Estimating the Costs of Filing Tax Returns and the Potential Savings from Policies Aimed at Reducing These Costs
This paper estimates the cost of filing taxes and assesses several policy proposals aimed at reducing these costs. Using US tax returns, a quasi-experimental method and additional extrapolations based on survey evidence, I uncover three main findings. First, filing costs are large and have been steadily increasing over time. Second, part of this increase in filing costs can be attributed to an increase in the number of schedules filed per taxpayer. Third, pre-populating tax returns and offering free filing options can result in substantial cost savings for taxpayers.
The views expressed herein are those of the author and do not necessarily reflect the views of the National Bureau of Economic Research.
Forthcoming: Estimating the Costs of Filing Tax Returns and the Potential Savings from Policies Aimed at Reducing These Costs, Youssef Benzarti. in Tax Policy and the Economy, Volume 35, Moffitt. 2020