Residents of 12 states are eligible to participate if they meet certain criteria. But the agency’s plans have already met resistance from tax preparation companies.
So I’m an American expat living in Australia. Australia has had the option to file directly to ATO, electronically, longer than I’ve been here. (Google suggests since 1999? So, more than 20 years.) It’s an easy process if you have a straightforward tax return.
It never ceases to amaze me how far behind the rest of the world USA is in some things that just seem like really obvious solutions. Like… Why wouldn’t the IRS want to get tax returns filed directly from the tax payers, skipping the middleman? At least for simple returns. More simplicity, less confusion all around if they get everyone onto the same system. Less paper to wade through, by significantly reducing paper returns. Etc.
It just seems like such a no-brainer. But I guess that’s why it doesn’t work in the USA. >.<
A spokeswoman for Intuit, Tania Mercado, criticized the direct file project as a “half-baked solution” and a waste of taxpayer money.
Yeah, screw you. You shouldn’t have to pay to file your taxes. End of story.
waste of taxpayer money
The existence of Intuit as a company has wasted taxpayers (checks notes) $14.37 billion dollars.
Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington State and Wyoming are participating.
It’s a shame more aren’t participating but I can see the reasoning behind staged access and iterative improvement. The real pity is that data they’ve already got won’t be preloaded in this stage. It would have been the nail in the coffin for Intuit and other companies’ predatory practices on lower income folks, at least as they exist currently.
I know Tennessee has no income tax so maybe states with income tax would rather sit and watch first?
My understanding is that this program only applies to federal taxes, so I’m not sure that the particular state’s income tax laws will have much bearing on selection for participation or which stage of rollout they’re added with.
I see. I got nothing, then.
You’ll have to fill in a form to prove that, I’m afraid :)
Have a good day.
The article “conveniently” omits the names of pilot states and the eligibility criteria, so I dug them up:
The Direct File pilot is available to eligible taxpayers residing in Arizona, California, Florida, Massachusetts, New Hampshire, New York, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming.
You may be eligible to join the pilot if you live in a pilot state and report these items on your 2023 federal tax return:
Income
- W-2 wage income
- SSA-1099 Social Security and RRB -1099 railroad retirement income
- 1099-G Unemployment compensation
- 1099- INT Interest income of $1,500 or less
Credits
- Earned Income Tax Credit
- Child Tax Credit
- Credit for Other Dependents
Deductions
- Standard deduction
- Student loan interest
- Educator expenses
The pilot is not an option for if you:
- Have other types of income, such as gig economy or business income
- Itemize deductions
- Claim other credits like the Child and Dependent Care Credit, Saver’s Credit or the Premium Tax Credit
Here in Australia, you can literally file your tax now for free in a few clicks using the government website. If you wait a few weeks, everything for most people is prefilled except deductions
It’s absolutely awesome
Good. Fuck Intuit.
Couple decades too late is better than never.
A spokeswoman for Intuit, Tania Mercado, criticized the direct file project as a “half-baked solution” and a waste of taxpayer money. “The direct file scheme is a solution in search of a problem,”
That’s rich coming from a company that created a problem so they can sell their solution.
Either way, there are better software than Intuit, like FreeTaxUSA.
I liked that quote. Intuit being the biggest waste of money claiming direct filing is a waste of money. Like you said, FreeTaxUSA is at least reasonable.
Hard to argue that having a dozen companies developing IT software and systems to file taxes is more efficient them the organization that specifies the filing requirements do it once. The current system is more like a welfare program for the tax companies.
Finally. Intuit has been lobbying for years to keep this from happening.
Derrick Plummer, a spokesman for Intuit, said taxpayers can already file their taxes for free and there are online free-file programs available to some people. Individuals of all income levels can submit their returns for free via the mail.
A “direct-to-IRS e-file system is a solution in search of a problem, and that solution will unnecessarily cost taxpayers billions of dollars,” he said. “We will continue unapologetically advocating for American taxpayers and against a direct-to-IRS e-file system because it’s a bad idea.”
And who believes that crap anyway? Intuit markets their solution due to the complicated nature of anything outside of standard deductions and figuring out if you should itemize and how to do that.
Intuit has spent $25.6 million since 2006 on lobbying, H&R Block about $9.6 million and the conservative Americans for Tax Reform roughly $3 million.
Now if the states get on board for easy filing online, it’ll be great.
