The New Taxes--are higher
Just completed my federal and state taxes, it'll be a shocker for most of you who do their own.
The personal exemptions of $4050 each are being eliminated for husband and wife, the kids (dependents) will be reduced to $2000 each.
I always itemize and and it totals around 19-20 thousand, i thought with the $24,000 standard deduction I would get a little bigger refund this year. But the 24,000 is offset by the lost $8100 personal deductions for the wife and myself, so i'm getting a thousand less in a refund this year.
As an example, someone that has 3 kids with the two adults would be expecting $20,250 in personal deductions and the standard deduction of $24,000 would give them a total of $44,000 in total deductions. Now that will be reduced to $6,000 for the kids (dependents) and 24,000 for the standard deduction, that's a $14,000 loss in total deductions and the expected tax refund turns into a tax debt nightmare.
My son who is 26 and never itemizes will get the $12,000 standard deduction but will still be ahead as he won't get the $4050 personal deduction. So I see it may help some people, but not a lot of others.
All I know is families won't benefit from this tax season...I'm still in shock.
The personal exemptions of $4050 each are being eliminated for husband and wife, the kids (dependents) will be reduced to $2000 each.
I always itemize and and it totals around 19-20 thousand, i thought with the $24,000 standard deduction I would get a little bigger refund this year. But the 24,000 is offset by the lost $8100 personal deductions for the wife and myself, so i'm getting a thousand less in a refund this year.
As an example, someone that has 3 kids with the two adults would be expecting $20,250 in personal deductions and the standard deduction of $24,000 would give them a total of $44,000 in total deductions. Now that will be reduced to $6,000 for the kids (dependents) and 24,000 for the standard deduction, that's a $14,000 loss in total deductions and the expected tax refund turns into a tax debt nightmare.
My son who is 26 and never itemizes will get the $12,000 standard deduction but will still be ahead as he won't get the $4050 personal deduction. So I see it may help some people, but not a lot of others.
All I know is families won't benefit from this tax season...I'm still in shock.
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Uhhhh.....that $2,000 for the kids is a credit, not a deduction. Increased from $1,000 to $2,000. If someone is in the 12% tax bracket, that means that $1,000 of extra credit is the same as a $8,333 deduction which is better than the approx $4k deduction.
If your refund went down, compare your withholdings in 2018 to 2017. You will probably find that the withholdings went down. The IRS adjusted the withholding charts for the employers first of 2018 for the tax changes and I think they over-adjusted. Compare your total tax liability for 2017 to your total tax liability for 2018. Refund amounts do not tell the complete story as far as tax savings.0 -
People should get NO tax break for having kids. Why am I subsidizing people having kids? If you can't feed'em, don't breed'em!
We don't need to encourage MORE people to have kids, we have enough people in this country already!
Merc0 -
quote:Originally posted by neacpa
Uhhhh.....that $2,000 for the kids is a credit, not a deduction. Increased from $1,000 to $2,000. If someone is in the 12% tax bracket, that means that $1,000 of extra credit is the same as a $8,333 deduction which is better than the approx $4k deduction.
If your refund went down, compare your withholdings in 2018 to 2017. You will probably find that the withholdings went down. The IRS adjusted the withholding charts for the employers first of 2018 for the tax changes and I think they over-adjusted. Compare your total tax liability for 2017 to your total tax liability for 2018. Refund amounts do not tell the complete story as far as tax savings.
^^^this, a tax refund just tells you how much taxes you overpaid for the year. Not whether or not the taxes went up a or down. What you need to do is add up all the taxes you did pay, minus the tax refund that you're expecting to get. That will tell you how much taxes cost you this year. Then do the same for last year, and that will tell you if it went up or down...
At the beginning of the year, most people were claiming they were getting less taxes taken out of their checks. No doubt so were you.
I have not done my taxes this year, but I know a few people that have. And they all have reported that they paid less taxes in 2018 than they did in 2017, after they figured the total amount paid in, minus any refund they have...
but like you, most people will be mad and figured they paid more taxes this year because their refund was smaller. The fact is that the government has adjusted the taxes so that people don't use them as their personal savings account. Which wreaks havoc with their accounting.
next year, you might want to try saving the money. What's put on your check instead of being taken out of your check for taxes, and put it into a savings account. That way you will have your money saved up... And then some0 -
I've been trying for 47 years to explain to my wife why everyone else gets a refund & we have to pay. I have no desire to give the government an interest free loan. I just make sure I don't wind up in any penalty situation. Still she moans & groans every year because we don't get a refund. 0 -
quote:Originally posted by gruntled
I've been trying for 47 years to explain to my wife why everyone else gets a refund & we have to pay. I have no desire to give the government an interest free loan. I just make sure I don't wind up in any penalty situation. Still she moans & groans every year because we don't get a refund.
Your wife is married to a very intelligent man... Even if she doesn't think so.0 -
Did our taxes today. Getting $1300 back which we are going to use as an additional house payment this year or possibly just leave it in escrow for when property taxes go up. 0 -
People seem to forget, we in the USA used to have the highest corporate tax rate in the world. The Trump tax cuts changed all that. Instead of corps fleeing, they are staying and many are moving back.
Doubling the standard deduction WILL help many.
The Trump tax cuts will NOT help many who live in DEMOCRAT states. That is DEMOCRAT states such as NY, CT, CA, CT, RI etc where their taxes are off scale high and they are used to deducting state taxes on a federal return.
Trump tax cuts put the quietus on state tax deductions. Thus mostly DEMOCRAT voters are the ones whining. Suggest they need to change their voting habits if they think state taxes are too high.
People who live in low or no income tax states should not have to subsidize those who live in high tax states.0 -
Taking care of the multi-millionaires is what matters, the benefits are all about trickle down. 0 -
quote:Originally posted by Mercury
People should get NO tax break for having kids. Why am I subsidizing people having kids? If you can't feed'em, don't breed'em!
We don't need to encourage MORE people to have kids, we have enough people in this country already!
Merc
Also why am I paying for their education? I reckon after I pay 12 years I shouldn't have to pay unless I have kid.0 -
I sort of agree with Merc & Yosh; except, I think that there should be a federal income tax penalty for children. The financial drag of providing education & infrastructure for children creates hardship for everyone. We need to encourage folks to limit the size of their litters.
Neal0 -
I never get a physical refund, but am happy with that. It means I made a nice chunk of change, and I also didn't loan the Feds my money all year. I would much rather invest it and make more for myself, than loan it to them for 0%.[:)] 0 -
Our refund this year was far less than we had been hoping for based on previous years. 0 -
GREAT idea Neal! Let's do it! [:D]
Merc
quote:Originally posted by nmyers
I sort of agree with Merc & Yosh; except, I think that there should be a federal income tax penalty for children. The financial drag of providing education & infrastructure for children creates hardship for everyone. We need to encourage folks to limit the size of their litters.
Neal0 -
Now you know why Paul Ryan slipped out the back door and decided not to run for office again [;)] among other reasons. He in my opinion was a "piss poor" House Speaker for the Republican party [V] 0 -
Alot of this crap could be eliminated if we went with a fair tax system. Everyone pays a straight percentage. End of story.
Thus the rich pay more so the poor cant complain, but the poor are missing the same percentage of pay the rich are. I can not think of a more fair tax system.0 -
quote:Originally posted by kidthatsirish
Alot of this crap could be eliminated if we went with a fair tax system. Everyone pays a straight percentage. End of story.
Thus the rich pay more so the poor cant complain, but the poor are missing the same percentage of pay the rich are. I can not think of a more fair tax system.
Yes, and it should be a national sales tax. No sales tax on food, except prepared(restaurant)food. No sales tax on road use fuel, as it is already taxed. Every thing else, goods and services, you buy you pay tax.0 -
quote:Originally posted by thorhammer
Just completed my federal and state taxes, it'll be a shocker for most of you who do their own.
The personal exemptions of $4050 each are being eliminated for husband and wife, the kids (dependents) will be reduced to $2000 each.
I always itemize and and it totals around 19-20 thousand, i thought with the $24,000 standard deduction I would get a little bigger refund this year. But the 24,000 is offset by the lost $8100 personal deductions for the wife and myself, so i'm getting a thousand less in a refund this year.
As an example, someone that has 3 kids with the two adults would be expecting $20,250 in personal deductions and the standard deduction of $24,000 would give them a total of $44,000 in total deductions. Now that will be reduced to $6,000 for the kids (dependents) and 24,000 for the standard deduction, that's a $14,000 loss in total deductions and the expected tax refund turns into a tax debt nightmare.
My son who is 26 and never itemizes will get the $12,000 standard deduction but will still be ahead as he won't get the $4050 personal deduction. So I see it may help some people, but not a lot of others.
All I know is families won't benefit from this tax season...I'm still in shock.
Have you calculated the actual percentage you paid in 2018 vs. 2017?0 -
quote:Originally posted by Horse Plains Drifter
quote:Originally posted by kidthatsirish
Alot of this crap could be eliminated if we went with a fair tax system. Everyone pays a straight percentage. End of story.
Thus the rich pay more so the poor cant complain, but the poor are missing the same percentage of pay the rich are. I can not think of a more fair tax system.
Yes, and it should be a national sales tax. No sales tax on food, except prepared(restaurant)food. No sales tax on road use fuel, as it is already taxed. Every thing else, goods and services, you buy you pay tax.
Sure as soon as they get that point of sale tax going.Of course with all those tax changes you requested they will insist on a cashless system be put into place. The VAT tax will be 20%. The rich will just park their money off-shore accounts like Walmart & Amazon.
Of course two years later they will start taxing you the same as before on fuel! Have a nice day !
serf
https://www.forbes.com/sites/parmyolson/2017/10/04/europe-cracks-down-on-amazons-offshore-tax-arrangement/#5566e559642c
Of course, this practice is not unusual. Non-financial American companies held $1.8 trillion in cash in offshore subsidiaries at the end of 2016, according to Moody?s.
Nearly a third of that was held by Microsoft, Google-parent Alphabet, Cisco and Oracle, all tech companies.0 -
Just finished my taxes, and for us although we get less of a refund our taxes turned out almost exactly the same percentage as last year though we made more this year.
2017 we paid 13% federal on our AGI and 4% state
2018 we paid 12% federal on our AGI and 5% state
So in the end we paid almost an identical overall percentage, but we did pay 1% less federal so Trump did give us a tax cut.
Less refund, yes but that is due to new witholding tables, and that is fine with me, I would rather come out close to even at the end of the year and have the money in my paychecks. And we do get very small refunds so nothing to pay.
Having said this our taxes are still too high, add in property taxes and we are paying way too many $$, especially since we have no dependents to claim. Those with dependents and head of household should do quite well though.
One other caveat is we both heavily fund our 401(K) plans so we shelter about 20% of our income from taxes (for now)
So that is my input, other's may vary but you cannot judge it based on what your refund is, that is not a legitimate calculation.0 -
When the tax law changed NBC did a huge investigation hoping to prove many people would be hurt. They failed. Every scenario they tried showed a lower tax bill with the new laws.
What does hurt many is the loss of deducting state taxes. If you live in a heavily taxed state (blue state) you don't recoup any of the state payments.0
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