With a new congressional “super committee” tasked with finding $1.5 trillion in cuts by No-vember, creative ways to find additional revenue are in high demand. And allowing the IRS to prepare you taxes could be one solution. The idea has been around for a while, but has been picking up steam in recent years. In 2006, Senate Finance Committee Chairman Max Baucus (D-Mont.) argued it would close a $345 billion annual “tax gap.”
Obama’s former Chairman of the Council of Economic Advisers Austan Goolsbee made a strong case for it in a 2006 New York Times op-ed, explaining, “… the revenue service could send you a tax form already filled out with the information it has for you — a Simple Return — rather than a blank tax form. You would simply check the numbers against your W-2 and 1099 and then sign it.”
While running for president, then-Sen. Barack Obama touted it during a 2007 speech at the Tax Policy Institute: “The government already collects wage and bank account information,” he said, “so there’s no reason the IRS can’t send Americans pre-filled tax forms to verify.”
Members of the Computer and Communications Industry Association (CCIA) believe this is a very real threat. “There is a fundamental conflict of interest if the tax collectors also become the tax preparer,” said CCIA President and CEO Ed Black. “If you don’t trust the fox to guard your hen house, why trust the IRS to do your taxes.