On: TurboTax and H&R Block Saw Free Tax Filing as a Threat

[neya]

Can you give me a specific example of something that you think would be very complex? Just to make sure I'm not missing out on something obvious.

[tstrimple → neya]

Here's the spec. It's only 289 pages and changes almost every year. Good luck!

https://www.irs.gov/pub/irs-pdf/p17.pdf

[neya → tstrimple]

Thanks, so I did over-estimate my ability here. Where I live, taxation works differently, so I never assumed it would be this complex.

[jefftk → neya]

For what it's worth it's even worse than this, since I count 629 references to other IRS publications in that guide.

[_fq4v → neya]

You also need to take into account the fact that you will need to file a tax return in the state you live in, as well as every state you work in. If you're a consultant on the East Coast and have been to 15 different states, then you'll need to file a federal return plus a return in each of the 15 states that correctly allocates whatever income you earned while working in those states.

You're not doing this in a weekend, year, or decade, by yourself.

[OrgNet → neya]

Covering most of the population could possibly still be very easy

[inferiorhuman → tstrimple]

So I wrote my own payroll software a couple years ago. I knew full well in advance how complex it would be. I spent weeks digging into specs (both state and federal). I tried to validate everything. There were tests. I still got hassled by the IRS and FTB for getting things. The FTB was especially bad, but even the IRS isn't too keen to help out.

I'm still trying to figure out how to unwind the mess with California. I've just been hit with this warning (after trying to log in, being forced to change my password, and attempting to find the landing page):

You are about to leave the EDD's Employer Services Online website and will be taken to the EDD's Employer Services Online web page. The Employer Services Online web page will open in a new tab.

[cdolan → neya]

What country are you in that you think tax software can be written in a weekend?

Sorry if the tone of that sounds rude, I don’t know how to better word it, but from a US perspective, our taxes are way too broken for a 48-hour sprint to solve

[cglace → neya]

If you think it can be replicated in a weekend ask yourself why it hasn't, given the billions involved.

[ineedasername → neya]

I think someone has already mentioned just how long the tax code actually is. But there's also state taxes. That's another 50 systems to implement.

[jcranmer → ineedasername]

Don't forget the crazy complications of multi-state taxes. One year, I ran into the issue that one state (of which I was nonresident) wanted me to compute the state taxes of my state of residency before I could compute its taxes, while my resident state wanted me to compute nonresident state taxes first. I only broke the cycle by noticing that one of the extra schedules had listed in the instructions to use that schedule if you were trapped in said situation, but such information was not listed elsewhere in the instructions.

To be fair, though, I think my situation was the single worst possible pairing for multi-state tax situations.

[dataflow → jcranmer]

I do wonder what would've happened if both states had such schedules!