Intuit is consistently one of the least ethical actors in tech. They have a monopoly position in many of their products and take advantage of some of the poorest people through misinformation and lobbying.
Facebook & Uber have received most of the heat over the past few years. Intuit has strangely avoided the same level of scrutiny.
For sure. The IRS needs to offer a tax preparation platform, the grift in this industry is astounding. I've always had decent experiences with TurboTax, but they've gotten extremely good at making your taxes hell if you want to avoid giving them $89.99.
“ProPublica has long detailed how Intuit, the maker of TurboTax, and other companies have worked against making tax preparation easier and less costly. They have lobbied to ban the IRS from offering free, simple tax filing. And they have deceived customers who should qualify for the Free File product.”
I find this criticism somewhat weird. It is very common for companies or even individuals to promote and support policies that benefit themselves. Intuit is seeking self interest here. But why would IRS and our elected representatives cave in ? Are these people so clueless or unethical that they do not care about their constituents anymore ? And if that is the case I don't see how anyone can bell the intuit's cat.
By your logic, here, an independent actor doing something to terminate the employees and stakeholders of Intuit would be completely blameless, if not celebrated by the people of the United States.
It's not even a slippery slope to imply that acting in self-interest is always excusable: By the time you've gotten to that point, you're already at the bottom of any and every slippery slope. There are lines that we as a species have collectively are inexcusable to cross in self-interest, and without them life gets a lot worse for nearly everyone.
Generously interpreted, I think they are questioning why we're criticizing Intuit for doing it when we don't necessarily criticize other companies for it.
It is a simple bargain. US representatives are dependent on fundraising and endorsements for re-election which lobbyists are happy to offer in exchange for help with their agenda.
They're capitalizing on a generalized anti-government and anti-IRS sentiment. It's not difficult for them to convince representatives that the IRS would do it badly, and it should be left up to the free market.
They made, and basically broke, an agreement with the IRS. But it's really not easy for a government agency to say, "No, you broke the roles, so our agreement is void". It would basically take a lawsuit, which would be ugly, expensive, and time-consuming.
It's not so much a matter of simply "caving", as that Intuit has gotten itself entrenched and it's difficult to dig them out. In theory it's not impossible, but it would require a ton of work, time, and will. Such things are very hard to come by, especially when you're the IRS and everybody already is predisposed to hate you.
Hypothetical:
I make kerosene.... we made a bad batch that doesn't burn just right and could hinder products it's used in...
We're located in California.
We've paid politicians to look the other way while we drop it over forests, in fire zones. It's a lot easier than getting rid of it other ways.
We're enriching ourselves which is the American way, so there's definitely no problem with this, even though it may make fire season a major bitch for some people, luckily all our CEO's have homes in safer areas that won't be affected....
^ Are you saying you'd say to the above scenario: I have no problems with this.
If the answer to the above question is you would say that...
What's it like to be devoid of morality? Is there anything resembling a conscious at all?
This year we tried doing our taxes using both TurboTax and FreeTaxUSA.
TurboTax has a much worse interface, it took almost twice as long to complete the taxes despite having an identical return. TurboTax did find about $50 more return for us somehow despite having entered the same information into both sites, but that amount is less than the fee TurboTax would charge so we ended up submitting through FreeTaxUSA instead.
Next year I don't think I'm even going to bother with TurboTax.
It may be apocrypha, but supposedly Intuit years ago realized that people don't think the system "worked hard enough" if results returned immediately. (These kind of calculations are what computers do well and generally return immediately.) Supposedly Intuit has been A/B testing for decades how many artificial delays to give people the impression that the system is "working harder" for them. They intentionally want their interface to be worse and "slower" because of the idiot dark pattern that our dumb monkey brains think that "serious things" like taxes need lots of "calculation time".
It wasn't even the stupid "spinning numbers" thing that slowed us down. Mostly it was being locked into wizards asking us one question at a time.
Dialog:
Do you have foreign bank accounts? Y/N
Next dialog:
Do you have foreign investments? Y/N
Next dialog:
...
For every single damn thing. FreeTaxUSA put them all in a list so we just clicked on the applicable ones. It was much more efficient.
And if you have to go back and double check/change something TurboTax makes you go through the whole damn wizard again.
TurboTax is supposedly able to import my W2 automatically (I work for a large corporation that use a large professional third party company to do W2s), but this has never worked. I always have to enter the information by hand.
I always go to the forms and ignore the interview.
I haven't found any other software that is practical to use in this way and has all the forms I need.
I tried H&R Block's free software one year, I think, because I was mad at Intuit, but it was useless because there were big gaping holes in the functionality.
I'm curious what the big gaping holes are. I've used H&R and its predecessor, TaxCut, to do my returns for like 20 years (minus 1 or 2 years where I hired a CPA due to complicated investments and tax credits). I find it very straightforward and fast to use.
Well, I've never had employee stock options or RSUs; my needs probably differ from the typical HN commenter.
Using the word "big" may be misleading. The point is, if anything isn't quite right, it's "gaping" because what's the fallback?
And as I said, I go directly to the forms, and the free option I tried was only interview-style. I could've predicted it wouldn't work, but I did give it a try to make sure.
I'm sorry I can't be more specific, but I don't think your experience relates to mine, because I was using the free version.
I imagine there is a very hazy line between the free version being designed for typical users without sophisticated taxes and "dark patterns" designed to frustrate someone into paying.
The pay version may be better, but I wouldn't have any motivation to try it, assuming that the wizard/interview is required.
I got totally screwed last year job wise. 2 of my employers have not reported my tax contributions to the state. I never received a W2 from one of them. TurboTax was able to find all my W2 from the HR companies, but I was unable to access those HR websites for my W2s. Because my contributions weren’t reported to the state I have to get all my W2 (luckily it was in my federal return) and resend them to the state. I hate TurboTax, but I wouldn’t have been able to file my taxes this year without them.
The basic process is to:
1. Contact your employer and have them send you a W2
2. If your employer does not send you your W2 by the end of February, contact the IRS and they'll send you a Form 4852
3. If you still haven't received a W2 in time to file taxes, then you can file using the Form 4852 instead
4. If you receive the W2 after filing and the actual numbers differ from your estimates, then you have to file an amended return.
> I’m not doing that under any circumstances. I’d rather get audited
I’ve run into issues with the IRS over incorrect filings.
I am not a tax attorney or an accounting professional, but I strongly advise you to rethink your position.
Under no circumstances do you want to get audited by the IRS instead of complying with the Federal Tax Code.
Once the IRS begins its investigation, you will be obligated to pay the costs of complying with their requests, which costs may very well dwarf the costs of complying in the first place.
I don’t have any money. I literally lost everything I have accrued in my life in the last 18 months. That fact that I’m not at bankruptcy door is because of what little stimulus we got. So no, I’m too exhausted to deal with the IRS. If they care, they can serve me and drag me to court because I won’t comply at all.
This is the sort of critical thing. You do your taxes once a year but the impact could be hundreds, thousands or even tens of thousands of dollars. In your case it was only 50 but thematically this says that TT is better because it found you more credits/deductions. You don't know it's gonna "only" be 50 ahead of time. And the more complexity/money is at stake, the more important it is to get right. Once you are talking about potentially real money, the quality of the UI becomes quite secondary in my opinion.
Don't get me wrong, would love for the IRS to offer a standard free filing solution. But short of that, I want the thing that is most likely to get me the biggest legal return
It could also be that TurboTax gets $50 less on the next person. I was working with only a single datapoint. Also, from what I recall the extra $50 seemed to be coming from TurboTax counting a deduction for double what FreeTaxUSA did. I really didn't understand what it was doing there.
The quality of the UI likely reflects the quality of the overall system. If the UI is flashy trash, you really want to trust the same programmers with actual math? Source: programmer for 30 years
The person paying the taxes is not always expected to understand exactly how the tax code applies to them. IANAL but I think that when you hire a human tax accountant, their saying that your return is legally sufficient for you to testify that you are entitled to your return as filed. I don't know how that would apply to tax software, but I imagine that for purposes that TurboTax is appropriate for, saying "well TurboTax, a widely used and generally respected accounting tool generated this return, so I believe that it is correct," would be sufficient. Of course if it turned out that you were not entitled to the full refund you filed for, you would still be liable to pay back the difference, but you wouldn't be assessed an additional fine.
Again IANAL, this is how I expect the law would work, not necessarily how it actually works.
I did the same this year, but found that FreeTaxUSA's support for crypto transactions was basically non-existent. Filing through TurboTax was way less work than what I would've had to do with FreeTaxUSA.
H&R Block wanted to upcharge me additional $$ just to fill out a Schedule D on top of the $$ tier fee (the past few years these forms were included in that tier price). They lost a long term (10yr?) customer by trying to grift me this year.
I used https://www.taxslayer.com/ instead this past year, a bit more DIY but if you've done your taxes for years and they're generally the same year after year it's not that hard to read your docs and type them in the boxes. You pay for Support level, not tax form access with this service.
I'll second TaxSlayer (2nd year) after being a online TurboTax user for 12+ years, desktop app user years before that, and afraid and skeptical of jumping ship and losing "history", tired of the fake delays and dialogs.
Relatively stripped down UI/UX and few "waiting" dialogs and I have to assume a good savings of clicks vs. TT. I have a relatively easy joint return with little audit risk and basically in the "generally the same year after year" boat as well.
the IRS has actually partnered with the "Free File Alliance" which is a group of companies that partner with the IRS (Free tax filing for incomes < X).. So Saddly I feel the hope of the IRS just sending you a bill is slim.
Its a little weird. One would hope they would just send you the bill.. I filed my taxes late with an extension. I could go to the IRS site and get all the documents they had filed by banks and my employeer, for me. They have that info...
This is so bizarre looking in from the outside. I’ve spent my working life in two European countries, one where if you’re just a regular employee and not doing anything special you just approve and submit your prefilled tax return, and one where you under the same circumstances literally have do to nothing.
> I could go to the IRS site and get all the documents they had filed by banks and my employeer, for me. They have that info...
As Robotbeat says, this is literally because Intuit lobbied to ban the IRS from being able to do it for you -- which is also literally what TFA is all about. YTF do people comment on stuff they obviously haven't even read?!?
This year is the first year I've worked at a company that has stocks, ESPP plans, etc. and I'm curious what's the most effective way to file my taxes by myself if I don't use TurboTax? I've read that Credit Karma Tax (which looks like it got sold again to Cash app?) doesn't do a good job covering these scenarios.
Why not ask the question why taxes are so complicated? Ted Cruz advocated for post card tax filing but everyone hated it because it would have eliminated the winners-and-losers picking that the tax code gives politicians.
According to Ted Cruz, 9 billion hours is spent on tax compliance each year.
Tax rates should be low, deductions minimal, and compliance easy. The Laffer Curve demonstrates this value to government revenues. But the economic literacy of most people is so lacking that it always revolves into some kind of class-warfare debate.
Tangential, but related would be the UBI debate vs. welfare program.
Whatever side of the aisle you’re in when it comes to spending priorities, one thing that should be obvious is that simplification is a win for everyone except those with robust lobbying resources to fight for carve-outs.
We could spend more money with simpler, lower taxes that are applied evenly. Have a high standard deduction to protect the very poor and for every dollar over that, the government gets 10%. Simple. But the compliance industry would lose their minds. This “progressive” tax system we have is ridiculous because it isn’t progressive at all — those making money from capital gains pay less than wage-earners. Everyone should pay the same percentage regardless of the origin of funds.
> Ted Cruz advocated for post card tax filing but everyone hated it because it would have eliminated the winners-and-losers picking that the tax code gives politicians.
No, it wouldn't. Like every tax proposal, it was winners-and-losers picking, not an elimination of it. People opposed it because they didn’t like the winners and losers Cruz picked.
> The Laffer Curve demonstrates this value to government revenues.
No. The Laffer Curve says that if humans were rational - which they aren't - and if tax enforcement is 100% effective - which it isn't - then the expected revenue is zero at both 0% taxation and 100% taxation.
That's all it says. Every other point on the "curve" is arbitrary, and in practice Laffer uses this worthless conjecture about a hypothetical world that doesn't exist to justify cutting taxes on the rich, saying it will result in higher revenues. It doesn't of course, but as someone who benefits why should he care?
Around 2009 my taxes grew complicated enough that I could no longer do them by hand and had to start using tax software for them. I've consistently refused to use TurboTax because the company is so evil. H&R Block is not necessarily a more ethical company, but at the very least, there's not more unethical. (And I'm vaguely aware of there being some open-source tax software of some sort out there, but when I looked it was kind of janky and didn't seem to give me much of an improvement over filling out the forms myself. I'd love to learn that things have changed.)
does H&R Block handle investments and cost basis year over year information? That's the only tripping point im finding with whatever product I look to in comparison to Turbotax. Once your tax situation starts down that path I'm noticing getting a product that can pull from multiple investment accounts and keep track of cost basis correctly really narrows it down to Turbotax so far for me.
At that point why not engage an accounting firm? Yes it would probably cost more, but you're supporting your local economy and have a human being to discuss any questions with (as well as be responsible for any mistakes).
The last time I got a quote from a local accounting firm it was for $3,000. My tax situation is more complex than most but the difference between $150 for some paid software and an accounting firm is a lot. And the people working at the budget firms are basically just using TurboTax-equivalent software anyway.
The value proposition of a tax accountant is not usually crunching numbers. It's instead helping you find the optimal choices to make when filing, helping you model your situation in terms of tax code, and giving you advice about how to arrange your affairs the rest of the year to give you the biggest benefit come tax time.
The one I've used has consistently saved me more money in taxes than he costs. That said, my tax situation is also nowhere near complicated enough that an accountant has ever asked the order of magnitude you were quoted, so YMMV of course.
There's still a big jump in cost between, for example TurboTax Premier tier ($90 federal + $50 state = $140) and a CPA (where I've been quoted $400-$600). I don't think the level of service justifies the cost. I tried a professional once in my life, and he basically just asked me all the same questions the software would have asked me, and typed them in to his system for me. 3X-4X the cost for the services of a typist doesn't seem like a good deal.
A CPA takes a risk doing your taxes. They are responsible if something goes wrong. That is probably $400 an hour. If you are paying less than that make sure it’s actually a CPA doing your taxes. There may be a CPA at the firm, but unless they sign and do your taxes you aren’t protected by their liability.
An accountant with a CPA could have ten or twenty seasonal temps working under them, but at the end of the day they will review and sign the outgoing product. They are liable and will be on top of your case if the IRS comes to bother you, but don't expect the personal attention of the CPA.
Also, personal accounting is an increasingly niche industry.
That’s only if the CPA is in that position. My mom has worked at places where they had a CPA on staff, but they were only doing here for consulting. They never reviewed or signed anything.
2. Taxable capital gains of various kinds, including stock, options, and 1256 contracts
3. Self employment business (consulting) with multiple clients and deductions for various business expenses.
All of this took less than 2 hours and most of the data was digitally imported from various portals.
I'm guessing it would cost me at least an order of magnitude more and take similar time to do it through an accounting firm.
So i'm kind of split, on the one hand intuit is an evil company and i hope our tax system is changed/irs no longer uses them/etc. On the other hand I really don't want to spend extra 1k+ on taxes OR spend tens of hours it would take me to assemble the 50+ page return on my own.
agreed. it's "more" money, but generally less headache, you can ask questions, and get answers specific to your situation, especially questions that may include state/local tax concerns as well.
I still do my taxes manually. I've looked for open-source software to assist. I've tried OpenTaxSolver, it is OK for what it does (basic 1040 and a few schedules like SE income and Schedule C). It does not come close to handling all possible scenarios.
It's possible that you could write your own modules to handle any mising forms, in fact I tweaked one calculation that wasn't handling some edge case properly. But that's more than most people would want to do, and would certainly be more work than just doing those forms manually with pen and calculator. But like any open-source project, it relies on individual efforts like that to build something that's useful to more people.
The UI itself is extremely minimalist and would not be regarded as "user friendly" by a user from the general public.
Edit: it also only attempts a few state returns. Mine is not one of them, but fortunately in my state the tax forms are pretty easy assuming the Federal return is done.
Is H&R block actually an independent code base? The last time I opened it, it looked like a page-for-page copy of TurboTax, which made me wonder whether it was just a white-label reskin of the same.
I've went through both H&R block and turbotax's flows this previous year, and although heavily inspired, it did not seem like a reskin. Certain info was organized differently, etc.
After being completely ready to spend $40 or whatever it was for the "Basic Premium" offering of each, BOTH H&R and turbotax silently upgraded me to "Self-employed" (I am not) and said I was free to pay the ~$100 or delete my account and make a new one.
"TaxSlayer" finally let me file for like $30 or something.
It's even worse - if you don't opt-out of the data sharing, they have an absolute field day with all your financial data.
They soak up a lot of the tech talent in San Diego, and every person I've met that works there on the TurboTax team has admitted to me that they feel ethically torn about what they do.
We compete with a business Intuit acquired, and the Quickbooks online API is blatantly hamstrung to make sure you can't get that kind of data in and out of their systems.
They had published spec'd out endpoints before the acquisition that just never happened. It's outright abuse, and harms their customers, but there's nothing we can do about it.
i reckon people hate filling out tax forms by hand more than turbotax… and within good reason, even if you’re educated it can be frustrating to simply read tax regulations (which turbotax translates to simple english), and there’s a lot of anxiety around messing it up
unfortunately turbotax is also one of the major players trying to prevent tax simplification… so they’ve got a great scheme going
anyway there are more and more free options every year so let’s hope that can start hurting them… I’ve used creditkarma for a couple simple years and it’s great
> even if you’re educated it can be frustrating to simply read tax regulations (which turbotax translates to simple english)
Not sure I agree with this statement. My experience with TurboTax is that the actual tax regulations are not that hard to read, and that TurboTax's translations do nothing to resolve the ambiguities of the tax code.
For example, the tax code might allow "deduction of reasonable expenses for blah blah blah" and the TurboTax "explanation" will be "You can deduct blah blah blah, but be sure the expenses are reasonable". Ok, what is "reasonable"? Oh, well, you know, reasonable.
It's like a high school student plagiarizing something they found on the internet by rearranging each sentence just enough that it isn't googleable.
Turbo tax is great if your income comes from one or more W-2 jobs (that pay cash) and a simple stock portfolio or investment properties. As soon as you start dealing with RSUs, stock options or (horror! ESPP), it starts becoming more trouble than its worth.
The ESPP thing is especially weird. Every office job I've ever had offered ESPP (so it's not some edge case). TurboTax will double tax your ESPP, unless you know the trick to enter your real cost basis[1]--and TT won't ever prompt you with "Hey, looks like you have some ESPP! Want a step-by-step guide to enter your cost actual basis so that you only pay as much tax as you actually owe?"
I really don't get the money side of US politics. How do these companies use money (presumably) do sway politicians? Just openly contribute to individual politicians/think tanks/PACs?
How do they launder the money Is that what the PACs do? Make sure Joe Politican can get the money, but isn't seen handed a bag of cash from a company?
Or is it simply that accepting campaign donations from corporations isn't seen as corruption by voters, so politicans can do it in the open?
It's utterly insane. It's insane how much influence money can have on politics, when it's basically entirely spent on election campaigns. (And some fancy fund-raising dinners, and stuff, but I think that is less important.)
It's insane that election campaigns are such an important and expensive part of politics. Accepting millions of dollars, and for what? To keep your job for another few years. Where the biggest part of your job is getting more money for the next campaign to keep it for another few years.
I'm not sure the money always even ends up in the hands of the politicians themselves. It's the unreasonable effectiveness of advertising. Honestly it probably mostly ends up in the hands of SV.
Here's one example: I've called my congressman to complain about his support for the Taxpayer First Act (which enables Intuit), his campaign received $16k from Intuit and H&R block. They spent a combined $6 million or so on lobbying to get it passed.
The act, among other things, removed the requirement for the IRS to report on their development of return-free tax filing.
Direct PAC donations are allowed up to $5k. Super PACs are meant to be independent, can't work directly with politicians or campaigns... and therefore have to such limits. They're very often used for "indirect" lobbying.
It's a scam and everyone knows it. The people empowered by the scam are the only ones who can change it.
Facebook & Uber have received most of the heat over the past few years. Intuit has strangely avoided the same level of scrutiny.