Anyone getting a lot less back in taxes?

[Blue.Fairy2]

I had assumed our refund would be smaller this year compared to last due to the withholding changes-our income neither increased or decreased this year compared to last...within $200-but our refund is almost $800 higher. I think it is because I changed some investments last year when the stock market went south. I took money out of taxable market and put it into tax deferred muni-bonds. Plus, we bought a car thru cash for clunkers and were able to deduct the sales tax. We also did a mortgage refi from a 30 down to 15 year loan. This means we no longer get to deduct the interest thru itemized deductions- but were saving a HEAP over the long haul.
So, long story short, we are back to taking the standardized deduction, but it still comes out in our favor and we get more than $2300 back. I know- some recommend adjusting withholding, but we love the guaranteed savings...and WDW trip savings. We use each years refund to 1.bulk up emergency savings 2.get us closer to WDW and 3.pay our car insurance up for 6 months.

Sorry- I wrote a book. Probably TMI, but even without any raises or income increases I feel we made progress this year. We gave more, saved more and did more as a family.

Just curious as to why you can not deduct the interest on your 15 year home loan?

 

[Goofy'slady]

Nope, we actually got more than we got last year, to the tune of 1,500.00 extra. So, we can finish paying off our April vacation to Disney, buy a new TV for the living room, shop for vacation and do renovations to our bathroom. I'm thrilled!

T.

 

[JandT'smom]

I think you are confusing things. A refund is an overpayment of tax. To compare apples to apples you need to look at your tax bill (Line 44 on a standard 1040) from 2008 and 2009. If your income is exactly the same last year as this year these two numbers should be similar. You adjusted your
withholding, so you paid less towards your tax bill over the year. Why would you expect your refund to be the same if you adjusted your payments?

No actually we adjusted our withholdings so they Took more out not less.

 

[ctinct]

Your son was born just 5 days before the end of the year. You only supported him for 5 days when the IRS gave you a full year write off for him.

The person whose son was born 6 days later had to support him for a complete year before they got the tax credit.

So you got your money for him 17 years ago and then get it this year. It all evens out in the end.

Isn't the tax credit relatively new? I have a sixteen year old (last year she will be eligible) and I don't recall getting the tax credit when she was very young. I know for darn sure it wasn't around for my older two children.

 

[rflorek]

They gave my brother $17 a week since April back in his check and then the same for his wife. He usually gets $1000 back at taxes, he now owes $1700

The extra money they gave throughout the year is screwing the middle class now that is tax time.

They actually had it all over the news when this happened that you needed to reexamine your withholdings at that time & make necessary adjustments so you wouldn't be hit at tax time.

 

[georgina]

They gave my brother $17 a week since April back in his check and then the same for his wife. He usually gets $1000 back at taxes, he now owes $1700

The extra money they gave throughout the year is screwing the middle class now that is tax time.

Did he take the Making Work Pay Credit? That's an extra $400 credit ($800 if filing jointly) for us true middle class folks - AGI less than $150,000. The adjusted withholding was to give you more money in your pocket, then you claim the credit when you do your taxes. So the stimulus should have no effect on taxes paid or refunded for the middle class.

 

[ColinCodyMom]

Did everyone get the extra money in their paychecks last year? I'm not sure that ever happened to DH. It sure didn't seem like more and I'm just wondering if it happened for everyone or if you had to make a certain amount or what? Would they have let you know somehow or did they just apply it to everyone? I'm so confused!! We did ours a week ago and the question came up like did I receive payments from the government like social security, etc and I put no. Was I wrong? I hate tax time!!

 

[Speedo1]

Haven't done ours yet......but everthing is still the same...here's hoping....

 

[Mom2apirate&princess]

We got a lot back this year.

 

[Tnkrbelle565]

Freaking out now. I do our taxes myself on TaxAct and we bought a house this year. So I was already expecting some confusion with the new deductions. But I'll be COMPLETELY thrown for a loop if our return is not roughly what I expected (we have gotten the same general return amount for the past 6 years so I expected it to be around the same plus the $8000 credit for first time home buyers). Maybe I'm wrong?????

 

[Disneyfan1977]

We did our taxes and are also getting $2000 less than last year. Bummer....of all years, this year we could use the most back. But thats what we get for not saving our refund last year.....

 

[My_3_Mi_Princesses]

In additon, I do belive that if both husband and wife are claiming 'Married' on their W-4s and both have worked all last year, then they would have gotten an overpayment on the Making Work Pay tax credit. This may be part of the reason why some people are getting less this year. However it can't be that much as the original credit was only 800. And I do believe this tax credit is in effect this year as well, so the same thing may happen next year.

btw what we did was both change our status to single from married and collected the extra $800 when we filed last week.

 

[marlynnp]

Did he take the Making Work Pay Credit? That's an extra $400 credit ($800 if filing jointly) for us true middle class folks - AGI less than $150,000. The adjusted withholding was to give you more money in your pocket, then you claim the credit when you do your taxes. So the stimulus should have no effect on taxes paid or refunded for the middle class.

Yep, make sure you are completing 'Schedule M' !!!

 

[leahjade]

A lot of people didn't realize that the $10 extra in our pay from the Obama stimulus had to be repaid at the end of the year. But just wait till next year - if he doesn't keep the Bush tax cuts in effect - you will be owing a lot more!

 

[Planogirl]

My paycheck changed a little this month and I'm assuming that it's due to the stimulus payments going away. DH's didn't change a bit so maybe it wasn't given to him? I need to find out how he claimed himself the past year.

I don't see how this stimulus helped the taxpayer at all.

 

[Tnkrbelle565]

We did our taxes and are also getting $2000 less than last year. Bummer....of all years, this year we could use the most back. But thats what we get for not saving our refund last year.....

Was this a surprise that you are getting $2000 less? Did you change anything from last year to this year? I'm totally lost as to why so many people are getting a HUGE amount less if nothing else changed for them?????

 

[disneybound31]

Just curious as to why you can not deduct the interest on your 15 year home loan?

Good question. Because in past years (with the 30 year mort.) we paid more than $6000 a year in mort interest and that, along with our out of pocket medical expenses each year, pushed us over the standardized deduction and so we always itemize. This year, however, (with the new 15 year mort.) we only paid around $3400 in mort. interest and had not alot of medical expenses as in years past so TaxAct defaults us to the standardized deduction. So unless we have huge medical in upcoming years I don't think we'll ever itemize our taxes again.

When I do the return itemized I get back almost $600 less than taking the standardized deduction. We just don't get up and over the standard deduction anymore without the huge amount of mort. int.

Does that make sense? I am oftentimes too wordy.

 

[pantherlj]

A lot of people didn't realize that the $10 extra in our pay from the Obama stimulus had to be repaid at the end of the year. But just wait till next year - if he doesn't keep the Bush tax cuts in effect - you will be owing a lot more!

Yes, I worry about this! Aren't they set to expire in 2011?

 

[disneybound31]

Did he take the Making Work Pay Credit? That's an extra $400 credit ($800 if filing jointly) for us true middle class folks - AGI less than $150,000. The adjusted withholding was to give you more money in your pocket, then you claim the credit when you do your taxes. So the stimulus should have no effect on taxes paid or refunded for the middle class.

On TaxAct it automatically adds in the Making Work Pay Credit if you worked all year and income is less than $150,000...I think that is where the numbers evened out for us. We are getting back almost exactly $800 more than I had estimated...and I suppose that is this credit.

 

[Claire&TheBoys]

In additon, I do belive that if both husband and wife are claiming 'Married' on their W-4s and both have worked all last year, then they would have gotten an overpayment on the Making Work Pay tax credit. This may be part of the reason why some people are getting less this year. However it can't be that much as the original credit was only 800. And I do believe this tax credit is in effect this year as well, so the same thing may happen next year.

btw what we did was both change our status to single from married and collected the extra $800 when we filed last week.

When I first heard about the way the new tax tables were being written, that was my immediate suspicion: that most dual-income families would get the extra $800 in both spouses' paychecks and would wind up owing half of it back.

I was a bit concerned about our tax return this year, as my husband changed jobs halfway through the year, and our AGI went up by quite a sum due to several factors. However, we wound up about the same as other years.

OP, I would be sure to double-check all your figures.