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  • Dan Connors

Confessions of a tax guy- why tax season gives me faith in humanity.

I sort of stumbled into the tax profession courtesy of my father-in-law, who combined his love of people with math ability for a pretty good life. Numbers have always come easily to me, but the older I get the more I realize how unreliable they can be. Joining the accounting profession midway in life has pulled back the curtain on all those spreadsheets, forms, and statements to give me an entirely new outlook on money and what we do with it.

Our systems of taxation has always seemed to me to be unfair and overly complicated and ambitious. Different people and behaviors are taxed differently, and an ever-changing system of tax credits and deductions tries to fiddle with results with some winning and others losing. Since I've been doing taxes the past decade, the system seems to be getting more and more unfair and sloppy, with serious consequences for future generations of taxpayers and citizens.

I have three serious beefs with the tax system and one great bonus that keeps me going every year. Read on if you want to see what makes this all worth it.

One of my biggest problems with the tax preparation business is how dangerously unregulated it is. There are absolutely no requirements for hanging out your name as a paid tax preparer. Almost anybody can do it, and many do, with little training or understanding of basic accounting. The IRS has no requirements other than obtaining an identification number, and some "ghost" preparers don't even bother to get that. Having invested years and years in accounting and tax classes, I find it incomprehensible that someone could walk in with no training and do tax returns of other people. As a CPA and Enrolled Agent, I am required to take classes every year in tax law updates and ethics. This gives me a solid foundation on which to base my interpretations of tax laws.

There are some types of tax returns that don't require much knowledge, and those can be done online using Turbo Tax or other software. But once you throw in side businesses, rentals, children, or investments, there is a strong knowledge component that makes a difference. In a study by the Government Accounting Office, mystery shoppers found that only 2 of 19 randomly selected preparers gave them the correct answer, and some gave downright wrong advice about what to claim.

My second complaint has to do with the Internal Revenue Service. And it's not the complaint you might think. The IRS, once one of the most feared organizations in America, is now not much more than a paper tiger. Since 2010, the budget for the IRS has been cut by about 20% adjusted for inflation. The effects have been disastrous for the entire tax preparation and collection system.

Because of these cuts, more experienced, trained IRS agents have been retiring and not being replaced. Getting through on the phone to the IRS takes much longer, and local offices are harder to find. Most contact with the IRS involves using the internet or waiting months for letters through the mail. The people that you do find there are less trained and more transient than the ones that were there a decade ago.

Tax compliance has almost certainly taken a hit because of all this because the audit rate, i.e. the percentage of tax returns that are audited to catch cheaters, has dropped by over half in the past few decades. In 2018 the IRS audited only 0.5% of all 200 million tax returns. In many ways what we have now is an honor system for those with the more complex tax returns, and one has to wonder if the honest are now subsidizing the crooked.

Which brings me to my third beef with taxes as they are today- they aren't doing their job of funding the government. The projected deficit for 2020 is over $1 Trillion dollars, meaning that all the tax money we will be collecting this tax season won't be nearly enough to pay for what we're consuming. So that means borrowing the difference and dumping that debt on future generations.

It used to be that wars and economic downturns were the only times that deficits this large happened. Now, even in a time of prosperity, we can't pay our bills, which makes me nervous. Raising taxes is a difficult proposition, especially when enforcement is so sparse. Cutting spending is even more difficult, given that some 75% of federal spending is considered untouchable (Social Security, Medicare, Medicaid, Veterans Benefits, Military, and Interest payments).

Okay, rant over. Now on to the stuff that gives me faith in humanity. We are better than this cockamamie tax system we keep voting for. I can tell because I get a unique view of the people I serve and my community by hearing directly from my clients about their lives and money issues.

In this day and age when person to person contact is disappearing, the tax desk is still one safe place for people to talk about their problems and get advice. Talking about money is considered taboo for many, so I am the only person in the world some of my clients get to talk to about their financial concerns. My office is a judgement-free zone, and no one needs be embarrassed they have too much or ashamed to have to little.

Ideally, financial planners are the best people to talk to about money, but there are two big problems. Most financial planners have a conflict of interest in that they are salesmen first and counselors last. Conflicted advice always must be taken with a grain of salt. The other problem is that the majority of my clients don't have enough assets to justify paying a financial planner, so they're stuck with me.

Because a tax return involves so many aspects of life- work, retirement, schools, living situations, and investments, much of my job involves getting to know people and their families. I have to ask a lot of personal questions to get the information I need to help clients, and those discussions make us closer. Over the years, I've developed an affection and kinship for clients who come back year after year and share their recent surgeries, weddings, graduations, births and deaths. It gives me a real perspective on all the stages of life and how different people negotiate them.

Much of our days now are spent with screens and not humans, and the few humans we interact with are often distracted by something else. As an introvert myself, I tended to prefer screens to humans until I became a tax guy. Learning how to listen to people has helped me learn to help them better and appreciate them more. There are some things that can't be communicated over a screen, (except of course blogs like this). Learning how to listen to people in general has helped me be a better husband, father, and friend. In the end, we all need people to listen to us unconditionally.

Undivided human attention is something I can offer that Turbo Tax cannot. Dealing one on one with other humans is becoming a lost art, and if you've ever tried to contact a real human being at the IRS or any large company, you know what I'm talking about. They keep saying that most knowledge workers like accountants and lawyers will be replaced by artificial intelligence in the next decades. Hopefully there will still be a place for one-on-one money discussions, and I'll be there.

Sure, taxes are too complex and unfair, the government is inefficient and overwhelmed, and the deficit is rising a lot more than I'd like. I still believe all of those problems are fixable, and that there is a place in the world for good tax guys and gals to provide that safe space to talk about the loaded subject of money, taxes, and finances.

My faith in humanity is restored because the vast majority of my clients are responsible, caring parents, grandparents, sons and daughters, husbands and wives, who want to do the right thing. In this divided and polarized world it's good to see such shared humanity right in front of me. I'm honored by the trust that people put in me every year, and I strive to do my best and not disappoint them.

So appreciate those people in your life right now who listen to you- your insurance guy, your hair stylist, your therapist and doctor if you're lucky, your loved ones, and of course your tax guy. Listen to those you serve with patience and empathy. Computers, phones, and screens are helpful, but we humans need each other more.

You can reach my tax alter-ego at

or you can reach me at my writing email of

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