That majority of people could fill out the 1040EZ in 10 minutes and call it done.

There's no way for the government to know what your work expenses were, what you donated to charity, and so on and so forth through many of the deductions. If you don't want to maximize your return, you can be done in less than 15 minutes.

Even making more than 100k, with stocks through multiple brokers, a 401k, interest from multiple accounts, a house, student loans, and probably a few others I forgot to mention, it took me an hour and a half to do my taxes and cost me under $20 on freetaxusa (whatever the price for the state taxes they charged was low enough where I didn't care to figure it out on my own).

The tax code is one of those boogeymen items that everyone attacks, but in reality isn't nearly as bad as people make it out to be.

Let's start with an MVP then.

For federal taxes, the government takes your W2 and 1099s, and prepares a tax return, with the standard deduction. If you either know you have a complicated federal situation (and people know if they do), or think you can do better with itemizing your deductions, then you have the option to do it differently.

Then, iterate every year to make it a little better, until 96% of people don't have to think about it.

> That majority of people could fill out the 1040EZ in 10 minutes and call it done.

How long does it take to understand that it's all you have to do?

> There's no way for the government to know what your work expenses were

What? That makes no sense.

> what you donated to charity

Same. This makes no sense.

> it took me an hour and a half to do my taxes and cost me under $20 on freetaxusa

wow. I guess you are used to filling your taxes so you're fast.

I've used h&r block, some irs.gov-recommended online fillable forms, and some other free tax software in the last 5 years (I've only had to file taxes for 5 years now). On average it takes me about 30 minutes, and one year i did pay $20, not realizing i could've done it for free.

Maybe you're not American? Or haven't done taxes?

In the US, you can deduct your work expenses if you so choose (such as required clothes, for instance). Since you did this on your personal card, how would the government have any idea that you bought that suit for work? And the same goes for donations to non profits.

Work clothes are only deductible if required and not suitable for ordinary wear and only for tax years prior to 2018. A suit does not qualify.

> how would the government have any idea that you bought that suit for work?

Because your work tells the IRS. I have expensed a shit ton of stuff and I don't say anything about that to the IRS when I file my taxes. I'm hopping that the W2 says enough.

I have never spent more than 90 minutes doing my taxes, and I have done them myself (on paper or with software) for 20 years.

Okay, sure. But wouldn’t it be great if for some portion of the population, they really don’t have to do a thing (because they think the government got it right)? Isn’t that better than everyone having to spend at least 10-15 minutes?

How much taxpayer money will be spent compiling taxes for all working adults in the U.S.? I'm guessing this is more work than it's worth. I don't think filling out a simple form once a year is that much to ask, even if it takes as long as a few hours to do.

Edit: Not sure why I have negative points here, I was just saying that the process of implementing a system to actually get people their taxes and accommodating all the edge cases and ensuring everything is perfect enough that people literally don't have to do anything is probably not worth it compared to doing a check of submissions against the IRS own findings. Feel free to tell me why I'm wrong, I'm all ears and not super knowledgeable on the system (obviously)

EDIT2: Also, not implying that it can't be done, just that it's not worth it to the IRS to do something like that. Seems like otherwise it already would have been done?

The same amount of work that goes into verification systems to cross check your manual entry against all of your financial data they’re ingesting from payroll, investment firms, and other data providers.

It’s asinine to think the IRS should not be in the business of calculating your tax liability and providing you a friendly way to square up, free of charge, when they’re already doing most of the effort required (and have spent the government funds to do so).

Isn't the whole idea that it's a sort of verification? We propose what we made and what we owe, and another entity has their own proposal of what you made and what you you owe.

I'm just spit balling here, I don't have a strong opinion on it either way.

The IRS is friendly enough to accept your proposal and then confirm if you’re right or not (to their standards). It’s not a negotiation. That’s why this is annoying. There is no value in the majority of filers going through the process so Intuit can profit.

The IRS already does most of this work, lest you be tempted to claim that you made $7 last year and nevertheless fed your 118 dependents. It’s just not being shared with you....

150 million filings (not counting retired and children), on a 3Ghz CPU core? Not terrible long. Maybe they get fancier with a dual core box.

How much does it already cost the tax payers by paying these third parties like TurboTax to do it? It would be cheaper for the public to have the IRS do it since they are doing it already anyway.

> 1040EZ

There is no 1040EZ anymore, with the change to the postcard^W (at least one) full 8x11 sheet of paper that's similar to the EZ but that everyone begins by filling out.

There are also anti-tax activists who want to make tax filing as onerous as possible so people hate taxes.

I'm largely in the anti-tax camp and I don't want that. Perhaps I'm just not in that martyrdom mindset enough to want such a thing... but even so it would be more of a gimmick than an argument. I don't like these kinds of stupid made up controversies when they come from people and groups I oppose and like them even less from my side of whatever political point is at stake.

As others have mentioned, I do think there should be transparency. So, for example, the employer portions of payroll taxes (in the U.S.) is not usually visible to the employee on who's behalf it is paid; an employee doesn't see the full weight of taxes that ultimately derives from their labor... that to me is hiding, in a fashion, what my real gross pay is and what amount of my earnings is being taken.

> I'm largely in the anti-tax camp and I don't want that.

I’m in the pro tax camp and I kind of like it. I enjoy paying my taxes, but I don’t think the government should take half of peoples’ paychecks without people having to think consciously about it every year.

As someone that is self-employed, and gets to pay that otherwise invisible bit I mentioned earlier myself... do I know about it? yes (I did as a hiring manager back in the day, too); do I think about it? yes... but there's an extra "implied" tax here because my time doing tax prep related work is also a cost in addition to the taxes.

So I now get to spend hours that I could otherwise be productive with, or spend on leisure activities, on the problem of understanding what is being taken from me. As I said, I agree with you that people should be conscious of what is taken from them. People should make conscious informed decisions in many, many areas of their life. But to take that half their earnings and then insist that they spend hours of their own time (true even if they hire tax preparation services) just to be sure they don't lose more than they're legally required to is kinda rubbing salt in the wound isn't it? Of course you could hire accountants to deal with those issues, but now you're just changing that cost in time to cost in money.

I don't see how requiring tax filings changes anything here though. Filing taxes isn't where you pay taxes; that already happens silently and automatically whenever you get paid. Hell, the fact that it's so common for people to celebrate large refunds implies to me that, if anything, for most people tax filing is seen as something lucrative rather than a cost center.

To put it another way, I'm not sure how much tax filing achieves your stated goal that wouldn't be achieved by an annual letter sent to taxpayers, accompanied by their refund.

"if anything, for most people tax filing is seen as something lucrative rather than a cost center."

Be careful with this line of reasoning... you might give someone the idea that there should be 100% withholding of earnings and that filing tax returns should be more an application for the privilege receive some of the money you've earned. Then it would look more like it was the government paying all your wages!

...with socialism being all the rage these days, I wouldn't be so surprised to see this sort of thing endorsed....

There's a wide gulf between "think consciously about it" and "fill out a ton of forms that are nearly useless because the IRS knows that information already, and now has to employ people to record hundreds of millions of handwritten scribblings of what they already know".

Who exactly pays an average income tax rate of 50% in the United States? You'd have to be making hundreds of millions of dollars a year, at which point you don't get it as a check, you get it as a wire transfer from your investment bank, because with the exception of certain athletes, nobody makes that much money in salary.

If you're only looking at federal income taxes, sure. But now add in state income taxes, local taxes, property taxes, sales and use taxes, special fees and assessments, and other mandatory charges and that bar starts to move down the great chain of being rather rapidly. I assure you, I'm not making hundreds of millions of dollars and I'm pretty sure that I'm in that 50% range of dollars consumed by government takings per dollar earned.

Good! And I want it to be even higher. Specifically, I want to make federal income tax considerably steeper.

I want to tax income above 100x the federal minimum wage (per hour minimum wage * 2000 or about $3M at $15 an hour) at 90%.

I also want an absolute end to all tax credits and deductions besides the standard deduction. Say no to charitable deductions. No to first time home buyer credit. No to everything. Cut it all out. Yes, no credit or deductions for saving money toward your child's college or toward your retirement. Get rid of it all. That is my platform.

Edit: I think it is incredibly Lazy to try to effect change in public behavior through taxes.

A 90% federal bracket, combined with 10+% State tax (ex: 12.3% top bracket in CA), combined with no deduction for State and local taxes (because only standard deduction right?), would mean you’d literally lose money by making more money.

Don't forget an extra 3.8% Medicare tax.

“Why you’d quit?”

“I couldn’t afford not to!”

» “I couldn’t afford not to!”

States will adjust their income tax brackets if we make taxes at the federal level reasonable. Perhaps, reasonable people will prevail and it well end state and local income taxes (and increase property taxes to a reasonable level instead).

Our income taxes are already progressive. Wealth gets a free pass: https://www.nytimes.com/2012/11/19/opinion/to-reduce-inequal...

What we really need are land taxes and progressive consumption taxes.

I disagree with you on this. While I support higher land taxes, the reason is to prevent land and homes from sitting vacant. I'm not trying to reduce inequality. I'm just trying to fund essential services.

As for taxing wealth, I think the best bet is a Paris Hilton tax of 90% for inheritance exceeding a certain value (I propose 100x yearly minimum wage or $3M at $15/hour). So if you inherit more than $3M over your life time, all additional inheritance will be subject to 90% inheritance tax.

> property taxes, sales and use taxes, special fees and assessments

These are not "income taxes".

The same happens in Spain. My take is that by hiding those taxes to employees (voters), governments have a much smaller accountability perception than they would have if their voters (i.e. their customers) saw how much they are really paying to them.

I would like to popularize a term for this kind of behavior: Political Terrorism.

All terrorism is political.

Also, I tire of the constant politically motivated attempts to inflate the usage of words to try to attach awful connotations to relatively innocuous things. Please stop.

What other term would you use for holding the country hostage through flagarant, unapologetic cronyism and regulatory capture?

Edit: None of these replies really captures of the gravity of the situation IMHO.

Corruption.

Economic water boarding, obviously.

Government

Plutocratic oligarchy.

abuse

Goddamn Grover Norquist.

You'd think, if they were powerful enough to affect tax law, they'd lobby for getting taxes included in prices, the way they are in most of Europe. That'd make a lot of people hate taxes—especially the people who have to constantly re-tag merchandise.

It's actually the opposite. The groups against taxes want taxes visible and not embedded into the price of a product. That means consumers are aware how much of what they're paying is the sales tax portion. Not saying I personally agree, just pointing out what the thinking is.

Actually, it works the other way around: when I'm in Europe the price on display is the gross price (including VAT), so I kind of get used to it.

In US when I go shopping the price on display is net price, and then, when I get to register, they add sales tax to it, which is irritating, but it makes it painfully obvious who's to blame for that difference (i.e. government).

One thing that would make people hate taxes even more is if we got rid of tax witholding by employers. Let every employee receive full, gross salary to their bank account, and then make wire transfer to IRS by themselves.

Another funny thing: here in California, when I go to arestaurant there's often a disclaimer at the bottom of the menu: "To support minimum wage increase we add 3% surcharge to each bill"

I've lived in California my entire life and have never seen "minimum wage surcharge" on a menu or receipt.

I've only seen it in cities that have a higher minimum wage than state.

In San Diego it only seems to be at the more expensive end of the restaurant business. They put a sob-story on the menu explaining how they are going to add 3% to my check or else the minimum wage law will drive them out of business. Unfortunately it has the opposite effect for me and makes me think twice about supporting a business who will charge me $40+ for an entree but admit to not paying their staff a living wage.

Yeah I can't imagine taking that kind of bullshit argument seriously. Did the owner complain about finding nearby parking for his Bugatti, too?

Maybe some companies should add a disclaimer "Our CEO needs a new yacht surcharge" to achieve full disclosure :-)

It’s not all of California. It’s just in the places with their own higher minimum wage like SF or LA. I’ve seen it a bunch of times, mostly at small family owned restaurants.

>It’s not all of California. It’s just in the places with their own higher minimum wage like SF or LA. I’ve seen it a bunch of times, mostly at small family owned restaurants.

if the menu lists a price for a dish, how is it legal to tack on an extra 3% because the owner doesn't like the minimum wage in SF?

Yea I've always wondered that. It's supposed to be included in prices (unlike sales taxes) like any other cost, so how are they able to legally get away with advertising a lower cost than they charge? Would it be similar (from a legal perspective) if they added an electricity surcharge or a dishwashing surcharge and lowered their menu prices accordingly?

I'm all for more transparency of taxes for the end-payer, but I'm curious about this from a legal perspective.

Someone replied with an article that they were legal, but that article mentioned the surcharge must be disclosed prior to ordering. I suspect there's wiggle room for a good lawyer if they're using mouseprint or not making sure ordering services like Grubhub accurately disclose the charge.

In San Diego the surcharges were deemed legal: https://www.sandiegouniontribune.com/business/restaurants/sd...

It's pretty common, and not just in California. Here are some examples from WA.

http://www.workingwa.org/action/surcharge/list

It's becoming more and more common, at least in the Bay Area. I know several places in downtown Palo Alto that do this.

I'm European. What this does is that it hides the tax and people complain about price increases when the tax increases. Every single EU libertarian would prefer the US way. BTW what the heck are you doing with your tax rates that you'd have to constantly re-tag? That's completely a non-problem over here.

Yeah if merchandise is sitting on a retail shelf long enough that the tax changes multiple times before it's sold, you need to rethink your stocking choices.

I don’t see why we can’t have both. Have one price that is the grand total, and in a smaller font, display how much of that grand total is the tax. That way people know how much the thing will cost upfront, and also know the tax amount.

In the USA, I have no idea. In the EU, politicians don't want that because that'd surely lead to a revolution, especially in the east.

Sales tax in the USA differs across states, and even across counties. So it could change fairly regularly.

VAT differs wildly across EU countries, including whole different schemas of the tax. And not only that, we also speak two dozens of languages. What you're saying is simply not a problem - come and see. I've never even thought that it could be seen as a problem because the solution (don't move tags, just the product) is so obvious.

Are you referring to VAT? If so, how does this necessitate "constantly re-tag merchandise"? In Denmark the VAT is the same for all goods, and was last changed in 1992 [0].

[0] https://da.wikipedia.org/wiki/Moms

Canada here... The government pretty much already does your taxes here, and will 'readjust' your taxes if they feel you made a mistake. I've never understood why they still make you go through the process. Such a waste of time.

Even more ridiculous is that you can do any corrections online. So you can pretty much send the Canadian tax agency any gibberish and then fill in any claims or deductions online later after they have fixed it. You just can't initially fill in anything so as to protect the business of the commercial tax preparation agencies.

You know, there was one line in there that gave me pause:

> Intuit argues that allowing the IRS to act as a tax preparer could result in taxpayers paying more money.

Self-serving Intuit aside, I can't help but think this would be true.

It would just continue what was started with automatic withholding, where the general population is psychologically disconnected with how much they actually pay in taxes.

They got used to not having their money and being able to beg some of it back makes them happy when they get some.

Too bad people thought Ron Paul was crazy when he talked about abolishing personal income ta.