Income Tax Thread

[ohgillian]

The income tax return I got back from the accountant is so complicated. I don’t understand it. I can do a call with her to go over it in detail and she’s great to talk to, but partner time is $475/hour so do I really want a 30 min call so I can understand it? Not sure.

We have the rental house new this year; that’s a big part of it (and is why I hired someone this year for the first time).

[dutchgirl678]

I finished our taxes at the end of last month and already got our federal refund and paid our state taxes. Last year we had to pay a lot in federal taxes so we changed DH's W4 withholding and we both took out more pre-tax to put in our retirement accounts, so I was glad to see we didn't have to pay this year even though our salary went up a bit.

We bought an EV as well but it didn't arrive until January 2023, so we have to wait until next year's taxes. We did have a charger installed in our garage and get a 30% refund for that. DD is 14 and so her dependent care expenses (like summer camps) are no longer allowable.

[namasteak]

How long are natural disaster losses written off on taxes? 2022 is the 5th year we have written off our Harvey loss and I'm shocked we are still getting a larger than expected refund from it.

[namasteak]

simpsongal we don't itemize

[gretchenindisguise]

We filed on 2/9 and already received state refund. Still waiting on federal.

Also looking forward to next year when our returns are going to be so much easier.

[dr.girlfriend]

I'm very interested to see how things work out this year. DH went freelance last year, but he was doing all virtual talks and workshops, so except for some initial start-up costs like his computer and desk chair he was making 100% profit. This year he's doing a bunch of in-person talks and I think for some of the international ones he's running a deficit because he's being a little bit of a diva about flying business class for long trips. He thinks it generates enough new business to be worth it but I'm still a little skeptical. Fortunately we don't need his salary and consider it to be icing on the cake, but some of his choices are getting a big sideye from me.

[sadlebred]

My taxes will be filed this week. I'm getting about the same amount back this year as last year. My CPA went up $100.

[sadie]

We owe this year, which was anticipated due to my job as an independent contractor. We're going to offset this a bit by making an IRA contribution.

[midwestmama]

DH did our taxes over the weekend. For Fed, we have to pay in $1100. For state and city, we are getting about $400 in refunds from both of them. So not bad overall, although I'm going to increase my Fed withholding by $50/pay to try and close the gap for 2023 taxes.

[quesyrah]

I’m nervous for ours. I inherited an IRA when my parents died and I withdrew most of it so I could disburse to my siblings. I had taxes withheld so hopefully it all turns out ok but it had to be done.

[dcn]

I filed on 2/22 and got our refund on 2/27, I think that’s a record. We sold our house after only owning a year so I was curious if that would affect anything but it was fine.

[red]

Well we royally screwed up. We got 10k back between federal and state because apparently my husband claimed zero all year despite us having 2 kids now (one born 2022). This was my first year staying home too so our bracket was different. He’s since adjusted. The last year has been a whirlwind with the second baby. We’re surviving but not thriving LOL.

[gretchenindisguise]

We still haven’t gotten our fed refund despite filing on 2/9. I wonder if it’s because of the electric car rebate, that’s the only thing I can think of as holding this up.

eta - I just checked the "where's my refund" and it switched to refund approved overnight with an eta in 3 days. hooray!

[goldengirlz]

Big win for us!

Ever since 2018, we’ve owed in the five figures every year. We were getting close to making quarterly payments, which seemed like a pain. However! This year — finally! — we will break even.

I think it was a combination of nailing the withholdings and having fewer capital gains. But either way, I am relieved.

[shaynaatl]

We figured out we didn't pay enough in Federal taxes last year. So we will owe low five figures this year ugh. It's mainly because DH got some big raises and for some reason, his Fed tax withholding didn't go up much. We are going to add additional withholding for this year's paychecks.

[mcppalmbeach]

We haven’t done ours yet and I pretty much would like to not.we sold our first home this year so capital gains will be painful.

[woowoo]

Ooof. We owe over $7K, which I am not surprised by but DH is. He grew up in a household with limited income where they ALWAYS got a refund every year so he just cannot wrap his brain around it.

[k3am]

Last year was our first year making quarterly payments. We'll be getting a $10k refund. But our tax return for 2022 says we need to make estimated quarterly payments in 2023 in excess of what we paid in 2022? We have a call scheduled with the accountant.

My incentive pay is entirely unpredictible, so trying to budget for taxes is impossible.

[jwright]

Mar 14, 2023 12:45:21 GMT -5 k3am said:

Last year was our first year making quarterly payments. We'll be getting a $10k refund. But our tax return for 2022 says we need to make estimated quarterly payments in 2023 in excess of what we paid in 2022? We have a call scheduled with the accountant.

My incentive pay is entirely unpredictible, so trying to budget for taxes is impossible.

Why don’t you just apply the refund to 2023? You can apply a partial amount if the $10k covers more than you need to pay in.

[k3am]

Mar 14, 2023 16:22:33 GMT -5 jwright said:

Mar 14, 2023 12:45:21 GMT -5 k3am said:

Last year was our first year making quarterly payments. We'll be getting a $10k refund. But our tax return for 2022 says we need to make estimated quarterly payments in 2023 in excess of what we paid in 2022? We have a call scheduled with the accountant.

My incentive pay is entirely unpredictible, so trying to budget for taxes is impossible.

Why don’t you just apply the refund to 2023? You can apply a partial amount if the $10k covers more than you need to pay in.

Because I had no idea we could! I learn something new thanks to these boards. I'd imagine/hope our accountant will suggest the same when we meet with him, but if he doesn't, at least I'll know to ask. (Our return is currently wrong and shows us as owing, since I forgot to send him the information on the payments we made, so we're still waiting on that adjustment.)

This is the first time we've been due a refund in a really long time.. it will definitely cover a portion of what we'll pay for 2023.

[jwright]

Mar 14, 2023 16:41:49 GMT -5 k3am said:

Mar 14, 2023 16:22:33 GMT -5 jwright said:

Why don’t you just apply the refund to 2023? You can apply a partial amount if the $10k covers more than you need to pay in.

Because I had no idea we could! I learn something new thanks to these boards. I'd imagine/hope our accountant will suggest the same when we meet with him, but if he doesn't, at least I'll know to ask. (Our return is currently wrong and shows us as owing, since I forgot to send him the information on the payments we made, so we're still waiting on that adjustment.)

This is the first time we've been due a refund in a really long time.. it will definitely cover a portion of what we'll pay for 2023.

Sorry if that came across snarky - but yes, it's pretty straight forward..  One page two of the 1040 -  Line 34 is the amount you've overpaid; Line 35a is the amount refunded and Line 36 is the amount to apply to estimated tax. 

[k3am]

Mar 14, 2023 17:21:58 GMT -5 jwright said:

Mar 14, 2023 16:41:49 GMT -5 k3am said:

Because I had no idea we could! I learn something new thanks to these boards. I'd imagine/hope our accountant will suggest the same when we meet with him, but if he doesn't, at least I'll know to ask. (Our return is currently wrong and shows us as owing, since I forgot to send him the information on the payments we made, so we're still waiting on that adjustment.)

This is the first time we've been due a refund in a really long time.. it will definitely cover a portion of what we'll pay for 2023.

Sorry if that came across snarky - but yes, it's pretty straight forward..  One page two of the 1040 -  Line 34 is the amount you've overpaid; Line 35a is the amount refunded and Line 36 is the amount to apply to estimated tax. 

Not snarky at all!

[heygrey]

Normally we owe ~$50, but this year we're getting back $450. Little bonus since we're starting a bathroom reno in two weeks!

[Susie]

I just talked through the summary of our 2021 v. 2022 with our accountant.  I was afraid we were going to have a 5 figure tax bill after the year I had in 2022, and I swear estimating quarterly taxes never goes my way.  But I had been paying the safe harbor 110% amount every quarter for 2022, so that avoided penalties and kept the balance due in check.  Plus, I got a NYS refund that will cover half of the federal bill due.  We're ending up owing a net 4 figure amount, but it's totally doable.  

Observation:  PTET really helps a ton at the state tax level.  There are a lot of downsides to being an equity partner (self employment tax, quarterly estimates, no 401k match by my firm, K-1 is way more complicated than W-2) but PTET is one of the few perks.

Minor yay:  This year we are finally free of repayment of the 2008 first time homebuyer "credit".  Woot!  That was the $7500 "credit" that had to be repaid at a rate of $500/year for 15 years.  We sold the house in 2021, so we repaid the remaining balance on last year's 1040.  $500/year is not a huge deal, but it feels nice to no longer be paying back a "credit" we got in April 2009.

We're still taking the standard deduction, which blows my mind.  Damn SALT limits.  With the SD continuing to rise, I can't imagine how we would get over it next year either.  

[kadams767]

Mar 22, 2023 14:15:17 GMT -5 Susie said:

I just talked through the summary of our 2021 v. 2022 with our accountant.  I was afraid we were going to have a 5 figure tax bill after the year I had in 2022, and I swear estimating quarterly taxes never goes my way.  But I had been paying the safe harbor 110% amount every quarter for 2022, so that avoided penalties and kept the balance due in check.  Plus, I got a NYS refund that will cover half of the federal bill due.  We're ending up owing a net 4 figure amount, but it's totally doable.  

Observation:  PTET really helps a ton at the state tax level.  There are a lot of downsides to being an equity partner (self employment tax, quarterly estimates, no 401k match by my firm, K-1 is way more complicated than W-2) but PTET is one of the few perks.

Minor yay:  This year we are finally free of repayment of the 2008 first time homebuyer "credit".  Woot!  That was the $7500 "credit" that had to be repaid at a rate of $500/year for 15 years.  We sold the house in 2021, so we repaid the remaining balance on last year's 1040.  $500/year is not a huge deal, but it feels nice to no longer be paying back a "credit" we got in April 2009.

We're still taking the standard deduction, which blows my mind.  Damn SALT limits.  With the SD continuing to rise, I can't imagine how we would get over it next year either.  

Super happy for PTET here as well. My PTET pass-thru amount this year was insane.

[wildrice]

I think I under withheld - I made just a little less than my H last year, but he withheld over 2x as much federal tax, lol. I do carry our health insurance and save more in my retirement (since I don't get a match and he does) but even so, I think I need to change that for next year.

So far it looks like we'll probably owe around 3k for federal and get $400 or so back from state. I need to finish it up though. I'm hoping the federal goes down a bit with deductions, but we'll likely be doing the standard deduction so I don't think there are a lot of places to save for us.

[jwright]

Mar 25, 2023 10:46:24 GMT -5 kadams767 said:

Mar 22, 2023 14:15:17 GMT -5 Susie said:

I just talked through the summary of our 2021 v. 2022 with our accountant.  I was afraid we were going to have a 5 figure tax bill after the year I had in 2022, and I swear estimating quarterly taxes never goes my way.  But I had been paying the safe harbor 110% amount every quarter for 2022, so that avoided penalties and kept the balance due in check.  Plus, I got a NYS refund that will cover half of the federal bill due.  We're ending up owing a net 4 figure amount, but it's totally doable.  

Observation:  PTET really helps a ton at the state tax level.  There are a lot of downsides to being an equity partner (self employment tax, quarterly estimates, no 401k match by my firm, K-1 is way more complicated than W-2) but PTET is one of the few perks.

Minor yay:  This year we are finally free of repayment of the 2008 first time homebuyer "credit".  Woot!  That was the $7500 "credit" that had to be repaid at a rate of $500/year for 15 years.  We sold the house in 2021, so we repaid the remaining balance on last year's 1040.  $500/year is not a huge deal, but it feels nice to no longer be paying back a "credit" we got in April 2009.

We're still taking the standard deduction, which blows my mind.  Damn SALT limits.  With the SD continuing to rise, I can't imagine how we would get over it next year either.  

Super happy for PTET here as well. My PTET pass-thru amount this year was insane.

We try to apply PTET payments to all the clients in our practice who qualify.  My husband is also an attorney and his firm has not made the payments in either of the past two years its been available.  I had him ask about it and he got a BS answer and doesn't want to push it but as a tax professional it fires me up!  We could save a few thousand, and the senior partners would save tons!

[blondemoment123]

H made a significant amount last year, but we made sure we were withholding extra for taxes. Well,
We owe....a lot. 🫣

[wildrice]

Ends up that we owe about $2400 in federal and get back just under $400 in state. I am going to change withholdings for next year, but I guess 2k isn't as bad as I was afraid it would be. Our HHI will be higher next year due to my H's promotion, too, so I guess we should figure out if we end up in a new tax bracket.

I had to laugh when TurboTax told me that we actually owed a little less this year than last year. I did NOT remember that and apparently totally forgot that I meant to change my withholdings last year!

[flygirl]

We owed about $3000 between Fed and State. I was expecting to owe a little but wasn’t expecting that much -more like 1/2 so that sucks. Also, the CPA who is working on the estate taxes I need to have done told me he’d have the numbers to me by the 15th of March, then the 31st. When I asked today if he even had an estimate he said he’d give them to me on April 18th. I don’t know if this is normal for CPAs but I was rather irritated. I delivered everything to him on Feb 7 and understand it’s complicated but don’t promise a date and then totally forget about it.