Who knows, some might actually be your kids.
Are most of you seeing drastic changes in your tax refund this year?
- Thread starter Ranger Dan
- Start date
Who knows, some might actually be your kids.
This is not true. Total tax liability is, of course, the most important thing, but there is always a huge concern re tax payments of timing. In fact, that's where most (legal) tax planning is focused (and timing can end up reducing your tax liabilities in certain instances).
In the case of the typical individual taxpayer, timing comes into play mostly with budgeting. Most folks know about what they're going to have to pay in or receive back come time to settle up their annual tax payments to the federal government, and they budget their spending/savings accordingly. So folks who had been spending/saving throughout the year according to their expectations from previous years are often finding out that they underpaid throughout the year and now have to pony up a chunk of cash they hadn't budgeted for.
Now, you may claim that this is their own fault - they should have recalc'ed and known better and, theoretically, I agree with you. But the reality is that many folks don't have perfect information, or the willingness/ability to understand this and, while we can stand here and chastise them for being too stupid, uninformed or lazy for not properly adjusting their withholding, it's a pervasive enough problem that the government should have done a better job of communicating the impact of these changes, overall and with regard to timing.
Refund! Refund! Quote Paul Dooley Breaking Away 1979 . Seriously people base this on refund , look at total tax pd and it may have changed to paying more for some but not for most. I have never understood why so many people see a refund as free money. You let the Govt use your money and you dont get interest on it.
Mine was almost identical (rate went up 0.2% from last year).
And please, people, don't focus on the amount of your return. Ideally, you shouldn't be getting any return (or should owe a little). Otherwise, you are loaning the federal government money at 0% interest.
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We always owe come tax season (married no kids, purchased a house in 2015). We purposefully don't withhold as much as we should for a few reasons. We live in CA and usually get a state refund which reduces ultimately financial hit on April 15th. This year was entirely different. We owed 150% more this year vs last year. I made a bit more ($10K) than last year but was the only change. Our only saving grace this year is that I purchased a Prius Prime so we have that one-time tax credit which reduces the hit a little bit. We're still paying 100% more than last year.
To account for this next year when we won't have the hybrid tax credit to soften the blow, we'll be changing our spending habits (less eating out, less shopping, and less travel). We're a drop in the bucket but if there are others like us choosing to do the same, that can't help the economy.
If the goal was to punish those in states like CA, NY, NJ, etc--mission accomplished.
And yes, we have a professional do our taxes.
To account for this next year when we won't have the hybrid tax credit to soften the blow, we'll be changing our spending habits (less eating out, less shopping, and less travel). We're a drop in the bucket but if there are others like us choosing to do the same, that can't help the economy.
If the goal was to punish those in states like CA, NY, NJ, etc--mission accomplished.
And yes, we have a professional do our taxes.
I was told there would be no math on this board.
But, have to say, I am enjoying this thread...a lot.
This is, to me, a fundamental failing in our school system. I mean jeeze, it is clear people have NOT been managing their tax withholding. I can't tell you how many people I know who claim zero dependents so that they get a big tax refund (at no interest). Smart people have the minimum amount withheld by law and invest that money. If you have to pay in on April 15th, you've at least gotten interest on that money.
But, have to say, I am enjoying this thread...a lot.
This is, to me, a fundamental failing in our school system. I mean jeeze, it is clear people have NOT been managing their tax withholding. I can't tell you how many people I know who claim zero dependents so that they get a big tax refund (at no interest). Smart people have the minimum amount withheld by law and invest that money. If you have to pay in on April 15th, you've at least gotten interest on that money.
Your best way to lower your taxes is to move out of California. I know the weather is usually nice and the scenery is pretty but the damaging effect of living there on your taxes is tremendous. If you like the west move to Nevada.
Me too, but not a big increase.
Let's say you pay $25k in SALT taxes and make $5k in charitable contributions. You used to be able to deduct $30k in addition to $8k personal exemptions (2 people, no kids). That's $38k you used to be able to deduct but now you can only deduct the $24k standard deduction. Taxable income goes up by $14k. Multiply that by a 22% tax rate and you have a $3k tax hike.
But your overall rates are 3% lower. 3% of a $150k taxable income is $4.5k. In other words the lower rates more than offset the reduced deductions.
This was quick in my head so I may have made a math error but you get my point.
I am not sure congress is that smart to aim at some states.
My tax situation is easy to explain
- Top line income up approx. 15% (combining W2, 1099's, 1098's, LLC and S-Corp)
- Deductions seriously reduced due to SALT $10k limit (i.e. just my property tax for residences is over $25k before even getting to S&L income)
- Took hit on business deductions (LLC and S corp)
- Net taxable income up
- Taxes up significantly as the reduced personal rate % never made up for the SALT limits (not in NJ or NY either)
- Getting $$$ back, but that is not what is relevant - as total tax way up. this was not a tax cut for me.
Not everyone, some like me ended up paying mor in thxes this year than last (not talking about refunds). In 2017 I payed 19,400 in taxes, this year I made about 2,000 in income, but ended up paying 20,500 in taxes, about 1,100 additional. My effective tax rate went up about .9% from last year. Many of the deductions I previously took are no longer available.
Let me know who your accountant is, so I can stay the hell away from him.
well that absolutely explains your response.
I ran into this (having to pay) last year due to improper withholdings. I expected a refund and surprise i had to pay into NC state. Not a fan, so I changed my withholding AND put aside an extra 50$ per paycheck just to be sure. Not sure how that effected me this year, as i'm still overseas for 2 more weeks.
so are we still complaining about a "tax cut" or are we complaining we didn't get a tax cut?
I am complaining I got a tax increase.
No Congress did that with the funding bill that they passed.
I'm really puzzled about how you "Took hit on business deductions (LLC and S corp)" I also own an S Corp. An accountant does my taxes. I compared 2017 to 2018 and everything looked identical except I got to take the brand new 20% deduction on the pass through profit made by my S Corp. This lowered my taxable income considerably. I would be interested in knowing what business deductions were reduced or eliminated so I don't make a mistake in 2019 and get hit too.
I don't disagree with what you say. California is a beautiful place with superb weather year round. I guess you get what you pay for. I live in Western Pa. Maybe only 50 nice weather days out of 365. However, I have relatively low taxes.
Listen, I was born in Johnstown, and lived in Ebensburg and Hollidaysburg when I was young. I remember the weather. man it was bad.
Then again, Brooklyn is only marginally better weatherwise. But lots more to do!
Under 30? And you post on this board? I thought you needed an AARP membership just to sign up.
Some of the board regulars.(I am not in the photo.)
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Which one is Glov!!
Agreed...you get what you pay for and supply and demand.
I live on lake Erie. My house in SoCal would be in the ten million+ range. Here, it is a fraction of that. So I have a much better housing quality of life but the weather is no where near SoCal. San Diego? you'd better play the lottery of get used to living on a postage stamp.
Last year, for spring break, I stayed in a shack on malibu beach. I had coffee while watching the wales breach at 7am. The 800 sq ft house had no heating or AC and many of the light switches didn't work. I was previously owned by the gal who played Jan Brady who bought the house when she was in her early teens. She sold it two years ago for $6m. I spoke with the young guy who owned the house next door. He thought his home, which was larger and remodeled, was in the $15m range.
The good news? We all get to choose our priorities. you can life on a "tiny house" in Enid OK and drive a $150k Porsche. Or, you can have other priorities.
I've never met GLOV in person, so I can't say for sure, but since he's originally from McKees Rocks, he's probably a good dresser, so I would say he's the one on the left facing forward.Which one is Glov!!
Those millions of Americans are now getting the tax advantage. By raising the standard deduction to $24k those that give but don't have a total of $24K of personal exemptions plus taxes and charity giving are ahead.
So most of middle and lower income America IS getting a tax break. i.e. paying less taxes in 2018 than they did in 2017.
After reading some of the comments here I now see how so many people that really are benefiting by the new tax law are still managing to complain as if it has hurt them.....
Because most people don't. I do, but I would bet the average person on the street is only concerned with their refund.
Yep, and those same people are some of the same ones that believe AOC is smart....
But this a Penn State University board, so everyone here should be OK!!!
If you live in a high tax state and pay high taxes, moving is about the only alternative if you want to pay low taxes. The other ways to pay lower taxes is to make less money or cheat on your tax return. These are worse ideas than moving.
Elimination of the personal and dependents exemption was sneaky. The objection is the tax cuts are peanuts for most, but not so much for the richest 1% and megacorporations, which is fueling the deficits and national debt, now at record highs. (A household earning $1 million or more will get an average cut of $69,660, an income bump of 3.3 percent. Compare that with the a tax cut of $870, or 1.6 percent, for the average household earning $50,000 to $75,000.)Those millions of Americans are now getting the tax advantage. By raising the standard deduction to $24k those that give but don't have a total of $24K of personal exemptions plus taxes and charity giving are ahead.
So most of middle and lower income America IS getting a tax break. i.e. paying less taxes in 2018 than they did in 2017.
After reading some of the comments here I now see how so many people that really are benefiting by the new tax law are still managing to complain as if it has hurt them.....
Ironically, blue states that link their tax system to the feds are reaping the benefits because their standard deductions are low and you can't itemize if you take the federal standard deduction. So lots of people (me!) are paying more overall.
BTW: "By 2027, according to the Joint Committee on Taxation, every income group below $75,000 will actually see a tax increase. Only those income ranges above $75,000 will still see a cut by 2027. And according to the Tax Policy Center, only taxpayers higher than the 90th percentile -- that is, those earning about $225,000 and above -- will have better-than-even odds of getting a tax cut in 2027."
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Even if you made more, you'd have to make enough more to bump yourself up into the next tax bracket, otherwise, while your taxes paid will increase (total $), your tax rate would stay the same (i.e. I made $16K more this year than last, but my tax rate stayed the same).
Surely you can not be so totally uneducated. Refunds go down when taxes and withholding go down. Compare your annual taxes
Self employed, mostly retired, I make quarterly payments, total amount of taxes due is lower. With income relatively stagnant from prior year total taxes due/owe/paid is less than last year. To me that is equivalent to a refund.
Hi Mary, noticed Mt. Dora, my wife goes to a periodic art show, festival, "shopathon" is Mt. Dora. We are down in the Naples area.
Everything you say in your post is counter to my experience. I do income taxes to help out my neighbors and friends -- all middle income taxpayers. Every single return that I have done so far shows that the new tax law benefits middle income tax payers. One return that I completed last night was for a family of 4 with an income around $70K. With the higher standard deduction and higher child tax credit their tax bill was lowered by about $2K from last year. This is very meaningful to them. They don't consider $2K "peanuts." I don't understand how anyone making less than $100K per year wouldn't be greatly helped by the new tax law.
