> Why cant the IRS just tell us every year if we owe or not and how much?
You can already contest how much the IRS claims you owe. Why would this hypothetical be any different?
Yes, it's probably impossible for the IRS to perfectly account for every American-person's income. They already make mistakes and it's not terribly difficult to show them how they got it wrong. Whether they are incentivized to adjust to your lower claimed liability is another question... but that's why we have independent courts.
You can already contest how much the IRS claims you owe. Why would this hypothetical be any different?
Yes, it's probably impossible for the IRS to perfectly account for every American-person's income. They already make mistakes and it's not terribly difficult to show them how they got it wrong. Whether they are incentivized to adjust to your lower claimed liability is another question... but that's why we have independent courts.