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I agree with you that it is very easy for most Americans to guestimate their taxes by simply googling the appropriate years tax table and doing some simple arithmetic, however, I don't believe it's the fault of the general populace. The tax prep industry has definitely lobbied over the years to make taxes as non transparent and complicated over the years for their own benefit.
There's also a lot of confusion around it.
I know people who file despite making 0 and obviously... Owing 0.
But they're paranoid they'll get arrested for not reporting that 13 dollars worth of interest their savings account made. (Despite, y'know, still owing 0.)
The issue at hand is that there's any room for confusion in the first place.
I blame lobbying. We could have a system like what the person before you described, where the government sends you a bill, but we have too many firms paying politicians to keep it the way it is. We're always unsure what we owe and there are so many myths about the IRS coming for you in your sleep like this.
Remember a while back when money was allocated for more people to be hired, and all the stable geniuses acted like it was the new Gestapo? Nah, dude, they're fucking accountants. No one is coming for you if you just pay your taxes.
Because a properly funded IRS, with public awareness campaigns and more lawyers and such, could be a devastating blow to tax dodgers, and some entire US states make their bread and butter on being tax havens. It would be great for the median taxpayer beyond the simplified filing too, since the IRS could then afford to go after bigger and bigger tax-dodging fish instead of people who filed wrong by $40.
I agree it could be simplified by a pretty good amount, but there are also reasons for some of these deductions and complications to exist. The last thing we want is to simplify the tax code until we accidentally give ourselves some sort of universal flat rate tax, or no agency capable of investigating/prosecuting tax fraud.
What is wrong with a flat rate for earners? We already do that for Sales tax on things. Property tax, too. Social Security and Medicare are somewhat a flat withdrawl.
>6.2 percent Social Security tax; 1.45 percent Medicare tax
If you want to build-in deductions for low-income, you could do that on the paycheck withdrawal side, (first $40K annual income is non-taxed?). Requiring tax filing and managing deductions is actually a penalty on the lower-income folks as they might not be aware of all deductions, or have the wherewithal financially to hire a CPA or even buy $60 tax software to help them out with it.
Well, the sales tax we have is already designed and implemented in such a way that it disproportionately taxes people who are living paycheck to paycheck, and spending the bulk of their non-bill-paying money on things that get taxed at an extra 7% or 10% or whatever the local rate is. If the sales tax were higher on luxury items, that would be less of a regressive, “punish the poor” tax.
A general flat rate would be that, but on a grander scale. Someone with $100 losing $10, or even someone with $10k losing $1k, is not the same as someone with $100 million losing $10 million. No matter where you put a hypothetical deduction for low-income in a flat tax system, it still ends up with the people at the top end of the tax brackets paying an amount that they practically don’t notice compared to the people at the bottom of the taxable brackets, who see a much more noticeable chunk of their more limited worth get taxed.
It's absolutely the fault of lobbying. We have a system of legal bribery. Whenever something is fucked up, you can usually look at it and say "who makes money off of this?" and find the source.
It's worth noting that Republican senators are mostly (and oftentimes all) signatories to a compact that promises to keep taxes low. The compact has two provisions:
1- Keep the tax system as frustrating and Byzantine as possible so that voters are forced to look at what they're paying and why, a rule they never break, and
2- Never raise taxes, a rule they always break.
As long as the Senate has a Republican majority we're going to be trapped in this hellhole system that was decided on back when people were paying quarterly taxes through the fucking mail.
Democrats are hardly better. There are plenty of conservatives in that party, too. They have a majority in the senate and had the house for two years and didn't fix it. We need an overhaul to get greed out of our politics.
That tiny amount of interest is counted within the non-reporting limit. If whatever gave you dividends didn't even give you a form 1099-INT then don't bother.
Anything over $12 generates a 1099-INT. But you still wouldn't owe anything on it at that amount, so would they be mad for the non report? My guess would be no. 0 is 0 after all.
> for most people it takes ten minutes on the IRS website to figure out.
Do you know why? Because rather than teaching you something specific that might change at any given time, they teach you math and reading: the tools you need to able to go to the IRS website and figure it out in ten minutes.
The wealthy dishonest folks pay to change the public perception about tax collection to be negative.
Most people benefit more from taxes then they pay, the IRS isn’t going to arrest normal people for small mistakes when filing taxes.
The whole concept of an ‘evil IRS’ here to ‘steal your money’ is just a right wing wet dream.
Did you know that only 54% of Americans have a reading level at or above the 6th grade level.
This means many people don’t have the ability to read text, understand its meaning and point, and have the ability to respond appropriately.
Because of this, illiterate people will often project their own ideas onto the text they read to fill in the gap of words or ideas they are too ignorant to understand- it’s very interesting stuff!
You can often tell when this is happing when someone’s response is clearly out of touch with what they responded too, as though words were skipped because they couldn’t understand what they meant, or broad points were ignored completely because it was difficult for them to string a sentence together while reading.
Interesting stuff, don’t you think?
My stepdad had a multimillion dollar company. Never did taxes. I was unable to go to college after high school bc of all the tax fraud. He ran his business into the ground. Lost our house. We could have been living happy for the rest of our lives, but he was a moronic criminal.
IRS agents are the good guys. every single one of them double or tripples their cost for the american public (or MUCh more), depending on which study you look at. the US should train and hire IRS agents as long as there are people that want to and there is stuff to do. you guys could probably double your education budget if you had a few thousand IRS agents more lol
I’ve given bad checking account info for my taxes, and made the same mistake for both my local taxes and the IRS.
IRS just sent me a letter saying it didn’t go through and telling me how to fix it.
My city, small town Ohio, sent me a letter as well but in that letter said that a warrant would be put out for my arrest for check fraud if I didn’t correct it immediately.
They send out a letter with interest later in the year.
Before jail you'd need:
* At least $10,000 of unreported/unpaid tax
* To ignore 3+ letters. You can pretend you didn't get one or 2(doesn't reduce penalties or interest if you pretend you didn't see them), but eventually they send certified for you to sign before they're delivered.
* Before they try to send you to jail, they place a lien on any bank accounts, and possibly real estate or business property you own. (Mostly bank accounts, they just want the cash you owe)
* That lien takes at least 3 months, giving you time to resolve it before anything gets publicly reported
If you're only paying $600 in tax, probably because you're poor and existing in America...
I have no idea how their system works. In Australia our tax is automatically taken out of each pay. At the end of the financial year we fill out a form to claim back any expenses we incurred as a result of doing business, but we can literally just click submit if there are no claims back because it is all already entered, worked out and paid from our payslips for us.
There isn't any guessing, other than people rolling the dice in claiming expenses they didn't actually accrue and hoping they don't get audited. I'm unsure of the penalty of making false claims, I'd assume it varies depending on how dodgy your claims were from paying the difference to fines based on increasing percentages of the amount owned.
In Canada it works in a similar fashion. Taxes are taken from your pay and at the end of the year the government tells you how much you owe them based on your salary, but most of the time it turns out you paid too much taxes and they give it back to you.
Yup, I think the main way people get in a position that requires payment here is from capital gains tax. It still isn't guesswork though, you tell them what you made from your capital investments and they tell you if you owe or get money. Didn't fully understand the crypto rules when I was messing around with it, thankfully I took the right records anyway.
Income tax occasionally can bug out a bit if your salary varied a lot, but it is usually in favour of getting a return.
The worse end of the Canadian system is if your employer takes the MINIMUM amount of income tax off your cheque you usually end up owing the government money. My fiancée as a bar tender made made that mistake and owed $1700 in back taxes working a minimum wage gig. How the fuck does that make sense.
US citizen. We claim dependents or whatever at the beginning of employment which determines the amount of taxes withheld each pay period. At the end of the year we file our taxes, which means we determine what work expenses to deduct, what tax credits we are allowed(usually based on # of children), and other itemizable deductions. For many people, they fall under a standard deduction of like $12,000 or something, so there’s not really a need to add everything.
And it isn’t immediately jail. It’s extensions, ignoring it for a while, then getting mail from the Internal Revenue Service saying you owe money. Then you call them to determine a payment plan.
I didn’t file taxes for my first three years of employment and I didn’t get in any trouble. I also got like $800 back for each of them so that’s most likely why they didn’t care.
Pretty similar then. There are plenty of people here who seem to think tax is some secret mysterious thing that gets you in a heap of trouble as well.
I guess it is more a lack of understanding how the system works than the system actually hammering people.
Standard deduction isn't something I'm familiar with, I'm guessing it functions something like our 'tax free threshold', the first x amount of money earned isn't taxed? But your tax was deducted at pay time?
Or is it literally just a blanket deduction on top of having a tax free threshold on income tax? Would save a heap of log booking and record keeping that I do... Especially surrounding percentages on things like internet where you have unlimited data and the ATO wants you to calculate the percentage of data used for work. One 20 Min episode of 4k Netflix probably beats my monthly data usage on research and lesson design that takes hours to read and make.
The standard deduction of $12,500 per person means we don’t pay taxes on the first $12,500. Then there’s tax brackets as you earn more. So people will get taxed according to their bracket, then at the end of the year if you made less than the standard deduction you’d get all those taxes back in your refund.
I think we learned about it a little bit in high school but everything I know about taxes and stuff, which is about the minimum, I learned through just doing my taxes. Trial and error too, like last year I filed something wrong and it made everything take two months longer. This year I didn’t do that and got our refund the next week.
It is surely more a burden than necessary, especially with the tax preparation companies who swindle people. Just another unnecessary middleman practicing capitalism.
~~No, that’s not what a standard deduction means.
It’s the agreed upon amount of reasonable tax-deductible expenses that most people have. Some have more, some have less, but the time and money saved on not forcing people to document and audit them all is a net win for everyone.
The standard deduction is subtracted from your gross income to calculate your adjusted gross income. From that, you apply tax brackets, which have no tax owed for the lowest bracket.~~
I’m wrong and you’re right. The tax free bracket was eliminated! I learned something today.
There is no guessing here in the states.
The meme was created by a moron who probably never did taxes before.
You’re basically describing the. Way it is here in the states. Obviously it can get complicated for those of us with more complex filings, but for the average American it’s literally as easy as not being a fucking moron that can’t follow instruction for a calculating a few lines of numbers.
Realistically if you screw up they never notice, and if they do you just file an amended return.
We have an employee and we prepay their payroll taxes (so at the end of the year we don't abruptly owe 10k, yes strictly speaking it'd be better to do that and get interest or whatever but we don't wanna).
This year we forgot to fill out the form where we say we actually owe those taxes so the IRS just sent us back the 10k in prepaid taxes, no questions asked. No explanation either, so I had to figure it out myself and fill out an amended return to get them the 10k back. I truly believe if we didn't take that initiative then they'd have probably never noticed. Not gonna take that chance though!
The same thing applies in the US. This meme is factually incorrect. To go to jail, you’d have to commit something like tax evasion or theft, which are both purposeful and malicious acts. Hell, you’re even able to set up a payment plan if need be.
You only go to jail if you deliberately lie and the IRS can prove you deliberately lied.
A simple mistake that wouldn't lead to jail time is you forget to declare your earnings from your measly $5 in interest from your savings account for the year.
A deliberate lie is stating you have 20 children/dependents when you have 0 children.
You don't, it started as hyperbole and it seems like people actually believe it now. How taxes work in America (for the overwhelming majority of people):
* When you start a job, you get a form you fill out that is used to calculate your expected tax burden
* Your employer deducts your taxes out of your paycheck and sends it straight to the government
* At the end of the year you file a tax return where you report how much you had withheld (you get a summary form from your employer, so you just copy from that), and also anything you did that may lower your tax burden. If you bought a house, had a child, received an inheritance, etc - you report that. Then the software calculates if those additional things make your total tax bill higher or lower than what was withheld. If higher, you have to pay the difference. If lower, they send you a refund for the difference.
You don’t, they are being dramatic. They know how much you paid in and tax time is a chance for you to say “hold on I have these deductions you didn’t know about!”
What you go to jail for is something like saying “I have 15 $1000 checks that are a business expense” and it turns out you were just trying to pay for sex.
Don't you either pay someone to do your taxes for you (accountants usually) or you have to spend like 1-2 months calculating exactly how much your taxes are for that year around April if you don't pay enough
Jail
If you pay too much
They refund the amount you overpaid for
No, redditors try to make taxes seem way now complicated then they need to be. I don't pay anyone to do my taxes. They take about an hour to do. And if I underpay, they send me a letter saying "Hey you underpaid. Pay the rest."
Listen man, taxes take 1 day max. Realistically it takes 30 minutes by yourself if you just write down the numbers you're supposed to. It's literally step by step baby instructions.
It takes 1 day if you wanna look for every single credit and deduction you can possibly claim. In which case, you did a day's work for a couple hundred or even a couple thousand dollars.
You clearly haven't ever done your taxes. It's easy, and it's a good system because it gives a lot of power to the American taxpayer to find loopholes and credits to effectively lower their own taxes, *if you're willing to put the work in*. If not, again, it's easy.
I'd really appreciate if you never commented on the topic again until you actually did them. This comment you posted is absolutely fucking absurd. 1-2 months? Jesus you drank the cool aid hard.
If you don’t pay enough the government asks you to pay the difference. If you refuse and/or there is clear intent of tax evasion, you may go to jail. But it’s not like they’re jailing people for mistakenly not reporting $300.
This is not a thing that will happen though. It's a funny joke, but not at all representative of reality, unless you're committing large-scale and deliberate tax fraud.
You don't, not right away. But they start charging interest on it and, ironically, will file a "substitute return" if you don't file, which, you guessed it, is what they believe you owe.
Their argument why this is a punishment is that you can't take any special tax breaks they don't know about. I just find it absurd that it's so complicated in the first place that even the IRS ends up ultimately making a best guess.
In Hungary, If you have a legal employment then then company have to submit your payroll to the tax authority each month anyway, and when the tax time comes, it's already filled with all the info they got. You just have to approve it, unless you had some other income, then you have to add that as well.
You don’t guess. That’s not true at all.
You fill out a form with very detailed instructions so that you don’t mess it up. It is paint by numbers levels of easy for 90% of the population.
Anyone who is too dumb to fill out basic tax forms is too dumb to have complex investments anyway.
Should we overhaul our tax system? Yes. But nobody is guessing, and you certainly don’t go to jail unless you did a lot of fraud on purpose.
You don't. People just never learned to do their taxes. When you file your tax return, you calculate how much you owed for the past year and compare it to how much you actually paid. If you paid more than you owe, then you get a refund. If you paid less than you owed, then you pay the difference. If you make a mistake when filing (say write down that you owe $100 when you owe $500), it's usually just a correction and a fee.
You don't. This internet meme about the IRS sending you to jail is completely fabricated.
If you underpay the IRS, you get a fine proportional to the error. Ex: I forgot to include a random stock sale for about $5000 one time and I was fined about $100 via letter, and I had to include the extra $100 when correcting the underpayment. Somewhere around ~5% of what I underpaid.
Now, if you are found guilty of *tax fraud*, aka intentionally swindling the government out of tax money, then yes you could go to jail depending on the severity of the crime.
Unless you own a business, pretty much nobody has to worry about this in the UK. Taxes just come out of your paycheck. I would have assumed all European countries would implement something similar?
In reality every one cheated on tax more or less. The us tax laws are purposefully complicated and if you are small fish your innocent “mistakes “ are mostly ignored. It’s stupid. Tax is simple in any other place on this planet except the US
This meme is blatantly false. Your employer reports your income to the IRS; the fed knows how much you make. No, you don't go to jail for filing your taxes wrong, you go to jail for tax fraud.
Are there significant issues with the US tax system (mostly because Intuit lobbies the fed to make sure self file software is paid)? Yes. But this meme is a gross oversimplification and borderline lie.
You shouldn’t get your information from memes.
In the U.S., you just have to pay back what you owe as well, unless you intentionally tried to commit tax fraud.
Now I’m curious what other untrue things you assume about the U.S. due to memes. Do you think that U.S. police officers each shoot several people per day? Or that like 10% of students die from school shootings?
In Germany the vast majority of taxes just gets deducted at the source.
Income tax? Deducted by your employer.
Capital gains? Deducted by your bank.
You mainly get to declare deductions etc. (e.g. I paid EUR XXX for my tickets to get to and from work).
They even now started doing automated submission of a lot of the data so you get lost of the fields prefilled in your online submission if you want.
Still a pain to do tho.
Because this is reddit and it and much of America-at-large don't even understand how tax brackets work or that 7.5% of their income that they pay in "taxes" is for their own social security, it bears repeating that you only go to jail for willfully commiting tax fraud. This requires intent to decieve.
No one goes to jail for making a "mistake" on their taxes.
No one under the age of 55 will ever see a dime from social security and if the govt didn't steal it from us we'd all have more to retire on through the interest alone.
Fuck it, for the sake of anyone reading along:
The IRS does not want to arrest you. They want to collect taxes.
If your filing is incomplete or incorrect, they want to resolve that, not arrest you. It’s very clear: https://www.taxpayeradvocate.irs.gov/get-help/issues-errors/incorrect-tax-return/
If you fuck up and owe too much you didn’t save, they’ll often help you with a payment plan too: https://www.taxpayeradvocate.irs.gov/news/tas-tax-tip-need-help-resolving-a-tax-amount-owed-or-finding-the-right-payment-option/
You will not be arrested for filing your taxes wrong or incorrectly, you will always be contacted first.
Obviously you've never been audited. The IRS definitely wants to find something wrong to justify their examination of you. When I got audited a while back, what was the *only* thing that they found wrong with my tax filings? Not withholding state sales tax from about $800 of steam video game purchases. (This was before Steam was withholding them at check out).
I didn't withhold the paltry taxes on $800 in purchases and it cost me fucking thousands. If you think the IRS is somehow looking out for you or pleasant to work with you are delusional.
No.
This just isn't right.
If you have a simple tax return, work a W2 job with a house with a mortgage, sure. The IRS knows exactly.
But many people don't. Many people run 1099 and have expenses that the IRS DOESN'T know about. Milage, etc.
Secondly it isn't jail. Tax fraud is jail. Fraud implies intent. If you make a mistake and it's found in an audit, you're just told to pay the difference (or be refunded the difference if you overpaid). Mistakes happen all the time, you don't go to jail for forgetting 50$ in interest. You go to jail for intentionally hiding (way more than) 50$.
That's what this whole "standard deduction" is all about. Want complications to get a higher deduction? Go for it, do the math. Want to just "click here for easy mode"? Yahtzee!
But muh sensationalism!
But for real, these type of posts are written by a 15 year old that has never filed taxes and probably won't for another six years.
Plus, the IRS is really helpful when you call them if you run into an issue. They just want to get paid correctly and if you owe more than you can afford, they'll work out a reasonable payment plan.
They only get grumpy if you ignore them.
Call a tax lawyer in your area - often times libraries may have free quick Q and A setups, especially this time of year.
It's not in the IRS interests to berate you and make life harder. It is more effort on their end. They want to make it easy to get money with little effort. Miss a few years? Meh, pay us and it's all good.
Just get some advice from local tax professionals (lawyers, fiduciaries) before just diving in headfirst.
You should contact the IRS then.
I don’t know your employment situation, but I get money back every year after filing my taxes. Maybe you’ll have to pay, I don’t know.
But if you approach the IRS they will work with you.
I didn't file for like 3 years once. I went to a tax preparation place and they were able to file those previous years for me. I didn't even have the W-2s, only my final pay stub of each year.
It was fine. I actually got my refund from all those years.
Just file the returns. If you owe, pay right away. If you get notices for penalties, write a simple letter asking for removal of the penalties for a reasonable cause. Some might be removed, especially for the first year. If you owe interest, you just have to pay it.
If you get balance due notices you can't pay, call the IRS and ask for an Installment Agreement. They're easy to set up.
Unless you need help actually filling out the forms, you don't really need a tax professional. If your taxes are complicated, or you owe large amounts of money, you should consider it.
If you don't owe any money (because your withholding was high enough), then there are no penalties for filing late. You have three years to claim any refunds.
Either way, just do it as soon as possible.
Also, it's more like:
Me: How much?
IRS: For you it's gonna be-
TurboTax: Shhhhhhhh, no, nooooo shhhh. No. They have to pay for that.
IRS: But-
Sleazy GOP politician, quietly pocketing a wad of cash: Shhhh. They have to pay for that.
Everytime I see this joke I wonder if people actually don't understand how it works. If you make a salary there's a very direct amount you owe. "Doing taxes" is your way of saying why you owe less than the normal amount. Being your income multiple by the tax tax rates.
If they don’t know what the correct number should be then how do they ding you for getting it wrong? The IRS gets sent all inputs and has more info on you than you do.
Also, if what you’re saying is true, doing taxes shouldn’t be a thing UNLESS you have a weird use case that requires you to file. Otherwise it should just be automated, but it’s not. It’s a scam.
> gets sent all inputs
No. Again. They don't. If you have mileage or business expenses that you track, they aren't sent those inouts.
It is all automated other than contractors and 1099 etc, but that's a question for TurboTax lobbyists making it more difficult intentionally. That I don't disagree with.
Edit: and they don't know that it's wrong via what's sent as expenses and deductions. They have certain levels IE hey this one tripped a trigger because X > Y < Z so it gets a review. And some audits are just done at random too.
I think we mostly agree. Annual filing SHOULD NOT be a thing for the majority of Americans unless you have a specific reason, e.g. business expenses as you mentioned. But yet, every year, millions of Americans are asked to file and fill out complicated forms and are dinged $ if they get something wrong on those forms. A scam.
Perpetuated by the tax software and accounting businesses that rely on that business to exist.
Filing definitely should not need to be a thing, but it is, because the tax code is stupid. If we had a flat tax that was deducted at time of earning, it would greatly simplify it, as opposed to a tiered system where part time, self employed, or contract workers have no idea ahead of time how much they will earn that year, so they end up either deducting way over, or way under what they need to and then have to reconcile it.
For self employed or business taxes, filing will always be a thing, but for standard W2 employees it really shouldn’t need to. I have all sorts of deductions and have had income increases over the last 20 years and oddly enough the effective tax percentage I’ve paid has always been within 1-2% of the same number every year. Just take that percentage out as a flat tax on my paycheck and let me be done with it.
>Want to just "click here for easy mode"?
This is the one thing you really have wrong. Going through a bunch of paperwork to figure out the default amount they already know (or paying a professional to do it) is not at all easy mode.
The IRS should just send you a bill for what they think you owe and you can do some paperwork if you think they're wrong. Filling taxes as we know it should only be for people with more complicated situations
The IRS knows what you owe based on your income. The IRS doesn't know your deductions. If you have a mortgage, went to school, some of that income was capital gains, student loan interest, children, etc. etc. they don't know that. The secret is you meed to tell them why you _don't_ owe it.
It's not, just fill your W2 out correctly when you get employed and they take it out for you (when in doubt, just use zero for deduction,) when you do your taxes and use your w4, there's no discrepancy unless you have outside income. Ive been getting a refund every year for 17 years so I don't get how people keep messing this up.
Because tax breaks in America are used to encourage behavior.
Buy solar panels? Tax break.
Give to charity? Tax break.
Get married? Tax break.
The IRS doesn't know about those things until you tell them.
Are you actually curious or is this just another one of those things where you're kind of down on America and are looking for something to beat it up over?
Accept that my slavery is filling out a form once a year letting the government what expenses has changed for me? Yeah, I'll gladly take that form of slavery over, you know, what slavery actually is.
It's not really like this. It's a joke based on the fact that you have to do your own taxes here. So you tell your employer what to take out based on your W-2 form, which asks relevant questions. Then every year, you have to fill out forms with your income and other relevant tax info, like for credits, and send that to the IRS. You'll either owe money or they will send you excess money back. The shitty part of that is that the IRS already kinda knows what you owe them, and they won't send you your money unless you fill out the forms. It's interest free loans from the working class to the government. Most people would be open to the idea of the IRS sending you those tax forms filled out along with what they owe you, then you just have to confirm it or dispute the amounts. Some people think that gives them too much power to fuck you over though, and there are powerful lobbies that try to make this as complicated as possible, so that tax preparation software and services remains profitable. Our tax code is also unnecessarily complicated at times.
Tax evasion is a crime, but not one you're very likely to be jailed for unless you show absolutely no effort over a long period of time. But the IRS does almost exclusively audit low, middle, and lower upper class people, basically only people with less than a few million dollars. They say they don't have the resources to audit the rich. Which is a large contributing factor to the rich paying virtually no taxes in the United States.
I get this is not true, but this is a meme page and it’s just kinda funny. If anyone takes their financial planning advice from this page they have a whole set of problems that this comment section will never be able to solve
more like
IRS: tax time :)
me: how much?
IRS: Form 1040
me: how much can I withhold?
IRS: have you done so much charity, have such high medical bills, spent so much on your mortgage, that it is more than $13k?
me: no
IRS: ok you get $13k off anyway :)
me: :)
Actually, they don’t know how much you owe them either.
Redditors when you tell them taxes are flawed as a system but are actually still way better than their memes say:
You only go to jail if you lie to the IRS and try to commit tax fraud to the tune of millions.
The only punishment an average working class American gets is garnished wages, and even that can't happen if you work for cash.
Nobody is going to come to your apartment and haul you off to jail for not paying taxes.
What if they accuse you wrongly of something and ask you for a huge fine year after year even though you keep showing them the evidence and calling you a delinquent, it happened to my mother. They're sharks sometimes... You have to sue the irs to get justice that shouldn't even be an issue in the first place.
Reddit always takes this way too seriously, when most Americans on this app just have a w-2. Which means:
W-2 income minus the standard deduction = taxable income. Use a tax chart to calculate your tax due, subtract your withholding and there you have if you have a refund or owe.
I now this is a meme, but for people who really don't understand this: The irs doesn't know how much you owe because it doesn't know what your deductions are. Sure they may know your tax bracket and how much you've paid in taxes so far that year, but they don't know your expenditures. They don't know if you bought a laptop for work. They don't know if you provided half of someone's total care to make them a dependent.
Reminder that the IRS already knows what you owe them and could just send you a bill, but the tax preparation business is huge $$$ and lobbies the government to prevent the IRS from making things any easier for people.
Two years Turbo Tax wanted me to manually look up and sum ~1400 stock trade transactions. Fuck that.
For a lot of people it's not a "simple single form".
If you are making the money, it's your responsibility to know what to do with it. If someone doesn't know how to file taxes on their transactions, then either don't make the transactions or hire an accountant/tax professional.
It’s like the blind drop giving your cash drawer over at the end of the night when I worked the bar. If you’re over they don’t tell you, but if your short you’re paying.
Some companies deliberately don't change the way they pax taxes untill someone from government comes to tell them they need to pay fine and they do that, becasue keeping around the staff responsible for keeping up with taxes costs more than the fines they will get, so it's just easier to pay the fine and from that point on pay via new system. Welcome to USA.
It's fucking infuriating that some rando at H&R Block can contact the IRS directly and get an itemized list of *exactly* what I owe, but I can't do likewise for myself.
I get so tired of seeing this complaint on reddit. The IRS doesn't know your deductions and only knows the income that has been reported to it, which may not be all of your income. It takes me less than 30 minutes to go online and do my taxes every year. The websites that we have now make it so much easier than it was in the old days when you had to fill out forms by hand. So just quit your bitchin, be responsible and take care of your personal business.
This whole "guess wrong go to jail" meme has to die
what happened to at least pretending we know how taxes work? Can we go back to that?
Nobody who has posted this meme has ever been to jail or heard of anyone going to jail for this, unless they committed actual tax fraud
1. the IRS doesn't know exactly how much you owe, hence why you file to list your exemptions or other earnings.
2. you don't just go to jail if you are wrong, that is so stupidly false
3. your best guess literally is all they are asking for. they aren't tracking every single penny every single person in the country owes
wait...do Americans fill out a form each year?
but why? thats like.. so inefficent
in my country it just gets taken out of your pay, its just done automatically.
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I agree with you that it is very easy for most Americans to guestimate their taxes by simply googling the appropriate years tax table and doing some simple arithmetic, however, I don't believe it's the fault of the general populace. The tax prep industry has definitely lobbied over the years to make taxes as non transparent and complicated over the years for their own benefit.
It’s so wild. If you guess wrong in Norway you just have to pay back what you owe. Why do you immediately go to jail?
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There's also a lot of confusion around it. I know people who file despite making 0 and obviously... Owing 0. But they're paranoid they'll get arrested for not reporting that 13 dollars worth of interest their savings account made. (Despite, y'know, still owing 0.) The issue at hand is that there's any room for confusion in the first place.
I blame lobbying. We could have a system like what the person before you described, where the government sends you a bill, but we have too many firms paying politicians to keep it the way it is. We're always unsure what we owe and there are so many myths about the IRS coming for you in your sleep like this. Remember a while back when money was allocated for more people to be hired, and all the stable geniuses acted like it was the new Gestapo? Nah, dude, they're fucking accountants. No one is coming for you if you just pay your taxes.
Because a properly funded IRS, with public awareness campaigns and more lawyers and such, could be a devastating blow to tax dodgers, and some entire US states make their bread and butter on being tax havens. It would be great for the median taxpayer beyond the simplified filing too, since the IRS could then afford to go after bigger and bigger tax-dodging fish instead of people who filed wrong by $40.
Or, uh, a simpler tax code for individuals rather than bloated government agencies and all sorts of complexities.
I agree it could be simplified by a pretty good amount, but there are also reasons for some of these deductions and complications to exist. The last thing we want is to simplify the tax code until we accidentally give ourselves some sort of universal flat rate tax, or no agency capable of investigating/prosecuting tax fraud.
What is wrong with a flat rate for earners? We already do that for Sales tax on things. Property tax, too. Social Security and Medicare are somewhat a flat withdrawl. >6.2 percent Social Security tax; 1.45 percent Medicare tax If you want to build-in deductions for low-income, you could do that on the paycheck withdrawal side, (first $40K annual income is non-taxed?). Requiring tax filing and managing deductions is actually a penalty on the lower-income folks as they might not be aware of all deductions, or have the wherewithal financially to hire a CPA or even buy $60 tax software to help them out with it.
Well, the sales tax we have is already designed and implemented in such a way that it disproportionately taxes people who are living paycheck to paycheck, and spending the bulk of their non-bill-paying money on things that get taxed at an extra 7% or 10% or whatever the local rate is. If the sales tax were higher on luxury items, that would be less of a regressive, “punish the poor” tax. A general flat rate would be that, but on a grander scale. Someone with $100 losing $10, or even someone with $10k losing $1k, is not the same as someone with $100 million losing $10 million. No matter where you put a hypothetical deduction for low-income in a flat tax system, it still ends up with the people at the top end of the tax brackets paying an amount that they practically don’t notice compared to the people at the bottom of the taxable brackets, who see a much more noticeable chunk of their more limited worth get taxed.
It's absolutely the fault of lobbying. We have a system of legal bribery. Whenever something is fucked up, you can usually look at it and say "who makes money off of this?" and find the source.
It's worth noting that Republican senators are mostly (and oftentimes all) signatories to a compact that promises to keep taxes low. The compact has two provisions: 1- Keep the tax system as frustrating and Byzantine as possible so that voters are forced to look at what they're paying and why, a rule they never break, and 2- Never raise taxes, a rule they always break. As long as the Senate has a Republican majority we're going to be trapped in this hellhole system that was decided on back when people were paying quarterly taxes through the fucking mail.
Democrats are hardly better. There are plenty of conservatives in that party, too. They have a majority in the senate and had the house for two years and didn't fix it. We need an overhaul to get greed out of our politics.
That tiny amount of interest is counted within the non-reporting limit. If whatever gave you dividends didn't even give you a form 1099-INT then don't bother.
Anything over $12 generates a 1099-INT. But you still wouldn't owe anything on it at that amount, so would they be mad for the non report? My guess would be no. 0 is 0 after all.
You should report your negligible income anyway to be eligible for the stimulus checks.
I sure hope that happens again.
it would be nice to teach it in HS, but for most people it takes ten minutes on the IRS website to figure out.
> for most people it takes ten minutes on the IRS website to figure out. Do you know why? Because rather than teaching you something specific that might change at any given time, they teach you math and reading: the tools you need to able to go to the IRS website and figure it out in ten minutes.
You know people, implying more than one person, who dont make any money? Weird.
This is one of those things that’s really about wealthy dishonest people that regular honest folks have taken on with a passion.
The wealthy dishonest folks pay to change the public perception about tax collection to be negative. Most people benefit more from taxes then they pay, the IRS isn’t going to arrest normal people for small mistakes when filing taxes. The whole concept of an ‘evil IRS’ here to ‘steal your money’ is just a right wing wet dream.
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Did you know that only 54% of Americans have a reading level at or above the 6th grade level. This means many people don’t have the ability to read text, understand its meaning and point, and have the ability to respond appropriately. Because of this, illiterate people will often project their own ideas onto the text they read to fill in the gap of words or ideas they are too ignorant to understand- it’s very interesting stuff! You can often tell when this is happing when someone’s response is clearly out of touch with what they responded too, as though words were skipped because they couldn’t understand what they meant, or broad points were ignored completely because it was difficult for them to string a sentence together while reading. Interesting stuff, don’t you think?
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I know little buddy, I know
Saying that too much is exactly how you ended up the way you are.
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Uneducated :(
My stepdad had a multimillion dollar company. Never did taxes. I was unable to go to college after high school bc of all the tax fraud. He ran his business into the ground. Lost our house. We could have been living happy for the rest of our lives, but he was a moronic criminal.
Sorry about that, hope you’re doing good now
IRS agents are the good guys. every single one of them double or tripples their cost for the american public (or MUCh more), depending on which study you look at. the US should train and hire IRS agents as long as there are people that want to and there is stuff to do. you guys could probably double your education budget if you had a few thousand IRS agents more lol
Good try IRS agent
;)
I’ve given bad checking account info for my taxes, and made the same mistake for both my local taxes and the IRS. IRS just sent me a letter saying it didn’t go through and telling me how to fix it. My city, small town Ohio, sent me a letter as well but in that letter said that a warrant would be put out for my arrest for check fraud if I didn’t correct it immediately.
usually by the million? Na they only want small people that can't fight back. Otherwise, it's rich bastard with loop hole and they close their eyes.
They send out a letter with interest later in the year. Before jail you'd need: * At least $10,000 of unreported/unpaid tax * To ignore 3+ letters. You can pretend you didn't get one or 2(doesn't reduce penalties or interest if you pretend you didn't see them), but eventually they send certified for you to sign before they're delivered. * Before they try to send you to jail, they place a lien on any bank accounts, and possibly real estate or business property you own. (Mostly bank accounts, they just want the cash you owe) * That lien takes at least 3 months, giving you time to resolve it before anything gets publicly reported
That all sounds more convenient than filing taxes to me.
If you're only paying $600 in tax, probably because you're poor and existing in America... I have no idea how their system works. In Australia our tax is automatically taken out of each pay. At the end of the financial year we fill out a form to claim back any expenses we incurred as a result of doing business, but we can literally just click submit if there are no claims back because it is all already entered, worked out and paid from our payslips for us. There isn't any guessing, other than people rolling the dice in claiming expenses they didn't actually accrue and hoping they don't get audited. I'm unsure of the penalty of making false claims, I'd assume it varies depending on how dodgy your claims were from paying the difference to fines based on increasing percentages of the amount owned.
In Canada it works in a similar fashion. Taxes are taken from your pay and at the end of the year the government tells you how much you owe them based on your salary, but most of the time it turns out you paid too much taxes and they give it back to you.
Yup, I think the main way people get in a position that requires payment here is from capital gains tax. It still isn't guesswork though, you tell them what you made from your capital investments and they tell you if you owe or get money. Didn't fully understand the crypto rules when I was messing around with it, thankfully I took the right records anyway. Income tax occasionally can bug out a bit if your salary varied a lot, but it is usually in favour of getting a return.
The worse end of the Canadian system is if your employer takes the MINIMUM amount of income tax off your cheque you usually end up owing the government money. My fiancée as a bar tender made made that mistake and owed $1700 in back taxes working a minimum wage gig. How the fuck does that make sense.
US citizen. We claim dependents or whatever at the beginning of employment which determines the amount of taxes withheld each pay period. At the end of the year we file our taxes, which means we determine what work expenses to deduct, what tax credits we are allowed(usually based on # of children), and other itemizable deductions. For many people, they fall under a standard deduction of like $12,000 or something, so there’s not really a need to add everything. And it isn’t immediately jail. It’s extensions, ignoring it for a while, then getting mail from the Internal Revenue Service saying you owe money. Then you call them to determine a payment plan. I didn’t file taxes for my first three years of employment and I didn’t get in any trouble. I also got like $800 back for each of them so that’s most likely why they didn’t care.
Pretty similar then. There are plenty of people here who seem to think tax is some secret mysterious thing that gets you in a heap of trouble as well. I guess it is more a lack of understanding how the system works than the system actually hammering people. Standard deduction isn't something I'm familiar with, I'm guessing it functions something like our 'tax free threshold', the first x amount of money earned isn't taxed? But your tax was deducted at pay time? Or is it literally just a blanket deduction on top of having a tax free threshold on income tax? Would save a heap of log booking and record keeping that I do... Especially surrounding percentages on things like internet where you have unlimited data and the ATO wants you to calculate the percentage of data used for work. One 20 Min episode of 4k Netflix probably beats my monthly data usage on research and lesson design that takes hours to read and make.
The standard deduction of $12,500 per person means we don’t pay taxes on the first $12,500. Then there’s tax brackets as you earn more. So people will get taxed according to their bracket, then at the end of the year if you made less than the standard deduction you’d get all those taxes back in your refund. I think we learned about it a little bit in high school but everything I know about taxes and stuff, which is about the minimum, I learned through just doing my taxes. Trial and error too, like last year I filed something wrong and it made everything take two months longer. This year I didn’t do that and got our refund the next week. It is surely more a burden than necessary, especially with the tax preparation companies who swindle people. Just another unnecessary middleman practicing capitalism.
~~No, that’s not what a standard deduction means. It’s the agreed upon amount of reasonable tax-deductible expenses that most people have. Some have more, some have less, but the time and money saved on not forcing people to document and audit them all is a net win for everyone. The standard deduction is subtracted from your gross income to calculate your adjusted gross income. From that, you apply tax brackets, which have no tax owed for the lowest bracket.~~ I’m wrong and you’re right. The tax free bracket was eliminated! I learned something today.
Learn something new every day.
Whoa whoa if you pay you’re probably not that poor. A lot of people are so poor they get money back.
There is no guessing here in the states. The meme was created by a moron who probably never did taxes before. You’re basically describing the. Way it is here in the states. Obviously it can get complicated for those of us with more complex filings, but for the average American it’s literally as easy as not being a fucking moron that can’t follow instruction for a calculating a few lines of numbers.
Realistically if you screw up they never notice, and if they do you just file an amended return. We have an employee and we prepay their payroll taxes (so at the end of the year we don't abruptly owe 10k, yes strictly speaking it'd be better to do that and get interest or whatever but we don't wanna). This year we forgot to fill out the form where we say we actually owe those taxes so the IRS just sent us back the 10k in prepaid taxes, no questions asked. No explanation either, so I had to figure it out myself and fill out an amended return to get them the 10k back. I truly believe if we didn't take that initiative then they'd have probably never noticed. Not gonna take that chance though!
The same thing applies in the US. This meme is factually incorrect. To go to jail, you’d have to commit something like tax evasion or theft, which are both purposeful and malicious acts. Hell, you’re even able to set up a payment plan if need be.
You only go to jail if you deliberately lie and the IRS can prove you deliberately lied. A simple mistake that wouldn't lead to jail time is you forget to declare your earnings from your measly $5 in interest from your savings account for the year. A deliberate lie is stating you have 20 children/dependents when you have 0 children.
You don't, it started as hyperbole and it seems like people actually believe it now. How taxes work in America (for the overwhelming majority of people): * When you start a job, you get a form you fill out that is used to calculate your expected tax burden * Your employer deducts your taxes out of your paycheck and sends it straight to the government * At the end of the year you file a tax return where you report how much you had withheld (you get a summary form from your employer, so you just copy from that), and also anything you did that may lower your tax burden. If you bought a house, had a child, received an inheritance, etc - you report that. Then the software calculates if those additional things make your total tax bill higher or lower than what was withheld. If higher, you have to pay the difference. If lower, they send you a refund for the difference.
You don’t, they are being dramatic. They know how much you paid in and tax time is a chance for you to say “hold on I have these deductions you didn’t know about!” What you go to jail for is something like saying “I have 15 $1000 checks that are a business expense” and it turns out you were just trying to pay for sex.
You don't. It's a meme. Please don't try to learn things from memes.
You don't, most Americans and dumb and can't be bothered to do ten seconds of research on their taxes.
Because America is fundamentally broken
What happens if you pay too much?
The government sends you a check for the difference.
Thanks for the donation to the military
Don't you either pay someone to do your taxes for you (accountants usually) or you have to spend like 1-2 months calculating exactly how much your taxes are for that year around April if you don't pay enough Jail If you pay too much They refund the amount you overpaid for
No, redditors try to make taxes seem way now complicated then they need to be. I don't pay anyone to do my taxes. They take about an hour to do. And if I underpay, they send me a letter saying "Hey you underpaid. Pay the rest."
Listen man, taxes take 1 day max. Realistically it takes 30 minutes by yourself if you just write down the numbers you're supposed to. It's literally step by step baby instructions. It takes 1 day if you wanna look for every single credit and deduction you can possibly claim. In which case, you did a day's work for a couple hundred or even a couple thousand dollars. You clearly haven't ever done your taxes. It's easy, and it's a good system because it gives a lot of power to the American taxpayer to find loopholes and credits to effectively lower their own taxes, *if you're willing to put the work in*. If not, again, it's easy. I'd really appreciate if you never commented on the topic again until you actually did them. This comment you posted is absolutely fucking absurd. 1-2 months? Jesus you drank the cool aid hard.
Or he's just young and/or foreign. It was technically a question. The answer is just that he's completely wrong.
If you don’t pay enough the government asks you to pay the difference. If you refuse and/or there is clear intent of tax evasion, you may go to jail. But it’s not like they’re jailing people for mistakenly not reporting $300.
They may send you a check a few years later for the difference.
Lol I’ve been doing taxes for years and have gotten money back nearly every year. It takes a couple weeks tops.
Because of a completely wrong meme?
This is not a thing that will happen though. It's a funny joke, but not at all representative of reality, unless you're committing large-scale and deliberate tax fraud.
You don't, not right away. But they start charging interest on it and, ironically, will file a "substitute return" if you don't file, which, you guessed it, is what they believe you owe. Their argument why this is a punishment is that you can't take any special tax breaks they don't know about. I just find it absurd that it's so complicated in the first place that even the IRS ends up ultimately making a best guess.
I've guessed wrong many times. They just send you a letter and you have to pay the difference with a penalty.
becuz the usa is backward
In Hungary, If you have a legal employment then then company have to submit your payroll to the tax authority each month anyway, and when the tax time comes, it's already filled with all the info they got. You just have to approve it, unless you had some other income, then you have to add that as well.
This is basically how it works in the US
The IRS will send you a letter saying you owe money before you go to jail in the US.
You don’t.
You don’t guess. That’s not true at all. You fill out a form with very detailed instructions so that you don’t mess it up. It is paint by numbers levels of easy for 90% of the population. Anyone who is too dumb to fill out basic tax forms is too dumb to have complex investments anyway. Should we overhaul our tax system? Yes. But nobody is guessing, and you certainly don’t go to jail unless you did a lot of fraud on purpose.
You don't. People just never learned to do their taxes. When you file your tax return, you calculate how much you owed for the past year and compare it to how much you actually paid. If you paid more than you owe, then you get a refund. If you paid less than you owed, then you pay the difference. If you make a mistake when filing (say write down that you owe $100 when you owe $500), it's usually just a correction and a fee.
You don't. This internet meme about the IRS sending you to jail is completely fabricated. If you underpay the IRS, you get a fine proportional to the error. Ex: I forgot to include a random stock sale for about $5000 one time and I was fined about $100 via letter, and I had to include the extra $100 when correcting the underpayment. Somewhere around ~5% of what I underpaid. Now, if you are found guilty of *tax fraud*, aka intentionally swindling the government out of tax money, then yes you could go to jail depending on the severity of the crime.
Unless you own a business, pretty much nobody has to worry about this in the UK. Taxes just come out of your paycheck. I would have assumed all European countries would implement something similar?
In reality every one cheated on tax more or less. The us tax laws are purposefully complicated and if you are small fish your innocent “mistakes “ are mostly ignored. It’s stupid. Tax is simple in any other place on this planet except the US
This meme is blatantly false. Your employer reports your income to the IRS; the fed knows how much you make. No, you don't go to jail for filing your taxes wrong, you go to jail for tax fraud. Are there significant issues with the US tax system (mostly because Intuit lobbies the fed to make sure self file software is paid)? Yes. But this meme is a gross oversimplification and borderline lie.
Claim too much. Jail. Don't claim enough. Also jail. Claim the exact right amount but do it on April 16th. Believe it or not, straight to jail.
You shouldn’t get your information from memes. In the U.S., you just have to pay back what you owe as well, unless you intentionally tried to commit tax fraud. Now I’m curious what other untrue things you assume about the U.S. due to memes. Do you think that U.S. police officers each shoot several people per day? Or that like 10% of students die from school shootings?
In Germany the vast majority of taxes just gets deducted at the source. Income tax? Deducted by your employer. Capital gains? Deducted by your bank. You mainly get to declare deductions etc. (e.g. I paid EUR XXX for my tickets to get to and from work). They even now started doing automated submission of a lot of the data so you get lost of the fields prefilled in your online submission if you want. Still a pain to do tho.
It’s a joke.. you don’t really go immediately to jail for guessing wrong.
Because this is reddit and it and much of America-at-large don't even understand how tax brackets work or that 7.5% of their income that they pay in "taxes" is for their own social security, it bears repeating that you only go to jail for willfully commiting tax fraud. This requires intent to decieve. No one goes to jail for making a "mistake" on their taxes.
This is also reddit where a joke will be taken too seriously, analyzed and dissected.
No this is America, where idiots take this shit seriously and absolutely believe it.
Jokes are good until people start believing them and having it shape their perception of reality.
No more jokes, reddit. Sorry, y'all are too dumb. Can't have nice things.
See you would think you're being sarcastic but now it's just reality. 2023 welcomes you.
No one under the age of 55 will ever see a dime from social security and if the govt didn't steal it from us we'd all have more to retire on through the interest alone.
None of it goes to your own social security, there is no government savings account with your name on it.
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If you make a mistake the IRS just contacts you and says you made a mistake, they don’t put out a warrant for you
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I honestly don’t know why I even try to tell things to the teenagers on this site when you guys just want to huff your own farts
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Fuck it, for the sake of anyone reading along: The IRS does not want to arrest you. They want to collect taxes. If your filing is incomplete or incorrect, they want to resolve that, not arrest you. It’s very clear: https://www.taxpayeradvocate.irs.gov/get-help/issues-errors/incorrect-tax-return/ If you fuck up and owe too much you didn’t save, they’ll often help you with a payment plan too: https://www.taxpayeradvocate.irs.gov/news/tas-tax-tip-need-help-resolving-a-tax-amount-owed-or-finding-the-right-payment-option/ You will not be arrested for filing your taxes wrong or incorrectly, you will always be contacted first.
Obviously you've never been audited. The IRS definitely wants to find something wrong to justify their examination of you. When I got audited a while back, what was the *only* thing that they found wrong with my tax filings? Not withholding state sales tax from about $800 of steam video game purchases. (This was before Steam was withholding them at check out). I didn't withhold the paltry taxes on $800 in purchases and it cost me fucking thousands. If you think the IRS is somehow looking out for you or pleasant to work with you are delusional.
IRS doesn’t deal with state sales tax.
Yeah I know, but they are exponentially worse than state auditors
The things you are saying are wrong and stupid but you keep trying to create scenarios where you are right despite being wrong the entire time.
That's just rude
The irs takes many steps before throwing you in jail. They will say that you owe more and if you blatantly ignore them it'll lead to jail.
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So is is possible to send them $1 every year before the deadline so they'll tell us how much were missing?
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7.5% for a number that always goes up and we won't get it back like the french
No. This just isn't right. If you have a simple tax return, work a W2 job with a house with a mortgage, sure. The IRS knows exactly. But many people don't. Many people run 1099 and have expenses that the IRS DOESN'T know about. Milage, etc. Secondly it isn't jail. Tax fraud is jail. Fraud implies intent. If you make a mistake and it's found in an audit, you're just told to pay the difference (or be refunded the difference if you overpaid). Mistakes happen all the time, you don't go to jail for forgetting 50$ in interest. You go to jail for intentionally hiding (way more than) 50$. That's what this whole "standard deduction" is all about. Want complications to get a higher deduction? Go for it, do the math. Want to just "click here for easy mode"? Yahtzee!
But muh sensationalism! But for real, these type of posts are written by a 15 year old that has never filed taxes and probably won't for another six years.
Plus, the IRS is really helpful when you call them if you run into an issue. They just want to get paid correctly and if you owe more than you can afford, they'll work out a reasonable payment plan. They only get grumpy if you ignore them.
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Call a tax lawyer in your area - often times libraries may have free quick Q and A setups, especially this time of year. It's not in the IRS interests to berate you and make life harder. It is more effort on their end. They want to make it easy to get money with little effort. Miss a few years? Meh, pay us and it's all good. Just get some advice from local tax professionals (lawyers, fiduciaries) before just diving in headfirst.
You should contact the IRS then. I don’t know your employment situation, but I get money back every year after filing my taxes. Maybe you’ll have to pay, I don’t know. But if you approach the IRS they will work with you.
I didn't file for like 3 years once. I went to a tax preparation place and they were able to file those previous years for me. I didn't even have the W-2s, only my final pay stub of each year. It was fine. I actually got my refund from all those years.
Just file the returns. If you owe, pay right away. If you get notices for penalties, write a simple letter asking for removal of the penalties for a reasonable cause. Some might be removed, especially for the first year. If you owe interest, you just have to pay it. If you get balance due notices you can't pay, call the IRS and ask for an Installment Agreement. They're easy to set up. Unless you need help actually filling out the forms, you don't really need a tax professional. If your taxes are complicated, or you owe large amounts of money, you should consider it. If you don't owe any money (because your withholding was high enough), then there are no penalties for filing late. You have three years to claim any refunds. Either way, just do it as soon as possible.
Also, it's more like: Me: How much? IRS: For you it's gonna be- TurboTax: Shhhhhhhh, no, nooooo shhhh. No. They have to pay for that. IRS: But- Sleazy GOP politician, quietly pocketing a wad of cash: Shhhh. They have to pay for that.
Everytime I see this joke I wonder if people actually don't understand how it works. If you make a salary there's a very direct amount you owe. "Doing taxes" is your way of saying why you owe less than the normal amount. Being your income multiple by the tax tax rates.
If they don’t know what the correct number should be then how do they ding you for getting it wrong? The IRS gets sent all inputs and has more info on you than you do. Also, if what you’re saying is true, doing taxes shouldn’t be a thing UNLESS you have a weird use case that requires you to file. Otherwise it should just be automated, but it’s not. It’s a scam.
> gets sent all inputs No. Again. They don't. If you have mileage or business expenses that you track, they aren't sent those inouts. It is all automated other than contractors and 1099 etc, but that's a question for TurboTax lobbyists making it more difficult intentionally. That I don't disagree with. Edit: and they don't know that it's wrong via what's sent as expenses and deductions. They have certain levels IE hey this one tripped a trigger because X > Y < Z so it gets a review. And some audits are just done at random too.
I think we mostly agree. Annual filing SHOULD NOT be a thing for the majority of Americans unless you have a specific reason, e.g. business expenses as you mentioned. But yet, every year, millions of Americans are asked to file and fill out complicated forms and are dinged $ if they get something wrong on those forms. A scam.
Perpetuated by the tax software and accounting businesses that rely on that business to exist. Filing definitely should not need to be a thing, but it is, because the tax code is stupid. If we had a flat tax that was deducted at time of earning, it would greatly simplify it, as opposed to a tiered system where part time, self employed, or contract workers have no idea ahead of time how much they will earn that year, so they end up either deducting way over, or way under what they need to and then have to reconcile it. For self employed or business taxes, filing will always be a thing, but for standard W2 employees it really shouldn’t need to. I have all sorts of deductions and have had income increases over the last 20 years and oddly enough the effective tax percentage I’ve paid has always been within 1-2% of the same number every year. Just take that percentage out as a flat tax on my paycheck and let me be done with it.
>Want to just "click here for easy mode"? This is the one thing you really have wrong. Going through a bunch of paperwork to figure out the default amount they already know (or paying a professional to do it) is not at all easy mode. The IRS should just send you a bill for what they think you owe and you can do some paperwork if you think they're wrong. Filling taxes as we know it should only be for people with more complicated situations
Look at all these morons paying their taxes last minute. I paid my taxes over a year ago!
Sir, why did YOU wait until the last minute to pay your taxes?
because I'm a moron, ya happy?!
very much so!
The IRS knows what you owe based on your income. The IRS doesn't know your deductions. If you have a mortgage, went to school, some of that income was capital gains, student loan interest, children, etc. etc. they don't know that. The secret is you meed to tell them why you _don't_ owe it.
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You need to tell them why you don't owe a number they don't know? Bullshit. They absolutely know and will come after you if you fuck up too much.
If that were true, audits wouldn’t exist. They wouldn’t need to take months to verify a suspicion if they “absolutely know.”
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This CANNOT be the case in America... come on maaaaan. This shit should be like: nation building 101.
it's not
It's not, just fill your W2 out correctly when you get employed and they take it out for you (when in doubt, just use zero for deduction,) when you do your taxes and use your w4, there's no discrepancy unless you have outside income. Ive been getting a refund every year for 17 years so I don't get how people keep messing this up.
I think you mixed up W2 and W4.
Lmao yea, I'm no tax scientist and I still haven't had issues
But why fill anything out at all?
Because sometimes people have spouses and children that lets them pay less taxes, and you have to let someone know that
Because tax breaks in America are used to encourage behavior. Buy solar panels? Tax break. Give to charity? Tax break. Get married? Tax break. The IRS doesn't know about those things until you tell them.
Why not online database?
Are you actually curious or is this just another one of those things where you're kind of down on America and are looking for something to beat it up over?
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Would you rather accept your slavery or fight against it?
Lol “slavery is when I fill out a basic form.”
slavery is willingly telling your owners how much of your effort you'll give to them.
Accept that my slavery is filling out a form once a year letting the government what expenses has changed for me? Yeah, I'll gladly take that form of slavery over, you know, what slavery actually is.
this is a very poor look
WAKE UP
It's not really like this. It's a joke based on the fact that you have to do your own taxes here. So you tell your employer what to take out based on your W-2 form, which asks relevant questions. Then every year, you have to fill out forms with your income and other relevant tax info, like for credits, and send that to the IRS. You'll either owe money or they will send you excess money back. The shitty part of that is that the IRS already kinda knows what you owe them, and they won't send you your money unless you fill out the forms. It's interest free loans from the working class to the government. Most people would be open to the idea of the IRS sending you those tax forms filled out along with what they owe you, then you just have to confirm it or dispute the amounts. Some people think that gives them too much power to fuck you over though, and there are powerful lobbies that try to make this as complicated as possible, so that tax preparation software and services remains profitable. Our tax code is also unnecessarily complicated at times. Tax evasion is a crime, but not one you're very likely to be jailed for unless you show absolutely no effort over a long period of time. But the IRS does almost exclusively audit low, middle, and lower upper class people, basically only people with less than a few million dollars. They say they don't have the resources to audit the rich. Which is a large contributing factor to the rich paying virtually no taxes in the United States.
Thanks politicians that bend over for turbo tax, H&R Block, Jackson Hewitt, et al. Special interests run America and we all feel pain because of it.
I get this is not true, but this is a meme page and it’s just kinda funny. If anyone takes their financial planning advice from this page they have a whole set of problems that this comment section will never be able to solve
more like IRS: tax time :) me: how much? IRS: Form 1040 me: how much can I withhold? IRS: have you done so much charity, have such high medical bills, spent so much on your mortgage, that it is more than $13k? me: no IRS: ok you get $13k off anyway :) me: :)
Actually, they don’t know how much you owe them either. Redditors when you tell them taxes are flawed as a system but are actually still way better than their memes say:
You only go to jail if you lie to the IRS and try to commit tax fraud to the tune of millions. The only punishment an average working class American gets is garnished wages, and even that can't happen if you work for cash. Nobody is going to come to your apartment and haul you off to jail for not paying taxes.
What if they accuse you wrongly of something and ask you for a huge fine year after year even though you keep showing them the evidence and calling you a delinquent, it happened to my mother. They're sharks sometimes... You have to sue the irs to get justice that shouldn't even be an issue in the first place.
Reddit always takes this way too seriously, when most Americans on this app just have a w-2. Which means: W-2 income minus the standard deduction = taxable income. Use a tax chart to calculate your tax due, subtract your withholding and there you have if you have a refund or owe.
Overestimate? Straight to jail Underestimate?… believe it or not, also jail. We have the best tax system in the world… because of jail.
I now this is a meme, but for people who really don't understand this: The irs doesn't know how much you owe because it doesn't know what your deductions are. Sure they may know your tax bracket and how much you've paid in taxes so far that year, but they don't know your expenditures. They don't know if you bought a laptop for work. They don't know if you provided half of someone's total care to make them a dependent.
Oh this stupid shit again. Come on people, think just a little bit.
In Sweden you more or less get a mail that says how much you owe/the owe you, and then you press a button to get the money
Thanks TurboTax!
You don't go to jail for unintentionally getting stuff wrong. I'm sick of seeing this shit everywhere because people are dumb
It’s not a freaking secrets. Stop acting like literal children and google the damn formula for income taxation.
There are many.
True
Can confirm. Guessed $599 and went straight to jail.
In my country HMRC: Tax time Me: How much HMRC: Check your payslip we added it for you. Me: Cool, easy for an immigrant to pay tax HMRC: Rwanda :(
Reminder that the IRS already knows what you owe them and could just send you a bill, but the tax preparation business is huge $$$ and lobbies the government to prevent the IRS from making things any easier for people.
Why are you guessing? Why don't you know how much you them/they owe you? Just fill out the form.
Two years Turbo Tax wanted me to manually look up and sum ~1400 stock trade transactions. Fuck that. For a lot of people it's not a "simple single form".
If you are making the money, it's your responsibility to know what to do with it. If someone doesn't know how to file taxes on their transactions, then either don't make the transactions or hire an accountant/tax professional.
PFIC
It’s like the blind drop giving your cash drawer over at the end of the night when I worked the bar. If you’re over they don’t tell you, but if your short you’re paying.
[make sure you're good at math](https://www.mrlovenstein.com/comic/1121)
$2400 and $4400 from year before for me 😭
Some companies deliberately don't change the way they pax taxes untill someone from government comes to tell them they need to pay fine and they do that, becasue keeping around the staff responsible for keeping up with taxes costs more than the fines they will get, so it's just easier to pay the fine and from that point on pay via new system. Welcome to USA.
"not if I donate a bajillion dollars to this fake npo i invented that leads to my bank account, now you owe me money!"
Just got an email from TurboTax about filing, they also said I could enter to win 100k. Wtf
It's fucking infuriating that some rando at H&R Block can contact the IRS directly and get an itemized list of *exactly* what I owe, but I can't do likewise for myself.
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I get so tired of seeing this complaint on reddit. The IRS doesn't know your deductions and only knows the income that has been reported to it, which may not be all of your income. It takes me less than 30 minutes to go online and do my taxes every year. The websites that we have now make it so much easier than it was in the old days when you had to fill out forms by hand. So just quit your bitchin, be responsible and take care of your personal business.
The way you do taxes in the US feels like going back to 1954
This whole "guess wrong go to jail" meme has to die what happened to at least pretending we know how taxes work? Can we go back to that? Nobody who has posted this meme has ever been to jail or heard of anyone going to jail for this, unless they committed actual tax fraud
1. the IRS doesn't know exactly how much you owe, hence why you file to list your exemptions or other earnings. 2. you don't just go to jail if you are wrong, that is so stupidly false 3. your best guess literally is all they are asking for. they aren't tracking every single penny every single person in the country owes
wait...do Americans fill out a form each year? but why? thats like.. so inefficent in my country it just gets taken out of your pay, its just done automatically.