- - Thursday, May 5, 2016

ANALYSIS/OPINION:

Americans are recovering from the annual pain of filing with the Internal Revenue Service, having paid the government more than $3.3 trillion this year alone. At almost 75,000 pages long, Americans collectively waste more than six billion hours and spend $378 billion complying with the code every year.

The solution to this nightmare should be simplifying the code, with some even calling to make the code so easy you could fill out your returns on a postcard. Others, like Sen. Elizabeth Warren, Massachusetts Democrat, suggest another solution: just have the government file your taxes for you.

This is a terrible idea that would needlessly waste taxpayer resources. Not only are there are a number of problems with giving the IRS this responsibility, the agency itself is dead-set against taking on this new job. When asked about government-controlled tax filing in 2014, IRS Chief John Koskinen flatly dismissed the idea that his agency had the capability or the will to do this.

Instead, the IRS promotes the Free File program, an innovative public-private solution to tax complexity. Free File is an e-file program available to 70 percent of taxpayers, or those making less than $62,000. Since the program’s inception over 40 million low income and active military families have saved $1.3 billion in preparation costs, while the government has saved millions in administrative costs.

Clearly, there already exists a solution to tax complexity, yet Ms. Warren chooses to ignore this when calling for government run tax filing. Rather than waste time and money having the notoriously inefficient federal government create a duplicate program, Free File should be made permanent and improved, as Rep. Peter Roskam, Illinois Republican, recently proposed. Importantly, Mr. Roskam calls for new innovations to provide stakeholders with the tools to meet security challenges like protecting taxpayer data against identity theft.

Even if the IRS did want to file your taxes for you, they probably couldn’t, and they definitely couldn’t do it more efficiently than the private sector could. As it is, the IRS has failed to safeguard sensitive taxpayer information again and again.

Just last year, the agency failed to stop a data breach that exposed the personal information of hundreds of thousands of taxpayers. Following this breach, the Treasury Inspector General for Tax Administration (TIGTA) revealed that the IRS has been warned at least seven times by watchdog groups that it needed to strengthen its protections of taxpayer information.

Last month, a report by the Government Accountability Office found the IRS does not have adequate safeguards in place to protect sensitive taxpayer data. The report warned that personal taxpayer data is often not being properly encrypted, and facilities which house sensitive IT are not protected.

Despite the inability of the IRS to manage its existing responsibilities, Ms. Warren’s absurd plan calls for ending the successful Free File program and having the agency spend taxpayer dollars creating its own e-file system.

Not only is this plan unrealistic, it’s a huge conflict of interest.

Ms. Warren wants the IRS to both determine how much you owe in taxes, and then seize your wages and assets in order to collect that tax liability. Taxpayers would be left to trust that the agency has correctly input all personal information and financial data. If any “mistakes” were made, the government could be receiving hundreds or thousands of dollars more at that taxpayers’ expense.

Advocates of government tax filing claim that no one would be forced to accept the IRS accounting of their taxes, so there’s little to fear. But the code is so complex that most Americans would have no clue if the government accurately filled for them.

While the tax code is so unmanageably complex for the majority of families, the solution is not for the government to “help.” The solution already exists in the public-private free file system. Rather than forcing the IRS to take on more responsibility against its will, lawmakers should work to ensure Free File is supported and strengthened.

Alexander Hendrie is federal affairs manager at Americans for Tax Reform.

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