>> We badly need legislation to force the IRS to send every taxpayer a bill which they can pay.

> The truth is the IRS bill would be wrong and the IRS would have countless challenges and no practical ability to review any in-house type of challenge and all cases would needlessly result in court.

That's not how it would work. The IRS wouldn't send you a bill: it'd sent you an offer in the form of a pre-filled tax return. You accept the offer or you submit your own tax return.

Yes, this would be awesome. For >50% people it would probably be correct.

Seems like this would make tax evasion easier for cash businesses.

That's how most of the world does it and it works fine. And for businesses it can be just as is.

Its the insane burden and waste of time for the average person that is the problem.

Imagine how much more productive the entirety of the US would be if tax filing would be simple. The amount of time saved would be enormous, there are approx 140 million tax payers and if everyone would spend just an hour (in reality its probably multiple days) per year doing tax related work you get an idea how much time is wasted.

Eliminate cash with instant payment systems. Central banks are already working on it.

This seems like another case of American exceptionalism. Countless countries around the world do this, they do it by having employers report income when they pay people. I’m in the UK and other than a short period of being self-employed I’ve never had to fill in a tax return, I just get the amount I should deducted from payroll each month and get on with my life. Occasionally I’ll change jobs which causes my tax code to move and I get a cheque in the mail from HMRC for the amount I overpaid.

Employers report that in the US, too. But that is just the beginning of the story. The IRS doesn’t know about your charitable contributions or your extra income from that side-job you did for your uncle until you report it. On the form.

The way it works in the UK is there's £1000 of untaxed self-employed income.

So you only need to bother with a "self-assessment" tax return if you earn over £1000 of casual income.

And then, if you have less than £1000 of expenses related to that income, you don't have to justify the deductions so you just enter the income as a number and you're done.

Charitable contributions are claimed by the charity at the basic taxpayer rate. So when you donate £1 they can claim 20p from the government.

You only need to itemise your charitable contributions (to claim back the difference between the 40p of tax you paid and 20p the charity got) if you are a higher rate taxpayer, which is something like £70k per year gross, so you're well into <5% of people here.

I'd expect if we moved towards a direct-bill model, tax policy would begin to optimize for "causes least frustration for the 200 million common-case taxpayers who do the direct billing."

We'd probably see more monkeying around with the standard deduction. I know for me, and presumably a lot of people (especially those without major mortgage interest), the current standard deduction exceeds the benefits to be had by itemization-- and claiming the trivialities like charitable donations or medical expenses.

This has nothing to do with the IRS sending automated bills. It's not like they would have not pursued you if you'd chosen not to report the fraudulent 1099. This is an entirely separate problem.

They should just auto approve all complaints, and randomly audit some of them. That's effectively the system today, just less convenient.

This, combined with the ability to audit back 20 years if they find any deliberately incorrect tax returns, is a neat way to only audit a tiny fraction of returns, while keeping losses to fraud small.

I'm sorry about your horror story, but if the bill they sent were wrong, ideally you could just file as you do now.

I’m sure it would be wrong. But I think it would be less harm than forcing tens of millions of people to pay TurboTax $100 every year.