I agree with the basic premise that the IRS is nothing to be afraid of if you make a simple mistake. Though if you make a $5,000 error (which is getting out of "simple mistake" territory), they'll tack on a 20% penalty.

That being said, audits are incredibly annoying if you didn't make a mistake, especially if children are involved. The Examinations department of the IRS is hard-headed, to say the least, and they will often make any excuse to deny you credits that you are actually entitled to. In order to get a fair hearing, you have to appeal the case to court. (The U.S. has made the appeal and court processes pretty doable even for taxpayers without an attorney, though.)

Even besides the risk of pecuniary damage, the problem with an audit is that it can take a long time. It's a time sink for you where the best outcome is usually nothing different happens.

A long time with a lot of stress, I imagine.

I made an error like that one year. It was as simple as me (personally) not receiving one of the 1099s from a few months of work my wife had done for a non-profit.

For those unaware: You get a 1099 when you're paid as a contractor, which means taxes haven't been taken out yet. It's fairly common for temp work and similar oddjobs that don't warrant a dedicated employee.

There was no audit in my case. They just sent me a letter that boiled down to that I had missed that 1099, and they were correct. I was just a little miffed that they waited almost a year to send that letter, which by then had higher interest / penalties than if I had been notified sooner. Still way better than an audit would be, though.

This is my experience too. I was audited and they do send you a "shock" letter or at least they did in my case claiming I owed roughly $15,000 USD. After fixing my mistakes (and submitting an updated filing), they sent me a check for a bit more than $1,500 USD. Plus I learned about my mistakes so it was a win-win (as I learned with just enough time to not repeat the same mistake for the next year's taxes).

I had an A+ experience being audited after my initial shock. They even have a secure message system where you can communicate via a website with the IRS including uploading files instead of having to mail letters back and forth. Definitely some clunkiness but overall it was solid and worked.

Not sure I'd recommend the experience but I definitely found it nothing to fear. I also found I didn't need professional assistance with being audited (I did seek it out but due to the time of year being so close to the next year's tax due date, I couldn't find someone right then so I decided to try fixing it myself).

It sounds like you got a letter from the IRS's automated underreporter program. I believe these are more common (and less painful) than an actual audit.

I wonder if someone could FOIA their audit software stack and put that up on GitHub and Docker Hub

Any code authored by or for (exclusively) the government is default open. Usually all it takes is a FOIA request; if you're lucky they're publishing it on github already. However there are carve-outs for areas where making the code public could impede the law-enforcement mission of the entity that uses it, that is, FOIA exemption 7E. Since the IRS knows that if you knew how the audit worked*, then you'd do your taxes "just so" to avoid the thresholds by running the logic yourself, which is not something they'd want to encourage. And it would definitely increase their audit casework load.

There's also the issue that if the code wasn't bespoke but also sold to non-government entities for similar missions (i.e. government does not hold exclusive rights), then it can be protected as the contractors IP. But for the IRS this would be rare, they are pretty unique and often do things their own way.

* You can sort of do this without the code. The IRS is not allowed by legislation to base an audit decision on any information that is not covered by eFile, so contents of forms 1041QFT and 990T, or any attachments to what could have been an electronically submitted form, is out of scope. As long as what you submit in the core set of forms aren't statistical outliers, then you're good.

Generally no. Data you get from FOIA requests is generally limited with what you can do with it. State specific laws, your use-case not withstanding

The IRS is a US federal agency, though. They can claim no copyright on the code. It should be be public domain.

Unless it was written by a contractor who then gave the copyright to the IRS. This is a very common situation. The federal government is not barred from having copyrights.

That would be a fun legal rabbit hole to descend into.

I don't know about fun, but it would definitely be expensive.

"Fun" from a research perspective. (I've got friends who are IP lawyers and enjoy talking about this stuff.)

FOIA results can definitely go into public domain. That's sort of the point.

> That's sort of the point.

It really isn't - the point is freedom access, not free use. Information acquired this way doesn't magically become public domain, it may (or may not) have other constraints on it.

See e.g. https://www.justice.gov/oip/blog/foia-update-oip-guidance-co...

Which begs the question if they essentially already know how much tax they think you should owe (for most people) why don't they present that number to get first and let you either agree or disagree?

If we view it as an error checking process, it's better to come up with the two numbers independently. Whether the improvement is worth the costs, I don't know.

They don’t know until mid to late summer. Your transcript is incomplete (or incompletely processed) prior to that.

Incompletely processed is more like it. The deadline for receipt of information from employers, etc. is Jan 31 with scaling penalties for tardiness.

IANAL, or an accountant, etc, but if I’ve learned anything from ravenously consuming Trump family news the past few years, it’s that ignorance of the law actually is a defense in cases around taxes, and the IRS has to satisfy a standard of proving bad intent in order to really screw you.

Again, IANAL, do your taxes, please. But it does seem like the system is legitimately designed with an ethos of just making sure taxes get collected and isn’t about being vindictive.

Having dealt with tax authorities in several countries, it's a recurring theme that they have no interest in coming down on you hard if you seem to be trying to do the right thing and make actual efforts at compliance, as they have their hands full putting actual effort into dealing with people actually trying to evade tax.

What I always do if in doubt is to attach a letter setting out my assumptions. I've outright had to tell the tax authorities I didn't know the real numbers one year, because I realised shortly before filing that I'd lost documentation in a move, and so a whole bunch of details were estimates. Even that was accepted without additional documentation.

Of course I'm sure there are countries that are worse.

There is no way that would work with the IRS. Anything you estimated and can't provide documentation for will automatically be considered void and non-existent by the IRS if that thing reduces your tax bill.

If you think you have about $5k in valid deductions, but you can't provide any documentation upon an audit, then that $5k will be reduced to exactly $0 and you will owe all additional taxes plus interest and penalties.

I was estimating income, not deductions.

>>**the taxes they are due**

Please explain to me why they are *DUE* said taxes...

What is the gas tax for, what is it intended to perform

What is the lottery tax for, what is it intended to perform

What is income/state taxes intended to perform

Where are the metrics for what tax==intent==outcome results?

Please - give me a detailed response.

Paying for stuff like roads, highways, snowplows, schools, government workers, the military, that kind of thing. If you'd like a detailed response, you can look up the federal budget, and the state and city budgets relevant to your area.

>You are a fucking idiot.

>If you disagree - then, please explain to me. EDUCATE me. on how I am wrong.

Boy howdy if that's how you go about seeking education I can guess a) what you political opinions are and b) how you arrived at them.

> You are a fucking idiot.

https://news.ycombinator.com/newsguidelines.html

"When disagreeing, please reply to the argument instead of calling names."

"Please don't use Hacker News for political or ideological battle."

"Please don't use uppercase for emphasis."

"Have curious conversation; don't cross-examine."

"Please don't fulminate."

You were warned a day ago as well:

https://news.ycombinator.com/item?id=26323291

I apologize - I am just so upset on how things are going and I am livid at the inability to make meaningful change for the positive while we all watch ourselves being robbed.

The fact that there is a "vote" on a 1.9 TRILLION additional stimulus, on top of the ~6 TRILLION previous thefts - the fact that in 2008, many senators and congress folk had their spouses create LLCs - then get stimulus and bailout funds just illustrates the corruption.

The situation is bananas right now.

And people are defending the system.

This is like if you have major outages to prod and instead of doing a proper post mortem to get to root cause on the failures, you re-up your contracts with the vendors who failed you and pay bonuses to execs and ops people who left the system in a position to fail, then have all the other employees yell at anyone who questions what the hell is going on.

I get emotional - isolation for the last year has made emotions bottle up...

But seriously this situation sucks.

Again, I apologize for certain things - but not my indignant opinion of the current political and technical climate we are forced to live in.

> Why are our roads so fucked up? > Why are our teachers so underpaid?

Because some assholes -- present company very much not excluded -- don't pay enough taxes?