H&R Block snuck language into a Senate bill to make taxes more confusing for poor people
Source: Vox
H&R Block's entire business model is premised on taxes being confusing and hard to file. So, naturally, the tax preparation company has become along with Intuit, the company behind TurboTax one of the loudest voices on Capitol Hill arguing against measures that make it easier to pay taxes. For example, the Obama administration has pushed for automatic tax filing, in which the IRS uses income information it already has to fill out your tax return for you. That would save millions of Americans considerable time and energy every year, but the idea has gone nowhere. The main reason? Lobbying from H&R Block and Intuit.
But H&R Block's latest lobbying effort is even more loathsome than its opposition to automatic filing. At the company's instigation, the Senate Appropriations Committee has passed a funding bill covering the IRS whose accompanying report instructs the agency to at least quadruple the length of the form that taxpayers fill out to get the Earned Income Tax Credit.
It is hard to adequately express how despicable this is. The EITC is one of America's premier anti-poverty programs. It targets poor families specifically, and because you have to work to get it, countless studies have found it encourages single mothers and other people without much connection to the labor market to enter the workforce. The Census Bureau estimates that it and the related Child Tax Credit keep 9.4 million people out of poverty every year, and recent research suggests that when you take into account the people the EITC brings into the workforce, the real number is probably twice that. If that weren't enough, it also boosts test scores for kids in families receiving it and improves both parents' and children's health.
But because it offers refunds for people who otherwise don't make enough to file taxes, the EITC expands the market for parasitic tax prep companies like H&R Block and Intuit. Currently, recipients only have to fill out a single-page form, and the IRS operates free tax preparation centers for low-income people having trouble completing their returns. But that hasn't stopped commercial tax preparers from swooping in, and currently two-thirds of EITC claimants pay to have their returns prepared. Commercial preparers charge hundreds of dollars in fees, so a huge chunk of EITC benefits are going to these useless garbage companies, rather than to actual poor people. Preparers also used to offer high-interest "refund anticipation loans," which were even more costly; regulators have pushed those out of existence, but similar "refund anticipation checks" remain.
Read more: http://www.vox.com/2015/8/24/9195129/h-r-block
secondvariety
(1,245 posts)WTF is next? It never ends...
progree
(10,918 posts)GoneFishin
(5,217 posts)cut of it.
BadgerKid
(4,555 posts)Flying Squirrel
(3,041 posts)I have a business and it would cost me $100 minimum to use TurboTax. (I've used it in the past) Since my business brings in about $1,000 a month and it's my only income, I find it hard to justify that expense.
So I do my taxes online using TurboTax, but I don't complete the entire process - I stop before the payment part, then transfer the numbers onto paper forms.
I'm sure I am not the only one...
GoneFishin
(5,217 posts)once were. By the time you get the state and corp forms add-ons it is no longer as great a deal.
They just aren't happy until they drive away half of their loyal customers with their compulsion to squeeze every last cent out of their customers' wallets.