Working for the Tax Man
With your tax return likely filed for another year, it’s probably not the time to think about tax complexity and tax burdens. But then again, it just may be. The National Taxpayers Union (NTU) released their annual study today of tax-filing burdens (press release and entire study). And it’s no surprise they found there is “little respite in sight.” According to NTU:
“ Taxpayers continue to be buried under burdensome federal income tax regulations, according to the 362,000-member National Taxpayers Union's (NTU) 10th annual study of tax law complexity trends. Taxpayers using any of the 1040 tax form series will spend an average of 26.5 hours and $207 completing their returns this year, up from 25.4 hours and $185 three years ago.
"American taxpayers are spending inordinate amounts of time and money navigating the nation's twisted Tax Code," NTU Senior Counselor and study author David Keating said. "Tax complexity probably will get worse before it gets any better, unless lawmakers start quantifying burdens (or, in the rare case, savings) for proposals that affect our tax laws."
"NTU has conducted comprehensive examinations of Tax Code complexity since 1999, providing historical trends of the increased burden on citizens and businesses in complying with IRS demands. However, the IRS recently has revised its methodology for reporting compliance burdens, making NTU's research all the more challenging.”
Three findings from the report are especially worth noting:
- “Americans filing a Form 1040 with common schedules this year will confront 155 pages of instructions, nearly quadruple the number in 1975 and nearly triple the number in 1985, the year before taxes were "simplified."
- “The average long-form taxpayer paid $268 last year for out-of-pocket filing costs -- an 11 percent increase over two years. The average self-employed taxpayer paid $444 in out-of-pocket costs -- a 9 percent increase over the same period.
- “As of March 15, the average per-client fee of H&R Block (which prepares one in seven tax returns filed by all Americans) was $169.15 -- a 5.5 percent jump from the same time last year.”
Sure sounds like it’s time for a flat tax or the Fair Tax. Time for another revolution?