The IRS seems to know and supposedly checks most of what the average taxpayer shows on his tax return. Wages and interest, Social Security payments, IRA withdrawals, among other things, are reported to the government for comparison to what we put on our return.
A very large percentage of taxpayers have only a few things to report such as wages and interest. Why not let the IRS figure what they think we should pay, deduct our withholding (which they should also know), and send us a bill or payment based on the information they have. We would then compare that with what we believe to be correct and either accept or reject their findings. A lot of people have no clue what they owe or are entitled to a refund and this would be very helpful to them.
Complicated returns would, of course, need to be filed in the traditional way. I believe though that the vast majority of the returns could be handled this way thus eliminating a lot of errors not to mention the cost of paid preparation for many people. The government seems to have most of our information at hand, why not use it?
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Sounds like a great idea. Now if only we could get someone in Washington to listen. Common sense should prevail but everyone knows how that goes.
I think this is a great idea and had a similiar one while doing my taxes this season. I don't know how deductions would work, but for those people who don't itemize and those who use the simple forms this could be a real benefit. Not to mention the cost savings for the IRS as to handling all those forms.
Great Idea, but far ahead of its time (for the IRS anyway).
I think the IRS would end up trying to fleece you with a higher amount. Just think of all the stunts they pull at DMV. If my state was allowed to send me a bill for my taxes, it would be near impossible to refute it... and in the meantime I'm sure they'd be socking me with interest.