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Intuit Still Fighting Government Tax Software
Back in January we discussed Intuit's opposition to California's free, convenient software to file tax returns. TechDirt noticed a recent article in the LA Times about Intuit's continued lobbying efforts to get rid of those programs. Quoting:
"Most importantly, Intuit is offering nothing that California doesn't already have. The state has arranged with other tax software providers to do exactly what Intuit proposes: Help low-income folks fill in and file state and federal returns for free — although Intuit refuses to participate. It apparently only wants in on this deal if the state knocks out its free programs, thereby creating a larger potential paying customer base for TurboTax. Not surprisingly, Intuit has been greasing the wheels in order to try to sell its scheme in California. Since 2005, public filings indicate that Intuit has spent $1.25 million on lobbyists in the state. Over the same period, it contributed an additional $2.12 million to statewide campaigns, including more than $1 million to state Sen. Tony Strickland (R-Thousand Oaks), a ReadyReturn foe who is running for state controller. In all, Intuit has doled out cash to nearly 120 politicians. The impact has been clear, even if Intuit hasn't gotten its way — yet. As documented in The Times, in 2009 California Republican legislators held back their votes on 20 bills in an attempt to do the corporation's bidding and force the abolition of ReadyReturn and CalFile. They didn't succeed in killing the tax programs, but they did kill funding for domestic violence shelters, police and fire departments, and prevention of swine flu outbreaks."
So, let me get this right. A tax code is so confusing and complicated - in part because of lobbyists and politicians carving out special exceptions for each other and special punishment for their enemies - that even cash-strapped California sees the need to assist its citizens with compliance? And the result is *more* lobbying from a company that's (frankly) had a windfall for years because of the degree of difficulty of that compliance, to convince the state ... to help the company *make money* from its constituents instead of helping those constituents? Unbelievable.
I have long thought that it is a scam that you have to pay a third party to do electronic preparation and filing like the usual services (TurboTax, etc.) provide.
The government made the convoluted tax system - they should make the web-based application to navigate it.
A work that expires before its copyright never enters the public domain and thus enjoys eternal copyright protection.
Wait, what? iFile was great, and I'll be pissed if it's gone. IIRC TurboTax wanted an outrageous amount of money to file state taxes which I laughed at because Virginia has (had?) such an great online system. Really, ever since Day 1 the Web has been fantastic at putting up forms for people to fill out. The IRS could have built their own website 15 years ago if they wanted, but one feels that they've gotten so cozy with HR Block, Turbotax, Legions of CPAs, etc... that they didn't want to rock the boat. It feels like the buggy whip manufacturers convinced the government that automobiles shouldn't be allowed on public roads because it would hurt their industry. (woo! Car analogy!)
I read the internet for the articles.
They didn't succeed in killing the tax programs, but they did kill funding for domestic violence shelters, police and fire departments, and prevention of swine flu outbreaks.
What were these doing in a bill about tax software in the first place?
This is more government of, by, and for the corporation. Bring on the National Sales Tax of 18%. Try evading that you shady fuckers.
You do realize that corporations just pass their taxes along to their consumers as a cost of doing business, right?
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.
No, "Fair Tax" won't pass because it is anything but fair.
Stuff like this is why a program like the "Fair Tax" won't ever pass.
No, a program like "Fair" Tax won't pass because it's ultimately regressive with respect to percentage of disposable income retained by low-income participants after payment of this tax and would only be used as a stalking horse for reducing the percentage paid by upper-bracket individuals while still allowing many deductions available to said upper-bracket individuals (unless you can tell me with a straight face that the government will give up all tax-related financial engineering via the tax code). People who really believe that the "Fair" Tax would really be fair are the same folks who could believe that a Libertarian government is more realistic than a Communist one, i.e., simplistic minds with simplistic solutions which lead to horrific consequences. But go for it. Destroying our government and devolving into anarchy should be on everyone's short list of things to do (and, yes, I'm being sarcastic about this last part - note added for the simplistic minded).
That is all.
You do realize that corporations just pass their taxes along to their consumers as a cost of doing business, right?
Only if their price elasticity of demand is infinite - which, barring a very few things like gasoline, it isn't. If it was, there wouldn't be a thriving industry that revolves around exploiting legal loopholes to hide corporate income offshore and buying the right politicians to make moar loopholes.
No, "Fair Tax" won't pass because it is anything but fair.
I was going to post a retort with the facts about it and then I realized it won't make a difference. Besides, I don't know why you don't like it and I don't feel like tackling all the criticisms about it.
Here's my quick and dirty irrational fucking argument for the Fair Tax:
Let's get this out of the way: All tax systems suck. None are "fair" There's no way to make it fair. We all take it up the ass because we the little people have always done that - things have never changed OK?
So why not make the pain a little easier and save the preparation costs every year?
RIP America
July 4, 1776 - September 11, 2001
No, a program like "Fair" Tax won't pass because it's ultimately regressive with respect to percentage of disposable income retained by low-income participants after payment of this tax
So it's more fair for the law to treat you differently based on how much money you earn? Equal Protection should apply to all the laws except the tax code?
only be used as a stalking horse for reducing the percentage paid by upper-bracket individuals while still allowing many deductions available to said upper-bracket individuals
You realize that almost half of this country pays no income tax whatsoever, right? It seems silly to think that the upper-brackets are getting the sweetheart deal when nearly half of the working population pays nothing.
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.
A large disbursement (or "minimum income" or "initial rebate" or whatever they're calling it this week) simply means that the middle class gets screwed over rather than the lower class. The whole scheme still amounts to a huge tax break for the rich.
Unfortunately, those on the low end of the wealth scale use most of their money to live, while those on the other end of the scale use most of their money... to make more money. That is why a lot of people see the "fair" tax as not fair.
Your post, emphasis mine:
You realize that almost half of this country pays no income tax whatsoever, right? It seems silly to think that the upper-brackets are getting the sweetheart deal when nearly half of the working population pays nothing.
How did half of the country become equivalent to half of the working population? Those are two pretty different numbers.
So it's more fair for the law to treat you differently based on how much money you earn?
The tax lax assesses income in brackets, not overall income.
Equal Protection should apply to all the laws except the tax code?
The tax code treats everybody the same. Everyone is taxed at the same rate for the money they earn in the first tax bracket, the second tax bracket and so on.
That many people don't make any money in the 3rd or 4th or 5th tax bracket is no reason for those who did make money in those brackets to bitch about unfairness. All it does is expose their ignorance of what a progressive tax scheme is.
Edith Keeler Must Die
It occurs to me that a simple percentage based income tax would not require anything more complicated than your W-2 form and a calculator to figure out.
The reason you are wrong is because you first have to define "income" and doing that is actually quite complicated. Seriously - it's not easy. Especially if you don't want any loopholes. Just define income as W2 earnings and every taxpayer will magically make no money on their W2's the following year and all of them will be compensated some other way that isn't taxable. I'd be perfectly happy to be compensated in stock grants or in bullion instead of fiat currency if my compensation wasn't taxable. If a loophole is available people will take advantage of it and while we dislike taxes, they are actually necessary for the efficient functioning of society.
It is true that some of the social engineering has made our tax code more complicated, but MOST of the complication is simply due to the difficulty of defining what income is (and what it is not). The social engineering bits add a little to the complication but they aren't what keeps your friendly neighborhood CPA employed. The actual payment calculations are pretty simple even now. For what it is worth, if your financial picture is very simple you probably actually can do your taxes with just a 1040, a W2 and your calculator. This describes more people than you might think.
Disclosure: I'm a certified accountant.
I know I'm one of the lucky ones (read: poor enough to take the standard deduction), but it takes me fifteen minutes to do my taxes. On paper. For free. Nyah.
it always seems with companies that offer marginally useful services are always fighting to stop others from helping, rather than improve their product so that it becomes useful. if people would only realize that it's not that difficult to do their taxes, they wouldn't need intuit's software.
Mean what you say...say what you mean.
Try flat tax plus a rebate. You give welfare checks to *everyone*, not just the unemployed or pensioners. This means that if you don't have a job then you get a small amount of money. If you get a job then you keep getting checks. This allows a fairly steep flat rate tax while maintaining a passable standard of living for low-earners. It gives incentive to earn an income without getting caught in a welfare trap. You keep every penny that you earn. It also eliminates several classes of tax fraud.
Most importantly, it provides a way to manage immigration. If you're not a citizen then you still pay flat rate tax but you don't get the rebate. This gives a home advantage to voters while allowing productive foreigners to contribute to an economy.
You obviously didn't pay enough attention to what the OP was saying in the third paragraph and made his argument for him. Perhaps you need Taxes 202, too.
So do the best of both... Institute a flat tax while allowing a cost of living deduction, say $30,000 just to throw a number out there, on the income. Earn anywhere up to $30,000? Pay nothing. Earn $90,000, pay tax on $60,000. Earn $1,000,000, pay tax on $970,000. The simplicity of a flat tax with the humanity of a progressive tax.
Congratulations, you just reinvented the progressive tax: 10% of 60K is 6.67% of 90K, but 10% of 970K is %9.7 of 1M. I.e. your tax rate starts at 0% below 30K and asymptotically approaches 10%. A very simple progressive tax, a very appealing progressive tax, but a progressive tax.
"You saved 1968." - Ms. Valerie Pringle to the crew of Apollo 8
Here's the problem with electricity.
I don't stick butter knives in electrical outlets because I'm not a raging moron.
The guy one income bracket down does, though, because he's a raging moron.
Now apply this to taxes. Clearly, we must do away with electricity because of all the raging morons out there. Also, sales-tax based solutions are fair. I'm sorry that there are folks out there who can't figure out that saving their money for worthwhile purchases is a senseful thing to do.
The current IRS employees doesn't want to provide any information or services that would interfere with private sector services because the private sector services are opportunity for employment after retiring from the IRS. Regardless whether interactive forms or answers to tax questions.