A Massive Giveaway to the Tax Preparation Industry
April 9, 2019 10:44 AM Subscribe
ProPublica reports on the Taxpayer First Act, which, far from putting the taxpayer first, permanently blocks the IRS from providing for free taxpayer filing of income taxes. This is one of the few bills in the House with actual bipartisan support, including such liberal lights as Ron Wyden and John Lewis.
Experts have long argued that the IRS has failed to make filing taxes as easy and cheap as it could be. In addition to a free system of online tax preparation and filing, the agency could provide people with pre-filled tax forms containing the salary data the agency already has, as ProPublica first reported on in 2013.Planet Money reported on the issue in 2017, with a followup last week. ProPublica has been reporting on the battles over this issue since 2013.
The Free File Alliance, a private industry group, says 70% of American taxpayers are eligible to file for free. Those taxpayers, who must make less than $66,000, have access to free tax software provided by the companies. But just 3% of eligible U.S. taxpayers actually use the free program each year. Critics of the program say that companies use it as a cross-marketing tool to upsell paid products, that they have deliberately underpromoted the free option and that it leaves consumer data open to privacy breaches.