Tax Time

[steve1971]

Last night I went and had my taxes done. I was thinking big return. Boy was I wrong! I ended up having to pay in and got a fraction of what I thought I was getting which means little or nothing! The reason? I made more then I did in 07! What a bunch of B.S! That puts a hold on me getting a new HD tv which my freinds and family say I dont need but what do they know? Now I have to wait for a freind of mine to come up with the rest of the cash to buy my HD tv and he wont have his taxes done until next Friday AND even then he dont know whether he will have enough or not because HE may have to pay in as well. All I need is $1000 and I will have it covered. This tax season sucked and I hope the rest of you dont have to pay in like I did. I just may have to be happy and keep what I have and spend the little amount of money I have on Blu Ray movies or a new surround sound system. I guess it aint all that bad because my current HD tv is very nice and I enjoy it but I want a 120hz HD. But I guess I should be thankful with what I have and just go with it.

[garlad]

Originally Posted by steve1971

Now I have to wait for a freind of mine to come up with the rest of the cash to buy my HD tv..

Why is your friend buying your HDtv?

[Blu-Ron]

Originally Posted by steve1971

Last night I went and had my taxes done. I was thinking big return. Boy was I wrong! I ended up having to pay in and got a fraction of what I thought I was getting which means little or nothing! The reason? I made more then I did in 07! What a bunch of B.S! That puts a hold on me getting a new HD tv which my freinds and family say I dont need but what do they know? Now I have to wait for a freind of mine to come up with the rest of the cash to buy my HD tv and he wont have his taxes done until next Friday AND even then he dont know whether he will have enough or not because HE may have to pay in as well. All I need is $1000 and I will have it covered. This tax season sucked and I hope the rest of you dont have to pay in like I did. I just may have to be happy and keep what I have and spend the little amount of money I have on Blu Ray movies or a new surround sound system. I guess it aint all that bad because my current HD tv is very nice and I enjoy it but I want a 120hz HD. But I guess I should be thankful with what I have and just go with it.

Nice avatar. Went to Graceland last April. Just something I needed to do before I die. Beside the fact that it exceeded all my expectations, I had the best friggin ribs in my entire life (also on my bucket list).

[crxvtec]

when i was single, i would claim 0, not exepmt, and the most the state could take. i was making about 30k and got back around 3k in taxes. last year, my wife and i got 7k and look to get 8-9k this year. if you want to get a return for sure then claim 0. that is the sure way to get a return. i have seen people claim 4 or 5 and it is just themselves and get pissed when they have to pay when they do taxes.

[beefytwinkie]

Originally Posted by crxvtec

when i was single, i would claim 0, not exepmt, and the most the state could take. i was making about 30k and got back around 3k in taxes. last year, my wife and i got 7k and look to get 8-9k this year. if you want to get a return for sure then claim 0. that is the sure way to get a return. i have seen people claim 4 or 5 and it is just themselves and get pissed when they have to pay when they do taxes.

So every year you guys get that much in tax refunds because you claim as little as possible? If yes, what compels you to do that? Is it some sort of economic strategy?

Just to be clear, did you know that it's actually better if you owe taxes than to get large refunds at the end of the year?

Please tell me you don't get refunds in excess of $5,000 every year. And for those of you who do, you all need to seriously think about what you're doing because, as frankly and non-offensive as possible, that's just really freakin' strange.

[toef]

Originally Posted by beefytwinkie

So every year you guys get that much in tax refunds because you claim as little as possible? If yes, what compels you to do that? Is it some sort of economic strategy?

Just to be clear, did you know that it's actually better if you owe taxes than to get large refunds at the end of the year?

Please tell me you don't get refunds in excess of $5,000 every year. And for those of you who do, you all need to seriously think about what you're doing because, as frankly and non-offensive as possible, that's just really freakin' strange.

Exactly. From a time-value-of-money standpoint, and assuming there is inflation, it's best to get your money as soon as possible, and pay money as late as possible.

Some people use tax returns as a way of budgeting, and like to count on a windfall of money each year.

Just think of it this way: You earn $100, and will owe $25 in tax.

Option 1
Pay $50 in taxes, and count on getting $25 back on your return.

Option 2
Pay $25 in taxes, and use the other $25 you would've given them, and invest in something with it. Then by the time you would receive your $25 tax return, the $25 you invested will be worth more than $25.

Of course, given the current state of the economy, maybe it's better to let the government hold the money for a bit, so it doesn't lose too much value.

[crxvtec]

I know I could invest and make money, but I will not do that. I will spend the money. Yes , I do know that I could have the money and not the government and make money, but it aint going to happen. Plus, investments are not doingtoo good right now. I like getting a big chunk of cash every spring. If I ever do get to saving better, then yes I will do it, but like I said, I know myself and it aint happening the other way.

[STARSCREAM]

Dang, thats alotta cash to get back!. We will be lucky to get anything back.

[DeeChizzle]

Originally Posted by beefytwinkie

did you know that it's actually better if you owe taxes than to get large refunds at the end of the year?

Depending on how much you owe I would disagree with that. It's better to be as close to zero on the balance as possible meaning you paid as close to what you were responsible for paying in taxes.

With the way the average American spends their money I don't think your strategy would work quite well when all of sudden they find out they owe 3K in taxes. I know what you mean but I just don't see someone jumping for joy or doing cartwheels because they owe 3K in taxes especially if they haven't managed their money well.

[steve1971]

Originally Posted by garlad

Why is your friend buying your HDtv?

Hey garlad,

My freind is buying my HD tv due to he wants a bigger one and it has to be a Sony. He dont give a rats butt if its 60hz because to him 60 or 120hz is not a big deal. For me it now has.


And to Blu ron,

I have been to Graceland like 6 times and wanna go back this summer. I am a big Elvis fan. I only wish we would see more of his movies and concerts on Blu Ray.

[jsteinhauer]

Originally Posted by Blu-Ron

Nice avatar. Went to Graceland last April. Just something I needed to do before I die. Beside the fact that it exceeded all my expectations, I had the best friggin ribs in my entire life (also on my bucket list).

You have not had barbecue until you have had it in Kansas City!

Originally Posted by beefytwinkie

So every year you guys get that much in tax refunds because you claim as little as possible? If yes, what compels you to do that? Is it some sort of economic strategy?

Just to be clear, did you know that it's actually better if you owe taxes than to get large refunds at the end of the year?

Please tell me you don't get refunds in excess of $5,000 every year. And for those of you who do, you all need to seriously think about what you're doing because, as frankly and non-offensive as possible, that's just really freakin' strange.

Last year I ended up owing $20K. I don't recommend doing it this way, either.

[Marquoz]

Originally Posted by jsteinhauer

Last year I ended up owing $20K. I don't recommend doing it this way, either.

I know people that refuse to pay a penny in taxes for years and then cut deals with the IRS. They've kept all the money saved up and invested, earned interest off it, and then when it comes time to finally pay the tax bill, they pay maybe 40-50% of the total. It's insane.

[hc666]

I always owe, i like it that way.

[Blu-Ron]

Originally Posted by jsteinhauer

You have not had barbecue until you have had it in Kansas City!

Would love to try 'em. Wet rub, right?

[toef]

Originally Posted by jsteinhauer

Last year I ended up owing $20K. I don't recommend doing it this way, either.

Well, on the bright side, you have to make [a bit of] money to owe [that much] money.

[beefytwinkie]

Originally Posted by jsteinhauer

Last year I ended up owing $20K. I don't recommend doing it this way, either.

Yea, what toefer said. At the same time, that couldn't have been a surprise for you though, right? For me, my 2008 return is going to look pretty bad and I'll wind up owing probably around $5,000 because I have some capital gains. Am I happy about it? Of course not but that's the way the cookie crumbles so I planned ahead and I already set aside a chunk of money to pay for that. To owe a fat bunch of money in the 20's... that's pretty awesome.

Originally Posted by DeeChizzle

Depending on how much you owe I would disagree with that. It's better to be as close to zero on the balance as possible meaning you paid as close to what you were responsible for paying in taxes.

With the way the average American spends their money I don't think your strategy would work quite well when all of sudden they find out they owe 3K in taxes. I know what you mean but I just don't see someone jumping for joy or doing cartwheels because they owe 3K in taxes especially if they haven't managed their money well.

DeeChizzle is right as well. The goal is to aim as close as possible to zero on your return. I mean, if you're constantly oweing a whole lot and it's always unexpected, someone has fallen asleep at the wheel.

I look forward to the day I owe hundreds of thousands in taxes. I've seen returns like that and if they were mine, I'd be pretty happy.