The IRS is actually testing a new system where they just tell you how much you owe/get, and that’s it unless there’s unreported income and such that needs to be corrected.
Tax time
Submitted 11 months ago by The_Picard_Maneuver@startrek.website to [deleted]
https://startrek.website/pictrs/image/eb3487ce-003e-4351-9e84-d6185cf334bf.jpeg
Comments
EatYouWell@lemmy.world 11 months ago
Catoblepas@lemmy.blahaj.zone 11 months ago
Also, the IRS only escalates straight to jail if it’s incredibly obvious you’re intentionally committing tax fraud. If your forms are wrong they just send you a letter to fix it.
Aviandelight@mander.xyz 11 months ago
I wish more people were aware of this. One year I made a rather significant number entry error and should have owed a couple thousand more than I paid. I got a fairly routine letter later in the year asking me to correct the error. I had a little mental panic, reran the numbers, and filed an amended return. There was no pressure, you always have payment options, and they send you back another letter confirming the acceptance of the amended file. I understand that many people would have significant problems paying extra unexpectedly but unless you are actively committing fraud you are not an immediate priority for the IRS.
Sanctus@lemmy.world 11 months ago
Link? I will instantly use it. Mostly to stick it to Intuit.
dantheclamman@lemmy.world 11 months ago
Turbotax has entered the chat. Turbotax has DMed your senator a couple hundred thousand to make sure you will never be able to use this
CuddlyCassowary@lemmy.world 11 months ago
They decide who is in the pilot at this point, not us.
wildcardology@lemmy.world 11 months ago
Things you need to know first
Xanthrax@lemmy.world 11 months ago
It’s already like this with free tax returns. It just sucks you have to go through Intuit, because of their lobbying. They’re also counting on you not properly doing your taxes in the OPPOSITE way. They want you to be lazy and pay more in taxes, for the convenience.
EatYouWell@lemmy.world 11 months ago
You apparently misunderstood what I was saying. The IRS is testing a program where they tell you how much you get/owe, and that’s it unless you need to make changes like adding deductions or reporting unreported income.
LameName3000@lemmy.world 11 months ago
That sounds like how it works in my country. Every year is just log in, take a quick look at the numbers, sign and send it away. Takes a minute or two and it just works.
wildcardology@lemmy.world 11 months ago
Testing for 13 states for now.
WoodlandAlliance@lemm.ee 11 months ago
[deleted]dangblingus@lemmy.dbzer0.com 11 months ago
Weird. My tax forms tell me how to fill it out. Super easy.
Jyek@sh.itjust.works 11 months ago
When you have a single income as an employee with no dependants or spouse, your taxes are dead simple. It’s when you have more things to consider that taxes get complex. If you own a small business on the side, have some kids, own a house, a wife, maybe you came into some money from an estate, also you did some contract work on 1099… That’s just normal people types of complex tax stuff. If your business does well, you can expect the adage “more money, more problems” to rear its ugly head.
repungnant_canary@lemmy.world 11 months ago
Okay, so I get the reason why NOWADAYS IRS can’t tell you how much taxes you owe is lobbying. But how did it work BEFORE computers? Did you file your forms and IRS agents checked them one by one, and it was just most efficient to check taxes instead of calculating them? How did we get to the situation where the IRS checks the taxes instead of calculating them? I’m genuinely curious, because that’s a recurring theme worldwide.
ggBarabajagal@lemmy.world 11 months ago
We have a “voluntary” tax system in the U.S. – that’s always been the situation. “Voluntary” doesn’t mean that that you can choose to not volunteer to pay your taxes. It mostly just means that the way we run things, by default, it is each citizen’s responsibility to calculate and pay their taxes each April.
American taxpayers filled out 1040 forms in the days before computers, a lot like they do now. The IRS selected certain fillings for audits, just like they do now – sometimes because of an apparent discrepancy, and sometimes just at random.
It would be a lot more work, take a lot more resources, and be prone to a lot more error and lawsuits, if the IRS tried to calculate everyone’s taxes for them. Even now that we are in the days of computers, it is much more efficient for the IRS to only audit a fraction of the filings submitted each year.
I’m also pretty sure our “voluntary” tax filling system has something to do with the Fourth Amendment and other privacy concerns. A lot of Americans very strongly believe that it is not the government’s place to be all up in their private business.
tias@discuss.tchncs.de 11 months ago
Yet many other countries do in fact calculate taxes for their citizens. You just need to check it and sign.
mosiacmango@lemm.ee 11 months ago
The IRS is confident it can do direct file for most american returns, which is why its running a pilot program this year to do just that
Blue_Morpho@lemmy.world 11 months ago
if the IRS tried to calculate everyone’s taxes for them
The IRS does calculate everyone’s taxes without an audit. If you mistype a bank statement you will get a bill or a check from the IRS (depending on whether the error was paying too much or too little).
An audit is completely different than the typical, "you typed $1000 in bank interest but you only really received $100 so here’s a check for the difference in taxes. This has happened to me many times over the years. It’s why I no longer get stressed over taxes because I know the IRS will just send me a bill or a check in 6 months to fix any mistakes.
bouh@lemmy.world 11 months ago
We had the same in France until not so long ago. It is a democratic principle that you voluntarily and freely pay your taxes, rather than the state take your money without you hvving a say in it.
It is both a principle of transparency and consent for taxes.
Obi@sopuli.xyz 11 months ago
Not in the Netherlands, there it’s all calculated for you and you just do the checking. If you have a more complicated situation like self employment or other stuff you may want to hire an accountant that will not only double check but also make sure you get the best outcome by doing some strange wizardry but for most people it’s literally just go online, check the salary numbers etc, click okay and get some cash back to your account.
Raz@lemm.ee 11 months ago
Too bad the Belastingdienst (Dutch Taxservice) is a massive shitshow on pretty much anything else. Their hardware is so damn old new tax laws can’t be passed, because it would break the systems. Of course this is more the fault of shitty upper management and poor political will to do anything about it.
jmcs@discuss.tchncs.de 11 months ago
Can’t speak for the American IRS, but in my home country they audit some declarations at random, specially the parts they don’t have in their system, like checking if professional deductions are valid or if there’s anything that indicates some foreign income wasn’t declared. Before computers the system was probably more or less trust based for most cases.
LEDZeppelin@lemmy.world 11 months ago
In reality -
Me: $600
IRS: are you a billionaire?
Me: what if I am?
IRS: $600 is too much
ObviouslyNotBanana@lemmy.world 11 months ago
Damn y’all Americans really do taxes weird
EatYouWell@lemmy.world 11 months ago
It’s because our country is a corporate oligarchy.
ObviouslyNotBanana@lemmy.world 11 months ago
Sounds cooler than it is
PP_BOY_@lemmy.world 11 months ago
Americans as a whole are very stupid and don’t realize that the overwhelming majority of them can file for free. 100% of Americans can self-file (for free) of they can handle about an hour of basic paperwork, but for 90% of Americans, you can file taxes for free in less than twenty minutes.
But most people would rather Google “how to file taxes,” click on the first sponsored link they see, and buy something before they ever actually try to do even a minute of research.
ObviouslyNotBanana@lemmy.world 11 months ago
Tbf as a Swede I just log in, glance at the forms, sign and log out. That’s what easy is.
starman2112@sh.itjust.works 11 months ago
if they can handle about an hour of basic paperwork,
People make it out like tax filing is like travelling to Ry’leh and transcribing eldritch runes, but it’s made pretty dead simple. Put the number from one box in piece of paper A into the corresponding box in piece of paper B. If it has you do a math, you can just… Do a math. Pull out your calculator and subtract the amount you’ve paid so far from the amount you owe. Is the result a negative number? Congratulations! You’re getting a return! It’s three number positive? Oh no! That’s how much you need to pay the IRS!
I get that for some people it is significantly more complicated than that, but if you work one job where you make some number of dollars per hour and you don’t invest in the stock market or cryptocurrency, it’s virtually idiotproof.
vsh@lemm.ee 11 months ago
Or perhaps the rest of the world does it weird and we are the tax OGs
garbagebagel@lemmy.world 11 months ago
Canada does this too. Do other countries just tell you? That’d be nice.
cley_faye@lemmy.world 11 months ago
Yeah. Basically, we get a pre-filled form with most of what can automatically filled in, already filled in. Of course some stuff like donations (which are deductible) and other stuff that are not automatically linked to you have to be added by hand, but for a vast majority of people there is no such thing.
So basically, open the pre-filled form, check that the incomes and your current situation is correct, send it back, then you basically get the amount (which can be either automatically collected through direct debit at a given date, split monthly, or paid manually).
We usually argue about why and how much tax we pay, but I never had any heated discussion about the tax system itself.
ObviouslyNotBanana@lemmy.world 11 months ago
My country just tells you.
AmberPrince@kbin.social 11 months ago
How it actually works is that the IRS doesn't known how much you need to pay. You provide your income and taxes already paid throughout the year then the IRS says "yeah, looks about right for what you made" or here's money back you paid to much or didn't pay enough. It only gets complicated when you have huge amounts of money.
cm0002@lemmy.world 11 months ago
That’s still dumb AF, they could easily do like many other countries do and send you a breakdown of what you owe/getting back and why. You look it over and go “looks good to me” and have to do nothing or “This part is wrong” or “I qualify for Y tax break/incentive/credit” and then file some proof and you’re done.
But the tax prep companies lobby really hard to keep things as difficult as they are
HubertManne@kbin.social 11 months ago
and there is a tax form that is setup exactly like this available for years. the 1040x. but they don't use that to predo our taxes.
Mamertine@lemmy.world 11 months ago
Your employer is required to submit the amount you were paid and the taxes that were withheld. The IRS knows how much you owe assuming that is your one source of income and you don’t have deductions beyond the standard.
Changetheview@lemmy.world 11 months ago
Exactly. The IRS has TONS of information on every individual and business. There may be some unreported items, but that’s the exception to the rule.
The IRS has a “transcript” with all of the many reported transactions associated with each person/entity. And you can request this transcript, which many people with complicated tax situations do so they can verify that everything is reported correctly and their records match the IRS data.
lowleveldata@programming.dev 11 months ago
Many people have deductions beyond the standard
EatYouWell@lemmy.world 11 months ago
That’s only true if you’re getting paid cash under the table, make tips, or are self-employed. Your job reports your earnings to the IRS.
glorious_albus@lemmy.world 11 months ago
Pretty much how it works in India too.
phoenixz@lemmy.ca 11 months ago
In the Netherlands, AFAIK (and please correct me if I’m wrong), the government tells you how much it is and you can make your own filing that contains various deductions that the government doesn’t know about that can make the amount to pay lower. The system still has a few issues here and there but it’s much better than the US, like just about anything these days
Aganim@lemmy.world 11 months ago
Yes, you are quite correct. Here you can file your taxes either on paper, which means you’ll have to fill in everything yourself, or you can use the website of the tax authority (Belastingdienst). In the latter case the most important stuff is usually already filled in, like your earnings, remaining mortgage & interest paid over it (which gets you a tax deduction), etc, so you’ll only need to check if the prefilled data is correct and add the stuff that the government doesn’t know about.
Bit of a correction on what you said, you not only have to add deductions yourself (some of which are actually already filled in, like the previously mentioned mortgage interest), but also other kinds of taxable income or wealth that couldn’t be filled in in advance, e.g. that bank account in a sunny country that doesn’t share data with our government.
For standard cases you can be done in 30 minutes tops, it is actually a pretty good system, and you indeed immediately get to see either what you have to pay or what are getting back. Although you’ll need to wait for the official message from the Belastingdienst which can take a month or two. But usually that won’t differ from what you were already shown.
Also nice, if you made a mistake you can simply correct it by opening your previous filing digitally, you can adjust a filing up to 5 years ago. Depending on what you adjust do expect to have to deliver some proof, as those adjustments are checked by an employee of the Belastingdienst. The regular filings are checked randomly.
Kit@lemmy.blahaj.zone 11 months ago
I’m so tired of paying HR Block $300/year to do my taxes, which has no tax return because I do my deductions carefully. Why can’t we have a straightforward system like the rest of the world??
Kid_Thunder@kbin.social 11 months ago
Because Congress creates really, really complicated tax laws that reduce tax burdens for business losses and obviously favor a structure that if you're wealthy enough you can exploit it for things that aren't actually contributing to our economy. Regular person with a few deductions that might go over a standard deduction? You might want some help with that, even if you're "doing it yourself" with the help of software (just like almost all of tax preparers do) or if you're just doing a standard deduction, it is easy.
Why can't you just fill out a 1040EZ in a webform and file online through the IRS?
Companies like Intuit lobby Congress so that the IRS can't just make it easy for most people. For example, the IRS wanted to just have their own app on a website to help you do your taxes for free just like TurboTax but nope.
The same thing has happened with weather in the US. NOAA/NWS pretty much provides all weather data and RADAR data to the public for free. They also provide a public API and all those weather apps either directly or indirectly get their data from there for the US.
Why don't they have an app like all these weather services do? Well companies lobbied so NWS isn't allowed to. The best they can do is provide a website that you can "use like an app." Paying extra for that up-to-date RADAR feed in your weather app? Guess what? You already did through taxes and now you get to pay a private company to simply display it in their interface.
Congress has the power to end this non-sense but does not. I'm sure this won't surprise anyone when I say this but US law is slanted towards empowering businesses and lowering accountability.
CosmicTurtle@lemmy.world 11 months ago
FreeTaxUSA provides free federal filing, including Schedule C (Self-Employeed) and Schedule E (Rental Income). I’m sure they have more scenarios.
You pay for state but it’s usually a $12-15.
You can import your TurboTax/HR Block returns and it mostly does a good job bringing it in.
LordOfTheChia@lemmy.world 11 months ago
I started a thread on asklemmy to find out what are alternatives to scummy Tax Services that lobby, but so far Tax Free USA seems like the one with the lowest cost (free Federal, $15 State) and while they are a member of a lobby group, the group has spent a fraction of what Intuit and H&R Block has to keep our tax returns complex.
Seems if I link the thread, my comment is hidden.
TangledHyphae@lemmy.world 11 months ago
Have you looked into TaxAct or CreditKarma? Both seemed pretty good (compared to turbotax) when I tested them out.
Cosmocrat@lemmy.dbzer0.com 11 months ago
Wasn’t CreditKarma bought out by Intuit? The same assholes who own Turbotax?
Kit@lemmy.blahaj.zone 11 months ago
Yeah I make too much per year to qualify for the cheap options, plus I need to file my stock and cryptocurrency options plus my retirement.
Endorkend@kbin.social 11 months ago
Meanwhile here, come tax time I get a letter and only people that have special things going on like stuff they would get subsidies for (like installing solar panels or insulating), will have to alter what the letter says. Most everyone else can ignore the letter as all their taxes have been paid in full or they get something back.
ininewcrow@lemmy.ca 11 months ago
I’ve often thought it would be fun to just punch in some random numbers, send it off and say that I owe $10, pay the amount and let them figure it out … they already do anyway.
But I know that if I do, they’d probably make me pay financially or legally anyway.
CubbyTustard@reddthat.com 11 months ago
[deleted]HubertManne@kbin.social 11 months ago
there will be fines and fees with that though.
garbagebagel@lemmy.world 11 months ago
I somehow forgot to do my taxes in 2011 (was a student and travelling), it took them 10 years to come at me asking about it. Now I have no access to any of that info and even if I did they’d owe me money. Their systems are slow unless you owe a lot I think.
PeleSpirit@lemmy.world 11 months ago
They really do keep it a secret. I’ve gotten bills saying I don’t owe anything more and then bill me for $100 later. I don’t understand, but just pay it. It’s where the healthcare system learned their math.
Pandemanium@lemm.ee 11 months ago
Just a PSA, the IRS recently instituted some kind of AI algorithm that is re-flagging a lot of things that have already been resolved… a friend got a bill for $1500 which they had earlier sent a letter of apology for. He doesn’t actually owe anything, it’s just the glitchy algorithm sending the old bill out again.
If you don’t understand why you owe more, don’t just give up and pay it. The IRS can make mistakes too.
PeleSpirit@lemmy.world 11 months ago
I know this is going to sound crazy, but I don’t mind paying a small amount if they come back in a timely manner. They have been so amazing to work with. We owed a huge amount and they negotiated with us to pay it down. So if we have to pay $100 more now and then, I’ll let them spend that time working with people who need it.
Note: If you owe a large amount, don’t ignore it. They will usually work with you if you contact them early to pay it in installments. If you don’t think you can pay ever, tell them. You’ll still owe it, but communicating is better than freezing and ignoring.
Thrashy@lemmy.world 11 months ago
Years ago they actually sent me a check because they thought I should have taken a deduction that I didn’t. I didn’t want to get on a gotcha list, so I sent back a letter explaining that the deduction was not proper for my situation, and they responded that if that was the case, I needed to file an amended return. That was way more energy than I wanted to spend on this issue, so I just ignored the check… until the next year, when they mailed me another one with a tartly-worded form letter about the importance of promptly depositing it, and again the year after. At that point I figured if Uncle Sam is that desperate for me to take the money I’d indulge him. At this point I’m well past the statute of repose for any potential issues that created, so I think I’m in the clear, but I guess we’ll see.
starman2112@sh.itjust.works 11 months ago
I mean, if they make that mistake, they can’t demand more back than they sent you. Look at it as an interest-free loan, invest it into something that’ll reliably earn more money over time, and if Uncle Sam ever wants it back, you’ve still made a profit
PeleSpirit@lemmy.world 11 months ago
Lol, that’s a good problem to have when dealing with the IRS.
kttnpunk@lemmy.world 11 months ago
I actually haven’t done my taxes in like 2 years due to extreme poverty (in the u.s you don’t have to file if your income is under a certain threshold) I think I’m still under that, but I still should probably file this year right? Is there anything specific I should do? Maybe not the best place to ask, but I hate financial anything so I’d really appreciate some advice
pokemaster787@ani.social 11 months ago
in the u.s you don’t have to file if your income is under a certain threshold
You don’t have to but also if you’re under that threshold you would almost certainly be getting a refund of all of the taxes you paid that year. So I highly recommend filing even if you don’t need to
kttnpunk@lemmy.world 11 months ago
I’m pretty sure TurboTax told me otherwise, it would’ve cost me to file I hate this goddamn nonsense but ty
Sarmyth@lemmy.blahaj.zone 11 months ago
IRS doesn’t know my deductions til I tell them. I’m certainly not rich either. I just get to write off alot.
Tb0n3@sh.itjust.works 11 months ago
You guess with a calculator and detailed instructions. Educated guess.
wildcardology@lemmy.world 11 months ago
An account’s take on this youtu.be/Vu3T4ZXzOyw?si=KnAP2TEvx9WSLzno
andthenthreemore@startrek.website 11 months ago
Blows my mind that you have to file tax returns and stuff in America.
alienanimals@lemmy.world 11 months ago
Turbo Tax is the reason why the government doesn’t just give you a number to pay. The process could be easy, but the giant corporation Intuit and their political lobbying is why it sucks.
Zoboomafoo@lemmy.world 11 months ago
TurboTax plus Republicans wanting to make paying taxes as difficult as possible so people will vote to cut taxes
nilloc@discuss.tchncs.de 11 months ago
rich donors want it complex so they can keep finding the loop holes that let them pay nothing most years.
redballooon@lemm.ee 11 months ago
Which is not a solution because just because while you pay less taxes you still have to go through the process
EatYouWell@lemmy.world 11 months ago
The IRS is actually going test pilot such a program in a few states in the near future.
LordOfTheChia@lemmy.world 11 months ago
Which is why they keep wanting to defund the IRS (example):
Baku@aussie.zone 11 months ago
America moment
ColeSloth@discuss.tchncs.de 11 months ago
Except people been having to do their taxes for a hell of a lot longer than turbo tax has existed. Turbo is a big lobbying entity, but they aren’t the only ones.
ElectricCattleman@lemmy.world 11 months ago
They aren’t the only one, but they are the largest one. They didn’t make the system the way it is, but they benefit massively from it staying this way.