IRS vows to digitize all taxpayer documents by 2025 [Updated]
arstechnica.com
All documents will be digitized as soon as they arrive at the IRS.

IRS vows to digitize all taxpayer documents by 2025::All documents will be digitized as soon as they arrive at the IRS.

  • reallynotnick@lemmy.worldEnglish
    2·
    1 year ago

    If the IRS is being told by a person’s work how much they’re paid, by their bank how much interest they got, by any Etsy-esque services how much they were paid… then the IRS has every bit of information it needs to get automatic withholding correct.

    Unless you just want to just keep withholding on the marginal tax rate a person is currently in, thus starting your withholding super low in the start of the year and increasing it throughout the year so that come December they have way more withheld per paycheck than in January, it’s not simple.

    Future income is unknown, you could maybe design a system a system that assumes you will adjust your withholding amounts especially in the last quarter of the year to either catch up or slow down with holdings to try to best get you close to zero by the end of the year, but even then to be dead on still is a wild bar to clear as that requires that last source of income to know it’s the last income for the year.

    • LetMeEatCake@lemmy.worldEnglish
      4·
      1 year ago

      You’re also making the implicit and incorrect assumption that this assumption of future income is not already the status quo. It is. The IRS already does this with your automatic withholding. It just does it at a higher level than necessary, due to what I mentioned above. Withholding basically assumes that a person will continue to earn whatever their paycheck was in every future payment period (weekly, semimonthly, whatever).

      Your assumptions on how this would be dealt with are not realistic. The outlines of how to implement this not only already exist, they are already used and have been used for decades. All the IRS needs to do is glue together its knowledge of your income sources and lower the withholding amount based on being able to predict an individual’s income far more accurately.

      Data on seasonal income is known too, for the record. Consistent trends in income changes with parts of the year are not a surprise to the government agencies that care about it.