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Why Taxes Are Such a Pain

In some countries, the government sends everyone a pre-filled form. Here, cronyism prevents that from happening.
tax form

There’s no good option when it comes to taxes—especially if you have kids, a mortgage, a job change in the previous year, a Health Savings Account, a home office, a personal computer you use for work, and a mix of salary and freelance income, to pick a totally random mix of circumstances. You can fill out the forms by hand (as I did for many years), which is free but labor-intensive. You can buy a computer program (my preferred method these days), but that’s not free, and feeding your information into the software still takes a lot of time. Or you can dump all your paperwork on an accountant and let him sort it out, the easiest alternative but also the most expensive.

Or the government could fill out its own stupid forms and send them to you for review. There’s actually no reason this couldn’t happen. It already does happen in numerous other countries.

The IRS already knows how much money you make, thanks to the W-2s and 1099s filed by your employer, as well as numerous other key details about your life. With modern technology it would be trivial for the IRS to set up a system that did most of the work for you—it could completely fill out simple returns, and it could provide at least a starting point for those of us in more complex situations, especially if it also collected some basic details about itemized deductions online. In fact this system might save the agency money by reducing errors and refund fraud, to say nothing of all the money and frustration it would save taxpayers. (It’s not often I type the words “you should read this report from Elizabeth Warren,” but, well, you should.)

The obstacle is cronyism. Tax-prep companies have relentlessly lobbied to keep this from happening; indeed, they’ve thrown their weight behind a bill that would actually ban the government from setting up such a program. Intuit has hilariously referred to the concept of pre-filled forms as “governmental encroachment” on its business. Keep your government hands off my tax returns!

So, as you scramble to finish everything up this weekend—Tax Day is April 18 instead of April 15 this year—pause to remember that much of the work you’re doing is completely unnecessary. That ought to cheer you up.

Robert VerBruggen is managing editor of The American Conservative.