User Panel
Posted: 1/31/2006 6:47:53 AM EDT
OK, I just do not get it - I finally thought, after all these years, that I would get to have a nice return. I bought a house this year, moved, had education expenses, business expenses, my wife has a home office, etc. We paid interest on a mortgage for the first time, paid property taxes, etc. So, I go to do my taxes.
And I STILL am better off taking the STANDARD deduction instead of itemizing. Hell, I even donated stuff to charity this year. But still, no dice. I just do not get it - it seems that everyone else makes out like bandits by itemizing, but I just cannot seem to catch a break. Of course, I do not have children, which is a huge deduction - but Christ - do you have to have a $300,000 house, pay $5000 in property taxes, and give 20% of your income to charity to itemize these days? |
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Fair Tax Here is the answer.
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But if it's fair to us, then it's unfair to the disadvantaged... Oh, wait. |
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I made like $11,600 last year, paid in like $1350 in federal tax and should get back $678 with standard deduction of $5k.
? |
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That is not correct. You need to use the term they use when describing such a tax in political science and public administration realms: REGRESSIVE tax. |
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I don't understand how the standard deduction can be better for you, not with the items you list. The home office is generally not worth it ... although it depends upon the size of the home and the size of the office, since everything is pro-rated on that ratio. The BIG problem is that you have to keep track of all the tax deductions you mkae, forever, so that when you sell your house you can pay the appropriate taxes on that part of your house -- that part not being tax free, because itd a business premises, not a home. For the actual reduction in taxes (at least in my case) its just not worth the hastle. The stadard deduction for two people is ~ $10k -- are you certain you didn't pay out more than that in mortgage interest, state tax, property tax etc? |
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I'll get back to you on that after I get through changing and feeding "Cha-ching", "Goldmine" and "Chri$tmas in February"
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No, you aren't thinking properly. Bash yourself in the head with a hammer a few times until your IQ drops enough to realize the point: Any tax that on the surface charges a "poor" person the same ammount of tax on a gallon of milk as a "rich" person is REGRESSIVE. Now keep repeating that before you end up being hauled off to re-education camp. |
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I found that at my income,401k/IRA, and housing level, I have to donate somewhere around 5%+ of my income to charity to get the itemized deduction. I usually do about 12-14%, but I'm damn poor,so it doesn't amount to much $-wise. If you bought a house mid year, you might not have enough mortgage interest this year to make it worthwhile.
Did you max out 401ks and/or IRAs for you and your wife? That's the other big pillar of the itemized deduction. Reducing your income with retirement investments lowers your taxes enough to make your itemizable deductions valid. Fair Tax is an interesting idea, but Boortz's book did miss a few things. I don't see the transition being very easy. There's also a huge opportunity for fraud in that system via the mechanism of hiding what is and is not a final retail transaction (since only final retail transactions are taxed under FairTax). That's why Europe uses the VAT taxes applied at every state of production. As flawed as VAT is,there's no point to claiming that items are nontaxable and "for resale" since it doesn't matter under that system-it taxes everything at each point of the system, not just at the final transaction as in FairTax. Fair tax has lots of good points. It would boost sales of non-taxed, already used goods. Neal's protests aside, it would be hard on charities. A lot of them are donated to for tax purposes,his objection to that fact notwithstanding. |
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It was more of a post for Greywolf but ya, thats cool. |
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I am single with no kids. Own a condo and pay about 2100 in property taxes. I give somewhere around $300-$500 in charity a year. I always end up getting between $750 and $1500 back between state and federal. What are you doing wrong? Is this the dreaded "marriage penalty?" |
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$1400 property tax $3500 Interest and points No state tax |
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As I understood it, you don't get an itemized deduction on pre-tax 401k contributions, nor do you get deductions for Roth IRAs. |
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The advantage for most retirement investments is that the income put into them does not count against your reported taxable gross income. I don't think you have to itemize to get that.... |
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If I understand you, you are being sarcastic right |
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Shh!! The walls have ears..... |
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I don't make enough of an annual income to pay taxes. All my taxes come out of my paycheck.
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Huh?? Do you mean that you don't have to pay additional taxes after filing your 1040 forms??? |
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Quit yer whining.
I sold stock and stock options last year, and got hit up for the "Alternative minimum tax" (AMT) this year. FUCKERS! I will have paid more in FIT this year alone than I made in my first year at this job. Move to TX if you want to itemize. Property tax will run you around $4000 or so for an average house. No problems being abe to itemize with that... |
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I have never understood what in the hell the AMT was all about. |
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By lowering your AGI, they make it easier to take deductions that are limited based on your AGI- medical expenses and non-qualified charities for example. Those are a stretch anyway though. It looks like your lack of state income tax deductible is probably what keeps you in the standard deduction anyway. |
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To make sure I "Pay my fair share" I guess... Here's the info from TaxCut:
Yeah - I wasn't paying a large enough "minimum" tax already. Maybe if I was Ted Kennedy and I had mondo tax shelters everywhere, I might not pay enough tax. As it is, it does nothing more than add to my outrageous tax bill. |
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It's a way to tax folks who have incomes over $60k or so, but manage to have a ton of various deductions such that they can recover most of their tax. Basically it's designed to punish skilled tax avoiders who can take advantage of "too many" simultaneous deductions. It's quite arbitrary. They love socking it to guys who own a lot of investment property or those who use their home equity loans to leverage investments. |
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Gotta keep Vaseline in the black somehow. |
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I'm at $21,525.41 in Law Enforcement Deductions...I wonder if that's a good thing?
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What are your deductions weekly? And what do you make? (Not really expecting an answer on that question) Depending on your income, If you are claiming married with 2 deductions and DO NOT have at least 150k on mortgage and pay out at least 2k in property taxes and other taxes (exise, state etc) then you WILL either break even or pay. |
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It is if you make $10.00 a year. |
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how about $88K? around $14K withheld |
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ina nutshell:
made 71K, income tax with held=10065 house interest=8500 house tax=4200 church donation=4000 union dues=600 2 kids and ole lady return=5800 |
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The AMT was originally put into the tax code as a punitive tax alternative in order to get 22 people to have to pay taxes that weren't otherwise. It has now ballooned so that a large number of middle and lower class people have to pay increased federal income taxes.
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Why am I not surprised? |
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I think I may have found the problem. For the first 7 months of the year I worked part-time, with an occasional decent bonus. My weekly pay was so low that often I didn't get any taxes withheld. My wife had 401ks and medical insurance reducing her withholding as well. She makes $40,000. I made $20,000 for those 7 months, but again a lot of times my weekly pay was not enough to get anything taken out. She is at SINGLE claiming 0, and I am at Married claiming 0. Starting in August I started a new job, full time, still Married claimin 0, and made about $18,000 in that time. So, total adjusted income for the year was $78,000 - but only about $8000 taken out in withholding instead of more. We're going to get about $300 back, but ONLY because of a $1200 credit due to my tuition and some moving expenses. Next year, if we don't change anything on our withholding, and I make $50,000 and she makes $40,000 then we'll be looking at owing about $800. Mortgage is $127,000. Taxes $1400 a year. |
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Oh, you're screwed, buddy. Definitely screwed. They like 'high paid' NY cops. |
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That's considered "High Paid"? |
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You file a return, you get a REFUND. |
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