IRS to Allow Tax Preparers to Sell Your Info? 289
merkel writes "The Philadelphia Inquirer reports that the IRS has proposed rule changes allowing tax-return preparers, like H&R Block, to sell an individual's return information to marketers and data brokers. The proposed rule [PDF], which does contain some substantive protections for the processing of electronic returns, was published in the Federal Register on December 8, 2005. The official comment period has passed, but hearings will be held this month."
Comment removed (Score:2, Insightful)
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Social Security Numbers & Fraud (Score:3, Insightful)
What dingbat at the IRS thought this was a good idea?
You know, one side effect of this is that it might accelerate the Flat Tax [fairtax.org].
Re:Why not leave it to the market? (Score:3, Insightful)
Lets get this straight (Score:3, Insightful)
The IRS wants to make it easier for people that I (may) do business with in processing my taxes to sell my tax information to marketers and whatnot?
Let me think what is on my tax info (I'm not rich and don't have a tax accountant, and I'm ignorant of needing such additional stuff).
My SSN.
My income.
My major debts (mortgage interest writeoff and student loan interest writeoff).
Doesn't equifax, and the other companies that collect and sell this information already have that and more?
My tinfoil hat might be suffering from a large dose of gamma radiation, but isn't this stuff already public knowledge?
Granted, the additional provisions for more people to be able to sell this information does absolutely nothing to my benefit, but I see where having more avenues to get to what is already practically in the public domain already is going to harm me any more.
Why not? (Score:3, Insightful)
nothing is personal anymore (Score:3, Insightful)
Sadly, nothing is personal... not your ethnicity, not your income level, not your educational background, not your browsing habits, not your spending habits, not your tv viewing habits, etc... Maybe this will wake enough people up to change the way data about our lives is traded and sold to anyone with some green.
Re:Internet Stalking 101 (Score:5, Insightful)
This isn't really much of a problem if you keep an eye on your credit reports. If something shows up that isn't yours, force the credit reporting agency to verify the entry. They'll try to avoid doing this because its troublesome for them and they don't really care if the info is right or not (as long as is right enough across millions of people to be useful to businesses). Force them to actually verify with the reporting creditor. If they verify it, contact that creditor (Via mail) and force them to verify that the debit is yours. They'll try to get out of that too, and may send you improper verification. Keep after them and force them to send proper verification and proof that they are authorized by the original creditor to collect the debit. If the debit is not yours, at this point you win.
Details about these processes and the laws that make them work can be found on the creditboards.com [creditboards.com] forums. In particular read about "Debit Verification" and the "The One-Two Punch". These are extremely effective techniques for getting inaccurate items off your credit record (or getting rid of reports from debit collectors who are not properly authorized to collect valid debits).
Key point in the article (Score:3, Insightful)
So, I don't see a problem. If for some reason, say free preparation, someone wants to give away this information, isn't that their choice? As long as I have the ability to say no to this, I don't see a problem.
Personal information is a commodity today. If you want to sell it, you should have that right. If you want to keep it private you should have a choice to do that as well.
Re:Internet Stalking 101 (Score:4, Insightful)
I filled out the parts that are necessary for the Constitutional purpose of the census. For the rest, I amused myself by figuring out the most misleading possible technically true answer.
Re:Fine by me. (Score:3, Insightful)
I'm extremely annoyed that the fed. gov. doesn't just set up a website for e-filing itself. It would save taxpayers and the government millions of dollars on paper forms and processing. It's a clear case of intentional government waste in order to create business opportunities for tax preparation services. Even my humble state of New Mexico has a simple, government run web form for me to file my taxes online. It's not rocket science.
My business scheme for next year is to start printing my own paper tax forms, then sue the govt. for sending them out and competing with my "private industry."
Agreed... (Score:5, Insightful)
At a certain point (generally at about $100k), the vast majority people quickly stop consuming their income and start hoarding it. Oh sure, some will burn through it on booze, drugs and hookers, but most start shoving that capital back into capital. The higher that income gets, the smaller the percentage of it that is consumed. So, your "fair" tax would, dollar-for-dollar, tax someone making $100k the same as someone making $1M...and I got news for you, that "used property" exclusion? Well, they ain't makin' any new land, so guess what will happen to the price of dirt? Well, until we're vacationing on the Moon.
Business purposes = no tax? Again, people nearing or exceeding $100k routinely put their entire damned lives on Schedule C (or into corporations) for exactly this purpose. Even if they _do_ consume above that level, it will surely be claimed as business expense--and that's determined at the point of sale or are we back to filing returns to prove it? Well, guess what, if you can avoid taxes completely by claiming business expense...you're going to find a great number of entrepreneurs and if they have to file returns, what's the benefit again in terms of paperwork and complexity reduction? If they don't, how do we prove it was business-related? Hmm.
A "prebate?" So, everyone gets a monthly check for the taxes on the first $14k of income, assumed to be consumed? Gah... That is going to eliminate the bureaucracy precisely HOW? So, people under $14k will get prebates for whatever % of $14k or will they have to file returns to prove exactly how poor they are? That'll really free up the ol' paperwork and fraud burden, now, won't it? What if it's a family of 12 and all but one are saving every penny. Now do we file returns to prove our consumption of "necessities?" Oy vey.
The tax structure we have now is designed to induce certain behavior in many sectors. It is also designed to pay for certain _types_ of consumption, like gas taxes paying for the interstate pavement based on use. You consume pavement, you pay for the pavement. This sort of all-encompassing tax would shift the bureaucratic burden, it wouldn't eliminate it.
Really, I think the "Fair Tax" crowd has critically examined the current problem, which is certainly well due and admirable, but I don't think they've critically examined their solution, which on even first sight is fraught with all the same problems as the existing system -- and totally ignores a number of problems that the existing system deals with quite extensively.
Re:Why not leave it to the market? (Score:4, Insightful)
Re:From TFA: (Score:3, Insightful)
There is a difference between protecting people from stupidity and protecting them from naivety. No-one is an expert in every field, and no-one has time to make themselves into one. The law should encourage/require popular services to work as the public would expect, not encourage the exact opposite.
Re:Enough is ENOUGH. (Score:1, Insightful)
Because people taking home 95 % of the wealth of this country will then pay 5% of the taxes, because they comprise 5% of the population. If you make 95% of the income you should pay 95% of the taxes, that is fair.
For example, to use your approach, why don't we just tax toilet paper, since everyone more or less uses the same amount? Then the people that harvest say $200,000
Here's a different way to look at that: (Score:4, Insightful)
or
Suddenly tax-prep gets more lucrative. Of course, if they ever come through with that "flat tax" all those guys'll be out of business overnight anyway (and then I can ride to work on a flying pig every morning...)
Re:Key point in the article (Score:4, Insightful)
Sorry to flame, but that's one of the most irresponsibly simplified statements I've seen in this thread.
Do you think a company like H&R Block is going to hand you a neon orange sheet of paper with 172 pt. font that says "DO YOU WANT US TO SELL YOUR PERSONAL DATA?"
No. They're going to hide it in one subclause of a 14-page contract agreement, tersely worded so that it doesn't even mention "selling", "personal data", or "yours". It's probably gonna be a single sentence like "Applicant surrenders all rights to proclude the preparer from providing gathered data to third parties." Taxes are stressful enough without having to become a lawyer to avoid being bilked by corporations.
Wake up and smell the slap in the face.
Re:Enough is ENOUGH. (Score:1, Insightful)
Some clarifications... (Score:3, Insightful)
Which is otherwise known as "investing", which is generally a good thing, providing money for loans, growing businesses, etc.
"The higher that income gets, the smaller the percentage of it that is consumed. So, your "fair" tax would, dollar-for-dollar, tax someone making $100k the same as someone making $1M
So what? If a millionare wants to reign in his spending to match that of someone making $100K, so what? You may be interested in: http://www.fairtaxvolunteer.org/smart/faq-main.ht
But they are, of course, making new houses and other buildings. You might be interested in: http://www.fairtax.org/pdfs/TreatmentOFhousing.pd
"We need 2.5T to keep the proverbial lights on in the federal government. You WILL PAY FOR IT SOMEHOW."
The Fair Tax has been set up with an initial rate of 23%, which is calculated to directly replace the funds currently used to keep the lights on by the Federal Income Tax.
"A "prebate?" So, everyone gets a monthly check for the taxes on the first $14k of income, assumed to be consumed? Gah... That is going to eliminate the bureaucracy precisely HOW?"
The prebate has nothing to do with income. You might be interested in: http://www.fairtaxvolunteer.org/smart/faq-main.ht
"Business purposes = no tax? Again, people nearing or exceeding $100k routinely put their entire damned lives on Schedule C (or into corporations) for exactly this purpose."
This is a valid area for concern. But remember, people cheat on their taxes today. The goal of the Fair Tax isn't to make a more cheat-proof system (though I believe it does just that), but rather to make a simpler, fairer system of taxation.
Steve
"Fair" Tax != Flat Tax (Score:4, Insightful)
Flat Tax proponents want to have a flat rate tax on all income, so everyone pays a fair share in direct proportion to how much they can afford.
Re:Some clarifications... (Score:3, Insightful)
a millionare has much more at stake in this country, and his property benefits on a continuing basis much more from the social services (such as defense, police forces, fire departments, roads, etc, the courts) than does the property of a person earning $100k. (let alone $30k) It are INVESTMENTS that benefit most from such services, consumed items are consumed and by definition reap nothing.
The web page that you cited is absolutely irrelevant to the argument. It charts taxes against spending, not against WEALTH. No one denies this consumption tax based system scales up with consumption. The point is that consumption as a ratio of wealth, scales practically inversly with wealth. The parent poster's point was that the million dollar a year earner consumes almost nothing MORE than what a 100k earner consumes. The million earner merely invests more. consequently the milion/year earner pays the same tax while reaping greater benefit on a dollar per dollar basis.
this is a regressive tax system. It will lead inevitably to more and more wealth being concentrated in the hands of fewer and fewer families, and thus take us back to a system of aristocracy. That is, of course, the entire POINT. This "fair" tax, is a tax system by the rich for the rich. It has nothing to do with creating a FAIR or just society.
I'm not saying income tax is king either. But consumption taxes are far worse.
You must be joking. (Score:3, Insightful)
for example, Howard Stern likes to eat at Nobu. Dinner at Nobu is about $100. He makes that in 30 seconds (24/7). I pretty routinely eat at places, say, half that expensive at about $50. An average dinner tab for me is thus about one twentieth of one percent of my income. 1/20th of 1% of his income would be $50,000.
That's about 500 plates of Nobu goodness. He must be REALLY hungry.
He must spend much more on housing, though. Oh wait, no, his house cost $20M.
http://www.curbed.com/archives/2005/11/14/celebri
That's ONE FIFTH of his annual income. Most people around or below the $100K mark are buying homes worth FIVE TIMES their incomes--and guess what, his was "used." A great number in the $100K mark are forced out into new construction in the 'burbs. So, for a $500k suburban McMansion, I gotta pony up $69k in "Fair Tax." For Howard's $20M manse in the Hamptons, he whistles dixie.
Get it yet?