Magazine article Mother Jones

Taxes Made Tolerable

Magazine article Mother Jones

Taxes Made Tolerable

Article excerpt

FORMS AND CONTENT

Joe Bankman isn't the first person to bemoan the morass that is the U.S. tax system, but he may be the first to make some huge improvements. Like, how about not having to fill out a return at all?

A professor of law at Stanford University, Bankman created Ready Return, a program that could help wage-earning Californians who don't itemize deductions. Because the government gets everyone's W-2 information, it has all the numbers to draft simple returns and send them out. "A good analogy is the property tax bill," said Denise Azimi, spokeswoman for the California Franchise Tax Board. "The property tax assessor doesn't tell you to sit down with a blank form and crunch all the numbers from the raw documents."

This model of pro forma-or prefilled-returns is used in a number of European countries and has been discussed in the United States but never implemented. Bankman, however, has decided to take the straightforward plan to the California Legislature and make it work.

Both ends of the tax transaction could benefit. California's Franchise Tax Board estimates that 800,000 state residents simply don't file tax returns. "About 25 percent of people who have to file a tax return don't have the literacy and numeracy to do it," Bankman says. Making filing easier for the average citizen would get many more of them to pay the 1RS. But a lot of these nonfilers stand to gain under the plan too. Many people eligible to file simple returns based on simple finances are likely to be minimum-wage earners, and a lot of them are actually due refunds.

Bankman has bestowed California with an elegant tax solution before. In 2003, he helped state legislators write one of the most successful tax bills in recent memory. His idea: Increase penalties for folks caught evading their taxes but also offer an amnesty period during which tax cheats could avoid the penalties if they paid up. …

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