Here in Sweden I go to the tax office website, log in, have a brief look at that all my salary has been correctly entered (I have yet to encounter that it hasn't) add if I possibly want to deduct some extra things (also very uncomplicated), go to file and click send (the whole thing can even be done on mobile) . The process typically takes 20min max, Australia was quite similar. I'm always amazed by tax systems which seem to be so complicated that you almost always need an accountant (I know my parents in Germany always had one, even though their job did not imply more complex taxes than mine)

If all your taxes are just wages then you just fill out a two page form (1040). Literally just copy a couple of numbers from your w2 and you’re good. The problem is if you have non-salary sources of income (eg stock, non-employee compensation, etc) then things can rapidly become very complicated.

You're right, but I think cycomanic has a point. Why do you even have to fill out the 1040? Why isn't there a default option where you can review tax forms that have already been filled out with the the information the IRS has already received?

That has been proposed. But has been shot down by powerful lobbying groups. One being the tax prep software companies, but another being a conservative group that objects to making paying tax easier because then it will become too easy for the government to just keep raising taxes. The idea is that if you have to file your taxes every year, you have to acknowledge how much you are paying.

You don't have to file taxes in Germany except if you and your spouse are filing together or if you are self employed. Everything else is being handled by your employer.

If you want to get some of your pre-paid taxes back, you will have to file but the tax office doesn't care if you don't.

To be honest I don't know how it is now, but I remember my parents always having an accountant because it was just so much easier to deal with this, and they were a teacher and psychologist (not self employed), without any significant additional income.

Having an accountant do it in that situation is so not worth it. I know my parents also used one for way too long. So easy with tax software and with the government software you don't even have to pay for the software any longer.

Fun fact, they called the government provided tax software ELSTER which in German is also the name of a bird (Eurasian magpie) which is also known as the "thieving magpie". Who said the government didn't have a sense of humor!

If you don't have a lot of investment type stuff in the USA then tax forms are a breeze. They really should be zero effort but it's not hard.

If your taxes are easy in Sweden / Australia they would be easy in the US.

What makes you say that? You know they are intentionally difficult in the US?

For instance, there's been legislation where the IRS would simply tell you how much you owe and you pay it or dispute it. The IRS already know this amount, because this is what eventually happens.

Turbotax successfully lobbied for its defeat. It explicitly spends large amounts of money to complicate and convolute the system and structure it like a classroom quiz.

One of the major challenges with the US system is that the central authorities do not have much of the individual tax information all submitted and processed in advance of the individual taxes. The individual then has to to incorporate this information and file it. Sometimes individuals get amended taxTax information from their income sources and then have to re-file. The central authorities cross check on the backend (in theory).

It is incredibly arcane, and in some cases individuals holding publicly traded assets are legally required to file income tax in all 50 states.

No. This is not correct.

https://www.propublica.org/article/filing-taxes-could-be-fre...

California piloted a pre-filled tax return system (similar to Sweden and Australias, that the OP was talking about) called ReadyReturn in 2005 with 51,000 people.

Intuit then spent $3 million to smash it. They lobbied and then sued the state to stop the program. They are also profoundly incompetent technologists. There's an entire subreddit dedicated to how broken their stuff is (https://www.reddit.com/r/TurboTax/top/?t=all)

What did the participants of ReadyReturn, the pre-fille forms, think of the government program that Intuit killed?

"99% stated they were satisfied with ReadyReturn, 97% stated this is the type of service government should provide, 96% stated it was more convenient than how they filed in the past, 95% stated it saved them time, and 98% stated they would use it again"

Once again private interests sabotage and destroy the public will.

The line of "the reason taxes are so difficult..." is from sheer propaganda shills. Tax simplification has happened, it worked, and Intuit killed it every time. The reason is Intuit. They are the buggy whip industry that won. Shameless grifters that intentionally disrupt people's lives for profit.

Use another service. Any listed on the IRS website: https://apps.irs.gov/app/freeFile/browse-all-offers ... Never give Intuit a dime and click on every ad you see from them.

I hear what you are saying about the problems with the current system being fraught with problems, and there being a total gap in a government provided service.

That said, there are a lot of challenges to such a program.

Ready return was limited to people who were single, no-dependents, standard-deduction, only-wage-income, one-employer, with a maximum adjusted gross income of $139,917

This is great for a number of people and should exist!

That said, if you fall into this category, your 1040 should take 15 minutes to file by paper.

Where automated systems break down is handling more complex scenarios. Selection of deductions, pass through business income and losses, charitable donations, corporate investment vehicles, ect.

Many of this things require individuals to make choices at the time of filing. This is challenging to automate.

It's not challenging at all. I did taxes in NZ for a contract once. You do make a few choices if you want add some exemptions to save money, but it doesn't amount to much either way.

Does NZ have a tax code as insane as the US? My point is that half the problem is the law, which needs to be updated.

Agreed, it was simpler. For example, they didn't have the married/single/blind nonsense.

This is incorrect. Your employer is paying in and reporting your taxed income to the feds on a quarterly basis.

There are some exceptions to this depending on business size i think but the vast majority of the data is in the feds hands.

1040ez is quite easy. I still believe that IRS could just accept you signing that you made a certain amount and these are your deductions. They have the same information that I do, I seriously think they like auditing people.

All the Americans I know who have moved to Australia rave about how much easier their tax is here.

Yes especially the ones who still had to file in the US as well.

That's one of the things I never understood, the US is only country im aware of where you have to file if you're a citizen, even if you're a resident overseas.

As a Swede living in the U.S., I beg to differ.

My understanding is that if your personal taxes are moderately complicated (income from self employment and investment/property, some possible deductions) they're a lot harder in the US though.

HMRC's website in the UK is far from perfect, but its tax form covering all UK personal taxes has the features people appear to be paying for with TurboTax (Q&A format, most sections being optional, references to industry specific deductions, guidance notes) baked in.

If your taxes are "easy" in the UK they come out of your payroll without you filing a return.

I'm using freetaxusa.com for the first time this year. I got fed up with TurboTax after being hit with a similar anti-pattern as the ones described above. Got almost to the end and was told I had to pay $80 to file. This was after spending hours on my taxes because there are some things that can't simply be updated.. no you have to completely start the process over from the beginning. This felt intentional so that I would just accept the cost to be done with it.

After learning about how TurboTax lobbies to make filing more difficult, I swore I would not use them any longer. I also take everything opportunity to let people know about TurboTax's lobbying.

So far freetaxusa.com seems better than TurboTax IMO. It's cleaner and to the point. No unnecessary animations or any of that nonsense.

Every year I internally gripe about the UI improvements I'd prefer, but fully recognize it is better than TurboTax, and is approachable to people with a wide range of computer literacy.

> I'd suggest FreeTaxUSA.com as an alternative.

LOL I just tried to sign up and they rejected me because my personal email is on a .ch domain:

  The Email Address can't be a foreign email address ending with .ch.

Wowwwwww.

Certainly is a weird requirement. Could this possibly a governmental requirement? I certainly know governments have some silly requirements.

I contacted their support and they said it was for security purposes. Hah...

And yet US citizens resident abroad still have to file US taxes, even if they are dual citizens and have never lived in the US.

But they have to file a 1040NR, which most of the tax software won't touch with a ten foot pole.

Let me add my recommendation for FreeTaxUSA.com. I am a newly married grad student on fellowship, which implies juggling estimated taxes, confusing withholding rules, scholarship income, a name change, and first-time joint filing. Needless to say, I am not a "simple" case. After TurboTax failed to prepare my forms correctly (!) and wanted to charge me for the displeasure, I went looking for an alternative. FreeTaxUSA.com is where I landed.

The interface is fairly minimal. The workflow mirrors the questions/boxes on the IRS forms/instructions, a very helpful feature in my situation since I could easily cross-reference the relevant IRS publications when necessary. They provide excerpts from the documents as you go, which is all I needed in many instances. Unlike TurboTax, the prepared forms were actually correct (to the best of my knowledge, I am not a tax lawyer).

Simple, cheap, reliable. Would and do recommend.

EDIT: Story is related to last year, I plan to use them again this year.

I also like their bookmark feature. I commonly realize I need a bit of information and can add a note about my questions I need to research more, or what form I'm waiting on.

Once my bookmarks are clear, I know I'm good to submit.

Why not use the official IRS free file forms?

I tried Free File Fillable Forms last year on principal, but I ran into issues in two areas:

1. reporting scholarship income (goes on the line beside box 1 and nowhere else), and 2. state taxes are not supported, and my state does not have an equivalent service.

It's really frustrating that states have not adopted an equivalent service. I actually filed paper forms for mine because their free service is a simplified approximation of the full form and leaves out certain workflows that limit its scope of complexity.

I find it more approachable to use the question/answer format compared to reading all of the instructions on detail, determining if that particular section applies to me, and wondering if I found every form to cover every situation from the last year.

An example is figuring out whether I would owe taxes on the gain from the sale of a primary residence I owned for less than 2 years. Figuring that out manually took some googling, finding an IRS guide, reading multiple pages of regulations along with exceptions and determining where I stood.

Another is determining HSA contribution limits when my wife and I were in individual HDHP plans part of the year, and a family plan the remainder.

If your tax situation doesn't change from year to year you don't need to scour the instructions. Just work through the forms using last year's return as a guide.

Except things change from year to year so even if YOU don't change, the underlying tax laws move over time.

And there have been a lot of tax changes recently. Although my personal situation didn't change significantly, the filing experience changed more during the past administration than in the 10 years I'd been filing taxes before that, even though those previous 10 years included multiple moves and changes of jobs, and the purchase of a house.

They changed form 1040 drastically a year or two ago. Plus tax law changes from year to year.

They did, but the line instruction verbiage is easy enough to trace where it went in the end if you search certain keywords and phrases you can hook into the right places more or less.

The new 1040 is essentially the same as 1040EZ split across two pages with the option to add more schedules as necessary. No big deal.

I did in college. If your tax situation is nontrival it can take a very long time and has lots of room for error. I made a mistake and owed a $200 penalty for it back then. Software walks you through it and automates all of the arithmetic, number copying, and prevents fat finger errors.

As another freetaxusa user, I would rather pay a very small fee to have the tool walk me through the process than try to figure it out myself.

Based on this site[0], it looks like you have to use a 'partner' to file the forms if you make under $72,000 a year, is that right?

0: https://www.irs.gov/filing/free-file-do-your-federal-taxes-f...

The IRS site gives that impression, but I believe that's not the case. There is "IRS Free File" which is income limited as you mention, but there is also "Free File Fillable Forms" which appears to not be income limited. Intentionally misleading if you ask me.

Yes, and I presume it’s because some corrupt legislators are twisting the IRS’ arm on behalf of Intuit.

The wording is confusing (I think this is an IRS requirement having read the documentation for many years now) but what it is saying is that if you make under $72,000/year there are a ton of free options available. If you make more than $72,000 this is supposedly the only free e-file option available.

The whole thing is a mess because TurboTax and H&R Block and the like want to stay in business. If the process is too easy then the middlemen won't survive.

I don’t feel like that’s required, more like if you make over $72,000 that you’re required to file the forms yourself

When my tax situation was very simple I was happy to do my taxes on paper, often using form 1040-EZ, which only took about 10 minutes. Now that they are complicated (lots of different 1099s and business income) I very much prefer to use software to guide me questions and answers style.

Does the IRS allow direct e-filing? At least as of last year, it seemed that you still had to go through someone else to file electronically (although the forms are freely available).

Yes, I’ve been using IRS free fillable forms for over 10 years, I think, with no middleman between me and the IRS. Similar with my state taxes on my state’s revenue website.

Sorry, so, just to be clear: you've been filing your forms electronically with the IRS, not printing out the filled forms and mailing them? How? I swear I've looked, and been unable to find a way to file electronically (although I agree it's easy to find the form), except if you fall into certain income categories. I've even been told that it's intentionally legally impossible, as a way for the IRS to avoid competing with private providers.

(State taxes are a different matter; I've paid Illinois and Michigan taxes recently, and they do provide an easy and obvious way to e-file directly with the state.)

https://www.freefilefillableforms.com/ is the site. It is technically not an IRS service, but one provided by the free file alliance as part of the IRS agreement not to build their own software.

There are no income exclusions or anything. It is possible you will be unable to use it if you have to use some really obscure forms, but it does have all the forms that paid Turbo Tax can file for you. You also might not be able to use it if you have one of those weird tax situations where the IRS instructs you to write a message across the top of your 1040.

Yes, I use the link here:

https://www.irs.gov/e-file-providers/free-file-fillable-form...

It’s all electronic. You get an email confirmation.

Another recommendation for FreeTaxUsa. Used it last year for filing and for an amended return. I am happy to pay the small cost (about $7) for unlimited support (didn't need any). Using it again this year.

They are great! Use them every year. TurboTax is a scam in comparison. Use code FREETAXUSA10 to get 10% off that already-cheap state filing (federal is free).

How well does FreeTaxUSA work with investments and other complex tax situations? Can it parse PDFs or import data from brokerages in the same way?

No, but it’s not hard to fill in the few boxes of information from the 1099-B. I have 1099-B, Section 1256 contracts, and regulated futures statements and they’re all easy to input.

+1 for them. I live in one of the few states with no state tax, so its totally free to file. They do ask if you want to pay, its only if you want some audit protection, and live support.

>I will say their system is a bit clunky.

Interesting, I use TaxHawk (parent company to FreeTaxUSA, same software) and I find their UI excellent.