Effects of Trump Administration's revised Federal Tax Plan worked as advertised for me

Homebrewale

Old Mossy Horns
We have always itemized and will continue to as our deductions still exceed the standard deduction. I don't think there's much difference for us.

But I am for anything that simplifies the tax code and cuts out loopholes. I'd be fine if they just said everyone give us X% of your gross income and there were zero other considerations. You wouldn't even need to file taxes. The only refunds or payments would be if there was an error in collecting. By definition, everyone would be "paying their fair share".
It's not that easy. The whole process of filing a tax return is determining income. Applying a tax rate to the income is a tiny, tiny part of the process. For people who have W-2 income, it's straight forward. For self-employed people, it's more complicated. You definitely wouldn't want to say gross income equals business earnings. There are a lot of things to write off. Even with a flat tax, you have a complicated process of determining income to apply the flat tax.
 

Homebrewale

Old Mossy Horns
The size of the refund check tells you nothing about how you may or may not have benefited from tax reform. Withholding tables changed with the new tax law. If your income changed at all between 2017 and 2018, comparing the tax refund also provides nothing meaningful. I have not yet used the tax calculator I posted earlier in this thread to determine if I benefited or not from the new tax law. I knew I was using the standard deduction so I quickly calculated my federal tax. I still have to gather more documents on property tax and charitable gifts to calculate what my tax would be under the old tax law. I do know that I owe $4600.
 

MJ74

Old Mossy Horns
My income is basically the same but I did pay less Federal taxes this year. I'll see in a month or so if or how much I have to pay.

It's a kick in the chiclets to pay as much as I do during the year and still owe when filing.

sent from...... Tapatalk
 

hunter

Six Pointer
Contributor
My $1 refund and the envelope shows .29 cent postage. View attachment 25151
I always figured it didn't make sense to pay or refund taxes under a certain amount. For example, at today's cost to process a payment or issue a check I figure any amount under $25 should be a wash. If you owe less than $25 you pay $0 if you are owed a refund of under $25 then you get nothing.
 

JBGrizzley

Eight Pointer
I got about $20 more federal this year, what makes me the happiest is i actually got a state return this year instead of the usual $300 payment
 

woodmoose

Administrator
Staff member
Contributor
all this talk of "getting back" this much or that much is funny to me,,,

what matters is what you PAID based on your pay,,,,

all the rest is a matter of what was withheld or not withheld,,,,

I haven't done mine yet - will do sometime this month,,,,and my assessment will be based on net % I paid,,,not what I got back one year over another,,,
 

Mr.Gadget

Old Mossy Horns
That is the smart way. Why give the fed the money upfront to hold for you when it can be in your bank or invest in stocks.
I never get much of anything back. I always pay or about even.
 

Pimpscoe

Eight Pointer
We strive not to get a lot back, however I feel we got shafted this year. With the new tax laws we made almost the same, paid the same in taxes, yet got less back. The “no exemptions” claim hurt us. That was an additional 16,500 we can no longer file. The increase in the standard amount didn’t help either (although the point of doubling them was to “help” offset the removal of exemptions) bc we already deduct more than the flat amount via itemize deductions.
From what I can tell; businesses, single people, or married with no kids (or dependents) will get an increase in their returns.
 

sky hawk

Old Mossy Horns
Contributor
Actually, the child tax credit doubled from $1,000 to $2,000 each. And that no longer phases out with income. So taxpayers with kids should get some help there.

The $10,000 cap on deductions for state/local/property tax hurt us, and the increase in the standard deduction didn't affect us one way or the other, but the child tax credit gave us $6k credit we wouldn't have had.

We met with our CPA yesterday, and he said the winners and losers are scattered all over, and people from the exact same income level would fare differently depending on their individual situation. Most people will fare better.
 

roundball

Old Mossy Horns
Contributor
A family of 4 would go from deducting $18,500 to $4,000. Not sure how that helps.
If you're talking married, filing jointly, standard deduction...seems like that would be:
$24,000 + $4000 (for the 2 kids) for a total of $28,000 wouldn't it?
 

Shaggy

Old Mossy Horns
After discussing it more with my wife even though we"re getting a similar refund to last year I made around 12k more than last year.
 

Pimpscoe

Eight Pointer
If you're talking married, filing jointly, standard deduction...seems like that would be:
$24,000 + $4000 (for the 2 kids) for a total of $28,000 wouldn't it?
Married, filing jointly, no standard bc our itemized is greater. If we didn’t itemize, yes then we may have had more to claim. In the future it will just encourage us to give less to needed causes and various tax credit places bc it isn’t worth the trouble of keeping up with it nor filing it for an additional 1-2k ok itemized.

Scenario a- last year (itemized deductions) 25,000 + 2,000 (1k for each kid), + 16,500 for exemption of 4 dependents (you could include you, your spouse, and two kids at 4,xxx. each) total of 43,500.00

Scenario b- this year (itemize deductions) 25,000 + 4,000 (now 2k each kid) and no exemptions, total of 29,000.00 (-1,000 if standard)

Make the same amount, pay the same taxes, and have less deductions = less return and essentially paying more in my eyes.
 

Pimpscoe

Eight Pointer
That $4k would be a credit. Where did you get the $18,500 from?
Last year you could file dependants exemptions at 4K each, which would make a family of 4 have 16,500 + 2,000 (1k each child) = 18,500 credit last year.
 
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Homebrewale

Old Mossy Horns
After discussing it more with my wife even though we"re getting a similar refund to last year I made around 12k more than last year.
Don't look at the size of the refund. The withholding tables changed from last year. Look at the amount of tax paid. Calculate your effective tax rate.
 

Homebrewale

Old Mossy Horns
Married, filing jointly, no standard bc our itemized is greater. If we didn’t itemize, yes then we may have had more to claim. In the future it will just encourage us to give less to needed causes and various tax credit places bc it isn’t worth the trouble of keeping up with it nor filing it for an additional 1-2k ok itemized.

Scenario a- last year (itemized deductions) 25,000 + 2,000 (1k for each kid), + 16,500 for exemption of 4 dependents (you could include you, your spouse, and two kids at 4,xxx. each) total of 43,500.00

Scenario b- this year (itemize deductions) 25,000 + 4,000 (now 2k each kid) and no exemptions, total of 29,000.00 (-1,000 if standard)

Make the same amount, pay the same taxes, and have less deductions = less return and essentially paying more in my eyes.
In Scenario-b, state and local income and property taxes are limited to $10,000 where in 2017 there were no limits. There is a good chance the person in Scenario-a will not have $25,000 itemized deductions in Scenario-b if the bulk of the deduction they took in the previous year was primarily made up of state income tax and local property tax.
 

sky hawk

Old Mossy Horns
Contributor
Last year you could file dependants exemptions at 4K each, which would make a family of 4 have 16,500 + 2,000 (1k each child) = 18,500 credit last year.
Credits are not deductions. Deductions reduce your taxable income. Credits apply directly to your tax owed/refunded.

Every situation is different. We went from $0 child credit to $6,000. Others will vary.
 

Pimpscoe

Eight Pointer
Credits are not deductions. Deductions reduce your taxable income. Credits apply directly to your tax owed/refunded.

Every situation is different. We went from $0 child credit to $6,000. Others will vary.
Correct, I worded it wrong...my bad. Bottom line, I made the same amount as last year, paid the same in taxes as last year, and get less back due to the new rules.
 

Firedog

Old Mossy Horns
Contributor
Correct, I worded it wrong...my bad. Bottom line, I made the same amount as last year, paid the same in taxes as last year, and get less back due to the new rules.
But How much did you PAY as a % of your income.. that is the only number that matters.. the rest, as others have said, is all about withholding tables.
 

PPosey

Twelve Pointer
Waiting on my last w2, then will see, I'd like to see a sales tax instead. That way everybody would pay some.
 

downeastnc

Twelve Pointer
I am getting back more or less what I got back last year.....filed jointly, 1 kid, made a little over 3k more than last year.....refund is a few hundred dollars more.
 

Homebrewale

Old Mossy Horns
I am getting back more or less what I got back last year.....filed jointly, 1 kid, made a little over 3k more than last year.....refund is a few hundred dollars more.
How many times on this thread does someone have to say don't compare the size of your refunds from 2017 to 2018? Look at your effective tax rate by dividing your tax paid into your gross income (or alternatively your tax paid into your taxable income).
 

Shaggy

Old Mossy Horns
Correct, I worded it wrong...my bad. Bottom line, I made the same amount as last year, paid the same in taxes as last year, and get less back due to the new rules.
Seems like what I'm reading this seems to be the case. People are either getting a little less back or even owing in some cases. Its a hot topic on Twitter.
 

sky hawk

Old Mossy Horns
Contributor
How many times on this thread does someone have to say don't compare the size of your refunds from 2017 to 2018? Look at your effective tax rate by dividing your tax paid into your gross income (or alternatively your tax paid into your taxable income).
Apparently at least one more based on the last post...:rolleyes:

Most withholdings were reduced due to the reduced tax rate, so "getting a little less back" is completely relative.
 

Shaggy

Old Mossy Horns
Apparently at least one more based on the last post...:rolleyes:

Most withholdings were reduced due to the reduced tax rate, so "getting a little less back" is completely relative.
Either people are lying or some people are saying they are owing THOUSANDS of dollars while only seeing small amounts less taken out of withholding.
 
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