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Other Voices

“Simplify, simplify,” urged Thoreau. No friend of taxation, he might have been envisioning the modern Internal Revenue Code. At roughly 3.7 million words, it’s getting more complex by the day —and a few companies would like to make it even worse.

Consider a scheme Congress may soon take up for some individuals applying for the earned income tax credit, once a relatively straightforward process. If a report from the Senate Appropriations Committee is heeded, what was once a one-page form for claiming the credit could expand to four or five pages, padded out by pointless and bewildering new questions.

The likely result would be that those eligible would either forgo their credits or hire tax services for help. As it happens, H&R Block, the largest such service, helped write a report recommending the changes. Complexity has its advocates.

This plan is doubly wrongheaded.

Most obviously, it would further complicate a process that already costs more than $30 billion annually, wastes billions of hours of taxpayers’ valuable time, facilitates fraud and drives Americans — rich and poor — to the brink of madness every April.

Worse, it would undermine one of the tax system’s few good ideas. The earned income tax credit — an earnings subsidy for the working poor — boosts incomes, reduces poverty, encourages work, rewards companies for creating jobs, and narrows inequality. It should be substantially expanded, not made needlessly difficult to administer.

Yet that’s exactly what Congress is mulling. Advocates say the extended application will combat fraud. But it’s hard to see how: It turns out that paid services aren’t any better than individual filers when it comes to making “overclaims.” And if the newly convoluted forms leave taxpayers scratching their heads, good luck: Thanks to years of budget cuts, the Internal Revenue Service has had to reduce its workforce by 11 percent and its training budget by 83 percent since 2010, so don’t expect anybody to answer the help line.

Services like H&R Block, aimed at ordinary taxpayers, are unknown in much of the civilized world. They shouldn’t be necessary in the U.S., either. Congress could simplify things enormously by reducing tax rates while eliminating most of the exclusions, exemptions, deductions and credits that have clogged up the code for years.

Politically impossible? Maybe so. In the realm of the more feasible, lawmakers could at least give the IRS the resources it needs to prevent fraud and help taxpayers navigate their increasingly dense returns. It wouldn’t hurt, either, for the IRS to issue the annual reports on tax complexity that the law requires, and which the agency has failed to do with any regularity. You never know: Bringing useless complexity to the attention of Congress might concentrate minds.

But if that can’t be done, please don’t make the system any worse than it already is by crippling the earned income tax credit - one of the very few features of the code that works.

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