Filed my returns last weekend. I was going to owe $1000 to federal and $600 to state, but my state has a nice surplus this year so I got a kicker; altogether I'm getting like $1400 back.
But it's the second year in a row I owed some money. Once I plugged in my 1099-INTs and DIVs I all of a sudden it was a done deal. Is there no way to circumvent this? Or just figure out what tax credits I could take advantage of next year?
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03-20-2024, 09:08 AM #1
I owe money every year come tax time
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03-20-2024, 09:09 AM #2
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03-20-2024, 09:10 AM #3
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03-20-2024, 09:10 AM #4
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03-20-2024, 09:11 AM #5
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03-20-2024, 09:19 AM #6
- Join Date: Apr 2006
- Location: California, United States
- Posts: 4,289
- Rep Power: 216879
Howdy Dolphin....
Just throwing this out: Did you check the "Withhold higher single rate" box on your work W4 (?) form?
I'm assuming that check box option is still a choice and it's one I always opted for.
I do understand the break even take on it but that seems a very difficult equation to achieve and monitor.
Personally, I don't mind getting a few bucks back and don't concern myself with splitting hairs in this context.
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03-20-2024, 09:21 AM #7
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03-20-2024, 09:21 AM #8
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03-20-2024, 09:23 AM #9
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03-20-2024, 09:35 AM #10
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03-20-2024, 09:39 AM #11
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03-20-2024, 09:52 AM #12
I think I'm good in my W-4s. When I entered all my info on my W-2 I only owed about $90 to federal. Once I plugged in all my 1099s it shot up.
Granted I was kind of stupid a lot of the year and kept cash in a money market fund about half the year. The other half I was exclusively mutual funds and treasuries.
I also recall last year when filing for 2022 I owed money plus I was on the hook for an underpayment penalty, which was a bitch to clear up.
Brb get penalty
Brb pay it
Brb get extra fees tacked on because I didn't pay the penalty fast enough
Brb have to pay that ASAP before another late penalty gets added
Fuk this I should just stop paying taxes.
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03-20-2024, 09:53 AM #13
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03-20-2024, 09:55 AM #14
Understand you are actually winning in this scenario
I used to owe thousands like 5k, Im good with money so bills like this do not phase me.
Then ole turdeau blocked the loop hole and made so i have to pre emptively pay like 12k (lol its crazy I know) if I owed the year before. Then they would refund the rest if I didnt owe the whole 12k later on when you did your taxes.
The tax system is clown level, they want to hold your money all year and collect interest off of it.
I should only pay tax at tax time, deductions off the paycheck are a joke
Anyways Ive got it set up now so im near zero or i owe a small amount so I don't trigger the pre pay thingLast edited by AlwaysFocus; 03-20-2024 at 10:01 AM.
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03-20-2024, 10:08 AM #15
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03-20-2024, 10:10 AM #16
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03-20-2024, 10:13 AM #17
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03-20-2024, 10:26 AM #18
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03-20-2024, 10:58 AM #19
- Join Date: Mar 2013
- Location: Vancouver Island, Canada
- Age: 65
- Posts: 1,267
- Rep Power: 19904
Interest on $12,000 is nothing these days. We have way more than that in one of our accounts and it barely collects any interest.
I have never heard of a pre pay bill before. Do you mean if you can't pay your taxes? My son works for the CRA I will ask him.
There are three fundamental ways to reduce your taxes:
Lower your gross and taxable income by deferring income to another year.
Take all allowable deductions, such as by maximizing your RRSP contributions.
Use all your available tax credits to lower your total taxes owing.
My wife made $139,500 last year and paid $35,000 in taxes. She gets a refund of $4000 because of RRSP's
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03-20-2024, 11:39 AM #20
I always owe $5-7000. Can't believe I haven't been assessed a penalty yet. Wife still has the same W4 from 15 years ago that says she's married with 2 kids, so they withhold like our 2 grown kids are still living with us instead of paying their own taxes.
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