Intuit Lobbying The Government To Make It More Difficult To File Your Tax Returns
from the isn't-that-special dept
A fascinating article points out that the government could make the process of filing your tax returns significantly easier by simply sending you pre-filled out forms of what they know (basically what’s been sent in from your employer(s)) so that you could just take the pre-filled form, check it over, make any additions or changes as necessary and submit it. Apparently, many places that have done this have had great success with it. But it’s not happening in the US in large part due to heavy lobbying from Intuit, who fears (perhaps correctly) that this would put a big dent into its tax preparation software business. Of course, that’s not how Intuit puts it. The company first claims that this functionality is “already available” (it’s not) and that it is a “conflict of interest for government to be both tax collector and tax preparer.” However, that is also inaccurate. No one is asking the government to be the tax preparer, but just to share the information it already has so that individuals aren’t forced to rebuild the info themselves. As one person quoted in the article notes, it’s “as if Visa sent customers a blank piece of paper, requiring that they assemble their receipts, list their purchases — and pay a fine if they forget one.” So, everyone, thank Intuit for making tax season that much more frustrating.
Filed Under: data, filing, government, lobbying, tax returns, taxpayers
Companies: intuit
Comments on “Intuit Lobbying The Government To Make It More Difficult To File Your Tax Returns”
I think that if the government did this it would probably lead to a lot more errors on tax returns. People would probably look it over and double check it the first year, then after that just assume that everything was correct for years to follow. Also they might assume that since the government didn’t know about some of their gains/losses they might not need to report them.
Having said that, As a competent human being capable of filling out my 1040EZ form, I’d love if I only had to error check it. I just don’t know if its the best solution for everyone (especially the lazy).
"conflict of interest for government to be both tax collector and tax preparer."
“conflict of interest for government to be both tax collector and tax preparer.”
The tax system is part of the government machine. It would seem to me they have the right to do any part of it themselves if they wish.
TurboTax
I tend to do my taxes for free online, with Intuit’s TurboTax. Now they charge you $30 if you want to load in your info from last year; the “reason to buy” is that they’ll import your address info, dependents, etc., rather than making you fill in the same fields again. It’s especially annoying since they did it for free last year.
No more Turbo Tax
Well I’ll be sure to steer clear of Turbo Tax for good now. I’ve used HR Block’s free federal tax online service the past couple of years since my taxes are simple and the state I live in doesn’t have income tax. Since I got married in 2009, I thought about getting turbo tax to make sure I got everything right, but now I’ll do anything BUT use turbo tax. Thanks NYT and Techdirt for the heads up.
Re: No more Turbo Tax
I used HR Block while in USA for 4 years. Rather variable experience.
Local office did 1st tax return. Fine
Local office did 2nd tax return, said I owed nearly $5K.
So I paid it.
Local office did 3rd tax return and said I owed $5K again. I decided to check it myself before posting it off. Spent many light nioghts acquainting myself with the tax code. Decided they were wrong.
Went to another HR Block office, who knew far more than the first. They agreed and recalculated my 3rd year. Nothing to pay.
They then helped me refile the 2nd year and eventually (nearly 5 years later) i got my $5k back.
The 2nd HR Block office were superb, in a nutshell.
The 1st HR block office were simply not qualified to do a resident alien’s tax return.
Seems there is no reliable guaranteed quality with HR Block. You just have to hope it’s a “good” HR Block.
The story in the headline is about Intuit but back in 2005 the same story surfaced as I recall about the HR Blocks of this world blocking the “preprinted forms” legislation.
In fact I recall that the suggestion was that millions of americans would have such simple tax returns they’d just need to sign and post it back…
Here’s an even crazier idea – let’s stop using the tax code for behavior modification. Let people figure out how much they owe without spending billions of dollars on tax preparation software/services.
Re: Re:
Unfortunately you have hit the nail on the head why there will never be a real overhaul to the tax system. It is all about controlling what you do or don’t do through the penalty of tax.
Re: Re: Re:
Alright dudes, it’s time to pass the joint of whatever you are smoking. Keep the tin foil hats though.
Re: Re: Re: Re:
Huh? Do you really see any chance of real tax reform? Do you not realize that most of the tax code is about control?
Re: Re: Re: Taxes
> > It is all about controlling what you do or
> > don’t do through the penalty of tax.
> it’s time to pass the joint of whatever you are
> smoking. Keep the tin foil hats though.
How is that a “tinfoil hat” issue? It’s not paranoid. It’s exactly what’s happening and the politicians involved don’t even try and hide it.
They raise taxes on cigarettes and alcohol to influence people to stop using them so much. That’s their *stated goal* in their press releases. Now we’re seeing much the same thing with sodas and junk food. Politicians everywhere are calling for taxes on those things to keep people from getting so obese.
Re: Re: Re:2 Taxes
Really?!
Actually, they raise cigarrette and alcohol taxes because they need more money to spend on out of control government programs. They tax cegarrette and alcohol disproportionately because they know relatively few American’s will object.
Re: Re: Re:3 Taxes
So they give a tax credit to new home buyers because they need more tax money. Wait, that is a credit so they are doing it to encourage home purchases to boost the economy. But wait, isn’t that control? Why yes it is.
There are many examples of this in the tax code, no need for tinfoil hats.
Re: Re: Re:4 Taxes
It’s not control unless they force you to buy a house. The housing credit is an incentive, not a control. As long as you have the freedom to choose one action over another, it’s not control. We are not salivating dogs that can be trained by a bell and a snack. Or at least we can choose not to be.
Re: Re: Re:5 Taxes
It’s a form of control. Not direct, but it’s there. It’s called positive reinforcement, it’s how you’re suppose to raise children.
Re: Re: Re:6 Taxes
Or negative reinforcement by taxing you for doing something they don’t want you to do.
But it seems the sheeple don’t realize they are being “controlled”.
Re: Re: Re:6 Taxes
Wrong, it’s negative reinforcement. You already have your money – the government is punishing you by taking your money unless you follow politically popular standards of behavior.
And taoareyou – the government is forcing you to give up money unless you buy a house, don’t smoke, etc. Unless at some point I missed a change to making taxes optional?
Re: Re: Re:5 Taxes
As long as you have the freedom to choose one action over another, it’s not control.
Well, you always have some kind of choice, so there’s no such thing as control at all, eh?
Re: Re: Re:3 Taxes
Actually, they are probably reasoning that cigarette and alcohol use are major costs to taxpayers.
Should taxpayers who don’t smoke or drink be burdened with the enormous costs of medical care, criminal prosecutions, funerals, diminished productivity, and other directly associated expenses created by smokers and drinkers?
Instead of complaining about paying a disproportionate share, maybe they should be grateful that they don’t have to foot the entire bill.
Re: Re: Re:4 Taxes
This is a slippery slope. If we stop everyone from doing everything, nobody will do anything and we will all die miserable. You take chances in your life that others don’t, they take chances that you don’t and it averages out.
Re: Re: Re: Re:
Alright dudes, it’s time to pass the joint of whatever you are smoking. Keep the tin foil hats though.
*psst* Tell this dude to ditch his too:
“The real truth of the matter is, as you and I know, that a financial
element in the large centers has owned the government of the U.S. since
the days of Andrew Jackson.”
— Franklin D. Roosevelt
(1882-1945), 32nd US President
November 21, 1933
Source: in a letter written to Colonel E. Mandell House
Re: Re: Re: Re:
Alright dudes, it’s time to pass the joint of whatever you are smoking. Keep the tin foil hats though.
Not at all. The government gives tax breaks for behaviors that it wants to encourage (hiring the mentally retarded, making charitable donations, buying a house, etc) and taxes behaviors that it wants to discourage (high fuel consumption, smoking, drinking, etc).
Re: Re:
It’s insane that tax preparation has become an industry.
My solution: Subtract savings at year end from annual income. The remainder is taxed.
If you want to appease the “what about low income group” people you could add a basic deduction or two and/or have three or four tax brackets.
Lets keep it simple.
Re: Re: Re:
1. The rich would find a way to make their money look like something other than “savings”.
2. This would discourage saving. I don’t know that the government needs to encourage saving, as people can decide to do it on their own, but penalizing people for saving money seems like a really bad idea.
Just Wondering
The gov prints the money…
Why exactly do they also need to take money from their citizens? They tolerate banks ‘creating’ money through lending money which they don’t have… why don’t they just ‘create’ the money they need for their budget and stop taking citizens money from them?
Re: Just Wondering
Because this allows the banks to be paid for all their tomfoolery.
Re: Just Wondering
Well, they’re taking “money” by printing more via inflation. Beyond that, I’m not sure that it couldn’t work somehow and be much more efficient, but then it would be something of a flat tax, except that individuals could evade this tax by owning assets instead of money. Which, of course, means that you would be creating a disincentive for liquidity, one that richer individuals would be more able to take advantage of. More than that, we’ve seen how strongly politicians enjoy choosing the individuals to reward and punish, much more so than choosing policies that help the country.
Here’s a better idea – why don’t we either eliminate the income tax(and payroll tax and capital gains tax and death tax etc.) and go to a pure consumption tax, or at least implement a flat tax, thereby trimming the IRS by about, oh, 99%? Easier and more efficient for everybody, which is awesome because I can’t fathom how much value we waste with the ridiculous tax code we currently use.
Re: Re: Just Wondering
The Reason we can’t go back to a straight tariff & excise tax based system is it would make to much sense. It would reduce government bureaucracy and if properly balanced simultaneously increase available revenue to the government (by reducing spending on said bureaucracy) wile reducing individual tax burden. The reason no politician would ever go for it was already stated. It would reduce government bureaucracy!
Re: Just Wondering
Why exactly do they also need to take money from their citizens? They tolerate banks ‘creating’ money through lending money which they don’t have… why don’t they just ‘create’ the money they need for their budget and stop taking citizens money from them?
Because money literally isn’t worth the paper that it’s printed on. It’s the fact that the US currency is backed by gold stores that makes them valuable (along with the trust that the world has in the stability of the dollar). But once you start printing more of it all willy-nilly, the value of the dollar becomes diluted. So instead of paying $1.29 for a loaf of bread you end up paying $129.00. That’s one of the major causes of inflation.
Re: Re: Just Wondering
It’s the fact that the US currency is backed by gold stores that makes them valuable
Woah, woah there. No – it’s not backed by anything now. They dropped the ‘gold standard’ years ago.
The Federal Reserve *CORPORATION* just issues money as it pleases – more or less.
http://economics.about.com/cs/money/a/gold_standard.htm
Re: Re: Re: Just Wondering
Yup. They call it a fiat currency, but I prefer the term “faith-based currency”. Basically the value of the dollar reflects the faith that worldwide investors have in the U.S. Government’s ability to pay its bills.
Re: Just Wondering
Banks print money, not govn – they do it under rules to finance loans at ratio that isn’t 1:1 – money is really debt.
Re: Re: Just Wondering
The US Mint prints money, and is a gov’t organization – not a bank.
Works great where I live.
Not only do they send pre-filled forms, but the pre-filled form is also online.
I spend about 5mn on my government’s dedicated website once a year and taxes are done.
Re: Re:
Where do you live man? I am really curious what countries offer this.
Re: Re: Re:
In South Africa the tax laws were ‘simplified’ [I would be surprised if they actually lost any tax income 8) ] over a few years to the extent that most taxpayers were only required to submit only a single supporting document: a statement from their employers, listing earnings & tax deductions for the year.
If applicable, the taxpayer might also be required to submit similar documents from the bank (for interest earned) and insurance companies (for the actual premiums paid on tax-deductible insurances).
The tax authorities then required the employers to submit a reconciled return of all employees and taxes deducted. Ditto the banks & insurance companies.
Now all one does is go on-line and enter the requested details, including amounts, etc i.e. the form – almost a single-pager – is not pre-loaded with data. This is then matched against the data supplied by the various parties.
My last tax submission was submitted one evening: by 8.30am the following day I had received my assessment, which showed a refund. The refund was transferred to my bank account during that same day, and appeared on my bank statement the next morning.
Re: Re: Re: Re:
It’s even better in Britain. Anyone who isn’t self-employed or have other unusual income doesn’t have to fill in ANY forms. Tax is Pay As You Earn (PAYE) for all employees, and in many circumstances you don’t have to do anything at all. The American system just seems like unnecessary insanity. Talk about re-inventing the wheel annually!
E-File it is then
Looks like I’ll be using E-file this year.
TaxAct.com is cheaper anyway.
re
Yeah, i know. Its been this way for years. With the info the government collects on you, they could just bill you. Think of all the taxpayer money this would save. Fewer tax advisors, fewer collections, fewer tax deadbeats, Smaller IRS. Not to mention all the time it would save me reading tax forms and trying to figure everything out.
But that would be easy. That would be fair. That would be the sane way. Why do that?
another brick.....in your face
time to take the pink floyd bricks form the wall and start thorwing some around at MORONS
conflict of interest?
Is Intuit the pot or the kettle in this argument?
re
While yes Intuit is protecting their interests, I have to side with them on this too. I am an Enrolled Agent (Paid tax preparer), licensed by the Treasury Department. The test that I had to pass in order to become an EA was one of the hardest tests I’ve ever taken in my life, and it was only on how the tax law affects tax returns. Our tax system is so complicated that it would be nearly impossible for the IRS to implement this type of system. The example given points to CA as showing how its done, but it doesn’t also show that their system does not take into account multiple jobs, marriage, children, simple deductions, etc… Most people that get a correspondence from the IRS/FTB (CA’s taxing authority) take it as verbatim: They sent this, so it must be correct. I see more often than not, that there are errors in the calculations and spend a good portion of my time correcting them. Unless there is a major simplification in our tax code, Pre-filling of tax forms should not even be discussed.
Re: re
Here’s my unsolicited $0.02…
Prior to getting married, 90% of my tax returns were filed with just my W-2. 1040ez, no deductions, no bs. Fill out the wages, look up the standard tax from the table in the back. For people like that, why not let the gov send a suggested filing. If all you have to do is fill in that most minimal bit of info, why not? For the rest of us with mortgages, and earned interest, and kids and other complicated things, we’ll probably still use tax prep software. I’ll trust my gov to fill out paperwork to a degree. If they sent me a pre filled out 1040 now, I’d still redo the thing, but 10 years ago I’d have probably accepted the one they sent. Even checking it over would have only taken about 5 minutes.
Great for the simple same old repeatable tax returns. This is a large percentage of people.
The other more complicated tax returns multiple jobs, marriage, children, etc would required some more expert care in preparation.
I would still like to see a major tax system change. A simple flat tax (say 20%) and short (restrictive) simple list of deductions (Government Registered Charities, Government Registered day cares, etc).
At least they are talking about change.
have to side with Intuit on this one...
Definitely would be a conflict for the IRS to fill out your tax forms. Just ask anyone who’s been audited. They send you form telling you why they think you screwed up and how much they think you owe them and ask you to foward a check to them for that amount. However, much of the time, a little digging will uncover that their numbers are incorrect. The government shouldn’t be trusted with your money, ever. For that matter, the government shouldn’t be trusted with anything you find valuable.
Re: have to side with Intuit on this one...
You don’t trust the government but you do trust a private, for-profit company like Intuit or H&R Block that makes it’s money by convincing you that taxes are too complicated to do yourself and has a vested interest in making tax returns as complicated as possible?
Re: Re: have to side with Intuit on this one...
Intuit has a vested interest in having the government make your tax returns as complicated as possible – they have no ability to do so themselves. Once the government has done so, they have a vested interest in saving you as much money as possible. Where the OP was wrong was in thinking that a “pre-filled tax return” means that you have no discretion or consent in submitting it.
Re: have to side with Intuit on this one...
Maybe you skipped over…everything, but the proposed policy shift here would not be for the IRS to fill out your entire form for you and then process it without submitting it for your scrutiny and consent. It would merely be a pre-filled form, the entirety of which you could still inspect anyways.
Calling this a “conflict of interest” is ridiculous – you only have to fill out these overly complex tax forms because the IRS requires it in the first place! If that’s a conflict of interest, then anytime the government chooses not to artificially make our lives more difficult could be construed as one as well.
But in the end – this is just a prime example of why the tax system will never get easier for the people.
Too many corporations count on this – along with other things.
Cure for Cancer? I bet the various ‘cancer societies’ would lobby against it.
Trust us
Trust our government to do my taxes. The same fine organization that has given us the USPS, FEMA, and the TSA? Not in my life time.
As others have commented, why not go to a simple a tax rate, the same for everyone. Say 25% across the board.
While on my rant I have another idea. Make it a requirement that all congressmen sit down on April 14 (1 day before the filling deadline) and do their own taxes, filling out all the forms by hand. No one leaves until they are finished. Maybe then tax simplification will have a chance.
Should taxpayers who don’t smoke or drink be burdened with the enormous costs of medical care, criminal prosecutions, funerals, diminished productivity, and other directly associated expenses created by smokers and drinkers?
What about the same for those who exercise too much, drive too fast, eat too much sugar, drink too much coffee, eat too many chips, eat not enough food, work too much, stare at a monitor too long, stay up too late, watch too much TV..
When should this list stop?
Many, many, many things can be considered ‘bad for your health’. Heck, just about anything at all can be – with the right ‘spin’ applied.
It never will – like an avalanche, once it gets going.
That and it’s to what degree one partakes in various activities.
You can’t say a ‘smoker’ who smokes one cigarette a day is going to cost ‘society’ more than a guy who drives at 95 MPH five times a week or the guy who chugs 10 coffees before lunch everyday. Statistically you could find any numbers you were looking for with the right control group.
People’s bodies are different as well – some can smoke a lot, and live to a ripe old age. Others will never smoke a day in their life and die to something else before 50 – was that because of a certain habit of theirs? Very possible – then again, maybe it wasn’t.
So should their kids pay more in taxes because potentially their genetics will cost the healthcare system more?
You will – trust me.
http://www.waragainsttheweak.com
Heck, Basic Training in the Military could be considered ‘higher risk for medical care’ needed – or long term service once they are out and a Veteran. Same with Fire Personnel, Police..
Then we get into Sports: Football, Boxing – obviously a ‘heightened’ risk.
If you don’t exercise right – it’s well known it can cause more damage than good – so should we monitor people to see if they are exercising right – like in 1984?
Because by doing all this – that’s what people are asking for.
But mostly – just spread this like wildfire, let people drawl their own conclusions. I’m tired of the corporate/government reach around, it’s sickening.
We need OpenSource Tax Software.
Why not copy the UK
If you are paid a salary by an employer, then your tax is automatically calculated and deducted out of each months pay. If you have no other income, you don’t have to file a return. 90% of people go there entire lives without having to file a tax return.
Flat Tax
First, if the government made this tax mess, they should provide (free of charge) the computer program for computing your taxes! The way we do our taxes is so technologically obsolete.
Second, the real solution; junk the whole tax code and implement a simple flat tax.
Unfortunately, there are probably so many entities, such as Intuit, who have a vested interest in the complexity of the existing tax code that they would never want to see a simple tax code.
Intuit has always impressed me as having shady business practices, so it is no surprise they would be lobbying the Government against the citizenry to further their own interests.
Does anyone remember their attempt to limit printing a return to a single copy? How about their attempt to limit the software to a single computer? How many people have tried to file with the “free” online version, only to find that a crucial form is only available for a fee? How many people are deceived into buying the “Premier” after being given the false impression that the “Deluxe” version won’t support investment income?
I would never use their product, if software wasn’t the only viable method for me to prepare my return.
Everyone should send the NYT article to their representatives and demand that the IRS provide the software and the pre-filled electronic forms. After all, the IRS and Congress created the monster.
The functionality is available. You have to fax your AGI and some other info along with a power of attorney to the IRS and you can get them to fill out most of the return for you.
make the tax system voluntary
Why not make tax contributions voluntary ?
If everyone paid what they thought the ‘government’ services were worth, and there was a ban on government debt being greater than 20% of the tax take, then there would be an automatic brake on government overspending.
Think outside the box for simple solutions to apparently complex problems.
Julie from Intuit. Appreciate the comments. Wanted to provide additional prespective. You can read more here: http://bit.ly/8GDjKT
Somewhere in the ideal world....
… there’s a government website which you log into with your SSN and are given a series of questions (such as: “Your W-2 earnings” — $[….], “Are you married?” – [Y/N], “Number of dependents” — [..] etc) in a “wizard” type of interface, you click through filling all the stuff, then click “Finish”, make a final printout of what it did for you, put it in envelope with documents proving what you claimed (if any needed), and send them off.
Good:
1) Takes all the complexity out of filing taxes. Just follow the flow: fill, click “next”, etc etc
2) SPEED!
3) Makes any discrepancies and tax evasion impossible: the govt tax site *IS* THE LAW.
4) The need for govt to digitize your paper returns? Gone!
Bad:
Intuit is soooooo out of business…
Tax season is frustrating for an entirely different reason
That is nonsense. Please just advocate simplification of the tax code(s).
So long as the rules are complicated, there will be no shortage of people trying to make a buck taking advantage of that.
Simple problem with receiving a pre-filled tax form: How do you fix an error? I bet it will be more difficult than fixing an erroneous or even disputed charge on a credit card.
Someone from Intuit sent me a link to the company’s blog after I linked this on Twitter.
I had to read it twice to navigate the maze of spin but it seems they agree having the information available would greatly simplify filing taxes – but only by way of having the info available for downloading into tax-preparation software. Giving the info directly to the taxpayer is apparently still doubleplus ungood.
I sent this reply on Twitter:
Good luck convincing anyone that govt shouldn’t give taxpayers their own information for easier filing but should give it to you
Sales tax
Forget income tax…and property tax…
CONSUMPTION tax….that is all there should be….period
Thanks for your time.
Re: Sales tax
The problem with sales tax (consumption tax, whatever you want to call it…) is that the lower income will end up paying a disproportionately higher percentage of taxes.
Lower income people necessarily spend more of their income on necessities (food, clothing, gas). So unless you tax luxury items at a substantially higher rate, you would actually be shifting the tax burden downward to the very people who need relief.
Flat rate income tax with no loopholes would be a more ‘fair’ way to change it.
As a foreigner in Slovenia, every year I have to declare how long I’ve been in the country… that’s it!
The gov’t gets tax records from the employer, and checks it against your bank account.. if it matches.. that’s it.. they determine if you get a refund or have to make a payment..
You can lodge deductions for various specific things, but then you need to manually enter a tax form (either on paper, or online)..
I really like this system, but Slovenia only has a population of 2 million or so.. so it’s much easier for the gov’t to do this..
Mike can make sense.
I agree completely with Mike on this one.
I would go a step further in that I think the government should make this available electronically with friendly fill in the blank software and I am willing to bet that tax compliance would improve by leaps and bounds.
Also, many transnational companies are using underhanded tactics to avoid paying their taxes. Much of this is done through use of their subsidiaries outside the US. The IRS should be doing more to stop this.
Ronald J. Riley,
I am speaking only on my own behalf.
Affiliations:
President – http://www.PIAUSA.org – RJR at PIAUSA.org
Executive Director – http://www.InventorEd.org – RJR at InvEd.org
Senior Fellow – http://www.PatentPolicy.org
President – Alliance for American Innovation
Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
Washington, DC
Direct (810) 597-0194 / (202) 318-1595 – 9 am to 8 pm EST.
Isn't that ironic, don't you think?
Isn’t it ironic that tax software has taken a big bite of the business of H&R Block and other brick and mortar tax preparers and now they are the ones crying foul when their business is threatened? There will always be a need for tax preparers and software for more complicated returns, small businesses and sole-proprietors.
I’m thanking them by boycotting them this year and very likely forever now
Tax payment application
I attention this product long ago,also like this product.This product appearance or whether I very satisfied with the quality.
cheap nfl jerseys
This article gives me more determined to purchase this product.
Tax payment application
Er, what the heck has that got to do with anything?
Re:
Nice try, Intuit.