Honestly, tax preparation outfits are scammers. The people there get only minimum training and have been shown to make as many mistakes as non-professional returns.
If you want to pay someone to do your taxes, hire an actual CPA. Or, just get TurboTax...
The conventional wisdom says that "taxes are too complicated." We're told that what we need is a simpler tax system, a fairer tax system, one that enables us to fill out our taxes on a postcard. What we need, in short, is a flat tax.
But the fact is that 75% of taxpayers don't even itemize. In addition to that, many, many, many people (me, you, &them) use super-easy programs like Turbo Tax.
So here's my question: do we really need tax simplification or is that just an excuse to give tax breaks (i.e., "flat tax") to people who don't really need them?
Part II of my question: aren't tax simplification and tax "fair-ification" two mutually exclusive concepts?
Well, many of us use things like TurboTax to make it easier but I usually spend 50 bucks or so for the Fed and state version. We are far from rich and I think that many people can't afford that. 50 bucks to spend to make sure your taxes are right to avoid penalties is a hefty price for many people.
I'm a big fan of the flat-tax.
do we really need tax simplification or is that just an excuse to give tax breaks (i.e., "flat tax") to people who don't really need them?
If the tax was a flat rate then those that don't need tax breaks like the super rich wouldn't be able to use loopholes to reduce their rate. There was a big hoo-ha last year about how JOhn and Teresa Kerry actually only paid like 18% because of loopholes and laws they were able to take advantage of. The people that can't do that are people like us in the middle. I can't afford to pay an accountant and I don't have enough money to hide or rename to avoid paying through the nose. They wrench every dime out of us that they can.
aren't tax simplification and tax "fair-ification" two mutually exclusive concepts?
Not really. If the flat tax was 20% the only thing left to do was to determine where that 20% started. Forbes' idea was that a family of 4 like I have wouldn't pay until after 36K. That would be the family of 4 deduction. After that boom pay the flat rate. That would reduce our taxes and many like us. The poor would pay any income tax at all and the super rich wouldn't have anywhere to hide the money.
You can't afford $50 for a tool that will save you hundreds, maybe thousands of dollars in taxes? I find that hard to believe.
the super rich wouldn't have anywhere to hide the money.
No, that's wishful thinking.
The problem with the flat tax is that it is a tax on wages whereas all the tax cuts and tax incentives are increasingly going to people with large amounts of passive income. That's why Kerry (and Bush) and Clinton (and Cheney) et. al. pay less in taxes ("18%") than you or I do.
Let's address that before we do anything else.
I'd be more willing to seriously consider a "flat tax" proposal that considered ALL revenue alike -- wages AND passive income.
You can't afford $50 for a tool that will save you hundreds, maybe thousands of dollars in taxes? I find that hard to believe.
I didn't say that, read what I wrote again. I said that we are far from rich but I spend it. I also said 50 bucks is a hefty price for many people that aren't we we are and we are far from rich. It's the little guys that get screwed and aren't able to take advantage of the loops and without TurboTax I wouldn't find them either. So people less fortunate than I could be missing out on tax incentives because they can't afford the 50 bucks. Also, I usually have to pay the State at the end of the year so spending 20 on a tax program and then having to fork over additional money to the State bites.
Actually, Bush and Cheney paid 35% according to the newspapers. I believe the Clinton's did too.
The flat tax considers all income not just wages. I haven't seen any proposal that said it was wages only.
"According to the Kerrys' own tax records, and they have not released all of them, the couple had a combined income of $6.8 million in income last year and paid $725,000 in income taxes. That means their effective tax rate was a whopping 12.8%.... "Under the current tax system the middle class pays far more than the Kerry tax rate. In fact, the average federal tax rate -- combined payroll and income tax -- for a middle-class family is closer to 20% or more. George W. and Laura Bush, who had an income one- tenth of the Kerrys', paid a tax rate of 30%.
What about freefile? The irs has been doing this for at least 2 years, as I've done it for the last few years. There are plenty of vendors out there supporting it in quite a few differnt demographic bases. I used it this year, and am doing my state manually, mainly becase I have a split state income this year. Several support free state and fed filing.
While Freefile seems to be targeted largely at the 'lower end' tax brackets (this isn't completely true, there are quite a few varied qualifiers, up and beyond the 50K mark, so..)
Anyone who can't afford the 20 or 50 bucks for software should be using this. Spend a couple hours at the local library if you dont have internet access at home, etc.
E-file/Freefile rocks, 10 days and I got my return.
If you want to pay someone to do your taxes, hire an actual CPA. Or, just get TurboTax...
The conventional wisdom says that "taxes are too complicated." We're told that what we need is a simpler tax system, a fairer tax system, one that enables us to fill out our taxes on a postcard. What we need, in short, is a flat tax.
But the fact is that 75% of taxpayers don't even itemize. In addition to that, many, many, many people (me, you, &them) use super-easy programs like Turbo Tax.
So here's my question: do we really need tax simplification or is that just an excuse to give tax breaks (i.e., "flat tax") to people who don't really need them?
Part II of my question: aren't tax simplification and tax "fair-ification" two mutually exclusive concepts?
I'm a big fan of the flat-tax.
do we really need tax simplification or is that just an excuse to give tax breaks (i.e., "flat tax") to people who don't really need them?
If the tax was a flat rate then those that don't need tax breaks like the super rich wouldn't be able to use loopholes to reduce their rate. There was a big hoo-ha last year about how JOhn and Teresa Kerry actually only paid like 18% because of loopholes and laws they were able to take advantage of. The people that can't do that are people like us in the middle. I can't afford to pay an accountant and I don't have enough money to hide or rename to avoid paying through the nose. They wrench every dime out of us that they can.
aren't tax simplification and tax "fair-ification" two mutually exclusive concepts?
Not really. If the flat tax was 20% the only thing left to do was to determine where that 20% started. Forbes' idea was that a family of 4 like I have wouldn't pay until after 36K. That would be the family of 4 deduction. After that boom pay the flat rate. That would reduce our taxes and many like us. The poor would pay any income tax at all and the super rich wouldn't have anywhere to hide the money.
You can't afford $50 for a tool that will save you hundreds, maybe thousands of dollars in taxes? I find that hard to believe.
the super rich wouldn't have anywhere to hide the money.
No, that's wishful thinking.
The problem with the flat tax is that it is a tax on wages whereas all the tax cuts and tax incentives are increasingly going to people with large amounts of passive income. That's why Kerry (and Bush) and Clinton (and Cheney) et. al. pay less in taxes ("18%") than you or I do.
Let's address that before we do anything else.
I'd be more willing to seriously consider a "flat tax" proposal that considered ALL revenue alike -- wages AND passive income.
I didn't say that, read what I wrote again. I said that we are far from rich but I spend it. I also said 50 bucks is a hefty price for many people that aren't we we are and we are far from rich. It's the little guys that get screwed and aren't able to take advantage of the loops and without TurboTax I wouldn't find them either. So people less fortunate than I could be missing out on tax incentives because they can't afford the 50 bucks. Also, I usually have to pay the State at the end of the year so spending 20 on a tax program and then having to fork over additional money to the State bites.
Actually, Bush and Cheney paid 35% according to the newspapers. I believe the Clinton's did too.
The flat tax considers all income not just wages. I haven't seen any proposal that said it was wages only.
"According to the Kerrys' own tax records, and they have not released all of them, the couple had a combined income of $6.8 million in income last year and paid $725,000 in income taxes. That means their effective tax rate was a whopping 12.8%.... "Under the current tax system the middle class pays far more than the Kerry tax rate. In fact, the average federal tax rate -- combined payroll and income tax -- for a middle-class family is closer to 20% or more. George W. and Laura Bush, who had an income one- tenth of the Kerrys', paid a tax rate of 30%.
Link here.
I used taxact (have for about 4 years now, first two I paid, last two have been free)
While Freefile seems to be targeted largely at the 'lower end' tax brackets (this isn't completely true, there are quite a few varied qualifiers, up and beyond the 50K mark, so..)
Anyone who can't afford the 20 or 50 bucks for software should be using this. Spend a couple hours at the local library if you dont have internet access at home, etc.
E-file/Freefile rocks, 10 days and I got my return.