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7 hours ago, SANDPSYCHO said:

Trouble finds trouble or is it what goes around comes around. :lol:

Paid zero owe zero. :bigrin

Im guessing you meant to say, Made Zero, Paid Zero, Owe Zero. 

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Posted (edited)

I'm paying $4500 to the feds and $1000 to the state. I claimed one less last year, made more this year and still paid more taxes last year. This is $1500 more than I paid last year.

The $10,000 cap for mortgage interest and insurance is a rip.

Edited by HappyW/VForce

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56 minutes ago, HappyW/VForce said:

I'm paying $4500 to the feds and $1000 to the state. I claimed one less last year, made more this year and still paid more taxes last year. This is $1500 more than I paid last year.

The $10,000 cap for mortgage interest and insurance is a rip.

Its not the mortgage interest deduction that is capped at $10,000, but the state tax deduction (including the total of state income taxes and property taxes).  So, unless you have a really big mortgage, you are unlikely to itemize your deductions, and will use the new higher standard deduction instead.

But they also eliminated the personal exemptions, which shielded additional income from income tax above and beyond your itemized (or standard) deduction.  So, Californians are mostly paying a lower tax RATE, but more of the income is taxable.  This is adding up to more tax liability, not less.  Now, if you have your own business and/or have a bunch of kids under 17, there are other things in play that can mitigate this and even get you big savings.  But if you are an employee with no kids or grown kids, you are more than likely screwed.

To top it off, there really is no simplification of overall tax return preparation, because you still have to itemize your deductions for the California income tax return.  Same amount of work as before.

 

 

 

 

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I get what everyone is saying. I do put money aside and have the amount needed to pay my taxes. Just venting! My wife and I work our asses off and that seems to be the problem! We don't own a home anymore but there isn't much incentive to do so just for a write off! We have one child and our tax guy just told us it was our last year to get max deduction for him because he is 16. So I guess it is no longer 18? We made a bit less than $150k without disclosing exactly how much! My goal isn't to try and get back as much as I can but rather just break even. With the cost of living these days how can anyone afford to claim single and zero to try and break even?!! As I said before, this wasn't about complaining. Just sharing and figured it would be cool to see how others did. We are blessed to have our health, the jobs we have, a roof over our heads, toys for the desert, etc. 

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8 hours ago, WLD-OTZ said:

We have been using H&R Tax Cut software, and we are being told that married/no curtain climbers get $24K write off and that is it. No matter mortgage interest or miles driven for work, or medical, nuttin.. 

Is this true? Right now, we have to write a fed check for $8300, and get $800 back from cali... 

For 2018 you are capped at $500k mortgage interest if you owned house prior to 2018. Capped at $250 if purchased home in 2018.  You can also write off $10k in property tax or $10k in CA state tax, but not both.  It is F'd and I might vote Democrat in 2020 if they bring back the SALT.  Trump is okay, but not if he costs me an extra $60k/year in taxes......

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1 hour ago, big_daddy_jp said:

I get what everyone is saying. I do put money aside and have the amount needed to pay my taxes. Just venting! My wife and I work our asses off and that seems to be the problem! We don't own a home anymore but there isn't much incentive to do so just for a write off! We have one child and our tax guy just told us it was our last year to get max deduction for him because he is 16. So I guess it is no longer 18? We made a bit less than $150k without disclosing exactly how much! My goal isn't to try and get back as much as I can but rather just break even. With the cost of living these days how can anyone afford to claim single and zero to try and break even?!! As I said before, this wasn't about complaining. Just sharing and figured it would be cool to see how others did. We are blessed to have our health, the jobs we have, a roof over our heads, toys for the desert, etc. 

I nailed it! What I win? Told ya man, you livin well. Non home owner 1 kid ha. Good stuff. 

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15 hours ago, big_daddy_jp said:

I get what everyone is saying. I do put money aside and have the amount needed to pay my taxes. Just venting! My wife and I work our asses off and that seems to be the problem! We don't own a home anymore but there isn't much incentive to do so just for a write off! We have one child and our tax guy just told us it was our last year to get max deduction for him because he is 16. So I guess it is no longer 18? We made a bit less than $150k without disclosing exactly how much! My goal isn't to try and get back as much as I can but rather just break even. With the cost of living these days how can anyone afford to claim single and zero to try and break even?!! As I said before, this wasn't about complaining. Just sharing and figured it would be cool to see how others did. We are blessed to have our health, the jobs we have, a roof over our heads, toys for the desert, etc. 

You might need to try a new tax guy.... single income W-2 around 130k. 2 kids and CA home owner and received just over 10k back.  I’m going to look at changing deductions this year so I get more during the year and have less return. 

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My wife and I are also DINKS-Double Income No Kids...We both made more this year and last year our tax guy said what we would probably owe this year.

We already both claim Married, 0.

I just set aside what we will probably owe. Hopefully I got it right. We'll find out Apr 2. :scared:

If for some reason I broke even...that would be awesome!

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16 hours ago, jusrlax said:

Its not the mortgage interest deduction that is capped at $10,000, but the state tax deduction (including the total of state income taxes and property taxes).  So, unless you have a really big mortgage, you are unlikely to itemize your deductions, and will use the new higher standard deduction instead.

But they also eliminated the personal exemptions, which shielded additional income from income tax above and beyond your itemized (or standard) deduction.  So, Californians are mostly paying a lower tax RATE, but more of the income is taxable.  This is adding up to more tax liability, not less.  Now, if you have your own business and/or have a bunch of kids under 17, there are other things in play that can mitigate this and even get you big savings.  But if you are an employee with no kids or grown kids, you are more than likely screwed.

To top it off, there really is no simplification of overall tax return preparation, because you still have to itemize your deductions for the California income tax return.  Same amount of work as before.

 

 

 

 

Great post, you seem to have a grasp on this. A question, is the root of the Trump tax issue that people in states with high taxation are being allowed to claim less of their state taxes on federal taxes? If so, could an argument be made that allowing full credit for state taxes against Federal taxation may result in a net zero? What I mean is that say an individual state hates the President / congress, could that state jack up their state taxes to equal Federal taxes resulting in the citizens owing nothing if full credit was given for state taxes?

 

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15 hours ago, 1newbie said:

For 2018 you are capped at $500k mortgage interest if you owned house prior to 2018. Capped at $250 if purchased home in 2018.  You can also write off $10k in property tax or $10k in CA state tax, but not both.  It is F'd and I might vote Democrat in 2020 if they bring back the SALT.  Trump is okay, but not if he costs me an extra $60k/year in taxes......

Funny, vote for a Dem to offset what the Dem's have done to you...

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39 minutes ago, BaBaBouy said:

Funny, vote for a Dem to offset what the Dem's have done to you...

Trust me, I spend 50% of my time on gd.com and the other 50% looking for houses in NV, but the move is tough at this point in my life (would have to move away from my youngest daughter that I share custody of).  I feel betrayed by trump and his tax plan after I voted for him.

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12 minutes ago, 1newbie said:

Trust me, I spend 50% of my time on gd.com and the other 50% looking for houses in NV, but the move is tough at this point in my life (would have to move away from my youngest daughter that I share custody of).  I feel betrayed by trump and his tax plan after I voted for him.

There was a 2nd part of the tax plan that the dems wouldn’t sign just for this very reason, to blame trump.  

You should be blaming the state of CA for not restructuring its own taxes to ease the burden of the people.  Other states changed to help with it, but not CA. 

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I was reading that Bryce harper signed 13 year $330m with philadelphia. SF, LA and Padres all were offering more money, but he said it wasn't worth it with CA taxes......

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45 minutes ago, 1newbie said:

Trust me, I spend 50% of my time on gd.com and the other 50% looking for houses in NV, but the move is tough at this point in my life (would have to move away from my youngest daughter that I share custody of).  I feel betrayed by trump and his tax plan after I voted for him.

I understand but why should the rest of the country offset high state taxes? The people in the individual states voted for high taxation so how is that a federal issue?

 

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23 minutes ago, 1newbie said:

I was reading (on the internet?) that Bryce harper signed 13 year $330m with philadelphia. SF, LA and Padres all were offering more money, but he said it wasn't worth it with CA taxes......

Well then it MUST be true!

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27 minutes ago, ahipara 55 said:

Well then it MUST be true!

Maybe he didn't sign 13 years for $330m and it is all a made up story although SF confirmed that they offered more $/year and would have gone higher.  Then again maybe the SF giants press made the whole thing up :/

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On 3/2/2019 at 8:16 AM, BaBaBouy said:

Great post, you seem to have a grasp on this. A question, is the root of the Trump tax issue that people in states with high taxation are being allowed to claim less of their state taxes on federal taxes? If so, could an argument be made that allowing full credit for state taxes against Federal taxation may result in a net zero? What I mean is that say an individual state hates the President / congress, could that state jack up their state taxes to equal Federal taxes resulting in the citizens owing nothing if full credit was given for state taxes?

 

Keep in mind that STATE income taxes paid are a tax deduction for FEDERAL income taxes, not a credit.  A tax credit reduces taxes dollar for dollar, while a deduction only reduces taxes by the amount of your tax rate (tax deduction x tax rate = taxes saved).  So, your asking if there is a rate to which a state could raise its income tax to that would completely eliminate a Federal tax liability.  The answer is yes, but that rate is 100%.  If I made $100,000, and had to pay all $100,000 as state income tax, then my Federal taxable income would be zero (assuming IRS still allowed full deduction of state income tax).  

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15 hours ago, jusrlax said:

Keep in mind that STATE income taxes paid are a tax deduction for FEDERAL income taxes, not a credit.  A tax credit reduces taxes dollar for dollar, while a deduction only reduces taxes by the amount of your tax rate (tax deduction x tax rate = taxes saved).  So, your asking if there is a rate to which a state could raise its income tax to that would completely eliminate a Federal tax liability.  The answer is yes, but that rate is 100%.  If I made $100,000, and had to pay all $100,000 as state income tax, then my Federal taxable income would be zero (assuming IRS still allowed full deduction of state income tax).  

Thanks!

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