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Calculating as a % of AGI for both 2017 and 2018 is apples to apples.
Ok, hang tight. Apparently, AGI and gross are the same thing. But there is a line for adjustments to income of which I have none. I have to figure it out.
If what you owe is over a certain percentage of what was actually withheld, you have to pay a penalty for "under withholding". If you actually owe $25K in taxes based on AGI and your employer only withheld $10K, you owe $15K. The IRS will penalize a percentage of the $15K. I disagree with this. As long as all taxes are paid by April 15, there should be no penalty.
I have never heard of the under withholding penalty going away as long as you file by April 15th. IRS knows that there was a problem with the withholding tables, otherwise they wouldn't have waived penalties for people who paid at least 85% of their tax obligation for 2018. (it is normally 90%) https://www.forbes.com/sites/kellyph.../#356e7c47c8ee
Ok, hang tight. Apparently, AGI and gross are the same thing. But there is a line for adjustments to income of which I have none. I have to figure it out.
It could be that you don't have any adjustments to gross, but many other people do hence, you use AGI to calculate effective tax rate.
Adjusted gross income (AGI) is your gross income — which includes wages, dividends, alimony, capital gains, business income, retirement distributions and other income — minus certain payments you’ve made during the year, such as student loan interest or contributions to a traditional individual retirement account or a health savings account.
Possibly. But the problem is when most people would rather get $2k back than $100 per paycheck. In other words, they are worse off in the net. Dumb, dumb, dumb.
$2,000 does not turn out to be $200 a paycheck unless they only work 10 months a year But let's just stick with the $200 a month that they allow IRS to keep for them until they file their tax return. If they were to put that in a bank @ 2.3% interest they would have earned $30.11 in interest - BFD.
What you may not understand is that people who are on a really tight budget find plenty of legitimate reasons to use that $200 for things that they really need, and I'm not talking just trivial junk. I was in that situation for a few years when I was young and was raising two kids and if I had $50 left after paying my bills and mortgage there were at least 4 or 5 things that I could have justified spending that on, you know things like new shoes for the kids, a replacement faucet for the one that leaks, a tune-up for the car. Instead I allowed IRS to save that money for me and as result I was able to pack the kids in the car once a year and take them camping.
most use that refund as a forced savings ...overpaying is the best thing they can do and the only way they can see a meaningful lump sum that can go for something a bit more meaningful ...
i hate the years we have to pay...i look at that nice balance on 12/31 each year from our investments and end up shelling out thousands in taxes later ..
we do estimated most years and tend to get back now that we are retired .
No, it's the price we pay when the Koch's bought Paul Ryan for half a million dollars
So Paul Ryan made and passed that law all by himself?
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