Taxes, taxes, taxes.

[Libertarian01]

I always use an accountant. Just like with any other profession their understanding of the law and intuition is beyond measure.

Consider that there is Indiana involved as well. That which may be completely irrelevant to the feds may be very pertinent to the state, for good or ill. What cannot be written off to the feds may well be written off to Indiana.

Always use an accountant, just like when charged with a crime always use a lawyer.

Regards,

Doug

 

[JettaKnight]

With all due respect, Doug, it shouldn't be that hard. Since everything gets reported to the fed and states, they should be able to send you a letter with everything filled in, you should only have to make changes if something is wrong. There's no good reason that someone with just a few W2's, kids, and student loan interest should have to pay TurboTax, or seek professional help, in order to pay the correct amount of taxes. There's no good reason that it should cost taxpayers over $11 billion just to administer tax collection.

At least that's how many 1st world countries do it.


California actually tried this, but were shut down by greedy tax software companies.




It's time for serious tax reform instead of just playing a shell game with the paperwork.

 

[HoughMade]

My wife did our taxes right up until the time I owned a piece of a law firm. I'm sure she still could, but she has enough to do.

...and me doing it is off the table. My job vis-'a-vis the family finances is to deposit checks in the bank.

 

[Libertarian01]

With all due respect, Doug, it shouldn't be that hard. Since everything gets reported to the fed and states, they should be able to send you a letter with everything filled in, you should only have to make changes if something is wrong. There's no good reason that someone with just a few W2's, kids, and student loan interest should have to pay TurboTax, or seek professional help, in order to pay the correct amount of taxes. There's no good reason that it should cost taxpayers over $11 billion just to administer tax collection.

At least that's how many 1st world countries do it.


California actually tried this, but were shut down by greedy tax software companies.




It's time for serious tax reform instead of just playing a shell game with the paperwork.

Oh, it is not that hard to PAY at all! If'n ya'll just want to ask what you owe and write the check, GREAT! They'll love that.

It isn't the paying what you owe where you need most of the professional help, it is the "getting all the rightoff's and benefits" that apply being where the accountant comes in.

People don't need that silly mortgage deduction, right? They don't need a rightoff for having kids and breeding, right? It isn't the figuring what you owe or don't that makes it hard, it's the rightoffs that make the professional worth while.

Just like going to court facing a criminal charge. We can all read the law, right? We can all bone up on rules of evidence. We can make an argument. It's easy.

Regards,

Doug

 

[DCR]

I've used 3 different accountants/CPAs over the years and had all 3 make mistakes. After back-to-back errors that came with a $600+ charge, I went to TurboTax for a few years, but cannot recall a mistake-free return with TT either. I'm now back to doing them myself, plus my mother's. I assume the cursing from mid-March to mid-April won't be any less than usual.

 

[JettaKnight]

Oh, it is not that hard to PAY at all! If'n ya'll just want to ask what you owe and write the check, GREAT! They'll love that.

It isn't the paying what you owe where you need most of the professional help, it is the "getting all the [write-offs] and benefits" that apply being where the accountant comes in.

If your accountant has you paying less than what you owe, then he's either incompetent or an unethical thief.

People don't need that silly mortgage deduction, right? They don't need a [write-off] for having kids and breeding, right? It isn't the figuring what you owe or don't that makes it hard, it's the [write-offs] that make the professional worth while.

The IRS knows exactly how many kids you have & what their ages are. They know how much interest you paid on your mortgage to the penny. (Never mind that with the standard deduction increase, far fewer Americans need/can take deductions like those.)

So why can't they send me a 1040 with that information filled in?

Seriously, it would cost them less (they don't need to print oodles of blank forms, instructions, hire tons of CSR personnel, etc.), it would cost taxpayers less time, there'd be far, far fewer 1040X filings. It'd help all those people that don't bother filing because they'd rather have a tooth pulled. I wouldn't have to spend Wednesday nights at a computer... The only loser I see is the tax preparer industrial complex - you know, the ones that lobby Congress to keep things complex to protect their profits.

I've used 3 different accountants/CPAs over the years and had all 3 make mistakes. After back-to-back errors that came with a $600+ charge, I went to TurboTax for a few years, but cannot recall a mistake-free return with TT either. I'm now back to doing them myself, plus my mother's. I assume the cursing from mid-March to mid-April won't be any less than usual.

Not surprising.

Take vehicle tax - you know, you pay for your registration and that's a tax so you should be able to write off all or part on schedule A. The trick is, there's a number of taxes and fees there and the method is not the same. I've talked to several tax preparers and one IRS agent - all gave me different answers.



Perhaps it's time schedule A goes in the garbage. We've come to expect that anything can be a write-off. I've had people come to me and say they bought a new water heater and want to write it off. Maybe, if you bought an uber-expensive one you can get a pittance back... but to want a deduction just for re-roofing? Come'on.

Just scrap deduction and lower the tax rate. With every 1040 I file, I become more of a flat tax supporter.

 

[Libertarian01]

If your accountant has you paying less than what you owe, then he's either incompetent or an unethical thief.

Really? Either incompetent or unethical thief? What I "owe." How is "what I owe" defined, please? If someone makes $Xk / year, do we just take their tax bracket and that is what they "owe?" Because that well may be what the .gov charges you - BEFORE deductions. Knowing that there are deductions that can be taken is one thing, know what many of them are is another.

My point was that what you "owe" isn't necessarily a simple or easy thing to calculate. Did you know that if a small business hires a convicted felon they qualify for a federal tax break to incentivize the hiring? If you don't know to ask for it, you're just a goober employer that gave a guy a break. The feds will say you "owe" $X before your accountant calculates the $X - $felon hire.

This is my biggest point, what you "owe" is a fluid number, legally speaking. Making a certain amount of money puts one in a certain tax bracket, so we start there. What comes after in deductions modifies the beginning number of what we "owe."

The IRS knows exactly how many kids you have & what their ages are. They know how much interest you paid on your mortgage to the penny. (Never mind that with the standard deduction increase, far fewer Americans need/can take deductions like those.)

So the IRS receives the death certificates of all the kids that died this year? And of course they are always updated with divorce papers, right? 827,261 divorces in 2016 per CDC, affecting 1,654,522 adults, and an unknown amount of kids. And naturally who gets custody of the kids is forwarded by every court in the US to the IRS. This becomes an issue because it is calculated two (2) entirely different ways for subsidies for the ACA and who gets to write them off for other tax purposes.

https://www.cdc.gov/nchs/fastats/marriage-divorce.htm

So why can't they send me a 1040 with that information filled in?

Seriously, it would cost them less (they don't need to print oodles of blank forms, instructions, hire tons of CSR personnel, etc.), it would cost taxpayers less time, there'd be far, far fewer 1040X filings. It'd help all those people that don't bother filing because they'd rather have a tooth pulled. I wouldn't have to spend Wednesday nights at a computer... The only loser I see is the tax preparer industrial complex - you know, the ones that lobby Congress to keep things complex to protect their profits.

I how the information that is to be filled in from the 1040 isn't presumed to come from a W2? There are over 15 million people that are contractors in the US that get 1099's. What was taken out? Were they provided any health insurance, because that affects subsidies from the ACA? Blah blah blah... Did they get divorced?

https://www.npr.org/2018/06/07/6178...independent-contractors-labor-department-says

Not surprising.

Take vehicle tax - you know, you pay for your registration and that's a tax so you should be able to write off all or part on schedule A. The trick is, there's a number of taxes and fees there and the method is not the same. I've talked to several tax preparers and one IRS agent - all gave me different answers.

Not surprising at all, nor is it necessarily inappropriate.

Consider that the tax code is so large that it cannot be counted.

https://www.politifact.com/missouri...-code-so-long-nobodys-really-sure-its-length/

It is over 2,400,000 million words on its own, or over 2,000 pages. This does not include the 60,000 pages of case law that has been built up around the bloody code in the first place.

Consider a college student who goes to school, they get a tax deduction for the "school expenses", right? This will be used to calculate that murky number we talked about in the beginning of what they "owe." Tuition is deductible, that is easy. So are books, mostly. What about notebooks that aren't textbooks? Deductible? Are you sure? What about if they join the track team and spend $300 on good running shoes? Deductible or no? But what if they're on a running scholarship? What is legal here? Easy to see how a professional opinion might differ.

Perhaps it's time schedule A goes in the garbage. We've come to expect that anything can be a write-off. I've had people come to me and say they bought a new water heater and want to write it off. Maybe, if you bought an uber-expensive one you can get a pittance back... but to want a deduction just for re-roofing? Come'on.

I agree entirely! The best, easiest route be a basic tax rate, very low, and no other write-offs. EVERY SINGLE CPA I have ever spoken with would love this! They do NOT like being in the tax side. They would all rather work with businesses and help entrepreneurs in their businesses. Note that all of these are entrepreneurs themselves, not the H&R Block folks. There is a mighty big difference between these folks perspectives.

Just scrap deduction and lower the tax rate. With every 1040 I file, I become more of a flat tax supporter.

Oh, the Utopian ideal! What a nice thought. It'll never happen, at least not until we kill all the lobbyists. Do away with the mortgage deduction and the contractors and realtors lobbyists will scream bloody murder about how this will kill jobs and tank the economy - as though no one would ever buy a home without a deduction. Try to do away with the education deduction. The colleges, universities, textbook printers all have lobbyists just sticking up for the kids to live the American dream, after dumping $50k on education, all tax deductible of course. You and I both know I could go on forever here. So long as there are lobbyists there will be tax deduction.

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I am not in any way trying to be offensive or rude, so I hope my response isn't taken as such. However, it is much more complicated than simple math. I do see it a lot being charged with a major crime, sad to say. How many lawyers would want to just cut a deal, and what deal? How many would take you to trial? What evidence would each focus on and why? What witnesses would they call, and what questions would be asked, and avoided?

In the latest Trump tax code for business owners, if you make widgets you can make any amount you want and get a tax rate. However, if your business depends upon your "knowledge and expertise" then the break is limited! After a certain amount, depending on married or single, the break stops and you pay more. Is there a way around this, legally? Sure there is, but it depends upon the situation.

I guess that if someone has an extremely simple life and nothing EVER changes and they know all their write-offs, then no accountant would be necessary. Except that even if their lives don't change the tax code does, and interpretations of the tax code are constantly winding their way through the courts.

One big change from Trump for businesses is that entertainment (ie. taking the clients fishing or golfing) can no longer be written off! If you feed them you can write off half - of the food so long as it isn't extravagant. If you rent a meeting room you can write off all of it. However, if the golf course where you took them to play does NOT break the bill down into two (2) or three (3) separate sections, guess what? The IRS says NONE of it can be written off! That's right, $0 dollars. Do you think business owners are getting a broken down bill from the Colts, or the Fort Wayne Tin Caps? They'd better, or else even the half the food and all of the meeting room expense are gone.

What should be and what is are two (2) different things - regrettably.

Regards,

Doug