We don’t want the IRS to do our taxes for us | Opinion

Much to the chagrin of taxpayers throughout New Jersey, tax season 2021 is shaping up to be quite a complicated, confusing process. Faced with an influx of stimulus checks and PPP loans, individuals and businesses alike are understandably perplexed. What does the additional income mean for our tax liability, and how will these changes affect our livelihoods?

Unfortunately, some members of Congress and the New Jersey Legislature believe this chaos is an opportunity to push for a return-free filing (RFF) system. Proponents believe that America needs to completely restructure its current tax system. The ongoing confusion surrounding tax liability could be resolved, they argue, if only we broaden the authority of the IRS. This contention, however, couldn’t be further from the truth.

In essence, a return-free filing system would replace our nation’s current process of tax filing by giving the U.S. Internal Revenue Service sole discretionary authority to determine how much each individual owes in taxes. No longer would you work with a tax service to ascertain your liability or refund — the IRS would instead make that calculation on your behalf. In theory, an RFF system could save Americans the effort of filing their own taxes. But in practice, the result would be a logistical nightmare, exacerbating the confusion surrounding this year’s tax season.'

The first and most obvious issue with an RFF system is that it would necessitate a vast expansion of the IRS’s power. Regardless of political persuasion, not many people have great faith in the IRS. Fewer still would like to see its authority broadened into simultaneous roles as the auditor, tax preparer, and payment receiver. Doing so would create an apparent and serious conflict of interest. As former Senator Bob Kerrey (D-NE) explained in a recent podcast on return-free filing: “You’re giving [the IRS] an incentive to raise an amount of money that you owe rather than you declaring what you owe. … It appears you’re giving the government an incentive to collect more money.”

But the problems with RFF are far deeper than a mere conflict of interest. The IRS simply isn’t equipped to handle the logistical burden that such a system would impose. As a recent Politico report clearly illustrated, the IRS is already overburdened in its current capacity. Amid the COVID-19 pandemic, the IRS has experienced a 300% surge in call volume, leaving the agency swamped and unable to meet callers’ needs. In fact, the report found that for every 12 calls placed to the IRS, 11 are going unanswered.