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Tax check (1 Viewer)
- Thread starter shadyridr
- Start date
BigSteelThrill
Footballguy
American working class absolutely hosed by the same people that keep nutpunching them.
mr roboto
Footballguy
Aren’t you a higher earner in the NE? High prop taxes?My weekly paycheck went down not up, my yearly deductions went down, I owed more than last year tax wise.
belljr
Footballguy
Yes . I have relatively cheap property taxes but with just taxes that's my cap.
Last year I had ~28k for deductions. This year I had to take standard.
But when the tax cuts went through allegedly everyone was going to get more in their paycheck. I got less.
I did make more than anticipated but not by a ton.
Tom Hagen
Footballguy
Not to defend the Treasury, but the problem is they can only determine the change from the old standard deduction and personal exemptions to the new standard deduction along with the change in rates. Withholding tables can't possibly factor in the amount of itemized deductions people had in 2017 or lost in 2018.Sand said:
ETA: It also didn't help that they had like a few weeks to figure it out because the tax bill was passed in December.
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Pipes
Footballguy
While I hate this tax law change this is absolutely not true at least as far as taxes are concerned. Tax rates dropped, child tax credit jumped from $1,000 to $2,000. Most people will see a tax liability decrease.
Sand
Footballguy
I did say I was being a #### here.
(Treasury really did need to massage the withholding tables here. It seems like a relatively easy job for a low level analyst, IMO).![[icon]](/data/avatars/m/5/5167.jpg?1660313464){kind=avatar}
:freemoney:
culdeus
Footballguy
Median and Mean matter here.
There are a lot of people that got a tiny tax reduction. It shouldn't cloud the fact that many others really got burned with the SALT thing.
DallasDMac
Footballguy
Just saw on the news that the average return is down 8.4% this year. So I guess returns really are smaller.
Steeler
Footballguy
I just overheard a conversation at work about this exact subject. They were discussing some general stuff related to the tax law changes and then one of them said, "I got more in my take home but I also got a smaller tax refund so they didn't really give me anything."
This is wrong on so many levels. First, the gubment isn't giving her anything in the form of a tax refund (it's an over-payment of what she owed). Second, judging the impact of changes can't be done by looking at how much you owe or the size of your refund.
It's surprising to me how many people are focused on their tax refund and not the actual amount of income tax they owe. The refund completely changes the perception of taxes and it bugs me
But instead of calling people names for wanting a refund, or thinking in terms of a refund, I think it's better to remind people that's not what taxes are all about. If you owe 10K in taxes it doesn't matter if you get a 1K refund (you overpaid throughout the year via withholdings) or if you own 1K (you under paid throughout the year) - your tax burden is 10K.
Any discussion about the tax cuts should be done using your effective tax rate year over year - and then if you want to get a big refund go for it
This is wrong on so many levels. First, the gubment isn't giving her anything in the form of a tax refund (it's an over-payment of what she owed). Second, judging the impact of changes can't be done by looking at how much you owe or the size of your refund.
It's surprising to me how many people are focused on their tax refund and not the actual amount of income tax they owe. The refund completely changes the perception of taxes and it bugs me
But instead of calling people names for wanting a refund, or thinking in terms of a refund, I think it's better to remind people that's not what taxes are all about. If you owe 10K in taxes it doesn't matter if you get a 1K refund (you overpaid throughout the year via withholdings) or if you own 1K (you under paid throughout the year) - your tax burden is 10K.Any discussion about the tax cuts should be done using your effective tax rate year over year - and then if you want to get a big refund go for it
shadyridr
Footballguy
This is where I disagree with you. If the President spouts on and on about how he cut taxes and your take home increases but your refund decreases to net out to the same amount that's not really a tax cut, is it?I just overheard a conversation at work about this exact subject. They were discussing some general stuff related to the tax law changes and then one of them said, "I got more in my take home but I also got a smaller tax refund so they didn't really give me anything."
This is wrong on so many levels. First, the gubment isn't giving her anything in the form of a tax refund (it's an over-payment of what she owed). Second, judging the impact of changes can't be done by looking at how much you owe or the size of your refund.
It's surprising to me how many people are focused on their tax refund and not the actual amount of income tax they owe. The refund completely changes the perception of taxes and it bugs me
Any discussion about the tax cuts should be done using your effective tax rate year over year - and then if you want to get a big refund go for it
Steeler
Footballguy
What are you disagreeing with? I'm not for or against the tax changes, this isn't political. I'm only talking about how to judge whether or not the tax cuts helped or hurt individual people and the refund is irrelevant for that purpose. In your example, it sounds like the net is that they owed the same amount as last year (which is my point - look at the tax liability this year vs last year), and no it wouldn't be a tax cut.
shadyridr
Footballguy
But then you are complaining about this particular individual you heard at work
If her additional take home plus smaller refund netted out to the same amount, how is this wrong on so many levels? They didnt give her anything.
I suspect this individual has absolutely no idea how much their take home pay increased vs the size of their refund. And I'll wager my tax liability to your tax refund that they still ended up with a tax cut.
Steeler
Footballguy
I thought I explained it pretty well actually. She never mentioned the tax liability directly so she doesn't truly know if she got a tax cut or not. She knows she got more in her check each week and knows she got a smaller refund - but both are irrelevant to the total amount of money she owed in taxes this year. Let me ask you this way - if she increases her withholdings today and gets a bigger refund in 2019, did the gubment give her anything in 2019? Did she get a tax cut in 2019 because she got a bigger refund?
The_Man
Footballguy
I had to take the standardized deduction of $24k, because my itemized deductions maxed out at $23,400. I had more than $6,000 in local income and property taxes I couldn't deduct. My tax bill went up.I just overheard a conversation at work about this exact subject. They were discussing some general stuff related to the tax law changes and then one of them said, "I got more in my take home but I also got a smaller tax refund so they didn't really give me anything."
This is wrong on so many levels. First, the gubment isn't giving her anything in the form of a tax refund (it's an over-payment of what she owed). Second, judging the impact of changes can't be done by looking at how much you owe or the size of your refund.
It's surprising to me how many people are focused on their tax refund and not the actual amount of income tax they owe. The refund completely changes the perception of taxes and it bugs me
Any discussion about the tax cuts should be done using your effective tax rate year over year - and then if you want to get a big refund go for it
shadyridr
Footballguy
The government specifically said taxes have been cut and in her case they may not have been. Thats what she is referring to. In my case they were not either. I received more in my check but my refund decreased dramatically due to the SALT cap. Overall my tax bill in 2018 was higher than 2017 due to the tax changes.
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culdeus
Footballguy
It's ok everyone, laugh it off. Fox And Friends says "oops" sorry for the tax...hike?
https://www.youtube.com/watch?time_continue=1&v=F-4Ud7mzZzo
https://www.youtube.com/watch?time_continue=1&v=F-4Ud7mzZzo
Steeler
Footballguy
In her case the taxes might not have been cut is my point! She doesn't know based on her take home pay increase and the amount of the refund she received. That isn't enough information to know how the tax changes affected her. The bolded is the only way to tell how the tax changes affected anyone, but many people don't look at the tax liability, they are only focused on the refund. And yeah, it sucks that the tax "cuts" made your taxes go up.
shadyridr
Footballguy
Steeler
Footballguy
If she focused on the tax liability we all would know, which is my point
Again, I'm not defending the tax changes. I'm not saying they were good or bad overall. The only way to know for sure how it affected individuals is to look at the tax liability.
If you think I should give her the benefit of the doubt that she looked at her tax liability then we can agree to disagree - most people don't do that.
culdeus
Footballguy
That's not really what happened. It's more like Starbucks lowered prices but quit accepting coupons. For those that didn't get the coupons they are happy. But those that counted on the coupons to afford it are now ####ed.
Pipes
Footballguy
But rates were cut for everyone across the board so just because you got screwed by the SALT cap it doesn't necessarily mean you are paying a higher effective tax rate this year. In your friends case the odds are extremely low for her weekly take home pay increase to exactly match her refund deficiency. The best tax CPA's in the land would struggle to calculate it that close.
With that being said I hate this tax law change and really feel bad for the non-profits who are likely going to suffer because of less and less people itemizing. Trump tried to fix something that really didn't need fixing or at least fixed in the way he did it.
belljr
Footballguy
culdeus
Footballguy
xulf
Footballguy
belljr
Footballguy
Sure. When tax changes were implemented my checks went down. Due to new tax codes my deductions were capped so my AGI was higher
SALT
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jabarony
Footballguy
Ugh. I suck. Should've read this BEFORE itemizing all those Salvation Army donations and then not meeting the 24k standard anyways. Didn't realize it was that high.
DallasDMac
Footballguy
No kidding. How annoying is it for people to come in a thread entitled Tax Check and talk about their tax checks? The nerve!
shuke
Black Ice Skeptic
shuke
Black Ice Skeptic
shadyridr
Footballguy
Sand
Footballguy
As noted I got hit with SALT (by ~1k, so not by much) and I'm in the reddest of red states. Certainly not screaming about it as I still have many tax forms yet to come in and don't know what my overall tax rate is going to be. We'll see.
TobiasFunke
Footballguy
I don't understand this attitude, which many posters seem to share. It seems unrealistic and/or ignorant of the reality of the finances of most Americans.
Most people aren't accountants and don't employ one year-round. They depend on Treasury and their employer to set their withholding. They are entirely justified in doing so, as this reliance has gone smoothly and predictably for their entire lives. It's unreasonable IMO to expect these people to "consider this or plan accordingly." For some reason (I suspect it was political, but perhaps it was practical or an administrative error or a combination of all of those), this reliance on others to set withholding has resulted in a lot of people getting much smaller refunds and in many instances owing more money to the federal government for 2018.
That doesn't mean they lost money overall, of course. But as a practical matter it is likely a blow to anyone who isn't upper middle class or wealthier. If you live paycheck to paycheck you tend to spend the extra couple bucks a month you might have gotten in 2018 without noticing and now either won't get a refund you were expecting or you will have to scrape together money to cover an unexpected expense. That's a bad thing no matter how you slice it.
Also, you didn't bring up the NPV "interest free loan to the government" thing but many others have. I think this is a similarly ignorant perspective. For people who are middle class or poorer and/or living month to month, money in 2018 and money in 2019 are basically equivalent in value. Even if they'd set aside every extra dollar in every 2018 paycheck instead of spending it, what exactly would they do with those extra couple bucks? It's not enough to invest in anything that's gonna give them a high rate of return.
Bottom line: I understand the argument that you and others are making, of course. It's logical and factual. But I believe it also reflects a fundamental lack of understanding about how many (perhaps even most) Americans live their lives. Yes, most people's taxes went down overall. Also, most people's refunds went down or disappeared or even have left them owning money, and this is doing real harm to lots of Americans whose only sin was trusting a system that has worked a certain way every year of their adult lives to continue to work that way. Both of these things can be true, they're not mutually exclusive.
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Tom Hagen
Footballguy
A cynic might think that the extra money in pay checks would be fresh in voters minds In November 2018, but the smaller tax refunds will be forgotten by November 2020.
Pipes
Footballguy
Yes people need to look at their effective tax rates to determine if they benefitted or not from the tax law change. It's basically your tax liability divided by your taxable income. It's the best way to compare apples to apples because while most people probably saw an increase in taxable income due to SALT limitations but with tax rates decreasing and credits increasing most people effective rates likely decreased.
Sand
Footballguy
The US govt. started withholding so that they would get their money first. Given the exact behavior your talked about re: American citizen spending habits, if the UST didn't people would spend it all before tax time. That said I completely agree that the UST hosed up the withholding tables. We have historically put trust in their ability to be consistent and they failed.TobiasFunke said:
Actually, I think it's the opposite. Folks won't really see or feel the extra $40 (or whatever) in each paycheck. They will, however, remember "getting screwed" with a smaller return, as most people judge their taxes by their return. Virtually no one will calculate their effective tax rate.Tom Hagen said:
For the same reason we, as a country, seem to tolerate the rampant fraud that goes on at tax time with fake returns, etc. A prudent country would gather all returns first, verify any inconsistencies, and then issue returns - quashing this fraud problem. We, as a citizenry, allow the govt. to hold our money, then are upset if we don't get our money back in 2 weeks. I shake my head at people sometimes.
Bossman
Footballguy
here's another thing that we, as a county, seem to tolerate...
We all work hard and pay our taxes ... lots of taxes. Pay our taxes or go to jail.
... yet I hear advertising on tv and radio ...."if you owe the IRS more than $10,000, call us and get off for a fraction of what you owe"
and testimonials from satisfied clients ... "I owed the IRS more than $50,000 ... and I only had to pay $2,000. Thanks a lot such and such a company!"
I want all of you to think about this when you look at how much taxes your paying this year. Somehow others are getting away with not paying taxes for years and get away almost scot-free.
irish eyes
Footballguy
This sends me right through the roof. How is this even allowed, these people getting off basically free. Makes me want to hunt them down.
I'm a CPA and those ads are BS. The only way to get tax forgiven is if you don't make any money and don't have any assets. Some people fall under this and can settle for a fraction, most can't.
jerry jones
Footballguy
My wife and I have had this conversation a few times, she likes that “refund” and all my life I claim a high amount of dependents (10) and then always owe a couple thousand at tax time. I like having my money now and in my mind making Uncle Sam wait until midnight on April 15 for my money is sweetIt's surprising to me how many people are focused on their tax refund and not the actual amount of income tax they owe. The refund completely changes the perception of taxes and it bugs me
Any discussion about the tax cuts should be done using your effective tax rate year over year - and then if you want to get a big refund go for it
ghostguy123
Footballguy
Fair tax. Just be done with it
jhib
Footballguy
