or pokemon cards if they want to.
        1y ago
alexandru_m 1y ago
Why does the US have a tax prep industry in the first place? In every other country in the world, taxes are handled by their respective financial authorities. Why must every service and thing in the US must be a private profit making thing?
- ta20240528 1y ago
  Yip, consider how much money banks make by injecting themselves between you and the reserve bank.
  - scott_w 1y ago
    This is a very different situation. If you're interested, I'd recommend reading Can't We Print More Money by staff at the Bank of England (https://www.amazon.co.uk/Cant-Just-Print-More-Money/dp/1847943381 https://www.amazon.co.uk/Cant-Just-Print-More-Money/dp/18479...). The short answer is central banks are not setup to offer services directly to the public. This is different to the tax office in that people already need to interact directly with it! Anyone in the UK can fill out a Self Assessment, for example, however it's optional for almost everyone, because Pay As You Earn takes the tax off your employer instead.
- janwl 1y ago
  Can’t you file your taxes for free in the US if you know how?
  - willis936 1y ago
    That's why GP said "tax prep". Anyone can download and submit a 1040. That isn't the part that takes domain expertise.
    - janwl 1y ago
      I don’t know why assume that in every country in the world that is free. In my European country until 15 years ago or so you had to hire someone to do your taxes for you, and currently the free method only works for the most simple tax filing. In fact what you get is called a “draft” of your tax filings because you’re supposed to make sure it’s okay, and it’s your responsibility if you miss something or if the draft is wrong. And obviously the draft usually assumes that you will have to pay more tax, since there’s a perverse incentive given it’s the government who fills it for you.
fersarr 1y ago
the UK seems to be going in this same bad direction now "As part of our journey to modernise and digitise our filing routes, all accounts must be filed using commercial software from 1 April 2027." https://changestoukcompanylaw.campaign.gov.uk/changes-to-accounts/ https://changestoukcompanylaw.campaign.gov.uk/changes-to-acc... you used to be able to do this yourself on the gov website for free
- rwmj 1y ago
  Tell me about it! The bottom tier subscription services are also subtly crippled to make filing MTD tax returns difficult. eg. Xero's lowest tier doesn't let you easily add cash payments (without jumping through hoops for each payment).
- Nursie 1y ago
  Eh, that’s companies rather than individuals, and while it’s still objectionable it’s not quite in the same league. If you’re running a company you probably already have an accountant, and they’re probably already using one of those pieces of software. Or you’re using something like Xero, which is already on the list.
  - fersarr 1y ago
    agreed it's not the same league, but it's still annoying for tiny companies that don't have much revenue
- smcl 1y ago
  It is insane how the UK seems hellbent on implementing the things that are shit about the USA
- shawabawa3 1y ago
  That's company taxes only, not individuals, a huge difference
  - fersarr 1y ago
    yeah that is true, but still really annoying for the tiny companies I talked to
Yizahi 1y ago
They are not as harmful as some other corporations, but for some weird reason I hate such parasites on our society much more than some bigger offenders. And I'm not even from USA :) . How do you all tolerate this?
- potato3732842 1y ago
  Few people give a crap because a two figure sum for tax prep once a year is just about the smallest thorn the government and government adjacent or intertwined industries put in the side of the average person even if it's arguably less justified than some of the other ones.
wateralien 1y ago
Tax shouldn't even have to be handled by anyone. It should be part of the currency itself.
- deleted 1y ago
  [deleted]
johnnienaked 1y ago
The problem is how ridiculously bloated and inefficient the US tax system is. Companies see that as a possibility for exploitation and wet their shirts with drool.
macinjosh 1y ago
One time I wrote a screed into a turbo tax feedback form on how they are an awful business and no one responded except that they refunded my money.
timmg 1y ago
I wonder why there has never been open source tax software. It seems exactly the kind of thing the community would be good at. I imagine it would be hard for very complex taxes. But for the 60% that have simple taxes, I don’t think it should be unmanageable. Is it a matter of liability? Like I could definitely see a big issue with mistakes — even if it was just operator error.
- bayindirh 1y ago
  Fast moving regulations and legislation. You need both a legal and developer team, at least to follow and implement things as soon as they become the law. Even the revision of yearly variables is a considerable task.
  - hylaride 1y ago
    Many laws also exist specifically to keep industries afloat. The complicated tax code keeps many lawyers and accountants in business.
    - bayindirh 1y ago
      > The complicated tax code keeps many lawyers and accountants in business. At least, some of the complications in these are not intentional, but result of centuries old evolution of these systems. Maritime shipping uses centuries old systems to handle costs in shipping accidents for example. I forgot the exact name of the system, but while the method is extremely fair, it's equally complicated. The whole premise stems from "This ship has sailed because you wanted me to carry your cargo", and becomes something mind boggling. I'm sure there are some steps taken to keep people busy, but chalking up everything to it is unfair and wrong.
      - hylaride 1y ago
        Fair points, but there is hostility to fixing a lot of those historical rules for the same reasons. Long-standing business practices is another can of worms, especially ones as international as shipping.
jeremymcanally 1y ago
Precisely why I built https://freetofile.com https://freetofile.com (it’s a simple static site with React for internationalization that automatically renders in Spanish, Chinese, Haitian Creole, or English depending on browser settings). It’s shocking and depressing how many low income people don’t know they don’t need to spend $100-200 to file their taxes. I want to blanket my area (well the whole country really but baby steps…) in signs with the URL during tax season. I really do loathe the entire industry at this point due to their gross practices around free filing. Some offer “free” online filing but deceptively upsell until they squeeze some money out of the customer. So I want to make any little push back I can against these companies.
- godkernel 1y ago
  great job. I used to use turbotax here in canada, until i figure it out that i could just fill it somewherelse for free.
  - __s 1y ago
    GenuTax is the free software I used for Canadian taxes
  - goatking 1y ago
    Wealthsimple Tax is free too, and pretty good for simple use cases.
  - Throwthrowbob 1y ago
    I used https://www.canada.ca/en/services/taxes/income-tax/personal-income-tax/how-file/tax-software/find-software.html https://www.canada.ca/en/services/taxes/income-tax/personal-... (or an equivalent page, in case it's shifted around) to look for options a couple years back. I was glad I had this list to look through. I believe I compared Wealthsimple, EachTax, and UFile.
- Spivak 1y ago
  Who's spending that much on their taxes? I'm not low income by any means and I've not paid a single dollar to HR Block who does my taxes every year.
miki123211 1y ago
Why isn't there a non-profit doing this work? If this is as big of a deal as people claim, surely a non-profit could have written a free tax filing app and just made it available to people? Does TurboTax have any kind of regulatory moat / AT&T style monopoly?
elevation 1y ago
After a recent post[0] suggesting the federal tax code was already online in machine readable form, my first thought was "could I write my own US tax-filing software?" But the answer is still no. Paying taxes doesn't mean just paying federal taxes. Users don't want free Federal taxes software if it means they'll have to re-renter all their information into different software for their State taxes -- especially when more than one state is involved, such as for people who cross state lines for work, or moved mid-year. A tax service is a massive value add. The "free" software you get to do your federal taxes will be no threat to TurboTax until the states are required to publish their tax codes in the same machine readable format as the feds. [0]: https://news.ycombinator.com/item?id=45599567 https://news.ycombinator.com/item?id=45599567
- mikeweiss 1y ago
  Except people living in one of the nine states that don't have income taxes. They're laughing all the way to the bank.
  - WesleyJohnson 1y ago
    Are the sales taxes generally higher in those states, which offset the lack of income tax?
    - everforward 1y ago
      Depends on the state, some have higher property taxes. Higher sales tax tends to be regressive because it doesn’t tax money you don’t spend, nor does it tax things where sales tax doesn’t apply like buying assets.
    - knute 1y ago
      Sales and/or property taxes are typically used to make up the difference. TANSTAAFL
    - BeetleB 1y ago
      Depends on the income tax you compare with. My state is 9%, and it kicks in at under $20K. No state has a high enough sales tax to offset that income tax. Concrete numbers: Say you and spouse collectively make $300K. That's a bit under $30K in state income tax. On top of that you'd pay property taxes (admittedly low). Sorry Texas, but your property + sales tax isn't that high.
linsomniac 1y ago
Reminder: FreeTaxUSA is a great alternative, I've been using it to file my taxes the last 3 years and plan to use it if I can this year. My situation is made harder this year by my wife starting a business. https://www.freetaxusa.com/ https://www.freetaxusa.com/
- wombat-man 1y ago
  It's not quite as good as turbotax, but turbotax also had it's issues. I've used it the past couple years though just to stop feeding turbotax.
  - linsomniac 1y ago
    Agreed, it's not quite as good as TurboTax, I'd say for my use it is 80-90% as good. But it is kind of important to me to avoid TurboTax because of the lobbying they do to keep us from just having the IRS tell us what we owe and be done with it.
everdrive 1y ago
Taxes are crazy anyhow. The government won't tell me how much I owe, but if I'm incompetent enough at figuring out the number, suddenly they both have a clear idea of what I owe and also I'm now in trouble. Why doesn't the government just tell me what I owe, and if I think they've calculated incorrectly, only then do I do my own filing or hire a CPA or whatever else?
- nemomarx 1y ago
  The tax filing industry is against it, essentially. Various attempts by the IRS to move in this direction have been stopped. There used to be a libertarian wing that thought paying taxes should be a little painful so people wouldn't vote for more taxes, but I've not heard anyone say that since the bush era.
  - ch4s3 1y ago
    The Grover Norquist folks in the RNC were not libertarians.
    - lelandfe 1y ago
      My favorite part about Norquist and the starve the beast folks is the utter hypocrisy of their silence in the face of Trump's tariffs. So much for the "drown the government in the bathtub" talk - turns out it was always just about the rich not paying more.
      - entropicdrifter 1y ago
        Pretty wild to me that we're at the point where even Penn Gillette recognizes that modern American Libertarianism is ultimately just about rich white men who want to do whatever they want with no consequences
        ch4s3 1y ago
        It’s not really ironic, he just broke with the LP per se. He’s given interviews with Reason where he says his core beliefs haven’t really changed.
fogzen 1y ago
Taxes are free to file. Just fill out the form(s) and mail it in. I find it way easier than using crap software. No logins, no ads, no spying, no losing my progress. There’s literally instructions for every box on the form.
DudeOpotomus 1y ago
Americans are the proverbial frogs in the pot. They've been ratcheting up the heat over the last 30 years, the first signs of danger are well past, now its 300mm people being held captive by abusive leaders and insanely greedy profiteers. This entire story exemplifies everything wrong with the USA and its form of corporate run government. Socialize the risks, privatize the profits and foremost, let the foxes not only guard the henhouse, give it to them! World, if you're listening. We need a pepperoni pizza.
- philipallstar 1y ago
  No, we socialise profits. All the risk for businesses is borne by the owners. All the profit is taxed by the government.
sometimez 1y ago
CashApp is free for both federal and state. Have used it since its Credit Karma days and has worked fine.
- netrap 1y ago
  Very interesting. I'll give that a try..
- mixmastamyk 1y ago
  If it’s free, you’re the product.
shepardrtc 1y ago
The IRS does have a free filing service called Direct File: https://directfile.irs.gov/ https://directfile.irs.gov/ The Trump Administration is trying to get rid of it, but its been so successful and so well-rated that they're having trouble doing that.
- mixmastamyk 1y ago
  I looked this year and the site went nowhere. But now seems to be up. Not sure what happened. But I just went through the eligibility steps and it requires id.me verification! Big nope. Mailing a paper form does not. Of course Uncle Sam figured a way to fuck it up.
pkilgore 1y ago
Politicians cannot write loopholes that benefits only their doners if the tax code and tax filing is simple. Period. Take corporate/dark/unlimited money out of politics and watch this problem (and many other) disappear.
- a456463 1y ago
  AMEN! How is that taxing is easy, computed by govt yet people and rich people keep evading taxes, not showing taxes, finding workarounds through other orgs to reduce tax profile but as an individual you have so many restrictions
lisbbb 1y ago
Around 2018, my accountant retired and sold his business to some other firm. That year, the other firm had some newbie cpa do my taxes. If I had blindly gone with his effort, I would have had to pay thousands of dollars. The problem is, he made a huge mistake because he didn't listen to what I had told him regarding a step up cost basis on inherited stocks. I fired them the instant I saw that issue. Then I was stuck with nobody to do my taxes! I used TurboTax and got it done myself and actually received a small refund that year. And no, nothing was done fraudulently, it's just that I knew the details of our situation far better than any cpa who refused to listen to what I told him or was too "green" to know what I was talking about (unforgivable, imho). I've used TurboTax ever since then. Yes, I know it sucks in many ways, but the thing is, they bailed me out and saved me thousands of dollars over the years for hundreds of dollars in fees.
skirge 1y ago
In Poland since 3-4 years tax form for regular employees is automatically filled and submitted. Before then many NGOs filled them for you (directly or indirectly) for 1% of tax (I think avoiding loss of 1% motivated govt to make this automated system).
netfortius 1y ago
Unfortunately TT is [still] a must for expats. While my new home country makes things extraordinarily simple, not only for the free online filing, but also for an amazing assistance one could get from the local tax services (first year I reached out to them, in the office, they had their expat expert fill out the taxes online, in my account, in front of me, so I could learn on doing them on my own, from then on), filing to avoid double taxation, with uncle Sam, is stil a PITA
nightski 1y ago
I think it would be great to just have the IRS website list all reported income. Free automated filing is amazing, but if that is too large of a political battle just making this income information easily accessible would be a giant first step.
wuuza 1y ago
I mail in a paper form because F TurboTax.
memcg 1y ago
Intuit emailed me stating that Turbo Tax 2025 will not install on a PC running Windows: "We’re reaching out to provide an update on TurboTax Desktop software for tax year 2025. After October 14, 2025, Microsoft will no longer provide software updates, technical assistance, or security fixes for Windows 10 operating system. Because security is a top priority for us, TurboTax Desktop software for tax year 2025 onwards will not be compatible with Windows 10 operating system. To use TurboTax Desktop software for tax year 2025, your computer will need to run on Microsoft Windows 11 operating system. You can also consider switching to TurboTax Online, which will work on any supported browser (available December 2025)."
- memcg 1y ago
  Edit: Windows 10
barchar 1y ago
I always like to comment on these posts that the IRS offers a program called "IRS FreeFile Fillable Forms" that allows any US tax person to file their individual federal tax returns electronically, for free regardless of income or complexity of the return.
- deleted 1y ago
  [deleted]
- mixmastamyk 1y ago
  I used to use these but two years ago or so they started demanding a phone number (or similar) and that's when I stopped using it.
throw-10-13 1y ago
Americans should just stop paying taxes. It's all going to your new Gestapo and concentration camps anyways.
Alifatisk 1y ago
Reading the comment section makes it difficult to take America seriously, no way people live with these conditions? And I just learned a new word, plutocracy.

913 points by lelandfe 1y ago

I do not work here so this is just tip. I have used freetaxusa for years amazing including schedule c. Since in Texas truly free haha!

ChrisArchitect 1y ago

(2019) Some previous discussion: 2021 https://news.ycombinator.com/item?id=26060414 https://news.ycombinator.com/item?id=26060414 2019 https://news.ycombinator.com/item?id=21281411 https://news.ycombinator.com/item?id=21281411

tomhow 1y ago
And some others, macroexpanded. TurboTax’s 20-Year Fight to Stop Americans from Filing Taxes for Free (2019) - https://news.ycombinator.com/item?id=34594832 https://news.ycombinator.com/item?id=34594832 - Jan 2023 (1 comment) 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 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) 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) 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) 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) 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) 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) 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) 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)
- porridgeraisin 1y ago
  Jeez, 13 years of history.
  - Pikamander2 1y ago
    Yeah, there's been a lot of talk about it for years. What's especially sad is that some major progress was made toward having a free official system just a few years ago, but now it's being torn apart. https://www.pbs.org/newshour/politics/irs-moves-forward-with-a-new-free-file-tax-return-system-that-has-both-supporters-and-critics-mobilizing https://www.pbs.org/newshour/politics/irs-moves-forward-with... https://home.treasury.gov/news/press-releases/jy2629 https://home.treasury.gov/news/press-releases/jy2629 https://apnews.com/article/irs-direct-file-tax-returns-free-trump-4bb0bca02fab9b3d06ae6f45ac67b7ab https://apnews.com/article/irs-direct-file-tax-returns-free-...
    - deleted 1y ago
      [deleted]

jameslk 1y ago

It seems their business model is more existentially challenged by LLMs these days. I’m waiting for the regulations preventing AI being used for taxes and legal counsel Edit: This is timely being on the homepage: https://news.ycombinator.com/item?id=45601230 https://news.ycombinator.com/item?id=45601230

f33d5173 1y ago
There are many things I would trust an AI with, but my taxes are not one of them.
- tempestn 1y ago
  Certainly not to do your taxes, but they're useful for tax questions, as long as your verify the responses.
- Ferret7446 1y ago
  Taxes are actually not a bad problem for AI, because a lot of the final calculations can be easily verified/sanity checked. The AI won't be able to get away with any math errors, the issues you'll likely see are incorrect categorisation of income or suboptimal deductions. The substeps like categorisation shouldn't be too difficult to manually verify
  - eloisant 1y ago
    Don't use AI for tasks where you don't have the qualifications to verify that the result is correct.
  - nickjj 1y ago
    The problem is if you need to verify everything you might as well do it yourself. I'm not convinced an AI will ever know how to distinguish a personal and business expense from a CSV dump of your credit card too. If you're going to go down the rabbit hole of creating a CSV, you can already parse and categorize it pretty easily without AI. I've built and have been using https://github.com/nickjj/plutus https://github.com/nickjj/plutus for a bit now and I've gotten quarterly taxes down to less than 10 minutes.

zkmon 1y ago

I never understood why the Revenue can't provide a set of simple online forms for tax returns like India does. Heck, India provided Excel sheets with VBA script for many years, that produced an XML which can be submitted as tax filing. Tax filing is now a 15-minute affair for a salary-only income in India.

jameslk 1y ago
The complexity is a feature not a bug. If you have more complexity, you have more opportunities for loopholes. Those loopholes are currently used by those wealthy enough to hire creative firms to help them get through them and minimize owed taxes If there’s one outcome I really hope from AI automating work, it’s taking away the advantage the monied class has in this regard. Then perhaps there’s less purpose for the complexity
- dennis_jeeves2 1y ago
  >The complexity is a feature not a bug. If you have more complexity, you have more opportunities for loopholes. Those loopholes are currently used by those wealthy enough to hire creative firms to help you get through them Agreed that the complexity is a feature but it's not for the rich ( though the rich will take advantage of it, and why not? ) . It's mostly for the powers that be. If there were a 'flat' tax ( and one could argue what constitutes a flat tax) the rich will be more willing to pay that flat tax. I'd say complexity support a very large govt, keeping several people employed including accountants, tax software companies etc. It serves the parasite class.
  - deleted 1y ago
    [deleted]
  - DiogenesKynikos 1y ago
    The tax brackets are not what make taxes complicated. Knowing how to categorize different types of income is what makes taxes complicated. The flat tax would not make tax preparation any bit easier. They only thing it would do would be to eliminate progressive taxation. In other words, the rich would pay less. The poor would pay more.

jopsen 1y ago

Paying to file taxes, and then getting you tax refund as an Amazon gift card -- that's very American :)

zkmon 1y ago
What? I just googled, and found it is actually a real thing. Holy molly! Has Amazon become a federal system for distribution of money and goods? What next? coupons for burgers, Netflix credit?
- saagarjha 1y ago
  I assume this is done by the company, not the IRS.
  - Steve16384 1y ago
    But where is the company getting the refund from?
    - edm0nd 1y ago
      I think its usually like a person is due to receive a $1,000 refund and the company they did their taxes through will give them the offer to immediately get an Amazon gift card for $800 instead of waiting for fed and state refunds to hit their bank accounts.
    - CSMastermind 1y ago
      In the US it's legal for the person filing the taxes on behalf of another person to collect the refund for them. This allows tax prep companies to give people 'instant refunds' (essentially loans for the expected refund amount) so people don't have to wait weeks for the IRS to send them a check in the mail. The IRS only pays out via check or direct deposit but the company who did your taxes can pay out in cash, gold, or pokemon cards if they want to.
      - 1y ago

alexandru_m 1y ago

Why does the US have a tax prep industry in the first place? In every other country in the world, taxes are handled by their respective financial authorities. Why must every service and thing in the US must be a private profit making thing?

ta20240528 1y ago
Yip, consider how much money banks make by injecting themselves between you and the reserve bank.
- scott_w 1y ago
  This is a very different situation. If you're interested, I'd recommend reading Can't We Print More Money by staff at the Bank of England (https://www.amazon.co.uk/Cant-Just-Print-More-Money/dp/1847943381 https://www.amazon.co.uk/Cant-Just-Print-More-Money/dp/18479...). The short answer is central banks are not setup to offer services directly to the public. This is different to the tax office in that people already need to interact directly with it! Anyone in the UK can fill out a Self Assessment, for example, however it's optional for almost everyone, because Pay As You Earn takes the tax off your employer instead.
janwl 1y ago
Can’t you file your taxes for free in the US if you know how?
- willis936 1y ago
  That's why GP said "tax prep". Anyone can download and submit a 1040. That isn't the part that takes domain expertise.
  - janwl 1y ago
    I don’t know why assume that in every country in the world that is free. In my European country until 15 years ago or so you had to hire someone to do your taxes for you, and currently the free method only works for the most simple tax filing. In fact what you get is called a “draft” of your tax filings because you’re supposed to make sure it’s okay, and it’s your responsibility if you miss something or if the draft is wrong. And obviously the draft usually assumes that you will have to pay more tax, since there’s a perverse incentive given it’s the government who fills it for you.

fersarr 1y ago

the UK seems to be going in this same bad direction now "As part of our journey to modernise and digitise our filing routes, all accounts must be filed using commercial software from 1 April 2027." https://changestoukcompanylaw.campaign.gov.uk/changes-to-accounts/ https://changestoukcompanylaw.campaign.gov.uk/changes-to-acc... you used to be able to do this yourself on the gov website for free

rwmj 1y ago
Tell me about it! The bottom tier subscription services are also subtly crippled to make filing MTD tax returns difficult. eg. Xero's lowest tier doesn't let you easily add cash payments (without jumping through hoops for each payment).
Nursie 1y ago
Eh, that’s companies rather than individuals, and while it’s still objectionable it’s not quite in the same league. If you’re running a company you probably already have an accountant, and they’re probably already using one of those pieces of software. Or you’re using something like Xero, which is already on the list.
- fersarr 1y ago
  agreed it's not the same league, but it's still annoying for tiny companies that don't have much revenue
smcl 1y ago
It is insane how the UK seems hellbent on implementing the things that are shit about the USA
shawabawa3 1y ago
That's company taxes only, not individuals, a huge difference
- fersarr 1y ago
  yeah that is true, but still really annoying for the tiny companies I talked to

Yizahi 1y ago

They are not as harmful as some other corporations, but for some weird reason I hate such parasites on our society much more than some bigger offenders. And I'm not even from USA :) . How do you all tolerate this?

potato3732842 1y ago
Few people give a crap because a two figure sum for tax prep once a year is just about the smallest thorn the government and government adjacent or intertwined industries put in the side of the average person even if it's arguably less justified than some of the other ones.

wateralien 1y ago

Tax shouldn't even have to be handled by anyone. It should be part of the currency itself.

deleted 1y ago
[deleted]

johnnienaked 1y ago

The problem is how ridiculously bloated and inefficient the US tax system is. Companies see that as a possibility for exploitation and wet their shirts with drool.

macinjosh 1y ago

One time I wrote a screed into a turbo tax feedback form on how they are an awful business and no one responded except that they refunded my money.

timmg 1y ago

I wonder why there has never been open source tax software. It seems exactly the kind of thing the community would be good at. I imagine it would be hard for very complex taxes. But for the 60% that have simple taxes, I don’t think it should be unmanageable. Is it a matter of liability? Like I could definitely see a big issue with mistakes — even if it was just operator error.

bayindirh 1y ago
Fast moving regulations and legislation. You need both a legal and developer team, at least to follow and implement things as soon as they become the law. Even the revision of yearly variables is a considerable task.
- hylaride 1y ago
  Many laws also exist specifically to keep industries afloat. The complicated tax code keeps many lawyers and accountants in business.
  - bayindirh 1y ago
    > The complicated tax code keeps many lawyers and accountants in business. At least, some of the complications in these are not intentional, but result of centuries old evolution of these systems. Maritime shipping uses centuries old systems to handle costs in shipping accidents for example. I forgot the exact name of the system, but while the method is extremely fair, it's equally complicated. The whole premise stems from "This ship has sailed because you wanted me to carry your cargo", and becomes something mind boggling. I'm sure there are some steps taken to keep people busy, but chalking up everything to it is unfair and wrong.
    - hylaride 1y ago
      Fair points, but there is hostility to fixing a lot of those historical rules for the same reasons. Long-standing business practices is another can of worms, especially ones as international as shipping.

jeremymcanally 1y ago

Precisely why I built https://freetofile.com https://freetofile.com (it’s a simple static site with React for internationalization that automatically renders in Spanish, Chinese, Haitian Creole, or English depending on browser settings). It’s shocking and depressing how many low income people don’t know they don’t need to spend $100-200 to file their taxes. I want to blanket my area (well the whole country really but baby steps…) in signs with the URL during tax season. I really do loathe the entire industry at this point due to their gross practices around free filing. Some offer “free” online filing but deceptively upsell until they squeeze some money out of the customer. So I want to make any little push back I can against these companies.

godkernel 1y ago
great job. I used to use turbotax here in canada, until i figure it out that i could just fill it somewherelse for free.
- __s 1y ago
  GenuTax is the free software I used for Canadian taxes
- goatking 1y ago
  Wealthsimple Tax is free too, and pretty good for simple use cases.
- Throwthrowbob 1y ago
  I used https://www.canada.ca/en/services/taxes/income-tax/personal-income-tax/how-file/tax-software/find-software.html https://www.canada.ca/en/services/taxes/income-tax/personal-... (or an equivalent page, in case it's shifted around) to look for options a couple years back. I was glad I had this list to look through. I believe I compared Wealthsimple, EachTax, and UFile.
Spivak 1y ago
Who's spending that much on their taxes? I'm not low income by any means and I've not paid a single dollar to HR Block who does my taxes every year.

miki123211 1y ago

Why isn't there a non-profit doing this work? If this is as big of a deal as people claim, surely a non-profit could have written a free tax filing app and just made it available to people? Does TurboTax have any kind of regulatory moat / AT&T style monopoly?

elevation 1y ago

After a recent post[0] suggesting the federal tax code was already online in machine readable form, my first thought was "could I write my own US tax-filing software?" But the answer is still no. Paying taxes doesn't mean just paying federal taxes. Users don't want free Federal taxes software if it means they'll have to re-renter all their information into different software for their State taxes -- especially when more than one state is involved, such as for people who cross state lines for work, or moved mid-year. A tax service is a massive value add. The "free" software you get to do your federal taxes will be no threat to TurboTax until the states are required to publish their tax codes in the same machine readable format as the feds. [0]: https://news.ycombinator.com/item?id=45599567 https://news.ycombinator.com/item?id=45599567

mikeweiss 1y ago
Except people living in one of the nine states that don't have income taxes. They're laughing all the way to the bank.
- WesleyJohnson 1y ago
  Are the sales taxes generally higher in those states, which offset the lack of income tax?
  - everforward 1y ago
    Depends on the state, some have higher property taxes. Higher sales tax tends to be regressive because it doesn’t tax money you don’t spend, nor does it tax things where sales tax doesn’t apply like buying assets.
  - knute 1y ago
    Sales and/or property taxes are typically used to make up the difference. TANSTAAFL
  - BeetleB 1y ago
    Depends on the income tax you compare with. My state is 9%, and it kicks in at under $20K. No state has a high enough sales tax to offset that income tax. Concrete numbers: Say you and spouse collectively make $300K. That's a bit under $30K in state income tax. On top of that you'd pay property taxes (admittedly low). Sorry Texas, but your property + sales tax isn't that high.

linsomniac 1y ago

Reminder: FreeTaxUSA is a great alternative, I've been using it to file my taxes the last 3 years and plan to use it if I can this year. My situation is made harder this year by my wife starting a business. https://www.freetaxusa.com/ https://www.freetaxusa.com/

wombat-man 1y ago
It's not quite as good as turbotax, but turbotax also had it's issues. I've used it the past couple years though just to stop feeding turbotax.
- linsomniac 1y ago
  Agreed, it's not quite as good as TurboTax, I'd say for my use it is 80-90% as good. But it is kind of important to me to avoid TurboTax because of the lobbying they do to keep us from just having the IRS tell us what we owe and be done with it.

everdrive 1y ago

Taxes are crazy anyhow. The government won't tell me how much I owe, but if I'm incompetent enough at figuring out the number, suddenly they both have a clear idea of what I owe and also I'm now in trouble. Why doesn't the government just tell me what I owe, and if I think they've calculated incorrectly, only then do I do my own filing or hire a CPA or whatever else?

nemomarx 1y ago
The tax filing industry is against it, essentially. Various attempts by the IRS to move in this direction have been stopped. There used to be a libertarian wing that thought paying taxes should be a little painful so people wouldn't vote for more taxes, but I've not heard anyone say that since the bush era.
- ch4s3 1y ago
  The Grover Norquist folks in the RNC were not libertarians.
  - lelandfe 1y ago
    My favorite part about Norquist and the starve the beast folks is the utter hypocrisy of their silence in the face of Trump's tariffs. So much for the "drown the government in the bathtub" talk - turns out it was always just about the rich not paying more.
    - entropicdrifter 1y ago
      Pretty wild to me that we're at the point where even Penn Gillette recognizes that modern American Libertarianism is ultimately just about rich white men who want to do whatever they want with no consequences
      - ch4s3 1y ago
        It’s not really ironic, he just broke with the LP per se. He’s given interviews with Reason where he says his core beliefs haven’t really changed.

fogzen 1y ago

Taxes are free to file. Just fill out the form(s) and mail it in. I find it way easier than using crap software. No logins, no ads, no spying, no losing my progress. There’s literally instructions for every box on the form.

DudeOpotomus 1y ago

Americans are the proverbial frogs in the pot. They've been ratcheting up the heat over the last 30 years, the first signs of danger are well past, now its 300mm people being held captive by abusive leaders and insanely greedy profiteers. This entire story exemplifies everything wrong with the USA and its form of corporate run government. Socialize the risks, privatize the profits and foremost, let the foxes not only guard the henhouse, give it to them! World, if you're listening. We need a pepperoni pizza.

philipallstar 1y ago
No, we socialise profits. All the risk for businesses is borne by the owners. All the profit is taxed by the government.

sometimez 1y ago

CashApp is free for both federal and state. Have used it since its Credit Karma days and has worked fine.

netrap 1y ago
Very interesting. I'll give that a try..
mixmastamyk 1y ago
If it’s free, you’re the product.

shepardrtc 1y ago

The IRS does have a free filing service called Direct File: https://directfile.irs.gov/ https://directfile.irs.gov/ The Trump Administration is trying to get rid of it, but its been so successful and so well-rated that they're having trouble doing that.

mixmastamyk 1y ago
I looked this year and the site went nowhere. But now seems to be up. Not sure what happened. But I just went through the eligibility steps and it requires id.me verification! Big nope. Mailing a paper form does not. Of course Uncle Sam figured a way to fuck it up.

pkilgore 1y ago

Politicians cannot write loopholes that benefits only their doners if the tax code and tax filing is simple. Period. Take corporate/dark/unlimited money out of politics and watch this problem (and many other) disappear.

a456463 1y ago
AMEN! How is that taxing is easy, computed by govt yet people and rich people keep evading taxes, not showing taxes, finding workarounds through other orgs to reduce tax profile but as an individual you have so many restrictions

lisbbb 1y ago

Around 2018, my accountant retired and sold his business to some other firm. That year, the other firm had some newbie cpa do my taxes. If I had blindly gone with his effort, I would have had to pay thousands of dollars. The problem is, he made a huge mistake because he didn't listen to what I had told him regarding a step up cost basis on inherited stocks. I fired them the instant I saw that issue. Then I was stuck with nobody to do my taxes! I used TurboTax and got it done myself and actually received a small refund that year. And no, nothing was done fraudulently, it's just that I knew the details of our situation far better than any cpa who refused to listen to what I told him or was too "green" to know what I was talking about (unforgivable, imho). I've used TurboTax ever since then. Yes, I know it sucks in many ways, but the thing is, they bailed me out and saved me thousands of dollars over the years for hundreds of dollars in fees.

skirge 1y ago

In Poland since 3-4 years tax form for regular employees is automatically filled and submitted. Before then many NGOs filled them for you (directly or indirectly) for 1% of tax (I think avoiding loss of 1% motivated govt to make this automated system).

netfortius 1y ago

Unfortunately TT is [still] a must for expats. While my new home country makes things extraordinarily simple, not only for the free online filing, but also for an amazing assistance one could get from the local tax services (first year I reached out to them, in the office, they had their expat expert fill out the taxes online, in my account, in front of me, so I could learn on doing them on my own, from then on), filing to avoid double taxation, with uncle Sam, is stil a PITA

nightski 1y ago

I think it would be great to just have the IRS website list all reported income. Free automated filing is amazing, but if that is too large of a political battle just making this income information easily accessible would be a giant first step.

wuuza 1y ago

I mail in a paper form because F TurboTax.

memcg 1y ago

Intuit emailed me stating that Turbo Tax 2025 will not install on a PC running Windows: "We’re reaching out to provide an update on TurboTax Desktop software for tax year 2025. After October 14, 2025, Microsoft will no longer provide software updates, technical assistance, or security fixes for Windows 10 operating system. Because security is a top priority for us, TurboTax Desktop software for tax year 2025 onwards will not be compatible with Windows 10 operating system. To use TurboTax Desktop software for tax year 2025, your computer will need to run on Microsoft Windows 11 operating system. You can also consider switching to TurboTax Online, which will work on any supported browser (available December 2025)."

memcg 1y ago
Edit: Windows 10

barchar 1y ago

I always like to comment on these posts that the IRS offers a program called "IRS FreeFile Fillable Forms" that allows any US tax person to file their individual federal tax returns electronically, for free regardless of income or complexity of the return.

deleted 1y ago
[deleted]
mixmastamyk 1y ago
I used to use these but two years ago or so they started demanding a phone number (or similar) and that's when I stopped using it.

throw-10-13 1y ago

Americans should just stop paying taxes. It's all going to your new Gestapo and concentration camps anyways.

Alifatisk 1y ago

Reading the comment section makes it difficult to take America seriously, no way people live with these conditions? And I just learned a new word, plutocracy.