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Old 05-28-2020, 01:58 PM
 
1,963 posts, read 503,478 times
Reputation: 3160

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Quote:
Originally Posted by turf3 View Post
That's YOUR MONEY that the government has had a zero-interest loan of, for a year.
Something most taxpayers understand, and is often noted in arm-waving hysteria.

To which I say... "So what?"

Life must be endless hell for those so anti-t-x that hearing the word makes them lie awake in sweating anger, fists clenched.

 
Old 05-28-2020, 02:03 PM
 
7,648 posts, read 3,605,936 times
Reputation: 21775
No, no, I'm not saying that. I'm not one of those crazed anti-tax people that break out in a rash at the idea of paying it. But it's clear to me that these people who complain mightily about having to write a check rather than getting a check do not understand what a refund is. It's not manna from heaven. You know that, I know that, but they don't.


Hence my proposal that every young worker ought to start out doing their own tax returns by hand with a pencil and calculator, no Turbo Tax or equivalent, just so they can understand just what the heck they're doing while their returns are still simple. At my age (late 50s) I have enough complexity that I need a professional to tell me which choices are allowable and which aren't, but when I was 24 it took me all of 15 minutes to fill the thing out. If you can add, subtract, and multiply, all the instructions are right there.
 
Old 05-28-2020, 02:04 PM
 
162 posts, read 243,792 times
Reputation: 255
Quote:
Originally Posted by turf3 View Post
Well, your thinking is exactly backwards. That "lovely refund"? That's YOUR MONEY that the government has had a zero-interest loan of, for a year. Why do you think there are penalties for being under-withheld, but not for being over-withheld? Because Uncle Sam wants that zero-interest loan.


Your objective should be to write a check for the maximum amount that doesn't trigger penalties for under-withholding.
Unfortunately, I think a majority of the taxpayers fail to understand this.
It's like paying your monthly mortgage and adding into an escrow. Most would rather do this than paying annual taxes in one lump sum because they don't have the discipline to save/invest it on their own.
 
Old 05-28-2020, 02:06 PM
 
Location: Seymour TN
1,969 posts, read 5,894,477 times
Reputation: 1299
Quote:
Originally Posted by Zymer View Post
There were changes in the tax codes/laws that resulted in differences in the withholding tables used by companies doing payroll deductions, and changes in the W-4 form.

These changes, and some companies' methods of implementing them resulted in some people being significantly under-withheld.
That seems to be the only answer relevant to my direct question. Thanks all for your input. I will see if hubby wants to do the comparisons people suggested.
 
Old 05-28-2020, 02:09 PM
 
1,963 posts, read 503,478 times
Reputation: 3160
Quote:
Originally Posted by turf3 View Post
No, no, I'm not saying that. I'm not one of those crazed anti-tax people that break out in a rash at the idea of paying it. But it's clear to me that these people who complain mightily about having to write a check rather than getting a check do not understand what a refund is. It's not manna from heaven. You know that, I know that, but they don't.
Okay, unfanaticism accepted. But it's also a pretty convenient, forget-about-it savings club, which is how I think most sensible taxpayers see it. Yes, they could set up their own savings... and get, what, 1%? On the deposits they remember to make? Or, for virtually no real cost, have Unca Sammy make them do it.

Offer invalid in any era of 10% savings interest.
 
Old 05-28-2020, 02:45 PM
 
1,533 posts, read 725,926 times
Reputation: 2007
Quote:
Originally Posted by NJDevil View Post
That seems to be the only answer relevant to my direct question. Thanks all for your input. I will see if hubby wants to do the comparisons people suggested.
Just a suggestion since you seem to be confused about what happened, you might want to do the comparison whether your husband wants to or not. Too often one spouse leaves these matters to the other only to wind up alone one day with no clue about their tax matters.
 
Old 05-28-2020, 02:48 PM
 
5,956 posts, read 1,755,840 times
Reputation: 10430
Quote:
Originally Posted by ChessieMom View Post
I would think it would be a very simple thing to compare your tax returns.
You'd be correct: it is a VERY simple thing.

Moreover, I just don't understand why some people mistakenly focus on refund/amount owed rather than total tax obligation
 
Old 05-28-2020, 02:59 PM
 
5,956 posts, read 1,755,840 times
Reputation: 10430
Quote:
Originally Posted by turf3 View Post
No, no, I'm not saying that. I'm not one of those crazed anti-tax people that break out in a rash at the idea of paying it. But it's clear to me that these people who complain mightily about having to write a check rather than getting a check do not understand what a refund is. It's not manna from heaven. You know that, I know that, but they don't.
Yep. I think it was John Wayne who famously once said:

Quote:
"Life's hard. It's harder if you're stupid."
 
Old 05-28-2020, 03:22 PM
 
Location: Western Washington
10,459 posts, read 9,437,481 times
Reputation: 17798
Quote:
Originally Posted by Therblig View Post
Okay, unfanaticism accepted. But it's also a pretty convenient, forget-about-it savings club, which is how I think most sensible taxpayers see it. Yes, they could set up their own savings... and get, what, 1%? On the deposits they remember to make? Or, for virtually no real cost, have Unca Sammy make them do it.

Offer invalid in any era of 10% savings interest.
I tend to agree with this sentiment. While there are exceptions, the vast majority of people get refunds of under $3000. That is higher than I expected, but based on moneymarket interest rates, the average taxpayer loses about $20 in interest annually on this. That is based upon a 1.3% interest rate, and an average account balance of $1500, because you start the year with a zero balance, and have a balance of $3000 at end of year.

I can see people preferring to give up that $20 so that they can get that lump sum once a year and don’t have to worry about paying. That is a pretty reasonable decision.

We could argue that the money could be invested for a higher return, but that means it is less liquid, and could cause problems if a significant amount of money is owed at the end of the year.

Back to OP, I agree with other posters. Any competent tax professional, or reasonably informed taxpayer, should be able to determine why you owed this year vs getting a refund. I bet I could work it out in 10 minutes if I had access to your tax returns. That isn’t an offer, I don’t want that info.

For myself, I have owed between $500-$1000 annually for the past 3-4 years. That is pretty good considering a growing small business has been part of my income, which increases my liability in unpredictable ways.
 
Old 05-28-2020, 03:23 PM
 
29,151 posts, read 35,565,299 times
Reputation: 38468
Quote:
Originally Posted by RationalExpectations View Post
You'd be correct: it is a VERY simple thing.

Moreover, I just don't understand why some people mistakenly focus on refund/amount owed rather than total tax obligation
I don't either. I have NEVER understood it, frankly.
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