{"id":650,"date":"2011-01-27T10:30:06","date_gmt":"2011-01-27T15:30:06","guid":{"rendered":"http:\/\/www3.law.harvard.edu\/journals\/hlpr\/?p=650"},"modified":"2015-10-02T15:59:28","modified_gmt":"2015-10-02T15:59:28","slug":"more-fun-with-taxes","status":"publish","type":"post","link":"https:\/\/journals.law.harvard.edu\/lpr\/2011\/01\/27\/more-fun-with-taxes\/","title":{"rendered":"More Fun with Taxes"},"content":{"rendered":"

Zach Luck<\/em><\/p>\n

Imagine you are in charge of an enterprise that has to process over 140 million forms each year. \u00a0Each form, on paper, costs about $2.87 to process. \u00a0Wait, you say, it is the 21st century and computers might not be a passing fad \u2014 shouldn\u2019t there be a way to process the form electronically at some lower cost? \u00a0Very astute. \u00a0It turns out that there is, and it will cost you about 35 cents to process each electronic version.<\/p>\n

Obviously, you would decide that it should be entirely free to mail in the forms on paper and cost money to submit electronically, right? \u00a0(Oh, with an important exception that turning in the form electronically must be free for anyone who makes less than around $58,000 a year.)<\/p>\n

<\/p>\n

Would you use your website to distribute, for free, forms which can be turned in by mail, but offer no method on your website for turning in the same forms electronically? People who want to send you an electronic form can use third-party services (some of which might be free, and most of which will use the opportunity to advertise additional products to a captive audience).<\/p>\n

Ok, maybe this is not what you\u2019d do. \u00a0But it is what the IRS does each year when it faces\u00a0this seemingly obvious choice<\/a>.<\/p>\n

So why doesn\u2019t the IRS make it free and easy for everyone to file from their website? \u00a0Why do they instead\u00a0link out to private firms,<\/a>\u00a0waiting with\u00a0offers for costly upsells<\/a>? \u00a0The simple answer is\u00a0effective lobbying<\/a>\u00a0by the tax preparation<\/a>\u00a0industry. \u00a0Consumers pay tax preparation companies\u00a0billions<\/a>\u00a0of\u00a0dollars<\/a>\u00a0each year to do something which the government could\u00a0save money<\/em>\u00a0by helping us do ourselves.<\/p>\n

The closest thing to an online tax return the IRS offers is a link to \u201cFree Fillable Forms<\/a>\u201d which provides as little help filling out your taxes as possible (including, for example, not filling in this year\u2019s standard deduction for you) combined with seemingly endless warnings to scare away consumers.<\/p>\n

Tax preparation industry lobbying probably also prevents the IRS from\u00a0moving towards<\/a>\u00a0actually filling out most of our tax returns for us<\/a>. \u00a0That said, the promised land of self-filling tax returns seems particularly far away if we can\u2019t even get government to provide an easily accessible online filing system.<\/p>\n

The company that makes Turbo Tax \u00a0argues that\u00a0government faces a conflict of interest<\/a>\u00a0if it assists individuals in preparing their taxes with helpful online forms. \u00a0While the \u201cbig brother\u201d fear the IRS will \u201cwatch your keystrokes<\/a>\u201d might seem scary, one need only remember that the government would not require anyone to fill anything out on their website. \u00a0Instead, the IRS should simply offer a freely-available bureaucracy-built competitor to private companies. \u00a0But we\u2019ve already learned that the public and the private sector, must\u00a0never<\/a>,\u00a0ever<\/a>\u00a0compete<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Zach Luck Imagine you are in charge of an enterprise that has to process over 140 million forms each year. […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[2],"tags":[],"class_list":["post-650","post","type-post","status-publish","format-standard","hentry","category-blog"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/peZQka-au","_links":{"self":[{"href":"https:\/\/journals.law.harvard.edu\/lpr\/wp-json\/wp\/v2\/posts\/650","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/journals.law.harvard.edu\/lpr\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/journals.law.harvard.edu\/lpr\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/journals.law.harvard.edu\/lpr\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/journals.law.harvard.edu\/lpr\/wp-json\/wp\/v2\/comments?post=650"}],"version-history":[{"count":0,"href":"https:\/\/journals.law.harvard.edu\/lpr\/wp-json\/wp\/v2\/posts\/650\/revisions"}],"wp:attachment":[{"href":"https:\/\/journals.law.harvard.edu\/lpr\/wp-json\/wp\/v2\/media?parent=650"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/journals.law.harvard.edu\/lpr\/wp-json\/wp\/v2\/categories?post=650"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/journals.law.harvard.edu\/lpr\/wp-json\/wp\/v2\/tags?post=650"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}