Have you ever had dealings with an IRS agent? They care about every cent above 49.
ETA:
Nothing, and I mean NOTHING is trivial at the IRS. Look at their requests for upgrade funding, and the results. Hint: grab a fifth of your favorite medication before diving into that rabbit hole.
ETA2:
So are you saying that if my profit making operation is in a small minority, I donât need to report it? That, [channeling John McCain] my friend, is tax fraud, pure and simple.
ETA3:
I suspect that your âclear and obviousâ suggestion would morph into the IRS just handling it by taking all your money and returning what they think, depending on your political views, is what you deserve. Câmon, we all know thatâs where it will lead.
ETA4:
This isnât even a guess, but I am sure that for the vast majority of taxpayers, tax payment is stressful.
ETA5:
No offense to you, but who gives a flying frog leap what Europe does. Letâs learn a little wokeness, no matter how old and fat one is. Africa does not do this. I think itâs racist to say we should be more like Europe (which is where all of our sins come from) than Africa (which is where all of our sins were inflicted ⊠except Indians (Western)). And please donât insinuate the black lobby is bad.
I typed out a nice, long, opposing viewpoint, when I realized that I like and would completely agree to the idea of the IRS sending us a bill every year ⊠if one of the following two points is accepted:
Payroll deductions are made illegal. Everyone must pay, or object to and fight, their IRS calculated bill annually, semi-annually, or quarterly.
The bill that the IRS sends to each victim states categorically that this is their total tax bill for [the stated period]. They owe nothing more.
If thatâs the standard, great - this what you owe, unless you can prove it should be less. But itâd also require rather drastic changes to tax law for such a standard to be legal.
So are you saying that if my profit making operation is in a small minority, I donât need to report it? That, [channeling John McCain] my friend, is tax fraud, pure and simple.
No, I am saying that his example is an outlier and not going to be the case for the vast majority of people who would have an easier time of it if things were handled automatically.
There is no realistic scenario where complex or outlier cases donât need special handling. Never suggested otherwise.
Iâm just pushing back on the assertion that it is typical to have anywhere close to 5 figures of âmiscâ income to report.
And thatâs where the restrictions of the current tax code come in. The source and purpose of a payment determines itâs taxability, not the dollar amount - it doesnt matter if it is 5 figures or 5 cents, legally there is no distinction in how it should be treated.
I never said it was typical to have large amounts of misc income, just that it is common to have something that is otherwise unreported by the payor. Even if in practice that something is hardly ever included on a tax return anyways.
The source and purpose of a payment determines itâs taxability, not the dollar amount - it doesnt matter if it is 5 figures or 5 cents, legally there is no distinction in how it should be treated.
For what itâs worth â one of your earlier points was about the kid getting paid $20 to mow lawns.
There are already high enough filing thresholds, in general, to where those people arenât needing to report anything or file taxes at all, due to their relatively low total income. (even working all season, kids earning nominal income like that arenât getting enough earned-income to need to file)
At the end of the day, the whole discussion is pointless, though, because the tax prep lobby is strong enough to prevent any real process improvements from taking place for the foreseeable future â aside from the reality that other simplifications of the tax code would probably be needed to make things smoother in general.
While I am not the expert that you appear to be, I canât recall a year when I did not have additional income ⊠even when I had a regular, salaried position without commission.
The IRS has no clue how many of those $20 payments an individual received during the year. Thus the prepared form would not consider them, thus the individual would need to re-do the numbers and calculations to account for them, thus the IRSâs prepared tax return, as prepared, could not be used by that individual. Even if that individual was not required to file a return, theyâd still have to do the work to arrive at that conclusion on their own.
Re: political abuse by the IRS, etc. Seen elsewhere, but touched on enough stuff that I hadnât heard I thought it was worth repeating.
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the Democratic party does have a prior record of abusing the IRS to attack political enemies. Lois Lerner was never criminally prosecuted (she apologized and that was it) for having the IRS target the non-profit status of every organization with a name that sounded affiliated with the tea party. That went on for years and was one reason the IRS was down sized.
In 2013, Acting Director of Exempt Organizations at IRS, Lois Lerner, apologized to tax lawyers for the IRSâs inappropriate targeting of political groups. Her comments set off a chain of events that would fire officials and consider impeachment proceedings for IRS Commissioner Koskinenâs actions.
But that was years ago. Itâs not like the IRS is still used today to harass people that the Biden family doesnât like? How about the tiny repair shop that turned in the laptop Hunter Biden abandoned there? No harassment there?
One organization that was particularly disliked was âTrue The Voteâ which is dedicated to keeping non-citizens and non-residents from voting. This really offends some Democratic leaders and this organization was harassed for more that a decade by the IRS and had to win a lawsuit against the IRS to get them to stop:
What about personal attacks by the IRS on the founder of âTrue the Voteâ and her personal businesses:
"In nearly two decades of running our small business, my husband and I never dealt with any government agency, outside of filing our annual tax returns. We had never been audited, we had never been investigated, but all that changed upon submitting applications for the nonprofit statuses of True the Vote and King Street Patriots. Since that filing in 2010, my private businesses, my nonprofit organizations, and family have been subjected to more than 15 instances of audit or inquiry by federal agencies.â
âAfter nearly 20 years of being in business and no agency coming to visit with us, the succession of agencies that have now come to us â for all manner of things â begs the question. The statistical probabilities of what happened to me happening, without political motivation is staggering.â
OSHA visited Engelbrechtâs business soon after she filed an application requesting tax-exempt status for the the King Street Patriots. The visit resulted in her business being fined nearly $25,000 for various violations, including âthe wrong type of safety glasses on an employeeâ and âthe wrong type of seat belt on a forklift.â
Catherineâs life has changed dramatically since submitting those applications. The organization has been questioned by the FBI on numerous occasions; she has had her personal tax returns audited by the IRS; and has also had her small manufacturing business tax returns audited by the IRS. In addition, her business has been subjected to two unscheduled audits by the U.S. Bureau of Alcohol, and Tobacco and Firearms (BATF) and has undergone another unscheduled business audit by the Occupational Safety and Health Administration (OSHA).
Unfortunately there is a troubling history of using the IRS and other federal agencies to target enemies of the Democratic Party. Sort of like what happens to Putinâs enemies in Russia.
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Work from home, the state tax wars. Aggressive states are claiming remote work for a company in another state is fully taxable in the companyâs state, possibly in addition to the residentsâ depending on credits / offsets between them. From the NJ vs NY roundâŠ
The proposed bill wages tax war on several other fronts. It offers Jersey residents tax credits if they challenge New Yorkâs tax law in court and succeed. And the bill offers tax incentives for out-of-state firms employing New Jersey residents to open an office in-state, which could then become the home for telecommuting employees, exempting them from New York taxes.
This is confusing as shit. I live in NY and work for a company in NJ. Commuted for many years and paid NJ & NY taxes. Seriously annoying come tax time having to figure out how much I owed and file returns in both states.
This year I went full WFH and one of the big benefits was supposed to be simplifying my income tax situation. So much for that I guess.
You should have mentioned the primary âfrontâ of that tax war â New Jersey âproposed a law that would let the state tax telecommuters, including possibly tens of thousands of Empire State [NY] residents now working from home but employed by Garden State [NJ] companies.â In other words they want to do the same thing that New York does â tax telecommuting residents of other states â while at the same time incentivizing their own residents to sue New York for doing the same thing. LoL.
Iâd expect a bunch of law firms turning these into multiple separate class actions already.
after they got their free/cheap tuition in say NY.