Tax Filing Experts - Semi-venting thread

Grabber

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Hey All,

Is anyone here an accountant and understands Taxes? We are really blown away as this is the 2nd year now, where "we could be negative"

When we filed last year, we owed over $2,500 in taxes. So, to avoid an issue, my wife changed her status on her W-9 to "0" and took out an extra $100+ per paycheck to pay toward federal taxes, putting out over $2,500 more to cover the difference.

Our incomes have NOT changed, and we paid over $2,500 more in Federal taxes in 2016. Now, using basic calculators, even factoring in PMI, mortgage interest, property taxes, federal/state and donations, we apparently may owe another 1,500 in taxes.

How exactly does this work? Did something change in 2016 we don't know about?

We both claim "0", are filing married/jointly, have property taxes, which went up, donations, student loans, PMI, mortgage interest paid, etc.

Kind of bullshit if you ask me.

Last year, we paid $200 for a CPA which was a waste since there was maybe a $20 different in the balance we paid ($2,500 bucks on top of our taxes)

-Chris
 

DHG1078

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I'm no expert, but the tax codes change every year. Some of your deductions may be worth less.

Any kids you're forgetting to claim?

Have you paid less in interest on your loans in 2016?
 

Grabber

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I'm no expert, but the tax codes change every year. Some of your deductions may be worth less.

Any kids you're forgetting to claim?

Have you paid less in interest on your loans in 2016?

No kids. Maybe in a couple of years we may have a kid.

Interest paid was the same as the previous year. Property taxes went up by several hundred. Our income stayed the same, but, we paid over $2,500 in federal taxes over the year to cover any future deficit.

Now, that seems to be closer to $4,000. Who the hell knows.
 

DHG1078

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Maybe the calculator is wrong. From what I can tell in teh tax brackets, people with no increase in income should see a decrease in marginal tax rate. Again, I am not a professional.

I'm a little nervous to do my taxes now lol.
 

Black2010

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Income may have stayed the same but what bracket are you in? It's entirely possible the tax % for that bracket went up. Just drawing straws as I'm not an accountant or versed in tax law.

For my family, even with 0 dependents claimed we were having to pay every year. After our first kid we were closer to breaking even. Last year we had our second child and this was the first year that I can remember where I didn't owe. The child tax deductions help a lot but lets be honest here. Raising a kid properly is way more expensive than the tax credit ;-)

Can you tell if it was your federal or state income tax that's causing the problems?
 

Grabber

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I always hear the kids are the way to go. :)

Well, the state tax only changed the total balance a hundred or two. It was the federal in which the previous year, my wife paid about 7.5-8K. Now, she's paying over 10K in JUST federal and I'm just under at 9,300. Both of our state taxes went up a few hundred dollars as well, but, that is small change in the bigger picture.

Our bracket should not have changed since we make the same amount of money (IIRC, I made 2,500 less than the previous year now that I think about it, could be wrong, though. )

I tried using TurboTax and HR Block calculators. Both were between $1,350 and $1,500 negative.
 

madscotsman

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My wife and I are in the same boat. We owe every year. Even with me having an extra $200 a month taken out and paying toward federal taxes. We both claim 0, we have our son, own a home, student loans, charitable donations,......etc. Seems like each year I put my info in and I see a healthy refund of 3-4K coming my way, but then put my wife's info in and it not only sucks away the "refund" but adds 3-4k to what we owe. Meanwhile all our friends get refunds enough to pay for vacations, home improvements, recreational vehicles (small boat or camper). Just once I'd like to break even.

Waiting in line at WAL-MART or any other grocery store, behind an able-bodied appearing person, who has 3 different groups of items each being paid for with different forms of "entitlement program" money, boils my blood. Hopefully there will be an executive order for that sometime soon.........
 

DHG1078

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I always hear the kids are the way to go. :)

Well, the state tax only changed the total balance a hundred or two. It was the federal in which the previous year, my wife paid about 7.5-8K. Now, she's paying over 10K in JUST federal and I'm just under at 9,300. Both of our state taxes went up a few hundred dollars as well, but, that is small change in the bigger picture.

Our bracket should not have changed since we make the same amount of money (IIRC, I made 2,500 less than the previous year now that I think about it, could be wrong, though. )

I tried using TurboTax and HR Block calculators. Both were between $1,350 and $1,500 negative.

Instead of using the calculator, maybe just create a turbo tax account and enter in your tax info. Its pretty easy, and you don't pay until you file, so it gives you your total return info for free.

I've used turbo tax the past few years. Way cheaper than using a CPA, but my taxes aren't as complicated as some of yours.
 

Grabber

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^^^ Yeah, with you on that.

We've been saving for a small vacation this year, but, looks like that fund is going to be drained once more.
 

Grabber

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Instead of using the calculator, maybe just create a turbo tax account and enter in your tax info. Its pretty easy, and you don't pay until you file, so it gives you your total return info for free.

I've used turbo tax the past few years. Way cheaper than using a CPA, but my taxes aren't as complicated as some of yours.

We actually have used TurboTax for many years, just not last year.

Will be using it again this year to do the taxes instead of paying a CPA $200+ for them to spend 10 minutes to file our taxes and tell us we owe x amount of dollars.
 

CV355

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I'm an engineer with strong skills in programming and mathematics. Taxes make no damn sense to me.

Tax Year 2012, I had to pay in (thanks Dannel Malloy, you literal piece of human garbage!) and missed my refund due to $80. $80 into the next tax bracket. I watched the screen go from "Refund: $2200" to "Owe: $400" instantly. The tax prep dude pulled out all sort of books and said "nope, that's right." I'm not allowed back in an H&R Block after the absolute fit I threw in there.

I brought my tax bundle to a CPA (who I use every year now) and he corrected it and got me a substantial amount back where H&R Block had dun goof'd.

As for tax filing status- that also drives me nuts. If it's set up right and your employer is withholding correctly, you should net close to even prior to additional deductions/credits.
 

DHG1078

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I'm an engineer with strong skills in programming and mathematics. Taxes make no damn sense to me.

Tax Year 2012, I had to pay in (thanks Dannel Malloy, you literal piece of human garbage!) and missed my refund due to $80. $80 into the next tax bracket. I watched the screen go from "Refund: $2200" to "Owe: $400" instantly. The tax prep dude pulled out all sort of books and said "nope, that's right." I'm not allowed back in an H&R Block after the absolute fit I threw in there.

I brought my tax bundle to a CPA (who I use every year now) and he corrected it and got me a substantial amount back where H&R Block had dun goof'd.

As for tax filing status- that also drives me nuts. If it's set up right and your employer is withholding correctly, you should net close to even prior to additional deductions/credits.

Yup. I think the tax codes are intentionally written to be confusing, and cost people to give up more money than they should.

I will vote for anyone who wants to streamline the process.
 

96dreamer

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I am in the same boat this year, student loans are knocked down enough that I can't claim the max deduction. Waiting for the wifes w2-s to come in and run us as joint to see if it changes anything.
 

sleek98

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I am a CPA and my main focus is in taxes.

There are a number of issues you could be getting hit with. Alternative Min. Tax, itemized deduction phaseouts, etc etc.

Assuming you only have w-2 income and no other income:

Look at both the total income reported on the w-2s and compare it to last years line 7. did it change? is so how much. I am going to guess by the amounts that you posted of your federal withholding you are in the 25% tax bracket. Take that change by 25% and that would be a rough increase or decrease in tax year over year.

Also take a look at the total federal withholding from the w-2 and compare it to line 64 of last years tax return. What was the change?

Compare the change in both.

I also find it hard to believe that your itemized deductions are exactly the same, Most peoples itemized go down a little each year due to the amortization of their loan.

If you want to shoot me a message with more details, w-2 amounts, withholding amounts etc, please feel free. I would be happy to take a look at it for you. I have done the same for a couple other members in the past.

Also an FYI the free online calculators are wrong more often than they are right.

Also when a married couple both have decent/high paying jobs the IRS tables have no idea how to calculate the tax due correctly. Factor in a decent amount of itemized deductions and the IRS withholding tables are completely worthless. I usually end up figuring out how much a client needs withheld and then adjust the the withholding until it gets to the number I like.
 

Coiled03

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Time to get "creative" with your deductions. Or, just make shit up like a lot of people do lol.
 

Machdup1

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I might be able to make you feel slightly better OP.

In Feb. of 2016 I got a call from my CPA's telling me that they have just worked with my book keepers and I needed to go get a cashiers check for an additional $184.5K above and beyond my normal quarterly estimated tax payments and mail it to the IRS (which I did).

Later in the year, he let me know that he had made a mistake, but I should just leave the money with the IRS for future taxes because that was the easiest thing to do. We had an impolite discussion.
 

Mpoitrast87

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I have not read anyones response. But I've owed on taxes every year. I change what I claim every year to see if that's the problem but its not. I've given up lol.
 

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