Americans Mess Up Their Taxes. A New Law Will Help
4 days ago
- #tax-reform
- #bipartisan
- #IRS
- Millions of Americans struggle with tax filing errors due to the complexity of the U.S. tax system.
- A new bipartisan law, the IRS MATH Act, aims to simplify IRS error notices by requiring clear explanations of mistakes and how to correct them.
- The IRS currently sends vague math error notices, often listing potential errors without specifying the exact issue, causing confusion for taxpayers.
- The National Taxpayer Advocate has long recommended improvements to the IRS's error notification system, leading to the new law.
- The IRS MATH Act mandates that error notices must include plain language descriptions, itemized computations, and clear appeal deadlines.
- Other countries use 'return-free' tax systems where the government calculates taxes owed, but the U.S. tax code's complexity makes this difficult to implement nationwide.
- The tax preparation industry has lobbied against simplifying the U.S. tax system to maintain its business model.
- The IRS's Direct File program, which allowed free tax filing, was shut down due to industry lobbying.