Tax Return Processing Fee
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I just e-filed my tax return through TurboTax (I'm getting a nice refund :) ), and at the end of it, they asked how I wanted to pay for using their software. The options listed were "pay with a credit card" and "pay out of my refund". I had enough from my refund to cover the fee, so I chose that one. But then after I selected it, they showed another $39.99 "Refund Processing Fee" tacked onto the price I was paying for filing my federal and state taxes with TurboTax. They were charging me another fee that they didn't mention would cost anything before I picked it.
They said that if my refund had already been submitted and was in a "pending" or "accepted" status, then I couldn't remove the fee. But I hadn't submitted it yet, yet I couldn't figure out how to remove it. Replaying the pages leading up to the choice didn't allow it to be changed, and even changing numbers in my return didn't change it. (I did change them back to the correct values.) The help questions even showed that other people had been having this exact problem, and TurboTax's answer was "if your refund keeps getting rejected so that you must print an amendment to correct it, then we'll remove that fee."
I really didn't want to have to clear everything and restart and hope that clearing everything really did clear everything. But I checked the "Print" option to see if I could print my return so I could restart and just quickly re-input all my information. And TurboTax showed me a new screen that said I had to pay (with a credit card) before I could print my return. That's exactly what I had been looking for, but it was so out-of-the-way that I can't help but think that it's something they missed when they set up their "don't-allow-stepping-down-to-cheaper-options" rules for the website.
After clicking on that, then cancelling out by going to another screen, I was able to re-select my payment method (credit card or refund deduction) and verify that that fee had been removed. I paid with my card, minus that unnecessary $39.99 fee, and my total refund will be direct deposited as soon as the IRS accepts my return.
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A few years ago I found a site had signed me up to a subscription service I didn't want, and trying to cancel it was not simple.
Every time I went to cancel it would put me through at least five different prompts, varying from "are you sure?" to "why don't you like it :(" to "you'll have to pay double if you ever want it again!" After all that, just to make sure I really didn't want to be giving those few dollars every month, it would send an email to confirm cancellation for realsies.
The link in the email had to be followed less than an hour after it as sent. It regularly took longer to arrive.
After a few rounds of this with, having grown tired of following all those prompts then over an hour of waiting, I had to contact support and assert that the email was arriving but there was nothing I could do to make the link valid by the time I saw it. I suggested they use a more conservative time limit, but in the end they just cancelled it for me.
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@kazitor what the hell? Was it some kind of high-security identity theft product or something? That sounds borderline illegal...
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@Tsaukpaetra said in Tax Return Processing Fee:
borderline illegal...
Both stories are under EU guidelines
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@Luhmann Indeed. I just paid 15€ for letting a website fill out all the forms after doing a questionaire. They're offering multiple ways of paying (direct debit, credit card, PayPal, wire transfer,...) and such a bait and switch scheme would see them going out of business fast.
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@kazitor
It wasn't Amazon Prime, was it? Asking for a friend.
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Had the same experience as @djls45 although after some fumbling I did find where the payment options were. They did NOT make this $40 fee at all obvious and I feel lucky I even caught it.
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@Watson said in Tax Return Processing Fee:
@kazitor
It wasn't Amazon Prime, was it? Asking for a friend.No; I've never used Prime.
It was one of those key-reselling sites, back before I learned of how a fair few of those keys tend to be acquired.
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@djls45 said in Tax Return Processing Fee:
I just e-filed my tax return through TurboTax (I'm getting a nice refund :) ), and at the end of it, they asked how I wanted to pay for using their software. The options listed were "pay with a credit card" and "pay out of my refund". I had enough from my refund to cover the fee, so I chose that one. But then after I selected it, they showed another $39.99 "Refund Processing Fee" tacked onto the price I was paying for filing my federal and state taxes with TurboTax. They were charging me another fee that they didn't mention would cost anything before I picked it.
They said that if my refund had already been submitted and was in a "pending" or "accepted" status, then I couldn't remove the fee. But I hadn't submitted it yet, yet I couldn't figure out how to remove it. Replaying the pages leading up to the choice didn't allow it to be changed, and even changing numbers in my return didn't change it. (I did change them back to the correct values.) The help questions even showed that other people had been having this exact problem, and TurboTax's answer was "if your refund keeps getting rejected so that you must print an amendment to correct it, then we'll remove that fee."
I really didn't want to have to clear everything and restart and hope that clearing everything really did clear everything. But I checked the "Print" option to see if I could print my return so I could restart and just quickly re-input all my information. And TurboTax showed me a new screen that said I had to pay (with a credit card) before I could print my return. That's exactly what I had been looking for, but it was so out-of-the-way that I can't help but think that it's something they missed when they set up their "don't-allow-stepping-down-to-cheaper-options" rules for the website.
After clicking on that, then cancelling out by going to another screen, I was able to re-select my payment method (credit card or refund deduction) and verify that that fee had been removed. I paid with my card, minus that unnecessary $39.99 fee, and my total refund will be direct deposited as soon as the IRS accepts my return.
Thanks for making me appreciate TaxAct.
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@jinpa said in Tax Return Processing Fee:
Thanks for making me appreciate TaxAct.
Or the retail version of TurboTax.
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It's never made sense to me that so many taxpayers in the USA had to use (and pay for) tax preparation software. The French tax code is a byzantine labyrinth (as is everything else), but for "normal" cases you still don't need a professional, and there is a governmental hotline you can call if you need help. Nowadays forms are pre-filled, there's a QR code you can scan to file if everything is OK, otherwise you just complete/fix it online.
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@Zerosquare my tax situation is simple enough that I can just copy my W2, but I guess for families, maximising deductions and credits by hand
would be a pain
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@bb36e said in Tax Return Processing Fee:
I guess for families, maximising deductions and credits by hand would be a pain
That's also the main case I've heard in Dutch taxes where you don't want to rely on the official filing software - balancing deductions between partners could increase your return.
Though last I heard anything about that was 20 years ago so things might have changed since.
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@Zerosquare We have a long tradition of companies/industries lobbying for the government to not make things easier.
What the tax software companies do instead is not charge people who have low enough income (a government mandate).
And yes, the "take the fees out of your return" option is a pretty big scam.
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@Zerosquare said in Tax Return Processing Fee:
It's never made sense to me that so many taxpayers in the USA had to use (and pay for) tax preparation software. The French tax code is a byzantine labyrinth (as is everything else), but for "normal" cases you still don't need a professional, and there is a governmental hotline you can call if you need help. Nowadays forms are pre-filled, there's a QR code you can scan to file if everything is OK, otherwise you just complete/fix it online.
Our tax code at the federal, state, and possibly depending on where you live, local levels, is subject to massive yearly rewriting. Including such wonders as: if your X for Y years ago during the Z th quarter was...; or you were in a zone declared as ÁÁ during ŃŃ but not including ČČÅ...
And so on. Plus state and local tax authorities sometimes wait until after “Tax Day” to retroactively adjust their tax laws...
I think our tax system is probably the world’s most dysfunctional one.
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@M_Adams said in Tax Return Processing Fee:
retroactively adjust their tax laws
Is that constitutional?
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@dkf said in Tax Return Processing Fee:
@M_Adams said in Tax Return Processing Fee:
retroactively adjust their tax laws
Is that constitutional?
No, but technically speaking, neither is the entire progressive income tax structure.
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@Parody said in Tax Return Processing Fee:
@Zerosquare We have a long tradition of companies/industries lobbying for the government to not make things easier.
What the tax software companies do instead is not charge people who have low enough income (a government mandate).
And yes, the "take the fees out of your return" option is a pretty big scam.
Btw, do people in U.S. have better option for filing tax?
In Hong Kong, residents were offered free online tax filing service (web based with Java applet) that will carry forward your personal information from your previous filing, and the salary reported by your employer.
And the employers here often uses tax reported software offered by banks of their choice. (I know this when I had to help reinstall the tax software from Band of China at one of my previous employer, and funny that the staffs at BOC had to call me for how to install that on WinXP :P )
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@Parody said in Tax Return Processing Fee:
Congress is about to ban the government from offering free online tax filing
@M_Adams said in Tax Return Processing Fee:
Plus state and local tax authorities sometimes wait until after “Tax Day” to retroactively adjust their tax laws...
That's... insane.
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@cheong said in Tax Return Processing Fee:
Btw, do people in U.S. have better option for filing tax?
You can do it yourself on paper, use one of a few different programs (on- or offline), or pay someone to do your taxes for you. Paper is free, programs vary in purchase price and filing costs, and preparation is comparatively expensive but good if you have a complicated situation.
For most folks income tax is pretty simple and they can do it themselves in an hour on paper or for free online through one of the tax applications. It's unfortunate that the federal government isn't setting up something like what's been described for other countries.
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@kazitor said in Tax Return Processing Fee:
Every time I went to cancel it would put me through at least five different prompts, varying from "are you sure?" to "why don't you like it :(" to "you'll have to pay double if you ever want it again!" After all that, just to make sure I really didn't want to be giving those few dollars every month, it would send an email to confirm cancellation for realsies.
The link in the email had to be followed less than an hour after it as sent. It regularly took longer to arrive.At least better than G2A Shield.
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@_P_ That's exactly what it was!
I'd just bought a single key, and if I remember correctly, what happened is they offer a free 10-day (or whatever) trial of "Shield" when you first buy. I thought, "there's no guarantee this key will work and I don't intend to use this site much/again, so why not?" Nowhere was it explicit that after that trial, they'd have you paying a subscription with the details you used to buy the key. The card statement was the only indication it had happened.
I'm sure you can see why it didn't take many attempts before I cut straight to support.
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@djls45 said in Tax Return Processing Fee:
@dkf said in Tax Return Processing Fee:
@M_Adams said in Tax Return Processing Fee:
retroactively adjust their tax laws
Is that constitutional?
No, but technically speaking, neither is the entire progressive income tax structure.
All that being true, no one is going to fight that and risk being flagged for extensive audits (going back up to 7 years) while their case winds its way through Tax Court ( The IRS is given, historically, very wide latitude, as the tax code’s three objectives are
: collecting the largest amount of money possible, being used as a political weapon against your opponents, and being used as a political weapon against your opponents).And IIRC, tax laws are considered “administrative regulations” which are a very different beast under US law.
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@M_Adams said in Tax Return Processing Fee:
And IIRC, tax laws are considered “administrative regulations” which are a very different beast under US law.
Taxes are handled under "civil law" instead of "criminal law" (except that tax avoidance can be prosecuted with criminal penalties), so the Supreme Court has opined that they don't trigger the ex post facto restriction.
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@djls45 said in Tax Return Processing Fee:
@M_Adams said in Tax Return Processing Fee:
And IIRC, tax laws are considered “administrative regulations” which are a very different beast under US law.
Taxes are handled under "civil law" instead of "criminal law" (except that tax avoidance can be prosecuted with criminal penalties), so the Supreme Court has opined that they don't trigger the ex post facto restriction.
Thanks! I went all
on trying to remember that fact. Didn’t SCOTUS’s opinion pretty much apply to most if not all administrative regulations? Most of them being considered civil laws? Another + 
moment.
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@Parody said in Tax Return Processing Fee:
@cheong said in Tax Return Processing Fee:
Btw, do people in U.S. have better option for filing tax?
You can do it yourself on paper, use one of a few different programs (on- or offline), or pay someone to do your taxes for you. Paper is free, programs vary in purchase price and filing costs, and preparation is comparatively expensive but good if you have a complicated situation.
For most folks income tax is pretty simple and they can do it themselves in an hour on paper or for free online through one of the tax applications. It's unfortunate that the federal government isn't setting up something like what's been described for other countries.
On Sunday, I declared my income here in France. No Java-applet website, no weird tax software that sneaks in weird bonus fees (er, bonus for the software provider, that is), nothing.
- Log in to the web site
- Find the button to start my declaration.
- Check the pre-filled numbers, my contact details, bank stuff.
- Push the "sign my declaration" button.
- Pay no tax for 2018 because of "prélèvement à la source".(1)
Done.
(1) The French tax system is in a weird state at the moment as they switch from "pay the year after by some means or other"(2) to "pay during the year by source witholding". 2017's tax was paid during 2018, and 2019's is being paid now, and we have collectively been excused from the obligation to pay 2018's this year as well as 2019's.
(2) That system caused problems for some people - a former boss told me the tale of forgetting to put aside money during his first year working, ready to pay his taxes the following year, and having to borrow money from his parents to cover the bill. He didn't repeat that mistake.
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@djls45 said in Tax Return Processing Fee:
@M_Adams said in Tax Return Processing Fee:
And IIRC, tax laws are considered “administrative regulations” which are a very different beast under US law.
Taxes are handled under "civil law" instead of "criminal law" (except that tax avoidance can be prosecuted with criminal penalties), so the Supreme Court has opined that they don't trigger the ex post facto restriction.
That's insane.
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@Gąska said in Tax Return Processing Fee:
@djls45 said in Tax Return Processing Fee:
@M_Adams said in Tax Return Processing Fee:
And IIRC, tax laws are considered “administrative regulations” which are a very different beast under US law.
Taxes are handled under "civil law" instead of "criminal law" (except that tax avoidance can be prosecuted with criminal penalties), so the Supreme Court has opined that they don't trigger the ex post facto restriction.
That's insane.
That's how they finally nailed Al Capone. They couldn't figure out how to tie him to any of his mob's misdeeds, but some genius finally realized they could get him for tax evasion for not reporting all his (illicit) income on his tax returns.
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@djls45 wait. They've got Capone for breaking the laws that didn't exist at the time it was being broken?
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@Unperverted-Vixen said in Tax Return Processing Fee:
@jinpa said in Tax Return Processing Fee:
Thanks for making me appreciate TaxAct.
Or the retail version of TurboTax.
Once I know that a company's crooked, I prefer to avoid them altogether, if possible, rather than say, "They just rip off their customers of product x, they don't rip off their customers of product y.
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@jinpa I guess since I expect SaaS billing in general to be scammy, I don't see misbehavior there as reason to abandon the disc-based product, and instead switch to another company who likely has a just-as-broken SaaS product.
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@Unperverted-Vixen said in Tax Return Processing Fee:
@jinpa I guess since I expect SaaS billing in general to be scammy, I don't see misbehavior there as reason to abandon the disc-based product, and instead switch to another company who likely has a just-as-broken SaaS product.
Many years ago, I was choosing between TurboTax and TaxAct. TurboTax concealed its prices (you have to
passorder it to find out how much it costs), whereas it was relatively easy to find the prices of TaxAct. I recognized TurboTax's practice as being a manifestation of the sliminess of the owner, and picked TaxAct. I have not regretted this, and the OP has reinforced my view that this was the correct decision.
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@Unperverted-Vixen said in Tax Return Processing Fee:
@jinpa I guess since I expect SaaS billing in general to be scammy, I don't see misbehavior there as reason to abandon the disc-based product, and instead switch to another company who likely has a just-as-broken SaaS product.
A better reason to abandon the disc-based product is that it's a load of garbage. Or at least the Canadian version is.
e: Reading @jinpa's post above I recalled that several times throughout the process, TurboTax tried to upsell us with a bunch of paid services and/or a "Pro" version or something.
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@Gąska said in Tax Return Processing Fee:
@djls45 wait. They've got Capone for breaking the laws that didn't exist at the time it was being broken?
No. I thought you were referring to the civil malfeasance carrying criminal penalties issue.
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@jinpa said in Tax Return Processing Fee:
@Unperverted-Vixen said in Tax Return Processing Fee:
@jinpa I guess since I expect SaaS billing in general to be scammy, I don't see misbehavior there as reason to abandon the disc-based product, and instead switch to another company who likely has a just-as-broken SaaS product.
Many years ago, I was choosing between TurboTax and TaxAct. TurboTax concealed its prices (you have to
passorder it to find out how much it costs), whereas it was relatively easy to find the prices of TaxAct. I recognized TurboTax's practice as being a manifestation of the sliminess of the owner, and picked TaxAct. I have not regretted this, and the OP has reinforced my view that this was the correct decision.Turbotax offers free filing if you have a fairly simple return (i.e. you require only the most frequently used forms) and your income is low enough. If you have a higher income or need more complicated forms, then they require an upgrade to a paid version.
Edit:
In my situation (dependents, other deductions), I think I'd have to use at least TaxAct's Deluxe version, so TurboTax could be cheaper.Last year I had some stock from an ESPP that I sold, so for this year's return, at least, only self-filing would have been free. (The stock was growing, slowly, but the managing company was automatically selling off portions to cover their $35 "maintenance fee", which more than negated the growth, and moving it to my IRA would have been more trouble than it was worth to me, so I just got rid of it.)
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@M_Adams said in Tax Return Processing Fee:
Plus state and local tax authorities sometimes wait until after “Tax Day” to retroactively adjust their tax laws...
I filed my taxes in March. Then several weeks later got a revised 1099-DIV and had to amend them (both state and fed). Fuckers.
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@djls45 said in Tax Return Processing Fee:
Turbotax offers free filing if you have a fairly simple return (i.e. you require only the most frequently used forms) and your income is low enough. If you have a higher income or need more complicated forms, then they require an upgrade to a paid version.
Yes, that's at this point. The free version is largely in response to many states now offering free on-line filing. In the early years, this was not the case. Still no reason they couldn't have an easy-to-find list of various versions and their prices (including the free version).
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@M_Adams said in Tax Return Processing Fee:
@djls45 said in Tax Return Processing Fee:
@M_Adams said in Tax Return Processing Fee:
And IIRC, tax laws are considered “administrative regulations” which are a very different beast under US law.
Taxes are handled under "civil law" instead of "criminal law" (except that tax avoidance can be prosecuted with criminal penalties), so the Supreme Court has opined that they don't trigger the ex post facto restriction.
Thanks! I went all
on trying to remember that fact. Didn’t SCOTUS’s opinion pretty much apply to most if not all administrative regulations? Most of them being considered civil laws? Another + moment.AIUI (IANAL), SCOTUS said (in one of many examples of ignoring the plain language of the Constitution and making up their own BS) that the ex post facto prohibition doesn't apply to civil laws where one might reasonably expect the passage of the
ex post factoretroactive law. One instance I recall was a law that expired and was reinstated retroactively; the plaintiff should have expected that the expired law might be reinstated and planned his finances (operated his business?) according to the expired law.
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@djls45 said in Tax Return Processing Fee:
@dkf said in Tax Return Processing Fee:
@M_Adams said in Tax Return Processing Fee:
retroactively adjust their tax laws
Is that constitutional?
No, but technically speaking, neither is the entire progressive income tax structure.
The problem with that argument is that it ignores the Sixteenth Amendment, which explicitly gives Congress the power to tax income without apportionment and without regard to the census. Prior to 1913, yes, it was (partly) unconstitutional under Article I, Section 9, Clause 4. With the ratification of the Sixteenth Amendment, it became explicitly constitutional.
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@Steve_The_Cynic Wait, so all of France didn’t pay any taxes for 2018??
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@djls45 said in Tax Return Processing Fee:
Turbotax offers free filing if you have a fairly simple return (i.e. you require only the most frequently used forms) and your income is low enough. If you have a higher income or need more complicated forms, then they require an upgrade to a paid version.
Free filing for the Federal tax return, but wasn't there always an extra charge for filing the State return?
This year is the first year that I didn't file my taxes through TurboTax Online so I don't know if anything changed, but all of the previous years they made it clear they tacked on that additional charge if you chose the option to pay it out of your refund.
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@HardwareGeek said in Tax Return Processing Fee:
@djls45 said in Tax Return Processing Fee:
@dkf said in Tax Return Processing Fee:
@M_Adams said in Tax Return Processing Fee:
retroactively adjust their tax laws
Is that constitutional?
No, but technically speaking, neither is the entire progressive income tax structure.
The problem with that argument is that it ignores the Sixteenth Amendment, which explicitly gives Congress the power to tax income without apportionment and without regard to the census. Prior to 1913, yes, it was (partly) unconstitutional under Article I, Section 9, Clause 4. With the ratification of the Sixteenth Amendment, it became explicitly constitutional.
Hence the
. . .
But there's also the question of some whether the phrase "without apportionment" in the Sixteenth ought to provide sufficient exemption from the uniformity clause of Article I, Section 8, Clause 1 to allow a progressive income tax.
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@djls45 said in Tax Return Processing Fee:
@HardwareGeek said in Tax Return Processing Fee:
@djls45 said in Tax Return Processing Fee:
@dkf said in Tax Return Processing Fee:
@M_Adams said in Tax Return Processing Fee:
retroactively adjust their tax laws
Is that constitutional?
No, but technically speaking, neither is the entire progressive income tax structure.
The problem with that argument is that it ignores the Sixteenth Amendment, which explicitly gives Congress the power to tax income without apportionment and without regard to the census. Prior to 1913, yes, it was (partly) unconstitutional under Article I, Section 9, Clause 4. With the ratification of the Sixteenth Amendment, it became explicitly constitutional.
Hence the
. . .
But there's also the question of some whether the phrase "without apportionment" in the Sixteenth ought to provide sufficient exemption from the uniformity clause of Article I, Section 8, Clause 1 to allow a progressive income tax.Wikipedia's article on the 16th amendment has this interesting blurb implying some income taxes were legal before the amendment.
"After Pollock, while income taxes on wages (as indirect taxes) were still not required to be apportioned by population, taxes on interest, dividends, and rental income were required to be apportioned by population."
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@mikehurley said in Tax Return Processing Fee:
@djls45 said in Tax Return Processing Fee:
@HardwareGeek said in Tax Return Processing Fee:
@djls45 said in Tax Return Processing Fee:
@dkf said in Tax Return Processing Fee:
@M_Adams said in Tax Return Processing Fee:
retroactively adjust their tax laws
Is that constitutional?
No, but technically speaking, neither is the entire progressive income tax structure.
The problem with that argument is that it ignores the Sixteenth Amendment, which explicitly gives Congress the power to tax income without apportionment and without regard to the census. Prior to 1913, yes, it was (partly) unconstitutional under Article I, Section 9, Clause 4. With the ratification of the Sixteenth Amendment, it became explicitly constitutional.
Hence the
. . .
But there's also the question of some whether the phrase "without apportionment" in the Sixteenth ought to provide sufficient exemption from the uniformity clause of Article I, Section 8, Clause 1 to allow a progressive income tax.Wikipedia's article on the 16th amendment has this interesting blurb implying some income taxes were legal before the amendment.
"After Pollock, while income taxes on wages (as indirect taxes) were still not required to be apportioned by population, taxes on interest, dividends, and rental income were required to be apportioned by population."
Yes, but those were flat, not progressive.
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@billhead said in Tax Return Processing Fee:
Free filing for the Federal tax return, but wasn't there always an extra charge for filing the State return?
I'm pretty sure all of the big companies include the cost of online filing for Fed (so it's "free" - scare quotes required). None of them include state (so I went ahead and printed all the pages (I think I has to send 17 pages, because my state also requires a full copy of the fed) and mailed them. Paying for 4oz of postage was cheaper than $19.95.)
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@djls45 from my extremely-layman reading I’d interpret “uniform throughout the United States” to mean “same rules apply in all states”, not “uniform tax for all people.“
Otherwise even a normal “flat” tax (say, 5%) would arguably not be flat enough, you’d need an absolute flat tax, say $2,000 a year. For everyone, even unemployed etc. That can’t be the intended interpretation.
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@djls45 said in Tax Return Processing Fee:
@mikehurley said in Tax Return Processing Fee:
@djls45 said in Tax Return Processing Fee:
@HardwareGeek said in Tax Return Processing Fee:
@djls45 said in Tax Return Processing Fee:
@dkf said in Tax Return Processing Fee:
@M_Adams said in Tax Return Processing Fee:
retroactively adjust their tax laws
Is that constitutional?
No, but technically speaking, neither is the entire progressive income tax structure.
The problem with that argument is that it ignores the Sixteenth Amendment, which explicitly gives Congress the power to tax income without apportionment and without regard to the census. Prior to 1913, yes, it was (partly) unconstitutional under Article I, Section 9, Clause 4. With the ratification of the Sixteenth Amendment, it became explicitly constitutional.
Hence the
. . .
But there's also the question of some whether the phrase "without apportionment" in the Sixteenth ought to provide sufficient exemption from the uniformity clause of Article I, Section 8, Clause 1 to allow a progressive income tax.Wikipedia's article on the 16th amendment has this interesting blurb implying some income taxes were legal before the amendment.
"After Pollock, while income taxes on wages (as indirect taxes) were still not required to be apportioned by population, taxes on interest, dividends, and rental income were required to be apportioned by population."
Yes, but those were flat, not progressive.
My point was I thought all income taxes were illegal before the 16th amendment.
I'm not sure why flat vs progressive matters as far as the law goes. The closest bit I could see in that wiki page was Article I, Section 8, Clause 1 which requires that taxes be uniform. Obviously I'm not aware of case law, but when I read that, I assume it refers to the tax rules being uniform, not a rate or amount.
I found a part of the Taxing and Spending Clause wiki article on the Uniformity Clause that seems to agree with how I read it.
"Here, the requirement is that taxes must be geographically uniform throughout the United States. This means taxes affected by this provision must function "with the same force and effect in every place where the subject of it is found."[37] However, this clause does not require revenues raised by the tax from each state be equal.
Justice Story characterized this requirement in a light more relevant to practicality and fairness:
'It was to cut off all undue preferences of one state over another in the regulation of subjects affecting their common interests.
Unless duties, imposts, and excises were uniform, the grossest and most oppressive inequalities, vitally affecting the pursuits and
employments of the people of different states, might exist.' "
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@topspin said in Tax Return Processing Fee:
@djls45 from my extremely-layman reading I’d interpret “uniform throughout the United States” to mean “same rules apply in all states”, not “uniform tax for all people.“
Otherwise even a normal “flat” tax (say, 5%) would arguably not be flat enough, you’d need an absolute flat tax, say $2,000 a year. For everyone, even unemployed etc. That can’t be the intended interpretation.I think the argument would say a flat percentage would be uniform, but progressive taxes aren't, because people with higher incomes are paying a different percentage, implicitly creating a form of classicism, which the uniformity clause was intended to prevent.
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@djls45 said in Tax Return Processing Fee:
@topspin said in Tax Return Processing Fee:
@djls45 from my extremely-layman reading I’d interpret “uniform throughout the United States” to mean “same rules apply in all states”, not “uniform tax for all people.“
Otherwise even a normal “flat” tax (say, 5%) would arguably not be flat enough, you’d need an absolute flat tax, say $2,000 a year. For everyone, even unemployed etc. That can’t be the intended interpretation.I think the argument would say a flat percentage would be uniform, but progressive taxes aren't, because people with higher incomes are paying a different percentage, implicitly creating a form of classicism, which the uniformity clause was intended to prevent.
From what I've read, uniform doesn't apply to the amount collected, but the rules for determining the amounts collected. Like I've said before when I read that clause that was how I read it. Everybody who makes $50k will pay $X in taxes. Everybody who makes $60k will pay $Y in taxes. Everybody in situation A pays $B less in taxes. Largely, the exact rules don't matter.
However I can see why others could read it differently and if I had a time machine I'd ask the framers to use more precise language for this kind of thing.
Here's something amusing and interesting to think about - how much of the Constitution would have been written differently (hopefully to be more precise) if the framers knew the sort of legal nitpicking that would happen over the years? Would the 2nd Amendment have been written differently? Would the General Welfare clause have been more targeted? Etc. Etc.
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@mikehurley said in Tax Return Processing Fee:
@djls45 said in Tax Return Processing Fee:
@mikehurley said in Tax Return Processing Fee:
@djls45 said in Tax Return Processing Fee:
@HardwareGeek said in Tax Return Processing Fee:
@djls45 said in Tax Return Processing Fee:
@dkf said in Tax Return Processing Fee:
@M_Adams said in Tax Return Processing Fee:
retroactively adjust their tax laws
Is that constitutional?
No, but technically speaking, neither is the entire progressive income tax structure.
The problem with that argument is that it ignores the Sixteenth Amendment, which explicitly gives Congress the power to tax income without apportionment and without regard to the census. Prior to 1913, yes, it was (partly) unconstitutional under Article I, Section 9, Clause 4. With the ratification of the Sixteenth Amendment, it became explicitly constitutional.
Hence the
. . .
But there's also the question of some whether the phrase "without apportionment" in the Sixteenth ought to provide sufficient exemption from the uniformity clause of Article I, Section 8, Clause 1 to allow a progressive income tax.Wikipedia's article on the 16th amendment has this interesting blurb implying some income taxes were legal before the amendment.
"After Pollock, while income taxes on wages (as indirect taxes) were still not required to be apportioned by population, taxes on interest, dividends, and rental income were required to be apportioned by population."
Yes, but those were flat, not progressive.
My point was I thought all income taxes were illegal before the 16th amendment.
I'm not sure why flat vs progressive matters as far as the law goes. The closest bit I could see in that wiki page was Article I, Section 8, Clause 1 which requires that taxes be uniform. Obviously I'm not aware of case law, but when I read that, I assume it refers to the tax rules being uniform, not a rate or amount.
What the 16th Amendment added was to make explicit the removal of the apportionment requirement for income taxes, so that states with low populations of very high income earners could supply more tax revenue in comparison to states with high populations of low income earners. Essentially, it allowed the taxes to scale with total incomes instead of total populations.
I found a part of the Taxing and Spending Clause wiki article on the Uniformity Clause that seems to agree with how I read it.
"Here, the requirement is that taxes must be geographically uniform throughout the United States. This means taxes affected by this provision must function "with the same force and effect in every place where the subject of it is found."[37] However, this clause does not require revenues raised by the tax from each state be equal.
Justice Story characterized this requirement in a light more relevant to practicality and fairness:
'It was to cut off all undue preferences of one state over another in the regulation of subjects affecting their common interests.
Unless duties, imposts, and excises were uniform, the grossest and most oppressive inequalities, vitally affecting the pursuits and
employments of the people of different states, might exist.' "I.e. the tax laws apply the same regardless of geography, but the amount of collected tax would vary geographically according to the population, since apportionment varied by population as determined by the Census.
Congress is about to ban the government from offering free online tax filing
