Tax Preparation

Tax preparation prices nation 6.5 billion hours, $210 billion

Filing taxes this year is expected to cost taxpayers and businesses about 6.5 billion hours at a cost of $210 billion, a staggering — and record — paperwork burden.

With the deadline to file coming Monday, rules and regulations involved in filling out taxes are choking the nation like never before, according to an analysis by Dan Bosch, the director of regulatory policy for American Action Forum.

“Costs grew dramatically from 2021 to 2022, topping $200 billion for the first time. The $18.4 billion increase is the biggest year-over-year change since 2018, when costs exceeded 2017 levels by $24.3 billion,” said Bosch’s report, Tracker: The Cost of Tax Paperwork.

Graphic courtesy American Action Forum

Big business got socked the hardest in complying with IRS rules, he said, citing the qualified business income deduction.

But individuals did not get off lightly. “The other notable cost increases came from annual adjustments to the estimates for the business and individual income tax, which increased by $4 billion and $1.7 billion, respectively,” said Bosch.

While it wasn’t in his report, Bosch told us that costs to individuals for preparing tax returns were high. “The average tax filer spends $242.96 and 12.5 hours on their return each year,” he said.

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