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Unfortunately, the answer is quite simple - the tax code discourages (and will soon criminalize) the Federal government from developing free tax-filing software that Americans could use to file their income taxes. This is because for profit tax filing companies have spent a lot of money lobbying both parties in Congress to stay out of the tax filing "business" and to let them take care of things.
That's amazing. Thanks for making me aware of that development.
So what, the argument is TurboTax and the like will lose a ton of business to the govt tax portal for free filing, making companies unable to also offer free services to the same group of filers?
Ok. That's just not true. It could operate in a free market still just like anything else. Let the govt offer it for free AND companies can offer the same service for free as well. And see which portals the tax filers by and large prefer.
I really hate the cottage industry that is the tax filing software companies. For all the reasons you pointed out -- filing taxes is too damn stressful and complicated. So now we pay for convenience and we pay so we don't screw things up and possibly get audited or worse.
But what's really going on here in my estimation is that these companies are upset because they want to offer 'free' services to 'customers' and at the last second UPSALE them on 'audit protection' or identify fraud protection or whatever bundle service they come up with. Similar to insurance companies, but you know, for taxes..
Having the govt offer free filing services makes perfect sense as a govt program and its really transparently uncool for tax companies to push them out of offering the service.