Inspired by tax return thread... let's talk $$

[Cyndirella]

A few years ago we got back a little over $5000, so we adjusted our withholding and have been getting about $2000 for the past few years.

 

[kldmom2000]

Well... DH is self-employed and the first year of self-employment, he underestimated what the quarterly taxes would be and we owed $12,000 more come tax time!!! The sucker of that was the accountant told us this APRIL 13TH!!!!!!!!! We ended up having to do the loan through the IRS and thankfully paid it off just in time to owe $8,000 more the following year even though we seriously upped our quarterly payments because of what happened... then we bought a house... had a second child... basically got more deductions for our benefit. That year we broke even. Last year DH's business almost flopped (he incorporated 3 yrs ago)... because the business failed so poorly and was at risk of going under, WE got a tax return of $7,500!!!! We of course put some back into the business and it's stable again... all I'm hoping for this upcoming April is that we won't OWE... I just hate owing.... I don't care if we get even a $50 refund... just so long as we don't OWE!!!

 

[luvsmickeymouse]

Oh yeah... please no flames for "giving the government an interest free loan".

I get anywhere between 4-5 thousand back each year. I also have more money than i should taken out of my paycheck each week. If I had less taken out, I KNOW that I would spend it on something stupid. A portion of this refund is our Florida money. I like getting money back even though I give the gov't a free loan, for me it works.

 

[EthansMom]

I do the worksheet on the back of the withholding form to estimate the number of withholding exemptions. Usually, we come out about even.

In years where we have a lot of changes (changed jobs, sold/bought houses, etc.), we usually get money back. I think the most we've gotten was in the $2000-$3000 range.

 

[kilee]

Back when I was a single mom I would get in the $4000-5000 range w/ the EIC. Well, that went out the door a long time ago. We used to break even or owe in the $200-300 range.

It was only since we owned a business that failed miserably that we got a return. This will be the last year since we closed it in 2005.

 

[MagicKingdom05]

luvsmickeymouse,

That is exactly why I have them take more money out as well. When it came time to plan a vacation, the money would have already been spent on other things that I really don't need. Don't get me wrong, I do put a portion of my check away each month, but that is for emergency purposes (car trouble, doctor issues, etc) and doesn't get used for a vacation.

 

[aprilgail2]

I get back between 5,000 and 6,000 a year......I don't mind giving my government a free loan at all LOL...otherwise I wouldn't save it, I know myself...I am happy to have that big lump sum to pay for my vacations, camp etc...

 

[Marseeya]

You can claim student loan interest deduction every year you pay interest, to my knowledge. Now, the education credit are a different story.

The most I will get back is this year, $500. Then again, I don't make much to begin with.

It must be the education credit I'm thinking of, because we haven't paid any interest on our student loans yet.

It just occurred to me. I've been in school almost every year straight since 1996 -- 10 years! Holy moly.

 

[Free4Life11]

The Hope Credit is for $1500 for expenses for the first two years of secondary schooling.

The Lifetime Learning Credit is much more general and can be used for 20% of up to $10,000 in qualified expenses (max of $2000 credit). The LLC applies to just about anyone who takes classes, etc.

You can also deduct up to $4000 in tution and fees, but you CAN'T double dip, you have to choose either one of the credits or the deduction.

ETA - If any of this information if wrong, correct me! I am studying my VITA manual and still learning so this was a little "test" for myself.

 

[Jeafl]

Well, my husband is a CPA, although he doesn't work in public accounting now. He definitely falls in to the category of never wanting to give the government an interest free loan. He tries extremely hard to break even every year. I think the most we have ever gotten back is maybe $500, and a couple of times we have actually had to pay a few hundred dollars. His dream is to break perfectly even.

 

[ChrisnSteph]

The best we did was last year - we got about $7000 back.

 

[Texan Mouseketeer]

Last year was our largest - About $6700 - which is why we went to Disney with a 10 month old! haha Couldn't pass up that unexpected return! It was our medical expenses...having a baby, both kids had surgery and I had surgery all in the same year. Whew!

 

[skiwee1]

The most we ever got back was $8000. We made that mistake once! We now owe about the same every year.

 

[Zmsksirt]

Wow! I'm not really concerned about giving the government an interest free loan as I am about loss of investment opportunities! Dollar cost averaging that tax money into a Roth IRA makes sense. Getting a large income tax return makes no sense. I end up owing about $200.00 to $300.00 per year to the tax man, but I'll have a very healthy nest egg that will be tax free!

 

[kdibattista]

Wow! I'm not really concerned about giving the government an interest free loan as I am about loss of investment opportunities! Dollar cost averaging that tax money into a Roth IRA makes sense. Getting a large income tax return makes no sense. I end up owing about $200.00 to $300.00 per year to the tax man, but I'll have a very healthy nest egg that will be tax free!

Thanks for the lecture but as I said... please no comments about giving the government an interest free loan.

 

[aprilgail2]

Wow! Dollar cost averaging that tax money into a Roth IRA makes sense. Getting a large income tax return makes no sense. I end up owing about $200.00 to $300.00 per year to the tax man, but I'll have a very healthy nest egg that will be tax free!

Perhaps to YOU it makes no sense, but for those of us that use it for things, like furniture or vacations etc when we know we would not save it otherwise it makes PERFECT sense. I would never use my income tax as a nest egg...money comes out of my check every week for a 401K, 457 and pension plan...income tax money is fun saved money.

 

[OhMari]

The Hope Credit is for $1500 for expenses for the first two years of secondary schooling.

The Lifetime Learning Credit is much more general and can be used for 20% of up to $10,000 in qualified expenses (max of $2000 credit). The LLC applies to just about anyone who takes classes, etc.

You can also deduct up to $4000 in tution and fees, but you CAN'T double dip, you have to choose either one of the credits or the deduction.

ETA - If any of this information if wrong, correct me! I am studying my VITA manual and still learning so this was a little "test" for myself.

I totally just scratch my head over this one. I do my own taxes and I can sit for 2-3 hours wondering which way to go.

And, I think we will be paying in this year. I looked at my husbands last paycheck and wondered why he didn't pay very much into Federal for the year.

 

[phorsenuf]

The Hope Credit is for $1500 for expenses for the first two years of secondary schooling.

The Lifetime Learning Credit is much more general and can be used for 20% of up to $10,000 in qualified expenses (max of $2000 credit). The LLC applies to just about anyone who takes classes, etc.

You can also deduct up to $4000 in tution and fees, but you CAN'T double dip, you have to choose either one of the credits or the deduction.

ETA - If any of this information if wrong, correct me! I am studying my VITA manual and still learning so this was a little "test" for myself.

If you deduct tuition, does that come right off the top or is it a percentage? I started my taxes via turbotax yesterday and the program hasn't updated for that yet.
If I paid say $2,000 out of pocket, not a loan or anything it went straight to the bursers office, how is that computed?

 

[taximomfor4]

If it's not too personal (although as I'm typing this I'm thinking it probably is), I'm curious what's the most refund you've ever received. Or, what's the most you owed? I'm seeing people buying furniture, Disney trips, etc and I'm just curious (ok, maybe nosey .. hey, I admit it).

The most DH & I received was $2,500 but I'm hoping it's more this year since we bought our first home last February.

last year, we were shocked to get back $7100. 4 kids, refinanced home from a TERRIBLE interest rate that DH had bumbled us into several years prior. Oh, and in the refinance, the new mortgage company had paid our first half 2005 taxes in advace (refi went through in December 2004). So I guess this means this year's return will stink, with only half the tax for 2005 to claim, and a MUCH better interest rate.

Beth

 

[robsmom]

The highest was $10,500 from federal. The highest from state was around $1500. Of course, last year, I paid the feds $97,000 and the state of Missouri $30,000. Not a good year!

I think it's all in how you look at it. I would say you must have had a very very good year if you ended up oweing that much in taxes!!

Our highest refund has been around $3000 or so. Last year was the worst year in that I swiched companies and in the process unintentionally changed my withholding by too much. We owed $5000 or so. Have fixed that for this year.