Just in time for Tax Day, the for-profit tax preparation industry is about to realize one of its long-sought goals. Congressional Democrats and Republicans are moving to permanently bar the IRS from creating a free electronic tax filing system.
Last week, the House Ways and Means Committee, led by Rep. Richard Neal, D-Mass., passed the Taxpayer First Act, a wide-ranging bill making several administrative changes to the IRS that is sponsored by Reps. John Lewis, D-Ga., and Mike Kelly, R-Pa.
In one of its provisions, the bill makes it illegal for the IRS to create its own online system of tax filing. Companies like Intuit, the maker of TurboTax, and H&R Block have lobbied for years to block the IRS from creating such a system. If the tax agency created its own program, which would be similar to programs other developed countries have, it would threaten the industry’s profits.
This is straight-up corruption.
This is idiotic but that’s what you get when you allow the sale of Congress and US law via lobbying and corporate money/influence.
There’s actually a deeper story here. Various well-meaning initiatives within the government bureaucracy have attempted at various times to make tax preparation easier in the US. For most taxpayers, the IRS could easily calculate taxes owed and simply send the taxpayer a summary for them to either accept or amend, but certain politicians have always scuttled these plans. Why? Because these politicians are ideologically opposed to taxes, and they want to make sure that preparing your tax return is as painful as possible, in order to condition people to hate taxes, thus giving them political momentum to get elected by demonizing taxes. Isn’t that wonderful?
This has long been a huge gripe of mine. Taxes are intentionally made inefficient and difficult to file with the express purpose of increasing business for tax accountants. We could save so much money by simply cutting out the middlemen who all told don’t add any value to the process. The responsibility of government is supposed to be to serve us, not to make more business for corporations. It really don’t make any logical sense that tax filing has to be privatized. People should have the option of using private services, but mandating them is pandering to corporations and nothing else.
Ultimately it’s just part of a broad pattern of corruption. What we see is politicians who are good at pretending to care about public interests to get elected, but once they’re in they’re the very same asshats who pass millionaire & billionaire tax cuts that significantly raise the national debt while simultaneously cutting low income education and fighting against healthcare. They rescind net neutrality, impose tariffs without any plan to actually make our companies more competitive, withdraw from global paris agreements, slash renewable energy, neglect crumbling infrastructre. The corrupt are winning and it’s going to be very difficult for future generations to rid themselves of this corruption and dig themselves out of the mess that’s been created by corrupt self-serving politicians.
I’ve been doing my taxes “by hand” for the last 5 years. I’m currently wrapping up my 2018 taxes this week (I owe money, so I’m not in any rush to file). I feel that people have an unhealthy relationship with the tax forms, they’re not difficult to complete. For a while, when all I had to worry about was a simple salary, I used the 1040EZ, which is really easy. Later, I started a business (LLC) and have had to use the full 1040 + multiple schedules. I’ve found that as long as you follow the instructions it is not hard to complete without any mistakes. Plus, after you learn how to do it the first year, it is only a matter of copying last year’s forms with updated values.
I’ve paid up to $500 for a preparer to do my taxes (business and person together), so if I consider my time worth $50 an hour, as long as I keep it under 10 hours, I’m coming out ahead. This time, it took me about 2 hours to complete everything. Well worth the investment of learning how to do it myself, I thought.
teco.sb,
I do my own taxes too with software, but with so many line items and forms it’s very stressful and very complicated. It shouldn’t be this way, but it’s not always clear what forms apply to you even after reading the instruction manual that comes with each form. The local paper did a study by hiring five different accountants to do one person’s taxes. None pair of them came up with consistent results. That’s our tax system.
My business is more complex than that, it takes me two days to do taxes.
I live in Sweden. The tax agency sent me a prepared form, I confirmed it using my phone. Was done in a few minutes. It’s amazing how complicated it is to do taxes in the US.
I guess this is bad? I was able to file my federal and state taxes free online and it was not via the IRS.
I am upset about this. My tax returns are super easy and don’t even include State tax because Washington doesn’t have an income tax. However, because I make more than $66,000 per year, I don’t qualify for the free online tax preparation software. Just because I make more money (and thus, pay more in taxes) doesn’t mean I should have to pay someone to submit a bunch of forms; especially when the IRS already has all the information needed to fill complete my taxes. It is very frustrating that our tax system is so corrupt in the US. To make things worse, Congress is using a misleading name to trick people into thinking the bill could in some way actually help taxpayers.
Yes, I just love (see what I did here? 😛 ) the NewSpeak names of many US bills…
Some people call it Big Brother, but in fact it is very convenient for the common tax payer in Portugal. For the second year in a row, most tax payers will have an option the an automatic income tax declaration, where one has to do little more than press “OK”. All invoices are sent by the emitters to government’s servers and, if they contain the person’s fiscal identification number, they are automatically used for calculating tax benefits and so forth…
I second that. For years now the vast majority of Portuguese people only need to log in and, optionally verify if the values are correct and press “OK”. Also the official tax software is also available as a jar file, so it runs in any operating system.
I still think they could go one step further and not even need the “OK”, like what happens in UK. If you don’t have additional income, tax submission is done automatically and you don’t need to submit anything.