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Government Software The Almighty Buck Politics

Intuit Still Fighting Government Tax Software 374

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."
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Intuit Still Fighting Government Tax Software

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  • by OhHellWithIt ( 756826 ) * on Monday August 02, 2010 @02:47PM (#33114562) Journal

    Virginia used to have a web-based filing program, iFile. After successfully running the program for four or five years, the legislature voted to do away with it this year, even though I'm sure it had paid for itself and was generating significant cost savings for the state. The sad part to me is that most Virginians seemed to have been unaware of it, as I haven't found anyone else who is even remotely bothered by it. They already pay for Tax Cut or something like that. <sigh>

    • by jandrese ( 485 ) <kensama@vt.edu> on Monday August 02, 2010 @02:54PM (#33114678) Homepage Journal
      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!)
      • 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.

        I'm sure you don't want a recommendation for another pay program, but TaxAct really does well and costs a lot less than the other versions. I can't remember exact costs, but IIRC it was around $20-25 including e-filing fees for me to file both my Federal and State returns last year. And since they have an online/web-based version available, you can use it on a Linux system for those who don't have access to a Windows machine. Having never had the option at a state-provided program before, I really found

    • It seems to still be there: https://www.individual.tax.virginia.gov/VTOL/IndLogin.seam [virginia.gov]

      I can't actually try it because it's not tax time.

      I use tax software to do my federal, so going to a separate web site to do the state seems inefficient, but it might be a good idea for other people.

      Virginia even sent out a notice that it saves them beaucoup money when people use online tax filing. Unfortunately, they aren't willing to pay companies like Intuit or Kiplinger's so that the cost to the filer is zer
    • Re: (Score:3, Informative)

      by NukeDoggie ( 943265 )
      Yes the iFile saved the state of virginia millions of dollars. The removal of it will increase paper filing tremendously. They bribed(lobbied) our officials completely to remove it. It was fast free and easy, and it's gone now. There was only discussion by our local rag after the law was passed almost unanimously. Another example of corporate greed raiding the coffers in the name of "Helping" the poor...
    • I live in VA as well. Welcome to the Common Wealth, where Wealth is unCommon!
    • Nebraska has one as well, NebFile. Even though I buy turbotax for federal and it comes with one free state software, it does not include the state filing fee. So I let turbotax generate the state forms based on the federal then I re-key the data into the state web based form to file free. If the state eliminated the free web based filing I'd probably just snail mail the state forms. I usually get a federal refund and owe the state a few bucks.
    • Re: (Score:3, Insightful)

      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.
  • Huh?! (Score:5, Insightful)

    by therealkevinkretz ( 1585825 ) * on Monday August 02, 2010 @02:49PM (#33114578)
    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.
    • Comment removed (Score:4, Insightful)

      by account_deleted ( 4530225 ) * on Monday August 02, 2010 @03:02PM (#33114764)
      Comment removed based on user account deletion
      • by jythie ( 914043 )
        Because 'simple' systems are really easy to abuse? And planned economies tend to be more stable and have better long term growth then completely laissez-faire ones? As stated by others, private companies tend to do what is good for their own short term benefit... this is often at odds with what is good for the whole economy... thus the social engineering.
        • Re: (Score:3, Insightful)

          by CajunArson ( 465943 )

          Because 'simple' systems are really easy to abuse? And planned economies tend to be more stable and have better long term growth then completely laissez-faire ones?

          Answers to your questions:
          1. No --> and if it is really that difficult for you to understand how it's about a million times easier to abuse a tax system full of loopholes and ambiguities, I feel sorry for you.
          2. No:
          With your "planned" economy, you can either get a fun-filled central planner who gets rid of all those "evil" comp

        • Re: (Score:2, Insightful)

          Comment removed based on user account deletion
          • by jythie ( 914043 )
            Actually such systems are pretty easy to game, just make sure whatever you do does not count as 'income'. If you are getting a paycheck at a regular job things are pretty simple, but when your worth comes in from more complex sources it gets a lot murkier, which is where other types of taxes kick in. As for social engineering... corporations are made up of people.
          • Re:Huh?! (Score:5, Interesting)

            by ckaminski ( 82854 ) <slashdot-nospam.darthcoder@com> on Monday August 02, 2010 @03:38PM (#33115298) Homepage
            www.fairtax.org.
            • Re:Huh?! (Score:5, Insightful)

              by Anonymous Coward on Monday August 02, 2010 @04:53PM (#33116524)

              Here's the problem with a Sales Tax based solution...

              I buy expensive shoes when I can afford it. I spend, say $100. That $100 buys me a good pair of shoes that lasts me maybe 2 years.

              The guy one income bracket down buys the cheap shoes because he never has $100 cash on hand. He spends the $20 he has to get a passable pair of shoes. In those 2 years he replaces them 8 times.

              In two years he has spent and been taxed on $160, I have spent and been taxed on $100. This is not because he *likes* his $20 shoes, it's not because he's simply being short-sighted. It's because he simply doesn't have $100 to spend all at once on shoes.

              Now, apply this same concept to any commodity or property you like. The Sales Tax based solutions *always* favor the rich who have far greater latitude to manage their money into tax-free ventures just by virtue of having more of it at any given time.

              • Re: (Score:3, Informative)

                by selven ( 1556643 )

                That's not really a problem with sales tax, it's a problem with any tax. A 25% sales tax is equivalent to a flat 20% income tax in every way - with a 25% sales tax the guy's paying $40 in taxes while you're paying $25, and with an income tax the guy has to earn $200 for his $160 while you earn $125 for your $100. No matter which tax you create, if it's evenly applied it's going to magnify the real world. The solution for income taxes is that you can make the progressive, so the guy is paying $25 in taxes on

              • Re: (Score:3, Insightful)

                by jwhitener ( 198343 )

                It's even more simple than that. Poor people spend a much higher percent of their income than the rich. Typically, the poor spend 100% of their income. That alone makes it easy to see that a sales tax approach would tax, as a percent of income, the poor, much more than the rich.

              • Re: (Score:3, Interesting)

                by sac13 ( 870194 )

                Here's the problem with a Sales Tax based solution...

                I buy expensive shoes when I can afford it. I spend, say $100. That $100 buys me a good pair of shoes that lasts me maybe 2 years.

                The guy one income bracket down buys the cheap shoes because he never has $100 cash on hand. He spends the $20 he has to get a passable pair of shoes. In those 2 years he replaces them 8 times.

                In two years he has spent and been taxed on $160, I have spent and been taxed on $100. This is not because he *likes* his $20 shoes, it's not because he's simply being short-sighted. It's because he simply doesn't have $100 to spend all at once on shoes.

                Now, apply this same concept to any commodity or property you like. The Sales Tax based solutions *always* favor the rich who have far greater latitude to manage their money into tax-free ventures just by virtue of having more of it at any given time.

                That's not a problem with a sales tax based system. That's a market situation in which you pay more for quality up front, but less in the long run.

                And, with the current system, you're paying the taxes anyway. They're just hidden in the price of the shoes. By removing the income tax component of the price, the price goes down and the consumption tax is paid on the lower price. You spend the same money, you just actually see what the two components (the cost to make them and the tax) are on your receipt n

            • Re:Huh?! (Score:4, Informative)

              by williamhb ( 758070 ) on Tuesday August 03, 2010 @01:24AM (#33120218) Journal

              www.fairtax.org.

              A famously broken model. There's an old saying: if you are an ordinary person who buys a football club's shirt as a souvenir, you pay 23% extra in sales tax; if you are a billionaire who buys a football club as a souvenir, you don't. But unlike today, that discriminatory sales tax the whole basis of "fairtax"'s proposed tax system -- the billionaire never needs to worry about corporation tax, CGT, or anything else ever taking a dime from his pocket. Meanwhile, there is already a long history of people pushing purchases through companies (turning them into fringe benefits) to avoid paying tax, and "fairtax.org"s proposals are even more open to that kind of rorting. Personal cars are taxed at increased rates; but company cars are 100% tax-free. Guess what happens to the number of companies providing their employees company cars "for business reasons"? And as everybody floods through the loopholes, the tax base moves to punishing only those who companies give the least tax-avoidance help to: ie, the poor, the unemployed, and the retired.

      • Not everyone receives a W-2. Also, there's income from other sources, interest, stocks, dividends, tips, etc. But I do agree it could be a lot simpler.
        • More people get W-2s than get 1099s though.

          Still, we're only talking about TWO forms now and a calculator.

          My mother is a CPA, she has an original copy of the first tax return form. Form AND instructions fit on the two sides of an 8.5x11 piece of paper.

          So much as a 1040EZ takes around 4 pages for the form itself today, and the instructions another dozen.

      • by MDillenbeck ( 1739920 ) on Monday August 02, 2010 @03:46PM (#33115462)

        Flat tax sounds like a good idea. You have two people, one makes $200,000 a month and one makes $1000 a month. Both should be taxed at a flat rate - let say 10% - so the first pays $20,000 in taxes while the other pays $100 in taxes. Fair, right?

        Okay, let say the cost of living (minimal housing, basic food staples for cooking, basic transportation because in the USA there are very few total basic services walking communities, etc) comes out to about 20% of income with a minimum cost of living of $950. Thus the first individual he pays the greater of $40,000 or $950, while the second pays the greater of $200 or $950.

        Thus, the first individual has a net income of $140,000 a month while the second has a net income of -$50 a month. This means something has to give - don't eat, don't have basic shelter, or don't have transportation for work. In other words, a flat tax is a detriment to those who are in poverty - and to say that those below a certain income threshold do not need to pay income tax is merely implementing a very simple progressive tax (0% up to the poverty line, 10% above the poverty line).

        This is not some theoretical discussion either. When growing up my mother was our sole source of income, and as such she constantly had to make the decision between paying the rent, buying basic food staples, or having transportation to work. Even after she finally divorced my father and was able to cut out his useless spending she still faced this decision all the time. Pardon my graphic description but even with a slipped disk she would opt to walk what should have been a 30 minute bus commute because she wanted feed and shelter her children - despite the pain being so great that she'd soil herself and have her s**t running down by the time she'd get to work. Her friends said she could work miracles with flour, and I still remember going and picking wild berries and living off them for a week. Until she was divorced, evictions were a semi-annual to annual event because she needed to feed us.

        However, despite our poverty, I realize we were far from the bottom of the heap. My mom still worked hard despite all the pain to feed and shelter us, so we never had to be exposed to the dangerous winter lows that caused her so much hardship or go without food for more than a couple of days at a time.

        So, no, a simple percentage based tax income is something beyond silly - is is criminally inhumane

      • by sjbe ( 173966 ) on Monday August 02, 2010 @04:40PM (#33116326)

        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.

        • Re: (Score:3, Interesting)

          It's only complicated because we differentiate between different types of income. If the tax code were written such that you took this year's net worth and subtracted last year's net worth, the difference could be called income, and for something like 99% of the people it would be laughably easy to calculate (we would need some type of depreciation table for homes and cars, perhaps a few other valuable items, or just exempt one house and one or two cars per household). Lop off the first $20,000 or so (in
    • Re:Huh?! (Score:5, Insightful)

      by elrous0 ( 869638 ) * on Monday August 02, 2010 @03:04PM (#33114800)

      The tax code is so complicated because there is a legacy of decades of politicians finessing it to raise needed taxes without LOOKING like they're raising taxes (or restricting raises in such as way as to exclude most voters). Add to this the fact that this is happening on at least *two* levels (federal and state, and sometimes even city and/or county) and you end up with an almost hopelessly complex system.

      Politicians are too cowardly to just come forward and say "We need to raise income taxes, because of X, Y, and Z" so they quietly sneak in shit like "A 2% business tax increase for fishing businesses earning over $100,000 a year with 12 or more employees." Repeat this over decades and you get a tax code that reads like the source code of Windows Vista.

    • Re: (Score:2, Insightful)

      by QuantumRiff ( 120817 )

      Its even worse than that.. Our government is the only organization I have ever heard of that refuses to tell you how much you owe!

      Could you imagine if you went to buy a car, and the ford dealership gave you the keys, then told you to submit payment, but never told you the price of the car? Especially if they threatened to come after you with the Police and lock you up for not paying correctly?

      Fairtax all the way. I find it silly that we have to hire people to tell us how much we owe....

      • Re:Huh?! (Score:5, Insightful)

        by Red Flayer ( 890720 ) on Monday August 02, 2010 @03:50PM (#33115538) Journal

        Its even worse than that.. Our government is the only organization I have ever heard of that refuses to tell you how much you owe!

        They don't refuse to do that. They just allow you to calculate it yourself.

        You can always ask the IRS to calculate your tax for you... they'll be glad to do so, as long as you make an estimated payment of net taxes due at filing time.

        Seriously, where do you wingnuts get your "facts" from? A cracker-jack box?

        I find it silly that we have to hire people to tell us how much we owe....

        If you need to hire someone to calculate how much you owe, you must be stupid. It's ridiculously easy, you just need to follow some instructions. What's silly is that so many people are so bad at basic arithmetic and language that they can't follow a form that was written to a seventh-grade level.

        And yes, I've been self-employed and received a W2 in the same year, along with capital gains tax due. It's not hard. It takes some time. People pay others to do it because it's convenient, or because they have an irrational fear of forms and numbers.

        I won't comment on fairtax, arguing about it with you would be a waste of time. But the reason you cite... it's just false.

      • Re:Huh?! (Score:4, Insightful)

        by Anonymous Coward on Monday August 02, 2010 @04:12PM (#33115870)

        Our government is the only organization I have ever heard of that refuses to tell you how much you owe!

        I take it you've never tried to get a price check on a medical procedure before.

      • Re:Huh?! (Score:4, Informative)

        by Red Flayer ( 890720 ) on Monday August 02, 2010 @04:18PM (#33115968) Journal
        Ok, I'll respond without insulting you, since apparently a moderator decided I was trolling -- and it's important that people know the truth.

        Its even worse than that.. Our government is the only organization I have ever heard of that refuses to tell you how much you owe!

        This is a falsehood. The IRS will calculate your taxes for you, you just need to provide the necessary data (since they don't collect it as a matter of course).

        If you choose, you can report a minimum of data, and though you will miss out on some deductions/credits, you don't have to perform a single calculation.

        Claiming that the government refuses to tell you how much you owe is a falsehood.

    • Re:Huh?! (Score:5, Insightful)

      by Nadaka ( 224565 ) on Monday August 02, 2010 @03:13PM (#33114936)

      People are second class citizens in America because the amount of money and votes they can contribute to a politician is severely limited.

      Corporations are first class citizens in America because it is a violation of human free speech rights for non-humans to have limited ability to bribe..., I mean donate to the campaign of, politicians.

      Welcome to Feudal Corporatist America.

      • Re: (Score:2, Insightful)

        Comment removed based on user account deletion
        • Re: (Score:3, Informative)

          by Nadaka ( 224565 )

          Corporations are first class citizens in America because it is a violation of human free speech rights for non-humans to have limited ability to bribe..., I mean donate to the campaign of, politicians.

          Corporations can't donate to political campaigns but why let the truth get in the way of your talking points?

          http://www.pbs.org/newshour/bb/law/jan-june10/supremecourt_01-21.html

          Don't let checking the facts of your statements get in the way of what you think is the truth. Its ok, sometimes I do that myself.

          • Re: (Score:2, Informative)

            Comment removed based on user account deletion
            • Re: (Score:3, Insightful)

              I know it's hard for you to understand, but there is a difference between being able to say "Barack Obama kicks puppies" and writing a check to Barack Obama's opponent

              That's right. One has to be reported by the candidate and the other is an end-run around our political system.
            • Re: (Score:3, Insightful)

              It did not say that they can donate money to political campaigns. They can print fliers, buy TV/radio advertisements, take out newspaper ads, etc.

              You do realize that the largest chunk of campaign money goes to publicity? I.e., printing fliers, buying TV/radio advertisements, taking out newspapers ads, etc.

              In other words, contributing to a campaign and buying publicity for a campaign is damn near identical. The only difference is who approves the ad. And even that's debatable.

              Seriously? You fail to understand that?

        • Re: (Score:3, Informative)

          by ckaminski ( 82854 )
          Actually, they can. They are limited however, just as every other American is.

          However, they CAN spend money on their candidates behalf, without contributing directly to a campaign.

          http://www.nytimes.com/2010/01/22/us/politics/22donate.html
    • Re:Huh?! (Score:5, Insightful)

      by PopeRatzo ( 965947 ) * on Monday August 02, 2010 @03:45PM (#33115440) Journal

      A tax code is so confusing and complicated

      Yet most people with an eighth-grade education can manage to fill out their 1040-EZ without hiring H&R Block.

      Unless you have racehorses (you wouldn't believe the tax law regarding owning race horses) the majority of people manage to file without problems.

      The complications in the tax law come from business and tax lawyers, who each have their own agenda. I'm sure the government would be happy to say "give us 35%, period", but then the oil lobby wouldn't get their subsidies and the home builders' lobby wouldn't have their products artificially valued, and the religious wouldn't be able to punish single people or homosexuals, and Churches wouldn't have their collections subsidized by the government, etc etc.

      If you've ever looked at the 25+ volume set of the Revenue Act and IRS Code, you'd see that most of the complications come from loopholes, exceptions and deductions rather than from diabolical ways to squeeze more taxes out of people.

      But knowing that spoils the fun of believing the FUD about how Americans are getting "taxed to death" and how it's "nearly impossible" for a normal person to file their own taxes.

  • by maillemaker ( 924053 ) on Monday August 02, 2010 @02:50PM (#33114592)

    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.

    • Re: (Score:3, Interesting)

      In theory, you'd think this would be the case. In practice, most people filing on April 15th are filing to get their money back, not send money in.

      There are actually no incentives for governments to make it easier for taxpayers to get refunds. Taxpayers can create those incentives by reducing their withholdings to $0 so that they owe the government on April 15th rather than the other way around. Given California's problems, that seems like a pretty good idea anyway. [mymoneyblog.com]

      • Re: (Score:3, Informative)

        by jythie ( 914043 )
        Actually, that is illegal. Under reporting your withholdings can get you into trouble since you are required to be paying your income tax gradually during the year.
        • you have the option of setting it to zero and paying quarterly.
          That's what I've started doing to California since my last refund was several months late.
          -nB

        • Re: (Score:3, Informative)

          It won't get you "into trouble", but you may owe a 10% penalty on the underreported taxes if the amount is large enough.
    • 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.

      I'd have to ask my wife what website she uses... She always does our taxes...

      But we always do them on-line. For free. We have no trouble, usually have them filed well ahead of time, usually get whatever refund may be coming before other folks have even filed their taxes.

    • by jythie ( 914043 )
      Well, at least it is a consistent scam. Our whole legal system is built that way... you need a 3rd party expert in order to actually utilize the system.... sometimes you are not even allowed to access it yourself. Even worse, in criminal cases, your opponent (the prosecutor) has all their expenses paid for them by the taxpayer, but the defendant has to out of pocket everything themselves.
    • The Government website is slightly clunky but yes, it works. It's a pity the last Government tried to make the system too big and intrusive (Government of anal retentive Stalinists, I'm afraid) because some of the automation projects were very good - like the link between passports and driving licences, which worked perfectly when I had to renew one and change the other, and the car tax system which checks your documents on-line.

      It also means that British accounting systems have to be really good because th

    • Whenever you say "the government" should do something, you need to replace "the government" with "the government should take something from me/my family/my neighbors" .

      The government is not some entity separate from yourself, it acts using YOUR assets and its rules affect YOU.

    • by LWATCDR ( 28044 )

      "The government made the convoluted tax system - they should make the web-based application to navigate it."
      Except that the "government" aka you the tax payer will be the one to pay for that system.
      Do you think that the government can pay the development cheaper than just letting you choose to buy Turbo Tax?
      In this case it is already written so the money has been spent.

      And not everybody needs to buy or really use tax prep software. If you need help with a 1040EZ you just need help with everything.
      I am sure

  • And here we see why we'll never have a simplified tax code. Or any kind of reform in this area. The military/industrial (IRS/Tax preparers) complex has grown out of control.

  • by 2obvious4u ( 871996 ) on Monday August 02, 2010 @02:55PM (#33114690)
    Stuff like this is why a program like the "Fair Tax" won't ever pass. There is nearly a 400 Billion dollar tax preparation industry. They would all be out of work if something like the fair tax ever passed, so not only are we stuck paying income tax we have to pay for all those tax services and tax lawyers that go with it. Intuit is part of the problem, not part of the solution, they are making your life harder not easier.
    • Intuit is making money OFF of the problem. Put the blame where it belongs; on the lying politicians and the apathetic public.
    • by wjousts ( 1529427 ) on Monday August 02, 2010 @03:12PM (#33114910)
      No, "Fair Tax" won't pass because it is anything but fair.
    • by frank_adrian314159 ( 469671 ) on Monday August 02, 2010 @03:13PM (#33114932) Homepage

      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).

      • Re: (Score:3, Insightful)

        Comment removed based on user account deletion
        • by Mongoose Disciple ( 722373 ) on Monday August 02, 2010 @03:52PM (#33115556)

          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.

        • Re: (Score:3, Insightful)

          by kindbud ( 90044 )

          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

        • by joggle ( 594025 ) on Monday August 02, 2010 @04:14PM (#33115908) Homepage Journal

          Do you know what proportion of the population payed the federal income tax when it was reintroduced in 1913? Or a couple of years after that? It has moderated a lot over the years, early on only the very rich had to pay the tax.

          In fact, when it was first passed they didn't even consider having everyone pay the same rate (or pay at all). One of the more extreme senators I could find (quickly) who supported your position (having everyone pay) would only go this far:

          (Senator) Lodge did not attack the essential idea of the income tax. Such a tax, he said, was well fitted to distribute equally the burdens of Government upon those best able to bear them. The viciousness of the Democratic bill, he said, lay in its exemptions from all burdens of the great middle class. Instead of exempting all incomes of less than $4,000, he said, he would rather see an impost like that suggested by Mr. McCumber of North Dakota, which proposed a tax of one-tenth of 1 per cent. on incomes of $1,000, with gradual increases of rates as the income increased. In that way, said Mr. Lodge, practically every citizen would feel that he had a share in the Government, as well as a personal interest in its economic administration.

          That was in August, 1913 (from http://query.nytimes.com/gst/abstract.html?res=9A02E7DC113CE633A2575AC2A96E9C946296D6CF&scp=3&sq=income+tax&st=p [nytimes.com]). At that time the average annual income rate was a little over $700 (in 1913 dollars, which is obviously what he was referring to in the quote). So even this senator was only proposing to include the middle class rather than relying solely on the rich, and only adding a very slight tax on the middle class. He didn't even consider levying the tax on the poor.

        • by langelgjm ( 860756 ) on Monday August 02, 2010 @04:34PM (#33116232) Journal

          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.

          They pay no income tax, they pay plenty of other taxes: sales taxes, excise taxes on fuel, etc. And those make up a much larger percentage of their income than for wealthy people. And when you're talking about very high income individuals, they are earning more through capital gains and other sources taxed at lower rates than the upper income tax brackets anyway, than through income subject to the income tax (and FICA tax for that matter).

      • Actually,
        A bit of anarchy would likely be healthy for the US about now.
        Might get to re-build a saner government from the ashes...

      • Re: (Score:3, Informative)

        by Anonymous Coward

        Have you actually READ the FairTax languange? You might want to start at http://www.fairtax.org

        FairTax is a truly FAIR system. YOU, the taxpayer, control both HOW MUCH tax you pay and WHEN you pay it.

        The prebate that included takes care of argument about taxing food and essential services up to the poverty line (wherever that gets set at). The argument about the "percentage of disposable income"...

        1) The overall percentage of income paid would go DOWN dramatically for the majority -- and EVERYONE pays.

    • Stuff like this is why a program like the "Fair Tax" won't ever pass. There is nearly a 400 Billion dollar tax preparation industry.

      That's staggering if true; $400 billion is ~2.5% of the US GDP. Are you sure about that? 400 million maybe?

      • by vlm ( 69642 )

        That's staggering if true; $400 billion is ~2.5% of the US GDP. Are you sure about that? 400 million maybe?

        400 million would only fund a one million dollar tax department at the 400 largest companies. 1/5 of the fortune 500 would have to wing it. A million dollar budget doesn't hire as many people as you'd think, especially with management bonuses, etc. Somehow, I'm not imagining GMs tax department as being 5 people and a supervisor.

        I would not be surprised, in the least, were the cost of collecting the dough equal to $1 out of every $50 raised.

  • This is more government of, by, and for the corporation. Bring on the National Sales Tax of 18%. Try evading that you shady fuckers.
  • I'm under the impression elsewhere that tax forms are filled out by the government treasury and sent to the person who then can read it and modify and correct for things unreported. The idea that taxes need to be a guessing game for individuals is kind of crazy and perpetuated by companies like Intuit because this is their bread + butter.

    And besides, these tax software companies often have a harsh software business model. I'm not entirely sure anyone should defend them.

    • by 0123456 ( 636235 )

      I'm under the impression elsewhere that tax forms are filled out by the government treasury and sent to the person who then can read it and modify and correct for things unreported.

      Certainly not in Britain or Canada, I can't vouch for anywhere else.

  • by johnhp ( 1807490 ) on Monday August 02, 2010 @03:00PM (#33114742)
    I read that as "Inuit still fighting tax software" and had prepared myself for an amazing story of Eskimo software standards. Imagine my disappointment.
    • You are not alone. I had a long, confused minute before I realized that they were talking about the company behind Turbo Tax.

  • 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.

    In all fairness, spending cuts, especially with regards to the police and fire department funding situation in California, are far from uncontroversial. There are definitely major pension shortfalls right now because of generally unrealistic expectations for growth in these pension plans being compounded by the market crash. A standar

  • The real WTF (Score:5, Insightful)

    by Korin43 ( 881732 ) on Monday August 02, 2010 @03:05PM (#33114812) Homepage

    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?

    • Re:The real WTF (Score:5, Insightful)

      by wjousts ( 1529427 ) on Monday August 02, 2010 @03:15PM (#33114990)

      RTFA, or even the summary. They are not in the same bill. Republicans decided to withhold their votes on a bunch of unrelated bills because they didn't get their way on this one bill.

      I believe they call it bi-partisanship. Everybody else would call it "my way or the highway".

    • Re: (Score:3, Insightful)

      Shouldn't you ask the opposite? I.e., what was "killing the tax program" doing in bills funding "domestic violence shelters, police and fire departments, and prevention of swine flu outbreaks"?

      • Re:The real WTF (Score:5, Informative)

        by TubeSteak ( 669689 ) on Monday August 02, 2010 @04:06PM (#33115784) Journal

        I.e., what was "killing the tax program" doing in bills funding "domestic violence shelters, police and fire departments, and prevention of swine flu outbreaks"?

        Neither you not the GP understood what TFA was saying.
        The Rs held 20 bills hostage in an attempt to force Dems to kill ReadyReturn and CalFile.
        Democrats said "fuck you," so California Republicans killed the hostages.

        Since Obama & the Dems rolled into office, Republicans have been doing a lot of hostage taking on both the local and national level.

  • Make the cost of tax software a credit instead of a deduction. Everyone likes corporate welfare and gratis software. Then, problem solved.

  • Intuit goes out of their way to make things difficult, here is my experience asking about Quicken for Linux:
    http://dotancohen.com/eng/quicken_on_linux.html [dotancohen.com]

    After that experience, I'm actually not so sure that I do want to use their software.

  • This is not politics. It is corruption at its worst. It's time to create laws that severely slam those who would use our governmental systems for financial purposes. Get rid of lobbyists.

  • This is why USA is dying. WE make are money off pushing bits of paper around and never actually DO anything.

    Honestly if our Forefathers we're here to see us today they'd be ashamed. In their day, they would have long ago strung up these politicians in Liberty Trees and been done with 'em.

  • The biggest problem (Score:3, Informative)

    by phantomfive ( 622387 ) on Monday August 02, 2010 @03:18PM (#33115032) Journal
    A lot of people hate big corporations and 'the man' for rather mindless reasons, and others blame 'big government,' but their understanding isn't nuanced enough to see the real problem.

    The real problem is when corporations get special favors from the government. A large, evil corporation will be limited by market forces and legality (it's illegal to kill, illegal to ruin the environment, etc), but when a company gets special favors from the government it distorts market forces and can get around the force of legality. This happens all the time, and its why companies lobby in the first place. Right now it is easy to get put on a board if a company if you have strong 'political connections,' but if politicians didn't bow to this pressure, that wouldn't happen because those connections would be worthless.

    Intuit is just the most vocal right now. Another case in California was portable building manufacturers lobbying to make a law that schools need to buy (ugly) portable buildings. Another case was some internet dating company whose entire business model was based on doing background checks for people dating online lobbying to make background checks required by law. Fortunately that one failed.

    Fannie May and Freddie Mac are other examples of when this goes wrong. They are private companies whose risk is taken by the public. There is nothing wrong with the goal of helping poor people get houses, but that isn't what Fannie and Freddie have been doing primarily. Banks of course do their lobbying. And lawyers are among the worst: Attorney Generals have their pay-to-play schemes [google.com] set up all over the country.

    Because of how this distorts the market, if it all got cleaned up, it would easily add 5% to the GDP. The rent-seekers would suffer a bit, but let them go do something productive.
  • s/WE make are/We make our/

  • The right-wing thinking seems to be that since businesses bring in money -- which is A Good Thing -- then anything a business does or wants must therefore be good. I'm not sure what a political system run by businesses (or at least unduly influenced by businesses) is called but we can summarise it with the acronym USA.
  • An inefficient system is a boon for those who benefit from helping people manage the inefficiency. Make the system more efficient and they lose. Sometimes they revolt as did the Piemen of Erie [robweir.com].
  • Form 1040 EEZ
    == == == ==

    Instructions: Fill in the form. Send payment in the amount listed in the final cell to

            Department of the Treasury
            Internal Revenue Service
            Fresno, CA 93888-0102

      == == == ==

    What was your total income last year? $__________.___

    /not entirely original with me

  • by TheNarrator ( 200498 ) on Monday August 02, 2010 @03:27PM (#33115136)

    in the classic Collapse Of Complex Societies, Joseph A. Tainter theorizes that societies collapse when they hit a point at which increasing complexity creates negative returns. For instance, the Romans funded their society on plunder of outlying civilizations for a long time. Eventually, each incremental conquest required more and more funds to maintain while not providing enough real wealth in return. Similarly the Mayans collapsed because they farmed more and more marginal lands leading to soil degradation, etc. and tried to fix civil wars through more and more ostentatious temple building. Tainter, in his book profiles more than 20 different significant societies that all collapsed following this pattern in one form or another. He says the only solution is voluntary simplification, which has happened only a few times in history.

    Now here in California we have an actual complexity industry, with its own lobbyists! How long can that last when you have an actual industry that makes money off of negative returns on additional complexity.

  • I hate intuit, but I need quickbooks for my small business.

    Intuit sucks, quickbooks sucks. Sadly, I have not found an affordable alternative.

  • by Toonol ( 1057698 ) on Monday August 02, 2010 @04:30PM (#33116164)
    "but they did kill funding for domestic violence shelters, police and fire departments, and prevention of swine flu outbreaks."

    At least, through a perfect storm of corruption, it ended up that the Republicans acted fiscally responsible.

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