The majority of Americans don’t do their own taxes, according to the Internal Revenue Service, but instead get help from professional accountants, friends or relatives, or software programs.
Even with all that assistance, however, no one is happy: 27% of responders to a WalletHub survey reported that they’d be willing to get an “IRS” tattoo if it meant never again having to deal with the tax man. Without the outside help that millions of Americans pay for, these numbers would be higher.
But picking up (or printing out) the Form 1040 and doing it the old-fashioned way has some benefits that are worth reaping. And contrary to popular belief, it’s something an ordinary citizen can do—and probably should, at least once. Here’s why.
It’s a great way to actually understand your taxes
Keeping taxes at arm’s length is a great way to avoid learning anything about your taxes or the system in general. If you’re like many Americans, you have only a vague understanding, picked up piecemeal from news headlines and those brief moments before you put away your paycheck and try to forget the gaping disparity between your “salary” and the amount that lands in your bank account every other week.
Using a program like TurboTax sheds a little light on the process. You’ll glean some nuggets about what’s deductible and what isn’t. But for the most part, these programs are a black box: You put in your numbers and out pops a refund—or a bill. Even the act of inputting numbers from your W-2—that is, if your software doesn’t pull that information directly from your employer—is a swift copy-and-paste job, box 12 to box 12, unlikely to give you a sense of what those numbers mean.
By contrast, sitting down with the Form 1040 and its many line items and schedules forces you to understand the mechanics. Many people don’t understand marginal tax rates, for example, believing that your tax “bracket” is the amount you pay on all your income, not just the amount above the previous threshold. Working directly with the tax tables swiftly dispels this common misunderstanding.
There are plenty of other examples, as well—how deductions reduce your tax liability; why a tax credit is better than an equivalent deduction. Such knowledge can potentially save money in future years.
And if that sounds like a good thing, know this: Studies show that deeper interactions, and in particular writing things down by hand, lead to better understanding, learning, and memory.
You won’t be contributing to tax complexity
Spending $30, $50, or even $90 for a software program to do your taxes, or $150 to have a human to do it, may seem like a small price to avoid the exquisite torture of doing your taxes by hand. But did you know that some of that money is being spent to keep the tax code complex?
In 2013, a ProPublica report showed that Intuit, TurboTax’s parent company, has lobbied extensively against simplifying and improving filing methods, which would obviously hurt its business. Similarly, as this article by Vox’s Dylan Matthews points out, H&R Block successfully lobbied the Senate Appropriations Committee to instruct the IRS to “at least quadruple” the length of the form you have to fill out to get the Earned Income Tax Credit.
Matthews, who recently announced he was boycotting TurboTax, also notes that complicated tax filing isn’t universal across the world. Many other countries have far easier filing systems, including some in which taxpayers receive pre-populated tax returns that require little beyond a signature. In fact, your employer already tells the IRS how much you make. The agency could easily send you a form to sign. Taxes, like death, may be one of life’s few certainties—but Ben Franklin never said you had to pay a third party to do yours.
It gives you a legitimate right to complain
Everybody complains about doing their taxes. But complaining about it without staring down a 1040 and a stack of 1099s is like complaining about Batman v. Superman without having seen it. You’re not wrong. You just don’t really know why you’re right—or how right you are. Maybe the problem is exaggerated; maybe not.
But actually doing them yourself, at least once, turns your vague and toothless criticism sharp and legitimate.
Having more of a right to complain is a pretty soft benefit, to be sure. But there’s actual utility in having informed and sharpened criticism. For example, during presidential debate season, candidates audition their tax plans, many of which include things like shutting down the IRS. A person with a vague, second-hand dislike of the IRS’s methods might support scrapping the agency that collects government revenue.
On the other hand, someone who has suffered through the process first-hand would easily see that the idea unhelpfully attacks the wrong part of the process and advocates for the wrong reform.