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(Christian Science Monitor)   Were you planning to file your taxes early this year in hopes of an early refund? Yeah, about that   (csmonitor.com) divider line 128
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14158 clicks; posted to Main » on 09 Jan 2013 at 7:21 AM (1 year ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2013-01-09 08:49:15 AM  
It gets better than just delayed filing dates.

The IRS will be unable to take many common forms until late Feb/early march because of the changes this year.

For instance, if your return has any depreciation on it, you'll be waiting to file.
 
2013-01-09 08:50:39 AM  

Devolving_Spud: Kuroshin: I'm married, no kids, no house, and combined income that just reaches six figures so no, I'm not terribly concerned with filing for any "refund."  We're expecting a bill in the $3k-$5k range, just like last year..

/got nothing to deduct

"Make" some deductions. No, I don't mean "have kids".

3 ways to reduce taxes

The most simple and beneficial way to reduce your taxes is to max out what you put into either your employer's 401(k) plan, or into an IRA you can set up yourself. (If you aren't taking advantage of an available 401(k) plan at work, kindly insert a pic of your favorite facepalm here.)

It isn't too late to do this for 2012.

Buy yourselves a Suze Orman book or two.


I've been contributing for years now.  Granted, I've only been contributing up to my company's match, so that's probably part of the problem.  Eh, I'm about to change careers very soon, so I may make some different choices this next time around.  Frankly, I'm not too concerned about it.  It's just annoying.
 
2013-01-09 08:52:02 AM  

stuartp9: Oh ok, I can understand what you mean - when you have more than one income (e.g. multiple part-time jobs) each gets taxed at lower rates. Same as here. But if you only have 1 income, work as an employee with a salary and have no deductions then would your tax bill at the end of the year be $0?


The pedant in me wants to say "No, your tax bill is based off your income, minus any credits and deductions. You effectively 'pre-pay' the tax bill through withholding from each paycheck. Rarely, if ever, is your tax bill $0, unless you had no income at all during the year."

In the real world, reality says "no". While I was a student and had a meager income, I can remember that I had roughly an $80 refund due from my federal taxes, and owed $2 to New York state. That's the closest to a "$0" tax bill I ever came.
 
2013-01-09 09:01:23 AM  

Misch: stuartp9: Oh ok, I can understand what you mean - when you have more than one income (e.g. multiple part-time jobs) each gets taxed at lower rates. Same as here. But if you only have 1 income, work as an employee with a salary and have no deductions then would your tax bill at the end of the year be $0?

The pedant in me wants to say "No, your tax bill is based off your income, minus any credits and deductions. You effectively 'pre-pay' the tax bill through withholding from each paycheck. Rarely, if ever, is your tax bill $0, unless you had no income at all during the year."

In the real world, reality says "no". While I was a student and had a meager income, I can remember that I had roughly an $80 refund due from my federal taxes, and owed $2 to New York state. That's the closest to a "$0" tax bill I ever came.


I think you misunderstood what I meant.. e.g. if your income for the year is $xxxxx and the tax on that amount is say $5200 and you get paid weekly then you would have withholding in each paycheck of $100 - thus by the end of the year you have paid the $5200 and owe exactly $0. This assumes that the weekly withholding matches up to the calculated amount of tax at the end of the year (which it should if you have no deductions). It seems that the calculation of withholding is a bit more complicated in the U.S.
 
2013-01-09 09:12:56 AM  
Re: getting a refund

I claim something like 10 exemptions (married, no kids). I'd rather my money be sitting in my bank account getting interest, than in the government's. Yes, I have to write a big check to the IRS every March. Yes, I have to be disciplined and not spend that money.

I don't quite understand those who want a refund. You have no self control, or what?
 
2013-01-09 09:14:21 AM  

stuartp9: I think you misunderstood what I meant.. e.g. if your income for the year is $xxxxx and the tax on that amount is say $5200 and you get paid weekly then you would have withholding in each paycheck of $100 - thus by the end of the year you have paid the $5200 and owe exactly $0. This assumes that the weekly withholding matches up to the calculated amount of tax at the end of the year (which it should if you have no deductions). It seems that the calculation of withholding is a bit more complicated in the U.S.


I've had it happen with my state tax, which is flat, and it could probably get pretty close on federal taxes if you make exactly the same weekly salary for the entire year and have no itemized deductions and no interest/capital gains income and aren't married because your payroll dept has no way to take into account your spouse's salary when calculating witholdings. That doesn't apply to very much of the population, though.
 
2013-01-09 09:15:41 AM  
Oh goody, it's that time of year when the Fark Collective becomes an amalgamation of tax experts.

Time to log off until April 15th.
 
2013-01-09 09:16:30 AM  

Wodan11: I claim something like 10 exemptions (married, no kids). I'd rather my money be sitting in my bank account getting interest, than in the government's. Yes, I have to write a big check to the IRS every March. Yes, I have to be disciplined and not spend that money.


Have you ever gotten a penalty for that? I understand that you can if you dramatically underwithhold although I don't know anyone it's actually happened to.
 
2013-01-09 09:19:04 AM  

you have pee hands: Wodan11: I claim something like 10 exemptions (married, no kids). I'd rather my money be sitting in my bank account getting interest, than in the government's. Yes, I have to write a big check to the IRS every March. Yes, I have to be disciplined and not spend that money.

Have you ever gotten a penalty for that? I understand that you can if you dramatically underwithhold although I don't know anyone it's actually happened to.


It is called an underpayment penalty, and yes it can happen. For the vast majority of "wage workers," it doesn't however.
 
2013-01-09 09:19:36 AM  
I've bumped up my W-4 for this year. We've always been near Zero at tax time, but with more taxes on the way I'm going to try to keep up.

Rising taxes.

Schumer (Sen.of NY) proposing more gas and electricity taxes.

Yeah, 2013 will not help.
 
2013-01-09 09:19:45 AM  

Thunderpipes: I paid for my college out of pocket. I cannot even deduct student loan interest. My tax dollars give free money to others to go as well. Why is this in any way fair?


If you did that without using or checking out grants and other resources that are available to you, then you're just a goddamned idiot, not a conservative.
 
2013-01-09 09:23:19 AM  

you have pee hands: I've had it happen with my state tax, which is flat, and it could probably get pretty close on federal taxes if you make exactly the same weekly salary for the entire year and have no itemized deductions and no interest/capital gains income and aren't married because your payroll dept has no way to take into account your spouse's salary when calculating witholdings. That doesn't apply to very much of the population, though.


If you have a fixed salary for the year, then you would have the same weekly/fortnightly/monthly salary..

I'm a bit confused with the "aren't married" bit - does this affect the withholding? That certainly is different than here in Aus - both in the marriage are separately taxed on their incomes, and if one doesn't have any income then the other may get a tax reduction at the end of the year. Perhaps overall we mostly pay more tax during the year here so most people then get a refund at the end after claiming deductions.  Just trying to figure out if there is any situation where you would have to pay extra tax at the end of the year in the U.S. if you are on a fixed salary.
 
2013-01-09 09:23:48 AM  

Wodan11: Re: getting a refund

I claim something like 10 exemptions (married, no kids). I'd rather my money be sitting in my bank account getting interest, than in the government's. Yes, I have to write a big check to the IRS every March. Yes, I have to be disciplined and not spend that money.

I don't quite understand those who want a refund. You have no self control, or what?


Yeah, that 0.05% interest would have really added up over the course of a year.

I prefer not worrying about taxes all year, then filing in less than 30 minutes online and getting a direct deposit for a couple thousand dollars a few weeks later. It feels nice.
 
2013-01-09 09:24:34 AM  
I have never gotten a W2 before 1/28, so this couldn't really impact anyone except self-employed contractors and small business owners.
 
2013-01-09 09:27:21 AM  

The_Six_Fingered_Man: It is called an underpayment penalty, and yes it can happen. For the vast majority of "wage workers," it doesn't however.


Is that because they don't bother looking at people who make normal wage worker salary, or because the average wage worker doesn't claim 9 children he doesn't have on his W-4? I think you have to do something pretty strange to end up significantly underwitholding if most of your income comes from a biweekly paycheck.
 
2013-01-09 09:29:12 AM  

Fark_Guy_Rob: Kuroshin: I'm married, no kids, no house, and combined income that just reaches six figures so no, I'm not terribly concerned with filing for any "refund."  We're expecting a bill in the $3k-$5k range, just like last year.

Filing 0/0 isn't enough for DINKs.  Ya gotta have them withhold several hundred dollars per month as well.  I miss the days of filing Single and getting a refund...

/got nothing to deduct

Financially responsible people like you should be punished with higher taxes so irresponsible people like me can get more stuff!

Sadly, this is how our system works.


The so-called marriage penalty actually makes a lot of sense. For a long time in this country only men worked high paying jobs, so doctors and lawyers would marry their high school sweethearts, and every family would have a solid breadwinner. Nowadays doctors and lawyers marry each other, which vastly contributes to wealth disparity, as the lower half of high-earning professional men have been displaced onto low earning jobs by the top women. So instead of every family having one $50k earner, half have two earners and end up in six figures, while the other half have two $12.50/hr earners and can barely get by. It makes sense to compensate for this by penalizing double income families to subsidize the lesser qualified men and the women who were left over to marry them.
 
2013-01-09 09:40:16 AM  
Just had my W2 dropped on my desk while reading these comments.

CSB
/ No, really it's true!
 
2013-01-09 09:40:34 AM  

soup: Yeah, that 0.05% interest would have really added up over the course of a year.

I prefer not worrying about taxes all year, then filing in less than 30 minutes online and getting a direct deposit for a couple thousand dollars a few weeks later. It feels nice.


I make quite a bit more than that interest rate. And, certainly, I don't worry about taxes all year. I've got savings specifically set aside for it, why would there be cause to worry?

"It feels nice?" Yes, how nice of the government to give you your own money back!
 
2013-01-09 09:47:46 AM  

MindStalker: Surprisingly even the $1000 per child credit starts to dissapear at the $110k level,


Surprisingly even things like worrying about food, clothing, shelter, water, start to disappear at the $110k level,

FTFY.
 
2013-01-09 09:49:50 AM  

Wodan11: I don't quite understand those who want a refund. You have no self control, or what?


see also: Americans. Honey Boo Boo. AR-15 rifles.Justin Bieber. Football.
 
2013-01-09 09:50:07 AM  

Wodan11: soup: Yeah, that 0.05% interest would have really added up over the course of a year.

I prefer not worrying about taxes all year, then filing in less than 30 minutes online and getting a direct deposit for a couple thousand dollars a few weeks later. It feels nice.

I make quite a bit more than that interest rate. And, certainly, I don't worry about taxes all year. I've got savings specifically set aside for it, why would there be cause to worry?

"It feels nice?" Yes, how nice of the government to give you your own money back!


THIS.
Any financial planner worth his salt will tell you to hold on to as much as you can and pay a little at tax time rather than get a refund.
 
2013-01-09 09:50:43 AM  

utah dude: MindStalker: Surprisingly even the $1000 per child credit starts to dissapear at the $110k level,

Surprisingly even things like worrying about food, clothing, shelter, water, start to disappear at the $110k level,

FTFY.


you sound poor.
 
2013-01-09 09:52:24 AM  

stuartp9: I'm a bit confused with the "aren't married" bit - does this affect the withholding? That certainly is different than here in Aus - both in the marriage are separately taxed on their incomes, and if one doesn't have any income then the other may get a tax reduction at the end of the year. Perhaps overall we mostly pay more tax during the year here so most people then get a refund at the end after claiming deductions. Just trying to figure out if there is any situation where you would have to pay extra tax at the end of the year in the U.S. if you are on a fixed salary.


In the US you married couples can file together, paying tax on the combined income, so it's going to be pretty unlikely to get the withholding quite right. I still think overpaying and getting a refund is more common than underpaying and owing unless you're self employed, though.
 
2013-01-09 10:01:07 AM  
Being that I get paid salary, why do I get a return? With computers and what not, I should pay the exact amount that is required. Such an antiquated system.
 
2013-01-09 10:05:44 AM  
what's theirs is theirs
and what's yours is theirs as well.

Smile, work harder
your benevolent government knows what is best for you
 
2013-01-09 10:07:55 AM  

stuhayes2010: Being that I get paid salary, why do I get a return? With computers and what not, I should pay the exact amount that is required. Such an antiquated system.


Because then you'd have to provide your employer with the exact amount of your mortgage interest payments, your child care expenses, and any charitable contributions you make, as well as your spouces income. And they would have to run a fairly complicated algorithm on each persons paycheck, every pay period.
 
2013-01-09 10:10:19 AM  

Thunderpipes: Going to cot my family about $7,000 more in taxes this year.

We are not rich, and are below the 250k evil line.

Thanks a lot, libs.


Then you're doing it wrong.
try going to a tax professional as opposed to doing it yourself.

/unless you had a big deduction last year that doesn't apply this year, like medical. in that case, you shouldn't complain that you didn't have huge payments this year.
 
2013-01-09 10:16:48 AM  

Madbassist1: Thunderpipes: I paid for my college out of pocket. I cannot even deduct student loan interest. My tax dollars give free money to others to go as well. Why is this in any way fair?

If you did that without using or checking out grants and other resources that are available to you, then you're just a goddamned idiot, not a conservative.


I paid for about half out of pocket, got loans for the rest. No grants available for me because I had a decent income. My last 29 courses I got 27 A's and 2 B's. I applied for grants, but was told to fark off. I was working 50-60 hour weeks at the time as well.

I also don't think people realize what the new Obamacare tax package does to people who have health savings accounts.

Spin it any way you want to. I pay for my collge, then pay off my loans, and pay for others who simply show up, vote for Obama, and get a check. Fark them.
 
2013-01-09 10:19:36 AM  

Khryswhy: Just had my W2 dropped on my desk while reading these comments.

CSB
/ No, really it's true!


IT'S TWUE!! IT'S TWUE!!!

I never get my documentation before the last week in Jan.
 
2013-01-09 10:26:38 AM  
1). Who actually gets all of their tax documents before Jan 30?

2) This constant excuse of, "It takes a month to update our software for this tiny change that shouldn't even be hard coded" is insane. If it is actually true, fire your software team.
 
2013-01-09 10:27:40 AM  

Wodan11: Re: getting a refund

I claim something like 10 exemptions (married, no kids). I'd rather my money be sitting in my bank account getting interest, than in the government's. Yes, I have to write a big check to the IRS every March. Yes, I have to be disciplined and not spend that money.

I don't quite understand those who want a refund. You have no self control, or what?


Don't you get hit with a
penalty for that? (according to the article there is also a potential criminal penalty)

Unless you are legitimately claiming 10 exemptions, which it doesn't sound like.
 
2013-01-09 10:30:48 AM  

MindStalker: Because then you'd have to provide your employer with the exact amount of your mortgage interest payments, your child care expenses, and any charitable contributions you make, as well as your spouces income. And they would have to run a fairly complicated algorithm on each persons paycheck, every pay period.


Not to mention whether you'll be fired in a few months or quit, whether you'll be rehired after that, at what salary you'll be rehired at, etc.

Getting it perfect and getting everyone's bill to $0 isn't possible; it wouldn't even be possible if the year-end return was "(1) write down your total yearly income; (2) look up your tax rate in this non-flat table; (3) multiply line (1) by line (2)*; (4) write down your total withholdings (5) subtract line 4 from line 3 (5) pay the amount on line (5)". Getting it better than what they do now, however, well that's a different story. :-)

* Yes I'm aware that tax brackets don't actually work this way; go ahead and mentally fix my form to have a couple more lines if you'd like.
 
2013-01-09 10:48:38 AM  
And don't you DARE be what the feds consider a "high earner", because then you are limited to what you contribute to retirement. So a person like me who worked hard, finally am a "high earner" am told I can only contribute 10k a year to retirement because it is not fair to others if I put, say, 15% away.

Oh, I pay 20k a year in daycare? Fark you, can't deduct any of that, and your taxes pay for others to send their kids to daycare.

Wife and I, student loan interest? Can't deduct.

2% payroll hit us, was temporary, supposed to be, I know, but still, that is 4k right there.


Tax tax tax tax tax and absolutely no spending cuts by Chimpy McChimpSpend. And now Pelosi says they want to limit deductions for people as well, because they want 1 trillion more in revenue, with absolutely no spending cuts, of course.
 
2013-01-09 10:54:41 AM  

GoodyearPimp: Thunderpipes: I paid for my college out of pocket. I cannot even deduct student loan interest. My tax dollars give free money to others to go as well. Why is this in any way fair?

SO you were aware that the interest was deductible. You could have gotten a loan and chose the path of most resistance. You sir are a genius.


This exchange is just bizarre. Even with the interest deduction, you're better off paying for college up front, because it's only a deduction. You're only getting about 1/4 of what you actually spend on interest actually back into your pocket.

Student loans aren't really a subsidy for students these days, anyway. Instead, they're a subsidy for the banks. Low yield loans backed by the federal government? That's a banker's wet dream.
 
2013-01-09 11:16:14 AM  

Krieghund: GoodyearPimp: Thunderpipes: I paid for my college out of pocket. I cannot even deduct student loan interest. My tax dollars give free money to others to go as well. Why is this in any way fair?

SO you were aware that the interest was deductible. You could have gotten a loan and chose the path of most resistance. You sir are a genius.

This exchange is just bizarre. Even with the interest deduction, you're better off paying for college up front, because it's only a deduction. You're only getting about 1/4 of what you actually spend on interest actually back into your pocket.

Student loans aren't really a subsidy for students these days, anyway. Instead, they're a subsidy for the banks. Low yield loans backed by the federal government? That's a banker's wet dream.


My student loan rates are below inflation, and until 2009 they were less than what I was getting in a savings account.
 
2013-01-09 11:18:45 AM  

jumac: I can never understand why it take companies 1 month to get w2 out in the 1st place. I mean how hard it is it to go into the payroll software and tell it to print out w2 for everyone on who worked there. Then stick them in the mail. But no companies gota weight to the last min to send out.


As someone who has processed a few thousand w-2's, this is a gentle suggestion to go fark yourself.

And you're right by the way - it's just a button that says 'press here to simply issue w-2 to all employees'. There's nothing that has to happen before that button can be pushed, no prep at all, and the data is already there automagically. And despite the fact the the people who are preparing the w-2's almost certainly have no other duties besides getting that button pushed, we usually wait until 1/31 out of spite.
 
2013-01-09 11:19:26 AM  

BMFPitt: 1). Who actually gets all of their tax documents before Jan 30?

2) This constant excuse of, "It takes a month to update our software for this tiny change that shouldn't even be hard coded" is insane. If it is actually true, fire your software team.


I don't know what the problem is. We typically get all of our tax documents by late September. I think we actually got them by mid-September last year. Of course, those were for our 2011 taxes....

/Hate having to file for an extension...EVERY year.
 
2013-01-09 11:26:53 AM  

Wodan11: I don't quite understand those who want a refund. You have no self control, or what?


I have assloads of self control. I actually hit the max contribution in our 401k for the first time last year. But I still claim zero deps and get a refund every year. I have a rental property and I like to use withholding to balance the tax due on rental income. And I just generally like getting a refund. Other things I do that would drive you crazy - I often estimate what the utilities will be and pay them a week or two in advance. And before christmas and vacation I'll often pay my credit card ahead. That's right - I loan money to visa. I hate owing and that's how I deal with it.
 
2013-01-09 11:28:38 AM  

Thunderpipes: So a person like me who worked hard, finally am a "high earner" am told I can only contribute 10k a year to retirement because it is not fair to others if I put, say, 15% away.


Or, you know, $17M to a 401k, or $17,500 if you're over 50 in 2013. Then your wife can do the same if she's working, and if not she can contribute $5M (or $5,500 if she's over 50) to a spousal IRA. So anywhere from $22M (more than twice what you're claiming) to $35M. And then, you can even save any amount you want and ear-mark it for retirement, it just won't be pre-tax. But because you don't know what tax rates are going to be when you retire, it might be beneficial to pay the taxes now because they might currently be lower.

If you're going to make shiat up about how much you're allowed to contribute to retirement accounts, how do I know you're not making everything else up as well?
 
2013-01-09 11:30:42 AM  

JohnBigBootay: And you're right by the way - it's just a button that says 'press here to simply issue w-2 to all employees'. There's nothing that has to happen before that button can be pushed, no prep at all, and the data is already there automagically. And despite the fact the the people who are preparing the w-2's almost certainly have no other duties besides getting that button pushed, we usually wait until 1/31 out of spite.


Honest question: what prep is necessary? I've filled out (not filed) my tax returns in years past using tentative information taken from my last pay statement so I could get it done early, and gone back and checked it against the actual W2s when they arrive. IIRC I haven't had discrepancies, and the only missing information tends to be administrative stuff like the EIN.

Is it that for some people it gets complicated, and those people slow it down?
 
2013-01-09 11:36:21 AM  

The Singing Bush: Thunderpipes: So a person like me who worked hard, finally am a "high earner" am told I can only contribute 10k a year to retirement because it is not fair to others if I put, say, 15% away.

Or, you know, $17M to a 401k, or $17,500 if you're over 50 in 2013. Then your wife can do the same if she's working, and if not she can contribute $5M (or $5,500 if she's over 50) to a spousal IRA. So anywhere from $22M (more than twice what you're claiming) to $35M. And then, you can even save any amount you want and ear-mark it for retirement, it just won't be pre-tax. But because you don't know what tax rates are going to be when you retire, it might be beneficial to pay the taxes now because they might currently be lower.

If you're going to make shiat up about how much you're allowed to contribute to retirement accounts, how do I know you're not making everything else up as well?


THIS.

And, speaking of fairness, is it fair that someone so clueless has become a "high earner"? Or is he just trolling?
 
2013-01-09 11:36:57 AM  

Thunderpipes: And don't you DARE be what the feds consider a "high earner", because then you are limited to what you contribute to retirement. So a person like me who worked hard, finally am a "high earner" am told I can only contribute 10k a year to retirement because it is not fair to others if I put, say, 15% away.


Ya know...I'm not calling you a liar or anything, but this is not the first time you have claimed to be a "high earner". Not saying you aren't, but I tend to think your definition may be different than mine, because you just don't sound like a high earner.
 
2013-01-09 11:43:36 AM  
I like the part where everyone cries about having too much money and therefore having to pay taxes.
 
2013-01-09 11:48:00 AM  

evaned: JohnBigBootay: And you're right by the way - it's just a button that says 'press here to simply issue w-2 to all employees'. There's nothing that has to happen before that button can be pushed, no prep at all, and the data is already there automagically. And despite the fact the the people who are preparing the w-2's almost certainly have no other duties besides getting that button pushed, we usually wait until 1/31 out of spite.

Honest question: what prep is necessary? I've filled out (not filed) my tax returns in years past using tentative information taken from my last pay statement so I could get it done early, and gone back and checked it against the actual W2s when they arrive. IIRC I haven't had discrepancies, and the only missing information tends to be administrative stuff like the EIN.

Is it that for some people it gets complicated, and those people slow it down?


Prep necessary:

Ensuring all SSNs are correct
Ensuring all wage information is correct
Ensuring all extraneous info (box 12) is correct and properly coded
Ensuring all mailing addresses are correct
Ensuring withholding is correct
Manually entering new employee information
Double and triple checking all of the above to ensure that YOU arent hit with penalties for submitting incorrect info.
Filing the W-2s and W-3s with the SSA either electronically or manually.
Checking back to ensure that the SSA has accepted the information return.
Mailing out or electronically delivering the W-2.

Now, multiply all of the above by the number of recipients.
 
2013-01-09 11:51:45 AM  
A lot of summarization going on to the point of misleading. There's a big difference between something like a Roth, a traditional IRA, 401k, and just plain saving (via any form of investment including stocks, CDs, bonds). Some have limits on what the US government allows, whether it's pre- or post-tax (which is a misnomer, you pay taxes anyway, it is just whether you are paying taxes NOW versus later). Post-tax is not necessarily better, for one thing. And a Roth means that the *interest you accumulate over years is not taxed*.
 
2013-01-09 11:54:29 AM  

Wodan11: A lot of summarization going on to the point of misleading. There's a big difference between something like a Roth, a traditional IRA, 401k, and just plain saving (via any form of investment including stocks, CDs, bonds). Some have limits on what the US government allows, whether it's pre- or post-tax (which is a misnomer, you pay taxes anyway, it is just whether you are paying taxes NOW versus later). Post-tax is not necessarily better, for one thing. And a Roth means that the *interest you accumulate over years is not taxed*.


Actually a ROTH means that distributions are tax free, since you cannot take the contribution deduction. Traditional IRAs are the other way round. Deductible contributions, taxed distributions. (In most cases, does not include non deductible contributions)
 
2013-01-09 11:55:11 AM  
Kuroshin:

Because he's trolling.  The primary problem with taxes in the US is that withholdings from your paycheck don't really reflect what you make.  Too much gets withheld at lower incomes, while too little gets held as you go up.  My wife and I both claim zero exemptions, yet still don't have enough drawn against our incomes over the course of the year.



Do you really think that is the "primary problem" with taxes in the US? And you're calling someone else a troll? FFS, just fill in an additional amount to be deducted from each paycheck on Line 6 of your W-4. How hard is that?

It gets especially tricky with dual-income households, because your incomes don't get taxed at the joint rate.  Being married with no kids and no house means there is pretty much nothing you can use as a deduction to lower your tax liability.  Back when I was self employed I was able to essentially negate my entire income with deductions, but that requires quite a bit of creative accounting and lots of receipts.

Our tax system is a bit of a clusterfark, but don't let Thunderpoop fool you - when you make more money, you take home more money.  Even though you end up with a (climbing) tax bill at the end of the year, you've still got more money in your pocket than the guy making less.  At the end of the day, the more money you make, the more money you have, even after taxes.


Both Thunder and Kuroshin are correct. If you make more money, you'll take home more money even after you do pay (relatively) more taxes. But something has to be done to better distribute the burden. Too many people without a stake in the game isn't wise. I'm ok with a progressive model, but smooth it out and eliminate the loops and illogical twists.
 
2013-01-09 12:22:40 PM  
sigpop:But something has to be done to better distribute the burden. Too many people without a stake in the game isn't wise. I'm ok with a progressive model, but smooth it out and eliminate the loops and illogical twists.

It's worth pointing out that initially income tax was not meant to be a distributed burden. Originally it was targeted at less than 10% of households. I'm not suggesting that it should stay that way, or anything at all really.

On a side note, It is nice to see Thunderpipes finally come out of the closet, he used to try to hide his racism.
 
2013-01-09 12:22:46 PM  
i get my w2 electronically online before the end of january, so i usually file super early. this really only delays my yearly snowboarding trip. no biggie.
 
2013-01-09 12:24:57 PM  

sigpop: Kuroshin:

Because he's trolling.  The primary problem with taxes in the US is that withholdings from your paycheck don't really reflect what you make.  Too much gets withheld at lower incomes, while too little gets held as you go up.  My wife and I both claim zero exemptions, yet still don't have enough drawn against our incomes over the course of the year.

FFS, just fill in an additional amount to be deducted from each paycheck on Line 6 of your W-4. How hard is that?



Thirty years running a business with employees, and I think we've had to explain that little detail to nearly every one. I think we should use it as a pre-employment reading test.

As has been pointed out several times in this thread, your employers don't know the details of your personal finances. For all we know, your job with us may just be a hobby, or a way to get some sunshine and a little exercise.
 
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