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Comment by nixy | Hacker News Reader

I lived in the US last year and just finished my taxes. It was unbelievably complicated and confusing—even using Turbo Tax. Never seen the likes of it.

This is how I do my tax return in Sweden:

1. Receive equivalent of W2, but all returns are already pre-calculated since the Swedish IRS knows all it needs to know to be able to prepare my returns.

2. If I'm happy with my W2 and pre-calculated returns, I simply send a text message with a PIN code to submit my returns.

3. If I'm not happy with my pre-calculated returns, I make the necessary changes in a simple form and mail it back to the IRS. Most people never do this.

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Norway has you one-upped: if you're happy with the pre-filled returns, you don't have to do anything at all; it will be auto-filed on the deadline.

I've never filed a tax return in the UK. It's automatic with PAYE. Only self-employed, business owners or those with unearned income from property or other investments need to file.

I think it is the same in Greece (I've always been self-employed). People who are employed don't file, they just get a cheque back at the end of the year if they're entitled to a tax return, as far as I know.

And if you ever leave Sweden, your tax obligations to Sweden end there. Not so with the USA. Actually they become more complicated than ever unless you also renounce US citizenship. Renouncing is itself a bit of a feat tax-wise.

Indeed. The FBAR and FATCA are terrible.

The incredibly heavy handed penalties for making a mistake can be quite frightening.

The seeming assumption that anyone who has a foreign bank account or property must be a tax dodger is insane.

While reading your first two sentences, I thought: "Oh come on, TurboTax at least makes it easier to get through, and anyone with a simple tax situation can get through it within an hour..."

After reading how it's done in Sweden: "Wow, our system is horrible."

Turbo Tax doesn't let you get through it in an hour.

I have a friend who I watched do her taxes recently. TurboTax probably asked her 100 questions over the course of the process, and for about half of those questions it contained at least one term that she had no idea what it meant.

I'd like to think I'm at least somewhat intelligent but I struggled on quite a few of the questions I filled out for TurboTax. More often it was due to (what I found) odd wording rather than words I didn't understand. I had to re-read some of them upwards of 4-5 times and then for a few google to make sure I understood the question. It is an extremely frustrating process.

even simpler for most in the UK its all done via your employer PAYE - and when I had a complex tax suitation (empoyer went bust the hard way) I rang up and they said ok your owed xxxx took 15 mins to sort out.

I don't know what Sweden's tax code looks like, but at least here in the U.S., the IRS simply can't know a lot of the information necessary to calculate your taxes. How would it know how much you paid in daycare expenses, tuition and tuition interest, home mortgage interest, etc?

You can say that we just shouldn't have deductions for these sorts of things, but that's a very programmer way to look at things (we need to get rid of these features because they would be hard to program). It's also not theoretically sound. An income tax is supposed to be a tax on net accretion to wealth. Expenditures that are non-consumptive should be excluded from taxable income because they don't represent an increase in wealth.

> I don't know what Sweden's tax code looks like, but at least here in the U.S., the IRS simply can't know a lot of the information necessary to calculate your taxes. How would it know how much you paid in daycare expenses, tuition and tuition interest, home mortgage interest, etc?

The same way that it already does know many of those things -- you know those student loan interest, mortgage interest, etc. statements you get at the end of the year that you rely on when filling out your tax forms, and that the tax forms refer to by form number? Yeah, not only are the people you paid required to send those to you, they are already required to file them with the IRS, as well.

There's some things that may not be amenable to this solution, but many taxpayers aren't effected by them and the workload if you reduced filing to addressing those would be minimal -- the IRS just sends you your precomputed "basic" return, with instructions on the handful of potential adjustments you might need to report and document and send back, and a deadline to do so if the basic return isn't all you need (along with the same deadline to pay any balance if the basic return is correct, or any remaining balance on the corrected return.)

Then, if nothing is filed before the deadline, the IRS sends out refunds (if applicable) or starts collection on any amounts due and not paid.

I agree there are exceptions, and even in the ideal world, many Americans will still end up having to submit something. But I think that starting from zero is silly. The IRS already knows a lot about our income - they must, that's part of how they check the correctness of our returns.

I think a system where the IRS says, "Here is what we know about your tax situation. We have calculated your taxes. If we owe you, and you agree, you don't have to do anything. If you agree, and you owe us, please pay us. If you do not agree, ammend this information and submit, with payment if necessary."

Forcing each American to start with a blank form seems wasteful, to me. It's a reproduction of work. I absolutely agree with your upthread comment about taxes being inherently complex, so please don't mistake my comment for an argument against that point. But I think that many Americans would be able to just accept what the IRS suggests, or at least use what the IRS says as a starting point. I think that the existence of the 1040A and 1040EZ forms support this point. (I tried finding numbers on how many people use those forms, but could not.)

This is solvable through policy: Have the daycare, educational institution, lender, mortgagee send the IRS (and you) a form detailing the amount you paid. Hell, this is already the case for most tuition and mortgage interest payments.

And there's the policy debate, since people don't necessarily want to give up that much privacy.

The IRS is already privy to much of that information, either directly or indirectly.

Most of the things you mentioned are reported by banks, other government entities etc.

The less people have to think about and understand the staggering amount of taxes paid the better.

In Norway, your pre-calculated returns will automatically be filed if you don't do anything before the deadline.

If you do need to file anything, everything is now done digitally. No papers to mail. Every single tax form is provided in a very well-organized form system that also validates everything and support subforms ("This field requires that you submit a 27b-6. Click to enter it now."). It was a godsend when I was working as a freelancer and was doing my own accounting, because you could actually do your own accounting without going crazy.

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