The IRS apparently already has a pretty good idea how much you owe. A tax prof at the law school here apparently developed some system intended for use with low-income persons that would have eliminated much of the unnecessary work involved in doing your own taxes. TurboTax or some such company lobbied against it, though, and it's dead in the water now. Grover Norquist joined in the lobbying effort because he recognized the same thing this prof did, namely, that filling out tax forms just aggravates one and leads to resentment over the whole process.
Uh, isn't that pretty much exactly what the linked Neil post says?
I don't know, because I didn't read it.
But now that I have I can say no; my comment has different information in that it states that some desired such difficulty-lessening system actually exists already, it just hasn't been implemented.
SO NEENER NEENER.
California has been experimenting with the pre-filled form thing and the taxpayers love it. I think you identified the two main opponents -- the TurboTaxes and Norquists. It wouldn't pain me to see the TurboTaxes and H&R Blocks and all go down.
4: But the links say that too, they're just referring to a different difficulty-lessening system that hasn't been implemented (the one Edwards is proposing).
Don't you people see?! Government inefficiency provides opportunities for capital accumulation! It's for the greater good!
I'm sorry I wasted your time with my unnecessary comment, Garyteo.
Just wait for the people who are happy to endorse state-sponsored warantless spying, kidnapping, torture, and indefinite imprisonment without trial object to this on the grounds that the state shouldn't be interfering in our lives like this.
This is another one of my bitches about Canadia, actually. You do your own taxes, just like here, and then they MAIL BACK TO YOU their OWN calculations and tell you if yours were right or not.
Seriously. WTF? Why fucking bother?
Maybe they're trying to make work for government-employed accountants.
News flash: Canadian practice, society contains inconsistencies. Not always better, sometimes just different, sometimes worse for no reason aside from habit and perverse developments.
bitchphd, they don't always do that, just sometimes, or at least they used to (this could have changed while I wasn't paying attention). I've had audits where they gave me money back I didn't know I could claim, too, so it doesn't completely suck. I think it was random sampling + some sort of automagically triggered conditions that got them to do the whole thing.
15. Ah. Well, my experience is limited, and basically I'm all for "let the gubmint figure out my taxes for me and send me a form to sign." Those who are paranoid enough can double-check the feds, instead of the other way around.
Bonus: no audits!
I admit that I've only skimmed the linked stuff, but under the Edwards system, how would things like charitable deductions get handled?
I imagine that if you're itemized deductions are more than the standard deduction, you just do your taxes as you normally would.
ogged's right. Note that Edwards acknowledges that it's simply not the case that his system would work for every taxpayer. But for a substantial number it would reduce the work substantially.
Ah. Well, OK. Still sounds like a good idea.
Did I really do "you're" for "your" and have w-lfs-n follow up with "ogged's right"? It's a new day in America. Hey Ben, I'm thinking of shooting you in your butt parts, whaddya say?
Bonus: no audits!
I think this is the main argument to be made against the plan. If the Government told you exactly what they had in their records, an unscrupulous person would have little incentive to correct the return upward, even though under the present system, they might report more fully, because they do not know what the Government knows.
That said, off the top of my head, it seems to me that whatever loss there would be from such fraud is probably worth the gain in efficiency and decrease in aggravation, transaction costs and failure to take advantage of programs like the EIC that currently occurs.
22: During the days of trucking regulation, I knew someone who made a pretty good living recalculating trucking rates. If the trucker made mistakes in the shipper's favor, nothing was said. If the trucker made mistakes in his own favor (charging for a high-rate item when it was really, or arguably, a low-rate item) they'd get the bill reduced.
This really does seem to be an area where deregulation was a no-brainer. It was insanely complicated and furthered no evident purpose.
22
This does bring up an issue. If the government calculates your tax and makes a major error in your favor are you obligated to fix it? If not this will encourage a lot of gaming of the system. If yes it will produce a lot of propaganda along the lines of I paid the governement what they said I owed and now they are trying to put me in jail.
24 - isn't this a problem in every transaction all the time, anyway? If I work for the government and they give me a double paycheck, I can't keep it. If I buy a shirt and they give me too much change, I'm not supposed to keep it.
Indeed, this very dilemma was the crux of the classic pilot episode of Family Guy.
They do this in Norway. Some time in March we get sent our tax forms already filled out. You have some things you can deduct and add in there and perform a couple of quick calculations and then sign it and send it in. Works wonderfully, though I imagine the tax code here is simpler. And I am not sure if this happens to people with lots of money because, well, that wouldn't be me.
And that spam comment above me was also posted on Obsidian Wings. Clever in that they stole the text from someone's blog and added the links. Over at ObWi it was actually topical to the thread as well.
25
Obvious mistakes like a double paycheck are one thing. But if the government calculates your social security benefit wrong for 10 years and then asks you to return the over payments it looks bad. Unlike social security the government is not in a position to calculate many people's taxes correctly so it is setting itself up for either a substantial revenue loss or a lot of bad publicity if it tries.
Speaking of government stupidity, what genius decided that 2006 returns would be due April 17 but 2007 first quarter estimated taxes would be due April 16? And why does New York make you copy your W2 form onto their form instead of just attaching it?
I'm guessing estimated tax payments go to an address not in MA, while 2006 returns go to Andover, MA? Offices in MA are closed on the 16th, so everything going there is a day later- which doesn't really make sense it's a postmark deadline anyway. You're free to send it on the 16th if you want.
As for W2s, why do you have to attach them at all if they're reported to the government in the first place?
I realize I'm probably not in the majority here, but I actually like doing my taxes. It's fun to work through all the forms, to see which deductions and credits I qualify for, and there's a wonderful moment of suspense at the end when I sum up all the different parts and get to see the final number. Is it a big refund or payment owed? You don't know the answer until you've solved the puzzle!
I sort of agree with Brock in 30, except that I know it's because my taxes are pretty simple, and there aren't any major things to overlook or screw up. The riddle-trail aspect of filling out forms is kind of fun; the ambiguity of more complicated tax situations, coupled with the possibility of financial or legal penalty, is not.
That said, I managed to totally miss the telephone tax refund in my haste this year.
(Filling out my dad's taxes, when I was a teenager and he was teaching in Eastern Europe, with some of his income in US dollars from the Federal government, and some of his income in local money that wasn't at the time exchangable on the legal market, was a pretty entertaining exercise.)
Grrr. I'm still annoyed by the time in my twenties when I was burgled and lost a couple of thousand dollars worth of stuff. (Some family jewelry.) It took me forever to track down a copy of the right form to calculate a deduction for losses due to crime, and after all that trouble, when I did the math, it came in just low enough to mean that I still needed to take the standard deduction.
These days, with all the forms online, I suppose it's different, but that ticked me off.
Dear God, Nathan, 30 wasn't serious.
Oh, nice, Brock. Lead Nathan along, and then pull the rug out from under him.
I don't like doing them, but I don't see what's so hard about most returns, especially if you're willing to pay $30 for some software. Capital gains are a little harder if you haven't kept good records. Schedule C is the devil, though- my wife had $600 of 1099-misc one year (just enough to trigger the need for C) and the details involved were ridiculous- how old is your computer/car, how much did they cost, what percent of them was used for this income, etc.
TurboTax isn't all that bad to use so long as the little number in the upper corner is green. Free money! It's when it turns red that the pain begins.
I used to enjoy doing my taxes when they were simple. Once you start itemizing deductions and having to keep and add up receipts, forget it. And that schedule C is a fucking bitch, man.
Did Standpipe just reveal his gender?
SP isn't Standpipe, if that's what you meant.
Oh, right. SP doesn't stand for anything?
That's a terrible thing to say about the poor guy.
38: Try doing it for two countries sometime, and trying to figure out exactly how the tax treaties do or do not apply to you. It's only slightly more difficult than finding a tax accountant who can actually do this properly.
Amen to that idea. While we're at it, can we have the IRS set up its own e-filing system? They actually wanted to do that a few years back and were prevented by Congressional supporters of the tax prep industry. Disgusting.
Truth, justice, and all that jazz.
46- I agree, which goes to the original point of the post- many people don't work in 2 countries, run their own business, or even itemize. That's why the government could calculate things for you and just send a bill, but there's this culture around How Hard Taxes Are! It's probably partially a media bias, where all the newspeople have to hire accountants and want to talk about the pain of doing taxes even though 20 million use 1040EZ and another 30 million don't itemize.
Why isn't e-filing free? I'm not paying $15 for the privilege of saving them time.