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Open Source Tax Products?
sub7 asks: "That time of the year is upon as again: Tax Season. Those of us living in the U.S. are busy fumbling with various forms with awkward names and meaningless garble on them. Being a lazy BOFH, I went to H & R Block to see how much it would cost for them to prepare and file my taxes. They estimated -at least- $175, if not more! I knew it was cheaper to buy some software to handle my taxes. So I headed down to my local office supply conglomerate and picked up Turbo Tax 2004 Premier for $69.99. Being an OSS user for nearly 6 years I have never even considered an OSS tax solution product (probably because I ph34r t4x s34s0n!). So I turn to Slashdot to ask: Are there any projects equivalent to Turbo Tax or the other tax products out there for the OSS community?"
No.
The price is always right if someone else is paying.
Trudging through tax law every year and coding an application just can't be fun enough to reliably get a group of coders to produce something like this with any regulartity. Can it?
Do you like wine with your taxes?
Why did you buy the software? You can fill the entire thing out online and save half the cash.
:)
The site actually works flawlessly in Firefox too
The price is always right if someone else is paying.
Open Tax Solver
Mexican border controls are almost certainly cheaper than $69.
sulli
RTFJ.
Anybody who invests five minutes in researching this will find that no, there aren't any OSS tax solutions.
Why?
They aren't needed.
If you go to irs.gov, they will link you to several services which will enable you to prepare and electronically file your taxes online, completely free of charge. Most won't file your state taxes for free, but then, many states allow you to file for free on their own website.
I didn't pay a dime this year, and I didn't have to print out any forms. And yes, I have a reasonably complicated tax return.
you can fill the entire thing out online and save all the cash!
You're not really buying programming there, you're buying a lawyer's time through proxy. All the lawyers I know bill out in six minute increments and earn every freakin' penny they make (and it's a lot of them), so I don't think you're going to be getting this kind of stuff for free. You could make the program free, but you'd still have to buy the advice.
That said, TurboTax for the Web is cheaper, works for everyone who only lived in one state this tax season, and will run in Firefox on Linux and Mac, so at least you don't have to use Windows if it's not your cup of tea.
adam b.
Can you imagine the horror of a OSS tax prep software package? By the time tax season rolled around we'd have 5 forks of shoddily written, poorly maintained code, and at least three new holy wars.
No thanks. I'll leave it in the hands of people that have accountability.
Why would you trust volunteers to produce tax software? If the software miscalcuates something or the programmers misinterpret some arcane IRS ruling, you end up being liable for the mistake -- which could cost you thousands of dollars.
Now if TaxCut or Turbo Tax has a defect like that, the company agrees to assume responsibility for calculation errors.
TaxCut Deluxe is $25, and the state version is $20 with a $20 rebate. If you don't want to spend the money, you can easily use a spreadsheet & calculator to figure your taxes, and waste 5-6 more hours in the process.
Conformity is the jailer of freedom and enemy of growth. -JFK
One of the things I like about TurboTax is the peace of mind. The company itself certifies that your results are correct, and will even litigate on your behalf if you run into trouble because you used their program.
... anyone?
Would an OSS tax software project have deep enough pockets to provide the same sort of guarantees? Because I think for many people to place their trust in an OSS tax preparation package, they would have to have some assurance that the results weren't going to either get them audited or thrown in prison.
Perhaps if there was a CPA out there who could also hammer out code
Since I started having an accountant prepare my taxes three years ago there has not been a year where he did not save me far for than the small amount of money he charges to to my taxes. If you have kind of investments or run a small business then the reduction in liability from having a professional do your taxes is worth it.
"God fights on the side with the best artillery." - Napoleon, Marshal of France - speaking truth to power
I use this (IRS Form 1040, pdf format), this (IRS Form 1040 instructions, pdf format), and XCalc. Seems to work fine for me.
I toggled a toggle and buttoned a button, but when I got done, I was done doin' nothin'.
The tax code is updated every year.
Unless you're looking at a fairly trivial tax calculator, trying to write and maintain an Open Source, Community-Driven tax program would be a positively Herculean undertaking. It'd dwarf the Mozilla and Apache projects. If you are looking at a fairly simple tax program, then you can probably wrap your taxes up by hand in the time it takes to download, install, and do your taxes on your PC.
What's more, code errors and oversights can mean audits, overpayments, smaller returns and penalties for your users.
Obliteracy: Words with explosions
http://www.taxfreedom.com/v /app/freeFile/jsp/index.jsp?
or
http://www.irs.go
for a complete list of freefile services
gnuTaxes is looking hopeful, if you're still living in 1999. From their "future release section":
1.0.0 - release gnuTax application with complete tax system definitions by end of 2000..
Seriously, these applications are not simple to write, and they change quite a bit, every year. Further, there's probably a certain amount of liability involved. You're better off sticking with one of the big commercial applications, or a web filing service. Hopefully they'll eventually write one in Java...
What do you call this?
Agreed. Just go to www.irs.gov and download the PDFs. You can get the forms and the instructions. The forms are fill-in so you can just type in your numbers. When you are done print and sign. It took me longer then the parent poster, it actually took me about a day to do Federal and State. When I was done I printed, my wife and i signed and I mailed them in. Why pay to e-file when I can mail them for less then a $1 each!?!? That's what really gets me about taxes...it costs the Govnmt quite a bit less if you e-file but they charge you to do so! i'll mail them and make them spend more the process my taxes until they make e-file free.
Well, if there was ever a need for support and updates... which last I heard was the OSS business model. However, since you only need it once a year, it'd be too easy to get it from someone else. Maybe a duel license model, where you have a "basic" OSS app, and some extended for-pay features to catch you once the taxes get too complex.
However, I think it is the double tranlation that is the killer. First someone needs to translate the tax code from legalese to english, then from english to code. And I'm sure it'd have to come with a big fat label saying we're not responsible if the IRS come knocking. I'm sure TurboTax isn't either, but I'm not sure I'd like to be head scapegoat of such a project...
Kjella
Live today, because you never know what tomorrow brings
if H&R or TurboTax make mistakes, you can hold them responsible. at least, they will give you the guarantee. i dont think anyone would stand behind any OSS programs when it comes to IRS liability.
not to sound judgemental, but if you are talking about saving $70 to $175 as being a "big deal," i tend to suspect that it's more of your laziness rather than complications that's preventing you from trying/using the IRS electronically fillable forms, available for free online.
Open Tax Solver is the only F/OSS tax program worth mentioning. It is better than doing it by hand but (if you are used to handholding from TaxCut, TurboTax, and similar products) you will need to be ready for a shock. It is under active development & started out as merely a simple calculator. You would feed in a text file of what numbers you would put on which lines & it would spit out what to put on all of the other lines. So you still need to be familiar with how to do your taxes by hand--you just don't need to have a calculator when you do this. The advantage of this is that it is very flexible--the same program can and is being used for state and other taxes than the US Federal 1040. The disadvantage, of course, is that you need to know a little something & be able to edit that text file.
Someone has since developed a GUI for it, but it is still quite new & somewhat untested. I haven't a clue if the GUI is as flexible as the CLI program.
The output is a textfile. They suggest you sit down with the text file open & fill out a fillable PDF form by hand. Acroread 7 supposedly supports filling in form data from a text file, so that will be the next big improvement to OTS. The catch is you still have to print out the form & mail it in. I don't know how likely efile will be--just as with the open source personal finance programs downloading bank statements, there is generally a lack of information sharing unless you are Intuit or H&R Block.
Don't like this? Then use a free (as in beer) web service through freefile. They list dozens of sites where you can complete and efile federal and some state taxes. Most allow you to keep a PDF of the filed forms for your own records or for a snailmail submission.
I've got small business income, two mortgages, interest income from my bank account, a W-2 from my day job, a W-2 from my wife's old job, and the unreported student stipends my wife receives as a grad student. You figure out how to file long form with a dozen-odd extra schedules tagged on in under an hour, by hand, and you've got yourself the single most profitable invention/business plan known to mankind.
Kids: Remember, don't take tax advice from a guy who thinks it's OK to just not do your taxes if you're not a government employee. We have a name for people like this. They're called "future inmates".
Obliteracy: Words with explosions
I already paid, it comes off my payroll. I want my money back.
Given that they owe me a huge wad of cash, the government might actually be quite happy if I didn't file.
As an aside, in Ontario where I live, there is a checkbox at the end of the tax forms asking if I want to donate all or part of my refund to help pay down Ontario's public debt. If I filed on paper, I would probably add a checkbox saying "Like hell, you greedy bastards", and check that one.
I'm dying to find somebody who actually checks that box every year, because I have some land I want to sell him.
it eFiles both state and federal for cheap and has a better interface than any iteration of turbo tax that I've ever seen.
The downside is that you have to trust the company with your financial info and transmit it to them over SSL. but this is slashdot, we know how to be secure... right?
Yields how I've been doing my taxes for the past three years:
http://hrblock.com/goto/free
If you don't mind filling out your state paperwork yourself, it doesn't cost you a dime.
mstyne: real name, no gimmicks
People will gladly pay the $50 or so it costs for tax prep software, but never the 50 cents or so per person (I'm guessing) it would cost the IRS to provide this service itself, as it reasonably and naturally should...
In Brazil the government allways developed the program used to it. They even developed a Java version, so you could use it on linux.
They banned paper forms last year, and those who send all the data by internet have some advantages. I don't know all the functions Turbo Tax has, a government developed program can be better.
Where you can use e-tax currently unavailable cause the tax year is July to June. The software is very good and the need for tax accountants is dwindling.
Many technical standards have associated with them a reference application, the operation of which is defined as the correct operation. Reference applications are a great way of resolving the inevitable ambiguities that arise in standards. IRS could publish an open source reference application that would have a high likelihood of meeting the IRS rules for nearly all tax filers, and could be used as a base of study by the commercial tax software industry.
If IRS were to adopt and publish such a reference application, then perhaps 95% of the questions that filers ask them could be answered by the application. The answers would be correct, or at least consistent. If an error were found, then the application could be corrected and everyone whose filing was affected by that error would be known and easily corrected. This is in contrast to the uncomfortably high error rate that the IRS telephone advisors have exhibited. (There many articles regarding studies of the error rate of IRS advisors, and all of those tax prep companies. I'm too lazy to find them today.)
Implementing a subset of their algorithm suitable for processing on a desktop is entirely within their capabilities. The IRS computers presently do this processing for nearly all filers. In other words, they already have a 'reference application'. It's just not public.
Such a reference application would not impact the commercial software industry, in fact it could help them as much as it would help anyone. I would expect that such an application need not have all the wysy features of a commercial tax prep product, and the commercial products might have much better tools for helping a person figure out the best strategy. Commercial vendors who want to base their product on the IRS product might or might not be be required to publish their own source, but should at least have to provide IRS with information on any errors that they identify, to allow correction by everyone.
A reference application would also be useful to IRS. It would provide a common reference point for all discussions and contentions regarding interpretation of the tax code.
There are some interesting legal questions. The majority of them would be answered by the following statements: 'This reference application is for reference by software professionals and is not intended for use 'as-is' by untrained individuals. It is applicable for the majority of individual tax filers, but not all. IRS does not guarantee accuracy and is not responsible for errors. Over- or under-payments, including interest and penalties the result from errors in the software are the responsibility of the filer, however underpayment as a result of a software error will not be presumed to be an act of fraud."
It's easier to be a result of the past, but more fun to be a cause of the future! http://www.spacefinancegroup.com/
A trip to H&R Block will pay for itself, so long as you identify the pitbull of the office. There is always one person, usually a woman, who will really hammer away with personal zeal at getting you a big return. your $175 investment could easily pay for itself if not pocket you some phat cash.
People who think they know everything really piss off those of us that actually do.
I slogged through the instruction booklet for a weekend, reading, entering numbers, etc. and agonized went I got diverted into ancillary worksheets hidden in the booklet. Talk about stealth bureaucracy!
But think about the Line by Line process of filling out the tax form. It's just a bunch of notices and instructions which could naturally be recast into any programming language that can print out a descriptive text, accept numerical input values and do simple arithmetic.
Most of the entries could be answered with "This doesn't apply to me - enter zero." as default answers.
In the longer run, releasing a programming language version of the tax form makes sense because the same 1099 forms that are sent to the IRS electronically could be made available to you as you fill out the form (assuming you can identify and authenticate yourself).
No, it shouldn't be SomeVendors closed proprietary solution..
The IRS should release the 1040 form in XML.
"Provided by the management for your protection."
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There are some major benefits to having your taxes done by a certified professional.
.agrippa.
a) If you get audited by the IRS, your tax preparer is the one that talks to them instead of you. The IRS can pick just about any reason they want to audit you, from legitimate inaccuracies/questions they have to the sky being blue that day (ie a random audit)
b) Your tax preparer, if decent, should know more loopholes in the state/federal tax structures that are apropos to you than TurboTax or even you yourself know.
c) The fees you pay to a tax preparer are write-offs for next year's taxes.
I just had my taxes done this week. It cost me $370, which is obviously a lot higher than TurboTax would be. This year I had a lot of tricky stuff including multiple jobs (some contracting), a house purchase, stock sales, etc. Considering she got me over 3000 off my federal/state taxes, I feel that its worth it. Some of the exemptions she used were totally unknown to TurboTax, which I have used in years past.
You should consider using the IRS Withholding Calculator. It will help eliminate that "loan" to the IRS.
Here in Brazil we have free software provided by our IRS equivalent. It has, windows, linux and MacOS versions (last 2 it's Java actually). The java version was released last year as an answer and I think it will become the standard version. We also can do it on paper, by telephone or internet.
Scientia est Potentia
But why? If it doesn't you have the source code - fix it and get you calculations right.
No Sig for you.!
All the tax software in Canada that I've found is for Windows, and I was upset when Intuit said I had an unsupported browser (though it works at my workplace running Firefox on a Windows machine).
But ufile.ca works under Linux, so that's where I choose to spend my money.
So the reason people in America are poor is because it's profitable, and not because factors outside their control force them into poverty? If only it was less lucrative to be poor everyone would start raking in the dough... that's one of the stupidest things I've ever heard.
Uhm, cause then you have to do your taxes with turbocash, do them by hand, compare the two, fix software bugs, then submit. This appears to be about the slowest possible way to do your taxes.
Jeremy
There are already FREE (BEER) solutions to e-filing your taxes for nearly everyone in nearly every state. No OSS person is going to take on the liability or complexity of the US tax code for "fun", especially when the FREE (BEER) solutions work so well and there are plenty of better projects to which you can devote your limited time.
The federal government has forms online and they also have a "Free File" for eligible taxpayers which is nearly everybody. Check out www.irs.gov for the site and a link to a variety of supported vendors who will e-file you for free using web-based forms.
I like www.taxact.com -- they are among the federal "Free File" vendors so you can use them for free and have the Fed gov't pay for it - just make sure you start at the www.irs.gov website or you'll have to pay for it. You can file the state with TaxAct for about $10 more but realize that MOST states (like IL where I live) have online FREE tax filing as well at their state websites.
However, if you're like me and want to do it at home instead of on the web for free, you can purchase TaxAct's fed and state for use at home for $20. Their software is very easy to use and asks you simple questionaire to make sure you get all your deductions. Additionally, TaxAct isn't as bloated and is not filled with crapware (like nasty DRM that writes to your root sector on your HD) like the other major vendors have done in the past. I don't work for or have any relation to taxact, but I do like them compared to other products and I would recommend them for people who want the actual program at home versus the FREE (BEER) solutions above.
The free online products allow you to file your taxes, guarantee accuracy of computations (not accuracy of what you enter OF COURSE!), print out your taxes for a personal copy, and verify their online filing. If you need a program, you can spend $20 for a fully guaranteed tax suite and save over the $175 or $69.99 charges mentioned in the post.
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
In the end, I do not believe that it's realistic for there to be a good quality open source tax program. The big problem is that a huge amount of the work that goes into something like TurboTax is done by professional tax accountants and attorneys. This is not the sort of thing that could be rolled together by a small independent effort.
I could see it as a possibility as a collective effort by a few companies. If there were enough organizations that saw a benefit in having an open source development effort, then they could put together the resources to do it. Having said that, who would benefit from free tax software? Certainly not intuit, or H&R block, or pretty much any tax accountant on earth.
Maybe the IRS could sponsor something like this, but realistically it's far more efficient for them to let TurboTax be the de facto standard. The price for TurboTax is very reasonable compared to the cost of an accountant, especially if you use the web version of their software.
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I've used it for 3 years now, why buy software when you can get nearly the exact same functionality ina webbased app? They transfer your old data from year to year so you have to type practically nothing. They also support importing W-2's from companies like ADP (check processing). Its not OS but its also not a waste of plastic and paper like the desktop products.
"Oh, foul. The wealthiest 50% of Americans pay approximately 95% of all income tax. The wealthiest 5% of Americans pay approximately 50% of all income tax."
As it should be, maybe moreso. I hate it when people whine about the rich getting taxed more. So what?
Look at it this way: here's the money we have to buy groceries for two weeks for a family of four, I have $1000, and you have $100 . Now we are both taxed, I'm taxed 30%, 'cause I'm richer than you are. You're taxed 10%.
I have $700, you have $90. Get it?
"How about this: a regressive income tax system that takes the poorer at a higher percentage but lower amount than those with more income than, then? You'd see prosperity abound in the US. That's Economics 101."
Uh huh... Yeaaaah. You want to just go ahead switch to a channel other than Fox, okay? Try Animal Planet.
I used to do my taxes by hand, the hard way, before there was a TurboTax. I did not have many complications, no home etc. but back then, there were alot of exemptions and special credits, that it took quite a few hours each year.
About 10 years ago, I began using TurboTax, and based on my experience of DIY prior to that, I found TurboTax to be very thorough and much easier.
Now, 10 years later, I have a home, and a side business and I still use TurboTax. I believe I have enough experience and I do make some effort to follow the tax law changes, that I am comfortable that TurboTax is getting me what I deserve in a lower tax bill.
People who claim... "My refund always exceeds what I would pay the accountant" are misleading. If I prepare my W-4 properly, and make lean estimated tax payments, I can target my refund to be Zero dollars (in theory).
Your refund is your money to begin with. The size of your refund is simply the error that was made in calculating your estimated tax.
You can make it bigger or smaller by changing your W-4.
Some accountants may find money in obscure deductions, like child care payments, that the average user may not know about. Or they might accellerate your depreciation on a depreciating asset, but this is just robbing peter to pay paul, because in future years, you will get a smaller or no deduction because of the accelleration!
I have seen the returns prepared by some "Accountants", and they were done by a tax prep program. So why pay them to plug the numbers into TurboTax?
I realize that I am more detail oriented, and a perfectionist too. And a DIY kind of guy. Doing my own taxes has never been an issue. I honestly do not see how an accountant can "lower my tax bill", which is different from "increasing my refund". I already reap the benefits of tax deductable mortgage interest, Child care deductions and 401K deposits. My medical expenses do not exceed 10% and I don't give to charities.
What else is there?
I would like to hear... What "tricks" were used to get you that bigger check? Or is it that you didn't know that you could deduct 401K payments in the first place?
I have a home, and a business. I use TurboTax standard, not the premium edition (I don't have stock options). State forms are free with a mail in rebate. This year, my taxes cost me $29.00 plus about 3 hours pulling the numbers together, which by the way, I would have to do for an accountant anyway...
Just my two cents...
This year, I hired an accountant (and EA: someone why has worked within the IRS previously in a return-related way for five years), paid $700, and definately got my money's worth: he found about $600 in extra refunds that even I, in my pennypinching, hacker-scheeming, diligence missed. (Of course, I expected this level of work, even though the extra refund was a pleasant surprise).
A good tax accountant will provide a 30 to 60 minute consultation session for free that will give you an idea if it is worthwhile to retain their services.
In my case, I'd already researched a bunch of strategies that I thought would work, but they involved the use of tax treaties. I was over my head in tax legaleese and nomenclature, and I needed someone to refute or verify what I though, and get the i's dotted and t's crossed to make sure I filed correctly.
You could've hired me.
It's actually much better than that... in order to be a company that CAN charge for efile you have to give it away to a bunch of people.
Essentially the IRS said that industry had to come up with a way to make it largely free or else they WERE going to come out with a universal solution. And industry said ok.
It's a nearly perfect example of this kind of cooperation between government and the free market.
Looking for freelance Actionscript (Flash/Flex) or ColdFusion work and/or freelance developers. Email me, put Slashdot
The obvious answer to this is "No". And I really loved the comment where someone said "What about this?" and gave a link to freshmeat that had a bunch of useless stuff that was quickly debunked.
As you may recall in many discussions of the pros and cons of switching from Win to Linux, tax software is always on there. That and the lack of games are the really big software holes that may not be filled for quite a while. The only reasonable solution available (or soon to be) is probably online versions of it through TurboTax.com. Hopefully they are web compliant enough that they can run on other browsers than IE.
We may experience some slight turbulence and then...explode. -Capt. Mal Reynolds
A federal real property tax replacing an income tax would be extremely regressive. Wealthier people would simply divest of any excess real property they owned and were not renting out. Renters would find the tax passed onto them and middle-class homeowners would see most of the benefits of home ownership be taken away. For most people owning a home is their best and biggest overall longterm investment. In addition it would hurt the housing market a lot which although inflated in many regions, new construction of homes and buildings is a source of some of the best paying jobs for many people.
I think a federal property tax would be even more of a disaster than a federal sales tax that did not exclude food and clothing.
Well alright then, get right on that.
The problem is that a vast amount of legislation is incorporated into our tax code. You know how ever time the Republicans want to offer something as a tax credit rather than as a new pay out? That's just another few gallons of quagmire for our tax code.
Let's say that tomorrow we had a flat tax. What would happen to:
* Deductions for children
* Deductions for interest on home loans
* Deductions for business expenses
There are thousands of little deductions that have been put in there over time for purely political reasons. Tossing it out would have some pretty harsh ramifications. The effective price of homes and hybrid cars would go up. The effective price of having children would go up.
A flat tax is a simple solution to a complex problem which means, in the end, it doesn't really work.
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That time of the year is upon as again: Tax Season. Where we all enjoy reading about someone moaning that they can't find Free or Open Source tax software.
Tax preparation is a classic case where OSS doesn't work: a tedious problem, lots of state-by-state variation, huge sets of rules that are constantly changing, customers that need hand-holding because they don't understand the underlying rules, and the result is just numbers, not something exciting like a game or yet another media player.
Programmers aren't motivated to provide tax software for traditional OSS principles. The only way to get people to do this is to pay them.
You are not looking for an open source application because this is something that you do only once a year. You are looking for a way to do your taxes using your existing FLOSS platform.
How about your browser? Sounds good.
Try http://taxactonline.com
Very thorough, fast and accurate and all you need is Mozilla or Firefox.
You can try it for free. Heck, if you don't want to e-file you can just take the pdf file that they give you at the end, print it and send it in.
Pragmatism as an ideology is not particularly pragmatic in the long term. Keep it in mind when you dismiss Free Software
How about this. I work 90 hours a week to make my $1000 and you work 25 hours a week to make your $100. Why should my extra work be taxed so much more?
Or how about another one. I make $100 and scrimp on everything so that I can put $60 of that into very high risk investments (like my business or a startup) and end up making $1000 while you spend all your $100 each time you get paid - why should I pay more tax for all the risk I took while you took none and made none?
There is a free Canadian tax filing software called Taxman. Can't vouch for it as I've never tried it.
http://pacificcoast.net/~gthompson/
If you have a business in Canada you may write off tax preparation fees and expenses. I don't know if non business owners can do the same.
In order to submit IRS returns electronically, the software developer and/or the agency submitting the returns has to be an authorized E-File provider. (Read that, it's chock full of insightful information on this subject, as is this one.) When you use TurboTax, you don't end up submitting directly to the IRS, but via TurboTax's systems as a middleman, which passes your return along to the IRS via "e-file transmitters".
Furthermore, you also have to get approval from every state you want to be able to support state returns for. 1, 2, 3
Which is, no doubt, why there aren't a lot more tax software options.
In the unlikely scenario that an open source project received this approval, the trusted endpoint problem would wreak havoc with its success.
Such a project would have to function like a foundation, with its own online middleman service to process the returns through. (Or, perhaps more ambitiously, operate its own e-file Transmitter.)
Anyway, I'm a big fan of TurboTax for the Web. I don't need to download anything, or worry about upgrading each year, and the cost is somewhat dependent on the complexity of my return and the added features I want, so I don't end up buying a shrink-wrapped flat-rate option that I end up underusing.
Terrorists can attack freedom, but only Congress can destroy it.