Americans spend $104 billion on tax preparation services

[MajorRewrite]

The US income tax system is so confusing that Americans spend $104 billion on tax preparation services annually. That’s absurd.

Dozens of prosperous countries save billions of dollars and hours annually by not requiring residents to fill out tax returns

Return-free filing is not difficult.

At least 30 countries permit return-free filing, including Denmark, Sweden, Spain and the United Kingdom.

Furthermore, 95% of American taxpayers receive more than 30 types of information returns that let the government know their exact income. These information returns give the government everything it needs in order to fill out most taxpayers’ returns.

The U.S. system is 10 times more expensive than tax systems in 36 other countries with robust economies. But those costs vanish in a return-free system, as would the 2.6 billion hours Americans spend on tax preparation each year.

It appears that the reason why we don’t have a “return-free” system is because tax preparation services and tax accountants lobby Congress to keep our nonsensical, confusing current system.

 

[Rightguide]

The IRS labors day and night to line the pockets of tax preparation services with more and more money.

 

[MajorRewrite]

The IRS labors day and night to line the pockets of tax preparation services with more and more money.

The bureaucracy only does what it’s told. As usual, this is Congress’ fault (both parties have perpetuated our inefficient system over the years).

 

[BabyBoomer50s]

The TCJA made it much simpler for many taxpayers. Especially with the fixes to AMT and higher standard deduction.

 

[Rightguide]

The bureaucracy only does what it’s told. As usual, this is Congress’ fault (both parties have perpetuated our inefficient system over the years).

The IRS like most of the federal agencies have migrated into writing their own regulations many of which exceed their legislative authorization. Several suits alleging this are in front of the federal court system as we speak. A couple big cases alleging administrative overstep are in front of the SCOTUS.

 

[MajorRewrite]

The TCJA made it much simpler for many taxpayers. Especially with the fixes to AMT and higher standard deduction.

But the point is there is no need for most people to have to fill out forms at all. The IRS has all the information already. The taxpayer should be able to simply look over forms automatically completed by the IRS and approve it.

Spending more than $100 billion a year on tax preparation is crazy.

 

[BabyBoomer50s]

But the point is there is no need for most people to have to fill out forms at all. The IRS has all the information already. The taxpayer should be able to simply look over forms automatically completed by the IRS and approve it.

Spending more than $100 billion a year on tax preparation is crazy.

I hear you. 1099s and W2s are all that are needed for many returns and the process of importing data and generating returns could all be automated. But are so many other things that can’t. People with rental properties, small businesses, independent contractors who depreciate office space in their homes, a myriad of tax credits and incentives that a taxpayer must qualify for, calculating RMDs from retirement accounts, etc.

 

[dmallord]

IRS forms could certainly use simplified forms. There are on-line products that are free fitting many individual needs such as those with a simple 1040 form.

Time for that old joke: Did you hear about the new Tax form? Yeah, it's a lot easier than it used to be:
Line one - How much did you make?
Line two - How much do you have left?
Line three - Subtract line two from line one and send that amount to the IRS before April 15th.

I used to handle my own taxes for years. I found it better to hire a private CPA and let him handle that. I lifted some of the risks of errors. My deductions center around real estate properties, rents, taxes, repairs etc. That requires depreciation etc. The stock stuff he handles as well.

 

[Wat_Tyler]

I hear you. 1099s and W2s are all that are needed for many returns and the process of importing data and generating returns could all be automated. But are so many other things that can’t. People with rental properties, small businesses, independent contractors who depreciate office space in their homes, a myriad of tax credits and incentives that a taxpayer must qualify for, calculating RMDs from retirement accounts, etc.

The first year that I filed when I was an independent business person was a clusterfuck. I think that I spent most of a weekend figuring out what to do to make it work. Home office, sieving through old bills to calculate costs of operation of that percentage of the house, some general cussing, and the double-checking of figures and math. Then it was all fill-in-the-blanks. For that year in particular, it survived audit with no changes to anything.


I went back to work for The Man and it simplified. Then the new system came out and it simplified again, almost to the point of being as easy as what I filled out when I was a student with a part-time job and no assets.


When you get done being scared of the IRS, you can figure this out once and then do the human version of copy-and-paste next year.

 

[Chobham]

The "Fair Tax."

 

[icanhelp1]

The IRS labors day and night to line the pockets of tax preparation services with more and more money.

The IRS gets money from taxpayers and then again as taxed income from tax preparers. Ever get the feeling that the government has their hands in all your pockets.

MORE BIG GOVERNMENT MOM!!!

 

[lovecraft68]

It's always blown my mind how many people pay for tax services. The average person's taxes are fairly easy and not much more than a couple of forms. I can see business owners or people with multiple properties maybe needing some help, but I've done my own taxes since I was 16. It's not rocket science. Maybe its the fear that someone you paid $150 to can save you that $75 deduction you missed.

Course I'm talking average working class folks, if you're a politician, you need to pay someone to hide all your lobbyist money, kicks backs, hush money, escort services, drugs etc...

 

[Wat_Tyler]

The IRS gets money from taxpayers and then again as taxed income from tax preparers. Ever get the feeling that the government has their hands in all your pockets.

MORE BIG GOVERNMENT MOM!!!

This would be funnier if it wasn't so fucking sad.

It's always blown my mind how many people pay for tax services. The average person's taxes are fairly easy and not much more than a couple of forms. I can see business owners or people with multiple properties maybe needing some help, but I've done my own taxes since I was 16. It's not rocket science. Maybe its the fear that someone you paid $150 to can save you that $75 deduction you missed.

Course I'm talking average working class folks, if you're a politician, you need to pay someone to hide all your lobbyist money, kicks backs, hush money, escort services, drugs etc...

I sincerely doubt that politicians pay taxes like all of us Little People. Certainly not that anyone would notice.

 

[MajorRewrite]

It’s all just dumb. We fill out forms to “report” to the IRS what they already know (in most cases). What a waste of time … and $100 billion.

 

[HisArpy]

This would be funnier if it wasn't so fucking sad.





I sincerely doubt that politicians pay taxes like all of us Little People. Certainly not that anyone would notice.

The only people who pay taxes are those who don't understand and take advantage of the tax code.

Every day that someone works for the man, is a day the gov gets its cut of that labor.

Every day that someone has income from an asset which is not taxed because of lawful tax code exemptions, is a day they get to laugh at the laborers of the world.

 

[BrightShinyGirl]

The only people who pay taxes are those who don't understand and take advantage of the tax code.

Every day that someone works for the man, is a day the gov gets its cut of that labor.

Every day that someone has income from an asset which is not taxed because of lawful tax code exemptions, is a day they get to laugh at the laborers of the world.

Hard work should never be laughed at. There is a dignity to labor that the idle rich will never know.

 

[HisArpy]

Hard work should never be laughed at. There is a dignity to labor that the idle rich will never know.

"The rich" are rarely "idle."

Or do you think people like Elon and Gates and all the rest just sit around all day every day smoking pot and getting high?

 

[BrightShinyGirl]

"The rich" are rarely "idle."

Or do you think people like Elon and Gates and all the rest just sit around all day every day smoking pot and getting high?

Bill Gates appears to be industrious, but from what’s reported about Elon Musk’s lifestyle your assessment seems pretty accurate.

 

[HisArpy]

Bill Gates appears to be industrious, but from what’s reported about Elon Musk’s lifestyle your assessment seems pretty accurate.

Yup, Musk just sits around all day in his mom's basement getting high...

If you believe that you must work hard to be that stupid. Too bad being that stupid doesn't pay well.

 

[BrightShinyGirl]

Yup, Musk just sits around all day in his mom's basement getting high...

If you believe that you must work hard to be that stupid. Too bad being that stupid doesn't pay well.

Elon Musk hit it big with PayPal, but the dwindling fortunes of Twitter and Tesla support the “sits around all day getting high” theory of his lifestyle. What evidence do you have that he’s industrious?

 

[HisArpy]

Elon Musk hit it big with PayPal, but the dwindling fortunes of Twitter and Tesla support the “sits around all day getting high” theory of his lifestyle. What evidence do you have that he’s industrious?

Lol. It's like you've never heard of Starlink. Or AI. Or realize that everything Musk has done is because he doesn't just sit around.

What you don't understand is that the world is in constant motion. If you just go with the flow you will never get anywhere except where the flow takes you. That is not success and never will be. To be successful you have to move. Smart people look downstream (toward the future) and try to see where the world is headed and then try to get there before you do.

 

[BrightShinyGirl]

Lol. It's like you've never heard of Starlink. Or AI. Or realize that everything Musk has done is because he doesn't just sit around.

What you don't understand is that the world is in constant motion. If you just go with the flow you will never get anywhere except where the flow takes you. That is not success and never will be. To be successful you have to move. Smart people look downstream (toward the future) and try to see where the world is headed and then try to get there before you do.

AI is a hype bubble that’s already starting to burst. Hyperloop already failed. Elon Musk is not a good example of a hard-working rich guy.

 

[HisArpy]

"Hard working" isn't the same as "successful" even though in Musk's case they are synonymous.

 

[Greytruck]

Should have a national sales tax. Get taxed as you spend your money.
Catch all the underground economy people too.
No IRS needed…

 

[BrightShinyGirl]

"Hard working" isn't the same as "successful" even though in Musk's case they are synonymous.

What makes you think Musk is hard-working?