In France, before this year, if you were an employee, you rarely filled a tax form, you just validated a prefilled one, usually with one click on the internet.
Now it's just taken every month from your salary, and you get a chance to correct it once a year.
But I agree the french gov is less into business.
First, a transparent system of the IRS would lower revenue.
Second, the deductibles system is very complex for the IRS to pre-calculate it, so they are unable to do it.
2019 deadlines for 1099-INT/DIV (i.e., the forms you get from your bank or brokerage) are April 1st. The IRS filing window opened January 29, with 90% of tax returns processed within 21 days. Since the IRS can't reliably pre-populate a tax return without all the required information, it would delay filing (and refunds) by 8 weeks.
As the tax refund check is the largest check many Americans receive every year, delaying that payout gets taxpayer advocacy groups up in arms and is tantamount to political suicide.
Incidentally, this same gap is where a bulk of tax return fraud happens—equalling billions of dollars. In short, if you file return before the IRS has all the information to validate that return is indeed correct, they'll usually shrug and accept it. By the time they get all the information they need, you've cashed out your refund debit card and are long gone.
I haven't seen any analysis that such a system would lower revenues (indeed, it would stop billions of dollars of fraud and tax evasion), or that the deductible system is too complex.
This doesn't really pass the smell test for me. The IRS has, what, 7 years(?) to audit your tax return. They can and will do so, and will send you a bill, with penalties and interest included. (Source: this has happened to me, around a mistake I made with self-employment tax the first year I had non-W2 income.)
Not sure how you'd be "long gone", either, unless you're not a US citizen and have since moved out of the US.
My point is that they'll "shrug", accept your return, and issue you a refund. Yes, they may come back later and say, "Actually..."
When I say, "you're long gone", I'm referring specifically to taxpayer identification fraud, where you'd file a (fraudulent) return on behalf of someone else (often a dead person or someone from Puerto Rico), receive their refund in the form of a debit card, and "disappear".
In any case, it's way easier to avoid paying someone in the first place than try and claw it back later.
Neither can I.
Example: your only bank sends your 1099-DIV on February 15, so you file your return. You know that no other bank is going to send you a 1099-DIV because you don’t have any other bank accounts.
The IRS doesn’t know this. The IRS only knows that you didn’t get any other 1099-DIVs after they’ve received all 1099-DIVs and no more are yours.
If they then receive more information later that would affect your taxes, they can bill you, or otherwise just go through the same process they would if you filed your taxes incorrectly under the current system.
1. Move up the deadline for companies to submit tax information to the IRS, or
2. Allow taxpayers to declare that the IRS will not receive any more tax information than what they already have, with penalties for lying (presumably, the same penalties as what happens today if you submit your taxes early and you yourself haven't received all the relevant information yet).
Or we could just pay the one-time hit of "you can't get your refund early" and have the IRS process taxes once the existing deadline has passed for companies submitting tax information to the IRS. I say one-time hit because after the first time, any refunds for following years would occur 1 year after the previous year's refund, just like it does today, it would just be at a different point in the year (assuming you even submitted taxes early to begin with; if you didn't, then no change).
#2 - Probably the best solution, though kind of waters down the revolution.
#3 - Probably what SHOULD happen, but again, political suicide.
Moreover, if you set up all yoyr withholdings correctly then you do not need to file anything. You only need to file if you owe (ie you set up withholding wrong) or want yoyr money back (ie your withholding was wrong)