Do You Really Want the IRS Preparing Your Taxes?

T he capacity of left-wingers to find new ways for the government to take care of us is inexhaustible.

Last week, the tax-preparation company Intuit announced that it would no longer be offering a free version of TurboTax through the IRS program for those making less than $72,000 (though it promises to create a more effective site for low-income Americans). “With this move,” writes a perturbed Binyamin Appelbaum in the New York Times, “the company is making clear what has always been true. Intuit and the rest of the tax prep industry want Americans to pay to file their taxes.”

So he wants the government to develop its own free-file program.

Intuit, notes Appelbaum, “tried to steer people to pay for tax preparation” by adding lines of code to the free version of its TurboTax website so that the site wouldn’t appear on Google searches. Well, yes. Of course. Let’s concede that there’s absolutely zero doubt that the tax-preparation industry has a desire to see more Americans pay to file taxes. That’s, in fact, why it exists. No one is forcing you to use their services. The New York Times doesn’t offer all its content gratis (the company even has the nerve to “steer people” to pay, as you’ll discover if you navigate to that column), and one imagines that Appelbaum doesn’t toil there for free, either.

Yet, Appelbaum contends that Inuit has dropped any “pretense of good citizenship” by creating a product that fills a market need. That sounds like good citizenship to me. But to comprehend why liberals are in high dudgeon over this, it’s important to remember that, for them, paying taxes is the ultimate act of patriotism, other than perhaps voting. So, charging Americans for the privilege of filing is akin to something like charging parishioners to participate in liturgical rites.

The optimal amount an American should pay in taxes is the absolute bare minimum permissible under the law. Every single “loophole” should be vigorously explored. Because every dollar you deny a swollen and intrusive state is a small act of patriotism. All those dollars are spent more effectively in the stock market or on a new car or at the movies or on a vanity trip into outer space. TurboTax, and other similar prep programs, help consumers take advantage a complex tax code so they can pay the Treasury Department as little as possible. Once the government takes charge of both withholdings and the paperwork, as Appelbaum desires — and, as many other nations already do — workers will almost surely be paying the maximum.

Worse, if the IRS takes over filing preparations, it would be far too easy to pay taxes. It already is. The pain should be commensurate with the size of government. Most salaried workers are disconnected from the true cost of government as income taxes are nearly invisible, embedded in their paychecks. (Yes, Milton Friedman’s biggest mistake was helping develop the withholding tax.) Now, I’m not the first person to wonder what American politics would probably look like if voters were compelled to write a lump-sum check for a third of their salaries every April and send it to the Treasury Department. We’re so taken in by this distorted system, that most Americans refer to the government’s repayment of an interest-free loan as a “refund.”

Appelbaum, who seems to believe every dollar you keep is a refund, grouses about “government’s dependence on private tax preparation” as if Washington’s first duty is to expand the public sector. As the columnist argues, empowering the IRS to both withdraw and file your taxes would also make whatever quasi-socialistic program the New York Times is supporting these days easier to administer.

Under no circumstance should Republicans allow the IRS to create its own filing preparation site to compete with the private sector. Appelbaum contends that the agency, which had a $12.3 billion operating budget for 2020 (a billion more than it did in 2019), is “starved for funding” — yet he wants to dramatically expand its responsibilities. The IRS is often used as a partisan vehicle and has proven repeatedly that it can’t be trusted. The last thing we should do is further empower it.

Read Appelbaum’s column and you might be under the impression that TurboTax and H&R Block are the ones making taxpaying difficult rather than the government. Nowhere does he argue for a simplification of our egregiously complex tax code. If you want to put the tax-preparation industry out of business, flatten taxes.