I forgot a form on my tax returns. It was the beginning of a nightmare.

There are moments in life when your own stupidity dumbfounds you. The letter I got from the IRS — on my birthday, no less — was one of those moments.

“Your tax return does not match the information we have on file,” the three-page letter began in large bold font.

Confusion quickly curdled into panic. I had to scan the document four times before my brain absorbed the issue. On a page titled “What caused the differences,” there were two numbers listed side by side. One number, under the heading “reported by third parties,” was my salary at Business Insider. The other number, under “shown on your return,” was zero dollars.

Oh, Christ. Not only had I forgotten to attach my W2 in my filing, but I hadn’t even declared my salary at BI, which I had joined midway through the year. Without meaning to, I had cheated on my taxes.

In my defense, 2023 had been a chaotic year for my family. Both my wife and I changed jobs. We had our second kid, which meant we remained sleep-deprived throughout tax season. We started a college savings fund for our children. So when it came time to upload all our tax documents, we missed one of the biggest of them all — my W2 for the second half of the year.

I took pictures of the IRS notice and emailed it to Greta Whelan, our accountant for the past decade. She replied three minutes later. “I’ll take a look and get back to you,” she assured us. “This happens much more often than you might think.”

As usual, Greta was right. Every year, several million of Americans fail to properly file their taxes. The IRS also sends taxpayers 170 million notices a year.

My therapist told me I was his third client to get an IRS notice this year. I heard about a guy who became the CEO of a major corporation but forgot to tell his accountant — who wound up omitting more than $3 million in income on the guy’s returns. Even tax specialists screw up and forget to attach their W2s. “It happened to me once, I hate to confess,” says Richard Rampell, a retired accountant in Palm Beach, Florida.

The galling thing is, it doesn’t have to be this way. In the notice I received, the IRS revealed that it already knew damn well exactly how much I had earned from BI that year — without my help. In other words, just by consulting the W2 it received from BI, it could have solved my problem before it even arose. But rather than share its knowledge with me, it penalized me for not reporting the information it already had in hand. More than three dozen other countries already have systems in place to eliminate the need for taxpayers to submit their W2s — but lobbyists for TurboTax and H&R Block have squashed efforts to bring tax sanity to America. With one simple change, we could simplify tax filing, eliminate inadvertent mistakes like mine, and increase America’s tax revenue, all without adding a single IRS agent to the federal payroll.

When you get a notice from the IRS, you enter a game of chicken.

Countries as diverse as Chile, Denmark, and Estonia already automate tax returns. In New Zealand, you log onto a website, see what the government says you owe, and click to verify. In Japan you get a postcard. The government calculates your taxes, you agree or disagree, and you’re done. It’s a win-win for everyone: less stress for taxpayers, more money for schools and roads and healthcare.

In 2005, the Stanford law professor Joseph Bankman — Sam Bankman-Fried’s dad — designed a California pilot program called ReadyReturn, in which single-income taxpayers received return forms prefilled with information the state already had on them. It was a huge success; 99% of taxpayers gave it positive reviews. Arnold Schwarzenegger, then governor, was a fan, and other states were watching closely. But when Bankman tried to get ReadyReturn passed through the state legislature, lobbyists from the big tax accounting firms made sure it was shot down. Why let the government fill out your tax forms for free, when you can pay $50 for some software and struggle through it on your own?

As a result, Americans are stuck with a system that’s both cumbersome and prone to errors. A study by economists at the Treasury Department and Dartmouth College found that nearly half of all tax returns are so simple that the IRS could automate them. But instead of implementing this one simple fix to America’s tax system, Elon Musk and DOGE are busy firing IRS employees who were working to modernize the agency’s technology and operate its taxpayer hotline. In the absence of automated returns, it’s been estimated that Americans were forced to spend an average of nine hours on their taxes last year — a staggering 7.9 billion hours of needless stress and lost productivity.

When you get a notice from the IRS, you enter a game of chicken. All our notice asked for was for us to check a box indicating whether we agreed or disagreed with the differences between the amount of income we filed on our returns and the amount the agency knew we actually made. The notice was asking us to say, “You caught me.” There was nothing about how much we owed. With the IRS, only after you confess to your crime does the agency send you the bill.

The problem is, you could be waiting a long time for that bill. The agency has a three-year statute of limitations to review filings. But since the pandemic, Greta explained to us, it’s been taking longer and longer for the IRS to do its job. Greta has some clients who received bills more than a year and a half after they filed their taxes.

Hence, the game of chicken. We could refile our returns right away and pay the additional taxes we owed, plus nine months of interest and penalties. Or we could wait for the bill and risk letting many more months — or even years — of interest and penalties accrue, in the hopes that we could beg for mercy as first-time offenders.

Greta asked what we wanted to do. Make it go away, we said. Tell us what we owe and make the nightmare end. She redid our returns and emailed us a revised calculation. All told, we owed $10,102, including just over a grand in penalties and interest. Call me crazy, but this sure seems like a place where the world’s richest man — a guy who built his wealth on the wonders of technology — could help me keep a little of my own.

Zak Jason is a deputy editor of Discourse at Business Insider.

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