My son made a mistake on his state taxes and his return was rejected. The letter he got back basically said "we couldn't verify your reported property taxes, so you can resubmit a correction or do nothing and accept our version of your taxes" (where he gets back about $200 less because of a typo.)
So, like, yeah. They're just comparing your notes to theirs, with the default benefiting the state.
Seems like the property taxes would be the easiest thing in the world for them to verify. Unless they've been lying to themselves.
There's a lot. Every tax form you get is submitted to the government as well. W2,1095 a, 1099, property taxes etc. For most people, the government could just send a letter saying: we have all the documents. Do you want to itemize or take a standard deduction? Do you have anything else to report? Cool. The people that would still have complicated taxes would be the self employed.
Yes, it would be helpful if people didn't have to chase down a bunch of forms that were submitted to the IRS already. But for instance in our family there's a lot of medical expenses, well over the minimum for us to deduct them, so we'd still want to do that.
I believe they had a typo entering their PIN. The property number is like 15 digits long with multiple hyphens. It was fine last year, but this year they got "wE cAn'T vErIfY yOuR pRoPeRtY tAxeS" .đ
They don't actually know. If they think something looks suspicious, they do an audit, and then they know.
The vast majority of people's taxes fillings are taken on good faith.
Mind you, if you routinely fudge your taxes, they will eventually notice something strange, or hit you with a randomized audit. Then, whoops, we found something! Better take a closer look at all your past filings too....
They donât actually know the final amount, but they do have an independent expectation for certain items.
If your job withholds income tax then it is paid quarterly to the government, so they know how much you made and how much taxes you should be paying.
If you win a large sum of money in the stock market or gambling at a casino then the broker or management company reports a tax bill to the IRS. The same happens for large early withdrawals of retirement funds.
They also know information based on previous returns, like how many kids you have or if you own a home.
They may not know it down to the dollar amount youâll be paying because of the complexity of the US tax code and the deductions youâll claim. For example, the government has no record of you purchasing a $600 electric car charger but you can claim that on your taxes to reduce your tax liability. That being said, if you under-report the amount you made at your job they will almost surely audit you if the number reported by your employer doesnât match the number you provide.
In many countries, the government does have a record of you purchasing that electric car charger as long as you ask the seller to include your tax number in the receipt - which you need to do if you want to file it - and it all comes automatically pre-filled in my tax deductions. Its become really easy to do taxes, it's literally 3 clicks for most people.
The answer of course is that the IRS doesn't know how much you owe, and it isn't feasible for them for figure out exact numbers for everyone with the tax code as complicated as it is. So, they audit a fraction of Americans every year to keep everyone honest. It's a bad system that taxes are so complicated but it's not a conspiracy.
It absolutely is a conspiracy though:
Except the federal government literally this year started instituting a free, public filling service to get around TurboTax. And they fought it tooth and nail.
There is a conspiracy, but it's not a federal government conspiracy. It's just a bad system that certain companies conspired to take advantage of.
I mean, the tax system is so bad because tax preparers like Intuit bribe politicians to keep it that way.
God, I would hate to have to work out my taxes every year laughs in British
Hey, some of us do have to do taxes, but you pretty much follow a questionnaire on the gov.uk website then fill out some numbers from paperwork you'll already have (P60, payslips, etc). I had to whip out the calculator once to add up 12 numbers for my student loan.
Could probably do it in under an hour if you're not doing anything unusual.
The American system sounds very much not that.
I was shocked how easy it was to do my taxes when I was poor (back before the online services even). Just went to the library and spent half an hour filling out a 1040EZ form and dropping it in a mailbox.
It's harder now that I actually have contributions to retirement, back when I owned a house, make considerably more, have two kids and a wife that's going to school, etc. But still took me less than an hour.
And I would argue that if it takes you more than an hour to do taxes, you both should and can afford someone to do taxes for you.
Oh interesting yeah, so doesn't actually sound too complex for most people then.
I'm a little confused about the last part, what are the main differences between paid and free services if it's as simple as you describe with the W-2 form?
Even then buying and selling stocks, having a 401k, IRA, etc. doesn't even make it complicated. You just have to fill out a 1099-B/DIV/INT and then list your contributions to your retirement accounts.
I don't know why people pretend it's so hard. You spend 30 minutes every year answering a few questions and punching numbers into boxes from a few documents that are sent to you by your broker/bank/employer. It's also only $15 at FreeTaxUSA.
Opening the accounts you report to the IRS is arguably more difficult than filing them on your taxes.
You guys have to fill in numbers? The Australian Tax Office pre-fills your tax return with the data they get from your bank and employer, so most people can do it in 5 minutes by clicking next a bunch of times.
To be fair the vast majority have it fully automated PAYE and don't even have to file. Though it's a good point, I'm pretty sure the tax forms you get the numbers from are a standard format, I wonder why they haven't got something like that in place here.
At the very least you should be able to upload the PDFs from your work payroll as the end of year forms and it could pull the details from those
Um, The American system is exactly like that.
Its a nice break from figuring out if the amount my medical providers charged me lines up with the estimation of benefits provided by my medical insurance company and trying to get a denied claim paid.
yep. They won't tell us if we payed them too much, they'll only tell us if we didn't pay them enough đĄ
works as well with just the last two panels
This year I think the IRS is rolling our free preparation (federal, some states offer it to I think).
Go check it out.
But yeah this could all be automated. Just another cigarette in your eye for daring to exist in the conservative fascist multiverse.
I looked into this. I didn't qualify due to having an HSA.
I hate fucking taxes. Just stayed on a call with Fidelity because I overpaid my 401k by a few dollars and they don't know how to set a reimbursement. Now I'm on a call with Anthem because they don't know why I never got my 1099-SA. Fuck. I really fucking hate taxes.
Just file for an extension, it'll give you until October (?) to complete your taxes with the proper paperwork.
Few years ago, I estimated my pay/taxes because a former employer never mailed me my W2 since they just sucked. I'm foggy on all of the specifics, but I remember getting a letter saying they couldn't verify the info from that W2, and that I wouldn't get my refund until it was verified.
Got the company to send me my actual W2, filed a revised return, and ended up owning like $1700, even though it had told me before the letter I'd get a refund of like $3k. Annoying as fuck, but ultimately my fault, I should've just waited for the W2 and filed for an extension in the meantime.
Following year, I got a letter from the IRS saying they owed me $1300 that was never released due to my tax shenanigans the previous year.
Moral of the story: just file for the extension, save yourself the anxiety and headache.
I enter in my w4 and take the standard deduction. Takes me 5 minutes.
Haven't owed since I had a retail job that reset my withholding when I got promoted to make it look like I got a bigger raise.
Do you not earn interest on any accounts? No loans on which you pay interest? Are you a student?
Like I said: standard deduction. Those numbers never come close to make itemized deductions worth the time and effort.
Interest is income, so your W-2 won't be enough to account for that. You'll also need to go to any banks, taxable brokerage accounts, etc, because that money will impact your taxable income. Still not a ton of work, but it's still more than just W-2 + standard deduction.
Thanks for the casual assumption brokerage accounts enter into the picture.
No savings for interest, all income goes to debts and expenses.
But I am doing relatively great almost entirely because my housing costs are comparatively low and locked in for 27 more years.
Most people aren't going to have anywhere near enough taxable investment income for that to matter.
I think I got about $.87 in interest payments from bank accounts in the past year. I don't think that's going to make a huge difference in taxable income.
I mean, thatâs essentially what our taxes are. Things vary based on tax brackets, state, dependents/spouses, and total earnings of course, but we all have a base tax.
The hard part of taxes is usually deductions, or when you start having things like investments or small businesses.
I guess that was some sort of short-circuit on my part?
No, youâre right that itâs extremely complicated. But the complexity doesnât come from the base rates. Youâre likely thinking of the process as a whole instead of the starting point.
What? No. They only know the amount you asked them to withhold, and that could get you in trouble if you specify dependents then tell everyone you don't have any or something. Also if someone is living in your house, making less than 4700 for the entire year, they can be claimed as a dependent, which means you don't even have to have kids. How would your work even know?
Last day to file taxes in the US without having filed for an extension.
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pan to tax preparation companies taking turns sucking off Uncle Sam
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