The Times had an article on having the IRS fill out 1040's, something which California has experimented with. Supposedly the problem is that IRS doesn't get W2 data from employers in time to do this. And Matt Yglesias also has a post that touches on the same subject.
Seems to me if people can figure out how to do electronic interchange of data so that a bill can be paid directly from one's checking account, then they ought to be able to figure out how to dump data from corporations into the IRS the same day they print W-2's. And then IRS ought to be able to put up a simple 1040 with the available data and all the payers from last year (i.e., savings accounts, brokerage accounts). Needless to say the people like H&RBlock and Intuit don't like the idea.
This reminds me of something the head of the Sherman County ASCS Office told me 18 years ago. Someone had left ASCS and set up a consulting firm to help farmers with (evading) payment limitation rules. Mike S. wanted ASCS to change and simplify and automate so that the firm would go out of business. Unfortunately that's not going to happen. Neither is IRS going to give taxpayers a strawman 1040.
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