Direct file and DOGE issues, fear of deportation, belief that the IRS will be dismantled... it's amazing how many different ways the current administration has damaged its revenue streams.
> Waiting to pay: The 1.1% drop in returns so far may be tied to the fact that the number of returns with balances due – as opposed to a refund paid out – has been going up in recent years, said North Carolina-based CPA Jim Buttonow, who worked at the IRS for nearly two decades before going into the private sector.
I can see that. If more people owe money as opposed to getting a refund, there is more incentive to pay later. If US govt owes you money, you handed Uncle Sam a 0% loan, and then it makes sense to file as early as possible.
This one is interesting:
> Refusing to file in protest: Every year, a small number of filers politically object to filing and paying taxes for different reasons. This year is no different.
> Olson said someone recently sent her a letter in the mail containing a copy of an angry letter they had sent to Treasury Secretary Scott Bessent. “It said they didn’t want to file their tax return and pay taxes because they were upset that the Trump administration was trying to breach taxpayer confidentiality,” Olson said.
That's happening with one of my acquaintances. They canvassed for Harris and were quite upset at the loss. As a form of protest they won't be filing their taxes. I don't know what happens then, I am not bold enough to try it myself. Even if a more friendly administration returns after 4 years, will they be willing to amnesty people who took this route. I wouldn't bet on it, and I don't see millions of people going for that option somehow, either.
IRS' DirectFile hasn't matured yet to the point of accepting health insurance and retirement data; it could only process basic W-2's. At least they made a good effort in it, will try again next year.
I doubt it's around next year. Republicans say it's a waste of money, 18F and its priorities were "deleted" by DOGE, and private tax preparation companies can more easily buy influence in the federal government now.
Providing a free service to make Americans' lives easier is not part of the business plan for the current administration. Scott Bessent only committed to keeping it available for the current tax season during his Treasury Secretary confirmation hearings.
Yes. It is IRS is deliberately dragging its feet to make it a real option for millions and millions of Americans. So that the near monopoly Intuit can rake in billions in sales each year.
I’m aware of some people who _always_ file an extension, but I haven’t pinned them down on why. Does anyone here file an extension in most/all years? Curious the reason.
If you are an American who lives abroad, you still need to file a tax return and possibly pay an obligation (two countries do citizenship based taxation: U.S. since Civil War and Eritrea).
To properly file taxes when living abroad, you usually file a tax return in your country of domicile first and then transfer select facts to the American one for credits, deductions, and other offsets.
All of this means minimally doing two tax filings. So: there you go. Heaven help you if you ever live in a place where the tax window is incompatible with the American ones.
California has a sensible policy that the IRS should adopt -- extensions are automatic. That's right, they only care that you pay at least 90% of your total tax liability by the April due date. There is never a failure to file (FTF) penalty as long as you file your California return by the October extension date.
Adding on to this. Had one K-1 come late and my CPAs strongly advised filing for an extension to give them enough time to do thorough reviews. Didn’t save me any money, they still told me roughly how much to send to the IRS immediately.
You can also file off season, get all deductions prepared, and put tax money in stocks and get a good return, usually. Last few years it was better to wait and then get pay lower.
This year, maybe because the IRS is gutted the extensions wouldn’t be manually reviewed and a reduction in audits?
Filing an extension doesn't change when income tax is due - but it changes the deadline for various things. Not just the 1040 filing deadline. Other procedures do not state their own deadline but rely of [the day your tax return is due, including extensions]. And there is no cost or penalty for filing the extension.
So you file the extension and sort out the rest later. I have in the past filed the extension (to lock in the extension date), then just days later filed my 1040 - because for once it happened to be ready early.
If you file your 1040 package without having filed for extension, you forfeit that later deadline for the rest.
The penalties and interest that the IRS charges are cheaper than any bank or credit card rate.
This time around, it's a cheap casino bet that the IRS will be totally abolished by the end of the year. Approach random systems with random strategies.
It's about 13% annualized right now. You need to add up both the failure to pay penalty at 0.5% per month and the interest at 7% per year. With good credit, you can likely get a cheaper loan.
The way I understand it is that some people put off filing as long as possible because they get a better return on other investments. They’re willing to pay interest and other fees on their taxes in order to pay as late as possible. I haven’t looked into this personally because I tend to be risk averse enough to pay off relatively low interest rate loans, but I’ve heard at least one personal anecdote once removed to this effect.
> Fear of deportation: Undocumented immigrants register with the IRS and pay billions of dollars in taxes every year. Multiple sources said members of this community might be holding back during this tax season, as the Trump administration tries to use IRS data to facilitate deportations
Readit News
Dead Comment
I can see that. If more people owe money as opposed to getting a refund, there is more incentive to pay later. If US govt owes you money, you handed Uncle Sam a 0% loan, and then it makes sense to file as early as possible.
This one is interesting:
> Refusing to file in protest: Every year, a small number of filers politically object to filing and paying taxes for different reasons. This year is no different.
> Olson said someone recently sent her a letter in the mail containing a copy of an angry letter they had sent to Treasury Secretary Scott Bessent. “It said they didn’t want to file their tax return and pay taxes because they were upset that the Trump administration was trying to breach taxpayer confidentiality,” Olson said.
That's happening with one of my acquaintances. They canvassed for Harris and were quite upset at the loss. As a form of protest they won't be filing their taxes. I don't know what happens then, I am not bold enough to try it myself. Even if a more friendly administration returns after 4 years, will they be willing to amnesty people who took this route. I wouldn't bet on it, and I don't see millions of people going for that option somehow, either.
An extension doesnt change when the taxes are due.
Maybe it about not wanting to eat stock loss yet having to sell in what looks like a bad market if they plan on using that to pay taxes.
Providing a free service to make Americans' lives easier is not part of the business plan for the current administration. Scott Bessent only committed to keeping it available for the current tax season during his Treasury Secretary confirmation hearings.
- What DOGE (allegedly) did, the GSA's + 18F's role in DirectFile, who is Scott Bessent: https://x.com/i/grok/share/HPCbOS8C5MCC7Uvwok2bg6uIk
- It `felt` like an attack but I couldn't articulate it: https://chatgpt.com/share/67f47c39-1e98-8003-a072-2c083fbe9b...
Trump administration plans to end the IRS Direct File program for free tax filing, AP sources say https://apnews.com/article/irs-direct-file-tax-returns-free-...
To properly file taxes when living abroad, you usually file a tax return in your country of domicile first and then transfer select facts to the American one for credits, deductions, and other offsets.
All of this means minimally doing two tax filings. So: there you go. Heaven help you if you ever live in a place where the tax window is incompatible with the American ones.
The lack of matchup between the UK tax year from 6-Apr to 5-Apr against the US tax year of 1 Jan to 31 Dec is the bane of my existence.
This year, maybe because the IRS is gutted the extensions wouldn’t be manually reviewed and a reduction in audits?
except now, I guess...
So you file the extension and sort out the rest later. I have in the past filed the extension (to lock in the extension date), then just days later filed my 1040 - because for once it happened to be ready early.
If you file your 1040 package without having filed for extension, you forfeit that later deadline for the rest.
This time around, it's a cheap casino bet that the IRS will be totally abolished by the end of the year. Approach random systems with random strategies.
let's hope their investment isn't the S&P500
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> Fear of deportation: Undocumented immigrants register with the IRS and pay billions of dollars in taxes every year. Multiple sources said members of this community might be holding back during this tax season, as the Trump administration tries to use IRS data to facilitate deportations