Are most of you seeing drastic changes in your tax refund this year?

[Lyons212]

My biggest complaint is that our charitable contributions no longer benefit our return. I donate for other reasons, but I can see some people really reducing their charitable contributions because they will not get the tax benefit.

That is BS. My tax situation, 2018 compared to 2017, I owe $5k compared to 2.5K in 2017 and paid $3.5K less in federal taxes in 2018 compared to 2017. My charitable contributions increased by $1,000 in 2018. In 2018 I took the standard deduction compared to itemizing in 2017.

You give money to charity because you want too. Most people even losing the itemized deductions are paying less in taxes now.

 

[NittanyLionFan]

Don't look at the refund. Look at the tax vs income for each year.

Yeah, I figured that i wasn't overly clear in my response. It is a double whammy - total tax (i.e., what I owe for the year notwithstanding my withholdings) is much, much higher than in 2017 and my assumption of claiming 4 deductions on W4 for the year was seemingly grossly insufficient, as I may owe a sizable amount (upwards of $7k) due to insufficient withholdings during 2018. I know that the latter issue is partly to wholly my fault since I blindly assumed that I wouldn't need to reduce my deduction number to less than the number in my household, but I've never had this issue occur during the past 35-40 years of filing. Looking like a 4/15 submission, lol.

 

[Pardlion]

Well, there is a raise in there and a sizable retention bonus, but I would have assumed that withholdings would have taken care of the extra income (family of 4 and I am claiming 4 on W4 and big withholding associated with the retention bonus). Wife's withholdings were lower, but her income wouldn't seemingly support such a big jump in tax liability (maybe need to investigate Married Filing Separately this year). Hopefully I can figure things out next weekend, to include detailed comparison to 2017 taxes. Maybe I am missing something, since the first draft was a bit of a rush job to include some 2018 details on a 2019 tuition application for one of my kids.

Bonuses are withheld at 22%, so when you get a large bonus you are always underwitheld unless you specify some other withholding rate.

 

[bdgan]

I made one pass of my returns and I owe when I normally get $$ back. I usually plan it so that I get at least a little back, less then $1000. However, I owe $2500 this year because the personal exemptions went away for my 5 person family. My itemizations are usually less then the $24K standard deduction which should have made it a little better. We claim 0 on our W4s and still owe which sort of pisses me off that I now have to make additional withholdings. The other thing that caught me by surprise is the max $10K on other taxes which I thought was just property which would have been fine for me but it includes the state and local income taxes which is over $10K for me. However, this was my initial pass a couple weeks ago and I may have missed something.

You definitely lose $20k of personal exemptions but child credits (under 17) doubled from $1k to $2k.

 

[GregPSU]

You always include the gross amount of SS payments on page 1 of form 1040. Most people are taxed on 85% of that amount. Low incomes don't pay tax on any of it.

You may of missed my point in my post. A net payment after taxes on my wife's account was then considered a gross payment to me and taxed again. My gross was artificially increased and net payment reduced for federal taxes TWICE.

 

[nitlion93]

That is BS. My tax situation, 2018 compared to 2017, I owe $5k compared to 2.5K in 2017 and paid $3.5K less in federal taxes in 2018 compared to 2017. My charitable contributions increased by $1,000 in 2018. In 2018 I took the standard deduction compared to itemizing in 2017.

You give money to charity because you want too. Most people even losing the itemized deductions are paying less in taxes now.

Reading comprehension is your friend. I specifically said that I donate not just to get the tax refund. Fact: the standard deduction will be greater than itemized so some people may not use charitable donations as much. So it’s not BS.

 

[LuvDaLions]

Let me know who your accountant is, so I can stay the hell away from him.

Typo, should have read “2000 additional income”.

 

[GreggK]

Most of the federal payments to states is in Social Security and Medicare money. (see link) Given that, I don't see how you can argue that California subsidizes Iowa. Iowa isn't being given preferential treatment on spending. It is simply that more SS and Medicare recipients per capita live in Iowa than California.

Because California recieves less than it pays.
For every dollar California tax payers give the federal government, the get less money back.

For every dollar someone in Iowa gives to the federal government, that get more than a dollar back from the government.

California, Texas, New Jersey, New York, Illinois, Massachusetts, Connecticut, Nebraska, Wyoming, New Hampshire, the Dakota’s all get back less than they give to the government in taxes. Every other state is a taker. Including Iowa.

 

[roswelllion]

Federal revenue was only up by $19B in 2016 vs 2015. It was only up $49b in 2017 vs 2016. My point is that it's unfair to say it would have been up by over $200b if not for the tax cuts. It's also dishonest when people complain that tax refunds are down while simultaneously complaining that tax revenues are down. That just shows political bias.

I believe the tax cuts had a negative impact on federal revenues. Probably somewhere around $60b. The actual number is impossible to prove because we don't know how much extra revenue was generated by the economic growth associated with the tax cuts.

you are good at this stuff, and I will try to be quick and mess up my zero's but if we have a $20 trillon dollar economy collect $3.3 trillion in taxes that equals 16.5%. If the economy grew by .5 stronger than w/o tax cuts and use the 16.5% rule, wouldn't that be $100 billion to the economy and 16.5 billion to the tax rolls. Offset that by I think you said an

Because California already subsidizes Iowa. They take more than they pay in federal tax.

The question is why should New York, New Jersey and California subsidize Alabama, Arkansas, Mississippi and pretty much every other southern and Midwest state?

And why is it ok to further screw them

I live in a neutral state so have no horse in this race but did get seriously limited by SALT, but I think this conflates 2 arguments.

. Point 1. New York or California contribute more than Iowa. That is because California and New York have more wealthy people than those other states or in terms of outflow those other states have more poor people who collect benefits than Ca or NY. It is federally based not state based so benefits paid out is individually based not state based.
. Point 2 It is only fair that two people one, who lives in Iowa and one who lives in Ca each make $150k they should pay the same federal tax. The fact that the guy in Ca might live beside a Silicon Valley guy make making $200 million and putting a lot into the system and the guy in Iowa might live beside a poor neighbor collecting food stamps and taking more out of the system shouldn't matter.

 

[Woodpecker]

A good accountant is worth their weight in gold. Find the lone wolf CPA.. it won’t cost more than a trip to H&R Block.

Why would an accountant be needed? I haven't done my taxes yet but I thought they were simplified and can be done on a post card?

 

[LemonEars]

Because California recieves less than it pays.
For every dollar California tax payers give the federal government, the get less money back.

For every dollar someone in Iowa gives to the federal government, that get more than a dollar back from the government.

California, Texas, New Jersey, New York, Illinois, Massachusetts, Connecticut, Nebraska, Wyoming, New Hampshire, the Dakota’s all get back less than they give to the government in taxes. Every other state is a taker. Including Iowa.

You didn't acknowledge my point. Most of the money that the states get from the feds is SS and Medicare. It isn't like there is a federal conspiracy against California. The citizens of Iowa must be on average older than those in California. We both know that California gets tons of defense money (shipyards and contractors and Silicon Valley). SS and Medicare money should not be included in your tally of how much money the feds give to states. The old people in Iowa per capita paid more into the Medicare and SS system than those in California so they are now getting more back.

 

[bdgan]

Why would an accountant be needed? I haven't done my taxes yet but I thought they were simplified and can be done on a post card?

Taxes are postcard simple for most people.

A lot of people on this board probably earn $150k, have investment income, rental real estate, kids in college, etc. They might even be self employed. Or they're retired and are taking SS, have a pension, or are taking required distributions from their IRA. Taxes are slightly more complicated for these people but they are not the average taxpayer.

 

[bdgan]

you are good at this stuff, and I will try to be quick and mess up my zero's but if we have a $20 trillon dollar economy collect $3.3 trillion in taxes that equals 16.5%. If the economy grew by .5 stronger than w/o tax cuts and use the 16.5% rule, wouldn't that be $100 billion to the economy and 16.5 billion to the tax rolls.

I think you're on the right track. Much of the GDP growth is taxed and much stays in the pockets of people (business profits, wages, etc). It's impossible to prove how the economy would have done w/o the tax cuts but common sense says it had a positive effect. I think tax revenues would have been $50b higher without the tax cuts. Just my opinion.

 

[cool1099]

Taxes are postcard simple for most people.

A lot of people on this board probably earn $150k, have investment income, rental real estate, kids in college, etc. They might even be self employed. Or they're retired and are taking SS, have a pension, or are taking required distributions from their IRA. Taxes are slightly more complicated for these people but they are not the average taxpayer.

The point is they are no simpler than before, except for the fact that fewer people will itemize or claim exemptions. Reporting requirements remain the same but spread over more forms. The idea of everybody tax reporting on a postcard was always just pure propaganda.

 

[cool1099]

I think you're on the right track. Much of the GDP growth is taxed and much stays in the pockets of people (business profits, wages, etc). It's impossible to prove how the economy would have done w/o the tax cuts but common sense says it had a positive effect. I think tax revenues would have been $50b higher without the tax cuts. Just my opinion.

No serious economist thinks cutting taxes increases revenues, no matter how much it boosts the economy.

 

[bdgan]

The point is they are no simpler than before, except for the fact that fewer people will itemize or claim exemptions. Reporting requirements remain the same but spread over more forms. The idea of everybody tax reporting on a postcard was always just pure propaganda.

A larger standard deduction means that fewer people are required to file. Also fewer people will fill out schedule A. That's definitely simpler for a lot if people.

I never heard that EVERYBODY would be able to do their taxes on a postcard. Neither side would be willing to give up enough deductions and credits.

 

[bdgan]

No serious economist thinks cutting taxes increases revenues, no matter how much it boosts the economy.

Revenues were higher in 2018 than in 2017. We can debate how much they were impacted by tax cuts.

Tax revenues would be zero if tax rates were 100%. Why would anybody work? This proves that at some point lower rates result in higher revenues.

Of course tax revenues would also be zero if tax rates were zero. This proves that higher rates can increase revenues. The key is finding the sweet spot.

 

[Pinkhippo PeanutButter]

Taxes are postcard simple for most people.

A lot of people on this board probably earn $150k, have investment income, rental real estate, kids in college, etc. They might even be self employed. Or they're retired and are taking SS, have a pension, or are taking required distributions from their IRA. Taxes are slightly more complicated for these people but they are not the average taxpayer.

A lot of people on this board are over 30 & live in their Parent's house.

 

[Pinkhippo PeanutButter]

A larger standard deduction means that fewer people are required to file. Also fewer people will fill out schedule A. That's definitely simpler for a lot if people.

I never heard that EVERYBODY would be able to do their taxes on a postcard. Neither side would be willing to give up enough deductions and credits.

The main idea for this is to narrow the audit pool to focus on the middle class people trying to stretch.

 

[roswelllion]

The point is they are no simpler than before, except for the fact that fewer people will itemize or claim exemptions. Reporting requirements remain the same but spread over more forms. The idea of everybody tax reporting on a postcard was always just pure propaganda.

Have you done your taxes this year. They were simpler although what made them simpler some people in this thread don’t like. For example the expanded standard deduction allowed many more to not itemize. It also eliminated the personal exemption and unless deducts are over $24 k the need to itemize charitable deductions. For moderately high earners it eliminated the need for AMT. No schedule B unless over $1500. For 75% of Americans with W-2’s and some dividends and interest it really is a post card.

 

[roswelllion]

No serious economist thinks cutting taxes increases revenues, no matter how much it boosts the economy.

"No matter how much it boosts the economy" Really? I hope you never had an economics course at PSU.
Think smaller scale, AOC vs Amazon. They offered a $3 billion TAX CUT for $27 billion of revenue. So you can be against that deal for lot's of reasons but NOT because this tax cut wouldn't boost the local economy and more than pay itself.
Those who think tax cuts do not raise revenues do not believe tax cuts boost the economy enough to offset, not no matter how large the boost is.

 

[GTACSA]

No serious economist thinks cutting taxes increases revenues, no matter how much it boosts the economy.

You keep saying that, so how do you respond to this analysis which appears to disprove your assertion?

https://www.heritage.org/taxes/report/tax-cuts-increase-federal-revenues

 

[psu7113]

I changed jobs and that threw in a couple of new variables, but we have gone from a refund of a couple grand, to paying in a couple. I’ve seen on the news that a ceiling on the property tax credit is impacting some, but we aren’t in a crazy high property tax area (as opposed to NJ). We are just getting the standard deduction this year, as opposed itemized deductions.

Not a political post, just trying to gauge whether we should pay someone to look at our taxes to see what we may be missing.

If you were getting a refund, then you were overpaying to begin with. The new tax law limits certain deductions, but it also reduces the marginal rate for most people.

 

[SLUPSU]

I think you're on the right track. Much of the GDP growth is taxed and much stays in the pockets of people (business profits, wages, etc). It's impossible to prove how the economy would have done w/o the tax cuts but common sense says it had a positive effect. I think tax revenues would have been $50b higher without the tax cuts. Just my opinion.

The long term average (50 yr) of revenues as a percent of GDP is 17.4%.
The numbers for the last 5 years are 17.5, 18.1, 17.6, 17.2 and 16.4 (2018). 2018 revenues are down 0.8 from the previous year or about $160B, how do you explain that away?

 

[sluggo72]

The long term average (50 yr) of revenues as a percent of GDP is 17.4%.
The numbers for the last 5 years are 17.5, 18.1, 17.6, 17.2 and 16.4 (2018). 2018 revenues are down 0.8 from the previous year or about $160B, how do you explain that away?

Cause corporate taxes aren’t due to 3/15/19 and personal to 4/15

 

[SLUPSU]

Cause corporate taxes aren’t due to 3/15/19 and personal to 4/15

The numbers are for full fiscal years, so 18 includes all tax payments from the previous year, 2019 will probably look uglier.

 

[58psu77]

Same job, same pay, but more tax in 2018.

I don't care if you're political or not, but trickle down never worked. Millionaires and billionaires are paying less tax than me right now.

Bulls***

 

[auxgym]

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.)

.

Don't let the picture fool you .......it's a dam tough crowd.......

 

[auxgym]

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.

Weather hasn't looked real great out there from what I've seen. Fire.....smoke .....rain .....temps in the 50's.....snow.

 

[auxgym]

I changed jobs and that threw in a couple of new variables, but we have gone from a refund of a couple grand, to paying in a couple. I’ve seen on the news that a ceiling on the property tax credit is impacting some, but we aren’t in a crazy high property tax area (as opposed to NJ). We are just getting the standard deduction this year, as opposed itemized deductions.

Not a political post, just trying to gauge whether we should pay someone to look at our taxes to see what we may be missing.

It sure looks like Dan threw gas on this dumpster fire......then retired to a bottle of beer so he could observe the circle jerk that was sure to ensue........

 

[bdgan]

The long term average (50 yr) of revenues as a percent of GDP is 17.4%.
The numbers for the last 5 years are 17.5, 18.1, 17.6, 17.2 and 16.4 (2018). 2018 revenues are down 0.8 from the previous year or about $160B, how do you explain that away?

2018 revenues were up slightly vs 2017, not down $160b.

 

[SLUPSU]

2018 revenues were up slightly vs 2017, not down $160b.

Nice punt...that's not what I said was it? When you look at the decline as a percentage of GDP, revenue is down about $160B compared to 2017. Why the significant revenue decline as a % of GDP?

 

[bdgan]

Nice punt...that's not what I said was it? When you look at the decline as a percentage of GDP, revenue is down about $160B compared to 2017. Why the significant revenue decline as a % of GDP?

I didn't punt. Revenues were up, not down by $160b. They were down as a % of GDP but not in dollars.

I know your political opinion is that GDP would have been similar without the tax cuts. I strongly disagree.

 

[SLUPSU]

I didn't punt. Revenues were up, not down by $160b. They were down as a % of GDP but not in dollars.

I know your political opinion is that GDP would have been similar without the tax cuts. I strongly disagree.

They would have been much higher without the tax cut.

You STRONGLY disagree, based on what? Your political opinion?

 

[Ranger Dan]

It sure looks like Dan threw gas on this dumpster fire......then retired to a bottle of beer so he could observe the circle jerk that was sure to ensue........

Yeah, I want no part of this thread now...

 

[m.knox]

I’m not sure why tha5 is relevant...

The most important thing is your effective tax rate. Doesn't matter if it is a refund or you are getting more in your check. Your effective rate is what you are paying. I just started my taxes, so I don't have this years rate.

 

[lein]

Because California recieves less than it pays.
For every dollar California tax payers give the federal government, the get less money back.

For every dollar someone in Iowa gives to the federal government, that get more than a dollar back from the government.

California, Texas, New Jersey, New York, Illinois, Massachusetts, Connecticut, Nebraska, Wyoming, New Hampshire, the Dakota’s all get back less than they give to the government in taxes. Every other state is a taker. Including Iowa.

You do get money back that is not reflected in your source.

You get to deduct free money from the Fed that pays for your onerous State and Local taxes. That is, your State raises your taxes, Federal taxpayers pay for it.

California also benefits by being over represented in number of military personal stationed there. Tens of thousands service members buying cars, buying goods and services, is huge.

Maybe those in California should look at the imbeciles that run that State and waste their State taxes. Bullet trains to nowhere while dams crumble. Poor forest management. The systematic destruction of agriculture. But I guess we should note that they help smartphone app development for things like tracking where the human poop is on SF streets.

 

[lein]

Well, here’s why. If I got $300 more a month, I’d probably just spend it stupidly without really noticing, and certainly not earn a dime of interest on it. However, if I get $3600 at the end of the year, we use that to book a little vacation, which I certainly notice.

So it is basically like free money, as long as you’re as dumb with your money as I am.

Then change your withholding to take out more taxes. Or make quarterly payments

 

[Ranger Dan]

The most important thing is your effective tax rate. Doesn't matter if it is a refund or you are getting more in your check. Your effective rate is what you are paying. I just started my taxes, so I don't have this years rate.

My question was, in general, are people seeing less refund or having to pay taxes?

 

[eidolon21]

My question was, in general, are people seeking less refund or having to pay taxes?

LOL LOL LOL