How Long Did It Take You to Fill Out Your Tax Forms?
According to the Internal Revenue Service, it takes an average of four hours for a taxpayer to fill out their tax return. And that's for those lucky folks who are only required to fill out and file Form 1040EZ. If you have to file Form 1040 (this accounts for about 70 percent of all tax returns), you'll spend an average of 16 hours during the course of a year getting the job done -- the bulk of the time (12 hours) on record-keeping and completing/submitting the proper forms.
Believe it or not, this wasn't always the case.
A recent article from Business Insider shares a typical tax return from 1948. The return consisted of just one page -- and could probably have been completed in less than 10 minutes!
Today's Form 1040 is just slightly longer, comprising a manageable two pages. But it's the set of rules for completing those two pages (along with the slew of additional worksheets many of us must also complete), explained over 206 technical pages, that leaves most of us crying uncle.
It's little wonder more than 80 million of us pay $10 billion each year to hire professional tax help (unqualified though they may be) to complete our returns for us.
It's Not That Complicated ... If You Live in One of These Countries
A handful of countries (Denmark, Estonia, Finland, Iceland, Norway, Sweden, Chile, and Spain) already use "pre-populated" tax returns.
For the most part, this means that the country prepares a tax return (using the wage data received from the citizen's employer), runs the relevant calculations, and then mails the return to the citizen for review.
If it's correct, you're done.
If a change needs to be made, you make it, mail it back -- and you're done.
Simple as that! No waiting by the mailbox for your W-2. No interest deduction forms that your kids can accidentally toss away. Heck, you may not even need a calculator.
More than just being a welcome stress relief, %VIRTUAL-article-sponsoredlinks%this process also results in quicker tax refunds, fewer audits -- and of course fewer employees needed at the tax department (which trickles down into smaller taxes!).
Of course, this free, automatic form of filing taxes is possible because those countries have simpler rules surrounding personal income taxes (meaning you may not be able to deduct mortgage interest, student loan interest, or charitable deductions) -- which is a topic for another article entirely.
Nevertheless, a simpler method for filing taxes is not only possible, but it's also receiving much praise. Unfortunately, you'd have to move outside of the U.S. to take advantage of it.
Adam Wiederman is a Motley Fool contributing writer.