A tax question

[Rogue Hawk]

Now please, don't let this turn into political pandemonium. It is strictly a finance question.

I have been lead to believe we got a federal tax cut. But yesterday while doing my taxes I noticed the individual deduction was removed. So the government guy is handing us money at the same time another one picks our pocket. So my question is, when it all come down to the bottom line, did we get a tax cut?

 

[ARtraveler]

Yup! I went from two years of $1,100 refunds to owing $680 this year. The tax cut did not work for me. No great changes to my finances either. :thumbup:

 

[JerryB]

Hi Rogue Hawk,

Re: did we get a tax cut?

In a word: No

Jerry Baumchen

 

[Rob Rodriguez]

Yes, you got the best tax cut ever from the most beautiful tax legislation ever passed and it was all done in record time by the most fabulous administration that has ever resided in the WH. LOL This will probably be pulled.

 

[Rogue Hawk]

Yup! I went from two years of $1,100 refunds to owing $680 this year. The tax cut did not work for me. No great changes to my finances either. :thumbup:

Yes, this is the first time in all the years I have been filing taxes I end up owing money. :banghead: The tax guy I go to said many people are in the same boat.

 

[glorybiz]

you should check your payroll deductions for exemptions. I found mine had changed from 0 to 1, so while I was getting more money in my paycheck, I ended up having to pay $900 instead of getting a refund

 

[Easy Rider]

So the government guy is handing us money at the same time another one picks our pocket.

So my question is, when it all come down to the bottom line, did we get a tax cut?

Nothing new with that first statement.

Yes, my income was almost exactly the same and my total tax was less.

 

[Easy Rider]

Yup! I went from two years of $1,100 refunds to owing $680 this year. The tax cut did not work for me. No great changes to my finances either. :thumbup:

That probably has more to do with the withholding tables than with the actual tax rates.
Was the total tax owed more or less this year ?

 

[wyliec]

Yup! I went from two years of $1,100 refunds to owing $680 this year. The tax cut did not work for me. No great changes to my finances either. :thumbup:

I too didn't have any great changes to my finances; but, I went from owing around a $1000 in years past to the feds owning me $69.

 

[2dogs]

We always claim "0" and add to our deductions so we never end up owing, and we always get a refund. However this year our refund will be smaller by several hundred dollars. So in short, we did not see a tax cut.

 

[ARtraveler]

I made no changes to my withholdings, so enjoyed a little bit extra each pay period. Now...it does not matter. No more employment income.

 

[IdahoMtnSpyder]

For me, there was no real tax cut. My gross taxable income dropped by about $11,000 and my total tax owed dropped about $1,200, which is about what my incremental tax rate is. I went from over $30,000 in deductions plus exemptions in 2017 to $26,600 standard deduction. One thing that helped is I took some of my Mandatory Required Distribution from an IRA as a Qualified Charitable Deduction to my church. Had I not done that I would have been stung by several hundred dollars.

If you have to take an RMD out of an IRA, and like to donate to charity, check out the QCD option. Your donation does not count as income to you, but it satisfies the RMD.

 

[IdahoMtnSpyder]

you should check your payroll deductions for exemptions. I found mine had changed from 0 to 1, so while I was getting more money in my paycheck, I ended up having to pay $900 instead of getting a refund

I don't know if the change in withholding was a blatant move by the administration to stealthily glorify the supposed tax cut, or a gross miscalculation by them as to what the net result would be for most people. Either one is plausible IMO.

 

[cptjam]

Mine went down. My tax rate fell, and I got a small refund. Don’t look at refund size. If you withheld too much, you get a big refund of your own money. Look at the tax rate, and look at deductions. Then adjust your withholding accordingly.

 

[DGoebel]

Lot's of folks complaining about their tax refunds this year because they didn't notice that their monthly take home pay bumped up. They enjoyed getting more monthly or twice monthly checks, but now are not happy that they ended up owing a bit. My wife's the office manager/bookeeper for a local company and really paid attention to the withholding change and adjusted ours appropriately. We got more back this year than last. She's getting a new Yamaha SMAX to replace her 11 year old C3.

 

[Little Blue]

Taxes

Taxes seem to Always have the bad Deal. Nobody wants to pay them, but everyone enjoys the Benefits. HAVE A NICE WEEKEND....:thumbup:

 

[Easy Rider]

However this year our refund will be smaller by several hundred dollars. So in short, we did not see a tax cut.

WHY......do SO many people try to measure their taxes by the amount of refund they get ?????

Those are two different things.

Compare the total tax owed from multiple years returns.

 

[newbert]

WHY......do SO many people try to measure their taxes by the amount of refund they get ?????

Those are two different things.

Compare the total tax owed from multiple years returns.

Yup. That's the true apples-to-apples bottom line.

 

[canamjhb]

Yup. That's the true apples-to-apples bottom line.

For me, a perfect situation is to have NO refund and OWE no tax at the end of the year. That means I am paying the appropriate amount for my income as I go..... The only way to determine tax increase/reduction is to look at total GROSS income and total tax paid year over year. If your income changes significantly, your tax bracket will too. Other events and personal changes, such as retirement, RMD, deductions, ETC. will have an effect tax liability. The amount of tax owed or refund due is only one component of your actual tax liability. It does not reflect reality..... Jim

 

[Easy Rider]

Not wanting to insult anybody here but the same people who "measure" their taxes by the amount of their refund probably are the same ones who think they got a great deal on a new car.........because their monthly payments are so low. :shocked: