Tax Preparation Industry Alarmed Over Plan For IRS Free Tax-Filing System - Slas...

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• Re:

  Another fake US industry invented to screw over working people while making money for corporations and their owners/investors. The US government knows more about the money I make than I do. They send me all the documents on it, then I have to put numbers they send me on a page and send it back to them. For crying out loud, they had the documents all along!! They don't need me to put them on another piece of paper and send it back.

  • Re:

    When you do your tax return you are checking their numbers for accuracy and completeness; or do you just want to blindly trust the government to calculate you return every year and get it right?

    • Every proposal for having the IRS handle most peoples taxes i've ever seen includes them sending you what is basically the completed return for you to just "sign off", if you find a discrepancy then you have the time and ability to correct it.

      • Re:

        This is the system here in Finland.

        They send a Pre-filled tax calculation either in paper form or if you only want look at it online you can unsubscribe the physical form.

        You then look though it and if there is something wrong you either correct them on the paper form and send it or correct them online.

        • Re:

          Same in Spain. The Tax Agency (AEAT) even provides a free software (PADRE) to fill in your tax returns, which is essentially what everybody (including tax preparers) use.

        • Re:

          In Sweden we can even correct the information online, no need for dead tree over snail mail to change the information.

    • Re:

      If the IRS could do my taxes, then I could just review a document and approve it, that would be fine with me

      • Re:

        How about moving to Sweden then?

• Re:

  If your job gets replaced by a website, did you really have a job to lose?
  Sounds like make work handouts/welfare for slightly educated people. Can't they learn to pick fruit or something useful?

  • Re:

    It's not even make work, the vast majority of returns processed through these companies are never touched by a human.

    It's more like make profit. The only folks who get anything out of the current tax preparer system are the shareholders.

• Re:

  And this represents your complete power as a tax paying citizen.
  
  You can yell 'Shame on you' all while the government does what the corporations want them to do.

• • That 87,000 number includes folks working on IT systems, answering phones, processing paper tax returns, updating forms and documentation after every congressional circle-jerk and all sorts of other mundane tasks.

    And yes, some of those 87,000 are armed enforcement agents. Which I'd have thought the Republicans would be in favor of, as they still go on and on about "lax" law enforcement. Unless of course it's against one of their own.

    Meanwhile, every $1 spent on the IRS yields a roughly $6 increase in revenue, with no change in laws. One would think that investing in something with a six-fold ROI would be a no-brainer?

    • Re:

      How does the phrase go...? Oh yea - Past performance is no guarantee of future results.
      I'm with others in this thread - too many new employees and make tax filing (and the tax rules) simple and free for the simple returns.

      • Re:

        While it's no guarantee of future results it also doesn't mean a decrease in results either. I mean even if the $1 spent gets $1 in return it's a good thing so they have some runway to work with if that 1:6 ratio is accurate.

        It's really a clear cut case of decades of poisoning the well on the issue paying off where such an amount of the public is opposed to both nearly 100k new jobs being created that actually doesn't cost any taxpayer dollars, creates revenue and has the end result of criminals being brou

        • Re:

          If the IRS didn't have as many horror stories about how they munged up someone's life for a long while - in error (I personally know a few folks who were caught up in a situation that turned out to be IRS' fault) they I wouldn't sweat more. Once upon a time people said Nuclear was so safe that only 1:1,000,000 would melt down, so they wanted to build 10,000 more -- oh goodie, now we have more meltdowns. Apply the same logic to the IRS...

          It's not controversial to me - make the tax code simpler, and we will (

          • Re:

            Well one could also make the case that an underfunded IRS is more prone to mistakes, we can't go by anecdote. The GAO reports pretty much paint hte picture of an understaffed and underfunded organization [gao.gov].

            Second it's a bit of a fallacy to say "more agents and more audits means more mistakes" because we are ignoring the outsized benefit of all the increased enforcement and revenue. Even in the nuclear example with 10k plants a 1:1m chance of meltdown, yes the meltdown chance has increased but we also have

• These new IRS agents aren't going to be going after the big, fat cat 1%'ers. Those folks have too much money to spend on lawyers. The IRS will go more after the low hanging fruit, the middle class filer...

  Ah, the right-wing talking point pops up. Do they text you the week's talking points every Monday?

  Yes, they will go after the rich cheaters. A tax cheat who under-reports ten million dollars of income is a lot more valuable than somebody who mis-reports a thousand dollars of income.

  Right now the rich know that the IRS is understaffed and there's a good chance that they will miss underreporting.

  • 1 hidden comment

  • • Re:

      This perception about who and why they are going to enforce tax laws though is not really their place or really perogative to discuss in the open nor would I consider it proper for them to say "we're leaving these tax cheats alone" because that's not what they are here to do.

      Technically if you are avoiding or cheating on taxes you are breaking the law, middle or upper or lower class. Where else in our law enforcement do we say "these people get a free pass on crime", we just don't know.

      Now internally I am

    • Re:

      I can easily promise you that if they hire X new people, this means that these X people will go after the 1%.

      That's like saying that you get a bailout if you use it to pay your staff. No problem there. I used to pay a million for my staff, so the million bailout that you pay me now go to my staff and I keep the million I used to spend on my staff for myself. See, I did what I promised to do!

    • No, it isn't. The IRS does not care whether you are big or small. They care about whether you paid your taxes or not. The reason the right wingnuts are whining is because the rich rightwing nuts will get nailed. Even so, most taxes are paid by the middle class, and they deserve to pay what they owe.

      • Re:

        Even so, most taxes are paid by the middle class...

        As much as I want tax reform, that statement is just not borne out by the data. Considering that 70% of income tax is from the 90th income percentile and above it's not mathematically possible for the middle class to collectively pay "most," unless you have an interesting definition of "middle class" that spans an unusual range of income percentiles.

        Or are you talking about other types of taxes in addition to income tax, which seems odd for a discussion on

    • talking point [Re:I lean both ways on this one...]

      Which is exactly what they did:
      Aug 9, 2022: IRS Commissioner Charles Rettig said the resources won't increase “audit scrutiny on small businesses or middle-income Americans.

      Right-wing talking points don't care about truth one way or the other. It's all about perception, distilled into tiny sound bites that stimulate outrage.

  • Re:

    Exact quotes from references below, emphasis mine:

    (1) In total, about 59.9 percent of U.S. households paid income tax in 2022. The remaining 40.1 percent of households paid no individual income tax.
    (2) Among Disaffected Democrats and Devout and Diverse - which have the lowest family incomes among the typology groups â" fewer than four-in-ten say they are generally satisfied with their finances

    So 40% of households pay no income tax, which by definition would be the lowest earners; And the lowest earners

• Have you ever tried calling the IRS? I have, multiple times, and there was a minimum - minimum - 45 minute wait, on hold, to get a live person on the phone. Once I got someone on the phone, it was fairly easy to get the situation figured out. But then there was a 3-6 month wait for the physical letter and check to address the issue.
  
  The hiring isn't exclusively about audits and enforcement - it's about providing a simple, basic level of service that supports effective government.

  • Re:

    I have called a few times in the past year, both personally and professionally, though never during "tax season". Never waited more than a few minutes, and the individuals on the other side were super pleasant.

• I lean only on way on this

  We're talking about 87k new employees who actually do something vs. the almost 300k in tax prep who only exist via exploitation of the average taxpayer.
  No more private companies charging lower to middle-class workers for what could easily be free.
  No more lost hours doing tax preparation for many of those same people. (And that's a few hours multiplied by 132 MILLION returns under $100k filed in 2020.)
  Less possible to cheat on your taxes.
  More folks to audit past returns finding people who did cheat on their

• On top of that, why should I have to share a bunch of important personal information with private companies in order to file my taxes? Makes no sense. To this day I still do my taxes myself, with printed forms. Not the easiest. But other options are worse.

  • Re: Oh Noooooo...

    FreeTaxUSA site is pretty good. Free federal filing, and state is cheap.
    • Thank you. Still a private company that has no business knowing my social, address, email, phone, income.

      • Re:

        I’ll start with a giant “I agree” to what you’ve said, but then I’ll also point out that they need your opt-in consent before they can share any of that data with third parties, hence why they almost all have an ominous checkbox along the way that may use dark patterns to try to trick you into agreeing to sharing. The good ones put it right at the start with plain language. The bad ones put it right at the end and will use vague terms that may leave you thinking that they

        • 1 hidden comment

        • • Re:

            No disagreement. There are laws to protect the data, but I agree that we all know how well those work: not especially well.

    • Re:

      And they don't have anything in their TOS that prevents them from selling your data to Meta like many other sites were doing.

      https://arstechnica.com/tech-p... [arstechnica.com]

  • Agreed

    My wife and I need to use an accountant today. As business owners our taxes more complex, can't get around that mess. When I was younger? You bet I did them myself. I did succumb to the Intuit for a couple years after college when things started getting more complex... but that was dropped fast when I started a business.
    
    Not surprised this happened... because it's been proposed before, and was attacked / eliminated by the same groups at that time. I think it was during the Clinton years they wanted to hav

• Why even make people fill out a form. The form should be sent to me securely by February 1st, all filled out so that all I need do is either sign and return as-is, make small amendments or replace with forms I filled in myself by the April 15th deadline

  If I do nothing at all the form should be considered approved by me after April 15th and I should be able to go back and re-file for previous years should I wish

• Re:

  It's 2023. There's no reason this shouldn't be automated like it is in most countries. Fine I have a tax agent, but then I have three properties earning revenue in 3 different countries, and calculating the redress from double (triple?) taxation is mission. But before I started moving around the world my tax return consisted of logging into the governments website, clicking "I agree" to my completely pre-filled in tax return based on my employers, banks, insurers, etc, etc, etc delcaration to the government

• Re:

  Whatever will we do if we don't need to pay people to fill out a form for us!?

  A vast majority of people have very simple tax filings. There's absolutely no reason why they shouldn't be able to fill out some simple info from their W2 or 1099(s) and send it through without a bunch of red tape (ironically, less red tape from the IRS than the private sector).

  Typical anti-citizen overreach from the republicans. Not surprised there. If it's useful to a lot of 'normal people' and not just the rich, or can be used

• Re:

  It is free to file, always has been. Anyone can mail in a paper filing, or upload a completed document.

  
  
  The problem is that you have to prepare the thing yourself, and most people can't be bothered so hire out to one of these companies to do it for them.
  
  The problem for years is that these companies actively lobby to disallow the government to implement a free competing alternative to their service because their entire business model would go up in smoke. Everyone sees it for what it is, and this is th

• Re:

  Wait until you read about our healthcare, weekly school shootings, incarcerations per capita, and worker’s rights.

• Re:

  I think it was a typo, should be:

  "... will cripple their businesses and infringe upon their ability to violate taxpayer privacy."

• 2 hidden comments

• • Re:

    Because, as I understand it "Fair"Tax is basically just sales tax, which means it's directly collected by businesses rather than individuals, which means you need much less bureaucracy to manage it.

    Of course, like all sales taxes it's a regressive tax, with the low and middle incomes being hit hardest. So basically just a handout to the poor, hard-working 1% who only control as much wealth as the bottom 80% of the population combined.

    • Re:

      That also is a bit of sleight of hand by the Fairtax people because sales-tax-fraud is in fact a thing that requires investigation and enforcement but currently it's all a state and business issue so it's easy for individuals to mentally handwave it away since they don't interact with it.

      With a national sales tax that work still needs to be done, even more so as now there is even a larger incentive for businesses to try and avoid the tax to gain an edge. Years ago when I read the FairTax book there was a wh

• Re:

  It's also a huge handout to the wealthy at the expense of the working class.

  All sales taxes are inherently regressive, since the poorer you are the larger the percentage of your income you spend on taxed purchases. And if you're replacing income tax, you'll need at *least* a 30% sales tax to generate anything like the same revenue. Probably closer to 50-70% since most income tax comes from the rich, who won't be significantly subjected to sales taxes.

  Because while working class people spend most of their

• Re:

  Ah yes, the tax reform that exempts almost all income from billionaires since sales tax isn't collected on the sale of stocks, bonds, jewelry, coin collections and real estate (all of which are capital gains taxes). Meanwhile, it fucks over the lower classes by increasing the cost of everything they're already having trouble budgeting for.

  "But there's a rebate"... yeah, but it also eliminates EITC and CTC, which already provide more than the proposed rebate.

  It shouldn't come as a surprise that the FairTax

• Re: Joke is on all of them

  When GPT gets it wrong and the IRS fines you $10,000, is OpenAI going to make you whole?

  • Re:

    I don't see why there would be a fine if an IRS approved AI messed up, the taxes would be re-calculated and any difference would be payable/refunded

    If of course the AI was lied too, say abut unreported cash income, that should be prosecutable

    But then I'm sure there are many people who feel that paying their taxes is always a "fine" and that they have a right to lie to under-count their income

• Re:

  That's actually a great use case for this type of information and LLM AI systems.

  It would need maintaining to be trained on law changes and such, would probably need a LLM base to have the language interpretation and writing skills.

  UAT would be a massive effort and all results would need a human review before use (at least for a while).

  Medical imaging analysis is another, completely unrelated, area where AI can be applied now.

  These systems can effectively address "data analysis" problems but require trainin

• Re:

  This! All of the keyboard twiddling middleman capitalist busy-workers (KTMCBW) should be quaking in their boots these days.

  If your job can be done by voice recognition, pattern matching, and copy/pasting from tables of data then its days are numbered; even the ego stroking the managers require that makes them want a floor full of people to oversee is not going to stop it. The manager that manages the people will likely be replaced by the best actual worker whos new job will now be to supervise and optimize

• Re:

  You got it wrong, filing electronic isn't convenient to you. It is convenient to the IRS, who doesn't need staff members to read the documents and reenter it in, and also have to deal with OCR issues. Taxes done in Crayon, People using their tax form as Toilet Paper before sending it to the IRS...

  • Re: OBTW

    Who would have thought it? A change to a transaction, that is convenient for both parties. That must without any doubt be illegal.

• Re:

  Fixed that for you.

  I was lucky to get my return in 8 months when I filed on paper, the IRS was sending status updates that nearly all of the returns filed 18 months prior were done being processed. E-filers got their money within a 3-5 weeks.

• Re:

  My complaint with the FreeFile forms was that that I had to manually re-enter the entire W2 into the system. They already have my W2, why do I need to re-enter it? They have my SSN, so all they need is my employers tax ID and maybe my employee number as a cross check.

  Along with the general clunkiness of the web interface at the time it proved to be easier to mail in the forms. A six by nine envelope and the stamp and a half postage is much cheaper than inTuit or anyone else, given my nine page return. (Last

• Re:

  The CEO's of these Tax firms, can afford remote mansions where they can live in Private without other people bothering them. I mean this law could force them to live in *gasp* an upscale housing development where they have to interact with neighbors who might know their face if they want to step outside their house.

• Re:

  "Privacy" is probably the wrong word. I'd think the real fear for people that take lots of deductions is that the IRS processors would dispute a lot of them and hold the taxpayer up, often an expensive process in tax courts. All those new agents aren't there to "get the rich". They were hired to squeeze more revenue out of the lower taxpaying brackets. The most likely tactic in that arena is targeting deductions. The assumption here is probably that they're not scrutinizing individual deductions right away

  • Re:

    Nice. Shill for rich tax cheats pretending to bleed for the poor and middle class.

    Half of all unpaid taxes are owed by those in the top 5% of income [treasury.gov]. The top 1% owe 28% of all unpaid taxes. Yes, the IRS is going to go after the biggest tax cheats -- the wealthy and the rich. Although relatively few in number they are the most challenging group from which to collect what they owe since the have the resources (and lobbied-for loopholes) to make collection difficult. And remember they still owe for all those

• Re:

  The problem with Flat Tax, (such as sales tax) is that the lower income people will be greatly more adversely affected than higher waged folks.

  The consumption tax, will also open the door to causing a bunch of other things that can cause problems, such as Value Add tax, and taxes on every-time money is moved. As we need to be sure the wealthy also pay their fair share, but those with extreme wealth can live more affordably than those who are poor.

  • Re:

    To ensure the poor aren't left behind, the government would give every US citizen a monthly check for $X. X would be the calculated monthly consumption taxes paid by someone at the poverty line. Every US citizen would get a check for the same amount.

• Re:

  Washington State does it this way, but the claim they can't get enough money that way. And it also hurts the poor.

• Re:

  You must have a lot of stocks or something that generates a lot of passive income. This moves the tax burden onto the poor.

• Re:

  If only the above were true. Alas, it no longer is [10isdsstories.org].

• Yea, Republicans pretending to be the party of

  small gov't - but what they really mean is, whoever doesn't pay us enough bribe money in the form of 'lobbying'. They're all about trying to legislate their religious shit on everyone else too. Fuck them.