When The IRS Says You're Wrong But Won't Tell You Why
Senator Elizabeth Warren has a new law on the books, and it addresses one of those frustrating bureaucratic mysteries that makes people want to throw their laptops out the window: getting a letter from the IRS saying your tax return is wrong, but not telling you what you did wrong or how to fix it.
The IRS Math Act, which Warren announced Thursday on X, is now officially law. It's a bipartisan piece of legislation that does something remarkably simple: it requires the Internal Revenue Service to actually explain where you messed up on your return and tell you how to dispute it if you think they're the ones who got it wrong.
"For years, even making a small math mistake on your taxes turned into a terrible headache," Warren said in a video. "The IRS would tell you your return was wrong, but they wouldn't tell you where you went wrong, and they sure wouldn't tell you how to fix it."
Warren frames this as common-sense reform that saves Americans time and money. "That means no more spending a fortune on lawyers or hours trying to find errors in tax returns," she said. Her core argument is straightforward: a math mistake shouldn't cost you a fortune or hours of work.
What This Means For Tax Prep Companies
The tax preparation industry had a mixed day Thursday. H&R Block Inc. (HRB) dropped 1.52% during trading and stayed flat after hours. Meanwhile, Intuit Inc. (INTU) climbed 1.23% before dipping 0.26% overnight.
Whether Warren's law had anything to do with those moves is unclear. But here's what we do know: both companies have spent years lobbying against efforts to make tax filing simpler. Think IRS Free File programs and direct filing proposals that would let taxpayers bypass paid services entirely.
The numbers tell the story. According to federal disclosures, Intuit dropped nearly $3.8 million on lobbying in 2024. H&R Block wasn't far behind at $3.1 million. That's $6.9 million combined spent influencing policy around how Americans file their taxes.
H&R Block doesn't look great from a technical standpoint either, with low Momentum and Value scores and unfavorable price trends across short, medium, and long timeframes.