I need to get a divorce (tax thread)

[Doggiedog]

with the alternative minimum tax.

This thing is completely messed up. It adds about another 5% to my taxes. Also, once you are in a tax bracket where it hits, you don't get a deduction for your children.

Living in NJ sucks too because they don't allow you to use past capital gains losses to offset capital gains.

I hate tax season!

/rant over

---

Doggiedog,

Please post your tax question in the sticky tax thread in OT. A couple of our knowledgable members have volunteered to monitor this thread and help our members. This will also reduce the clutter of multiple tax threads in OT.

Thanks for understanding.

Mod

 

[Saulbadguy]

Originally posted by: Doggiedog
Living in NJ sucks

You could have stopped there.

 

[Queasy]

Yes, it's great that the government keeps finding ways to bend you over and screw you...without lube.

 

[flyboy84]

Originally posted by: Saulbadguy

Originally posted by: Doggiedog
Living in NJ sucks

You could have stopped there.

:thumbsup:

 

[LukFilm]

But.. but... but... your gas is cheaper than in PA!

 

[mhillary]

Why?

 

[MikeMike]

Originally posted by: LukFilm
But.. but... but... your gas is cheaper than in PA!

prolly not cheaper than the nearest Sheets station.

i love Sheets to bad its not worthwhile drive for me.

MIKE

 

[Doggiedog]

Originally posted by: mhillary
Why?

Apparently (I did not know this since I'm tax illiterate) the government instituted something a while back called the alternative minimum tax requirement. This was used in order to prevent people from using over inflated expenses to offset their tax liabilities, oftentimes by wealthy people. The government basically slapped a hard tax on people making above a certain income level. This level has come down every year and is hitting the upper middle class. It hurts even more for married couples because your combined salaries can push you into the threshold, hence the name the marriage tax. The only way to reduce this liability is to put more in a 401K, contribute to charity or lower your income bracket. Almost nothing else will help. You do not withhold for this tax. It is just assessed. It slapped on an additional $8K in taxes for me. When you are in this tax bracket, you lose your child tax benefits as well.

You might say I don't have to worry about this since I don't get paid that much but if you and your spouse make $120K combined (which isn't unreasonable), you may get hit with this tax.

 

[PingSpike]

Some how, this is all John Kerry's fault.

 

[isasir]

I was reading an article the other day on the AMT, which flat out acknowledged that it's a broken system that's going to continue to hurt the upper middle class and more and more people as the years go by, but will likely never get revised any time soon, since it's such a cash cow for the government.

 

[Doggiedog]

Originally posted by: isasir
I was reading an article the other day on the AMT, which flat out acknowledged that it's a broken system that's going to continue to hurt the upper middle class and more and more people as the years go by, but will likely never get revised any time soon, since it's such a cash cow for the government.

Could you refer me to it?

This tax is really messed up. Its something you younger guys who are considering getting married should start worrying about since the tax bracket keeps going lower and lower each year. It really penalizes you for getting married since filing separately would like prevent you from hitting the threshhold.

 

[Queasy]

Originally posted by: Doggiedog

Originally posted by: isasir
I was reading an article the other day on the AMT, which flat out acknowledged that it's a broken system that's going to continue to hurt the upper middle class and more and more people as the years go by, but will likely never get revised any time soon, since it's such a cash cow for the government.

Could you refer me to it?

This tax is really messed up. Its something you younger guys who are considering getting married should start worrying about since the tax bracket keeps going lower and lower each year. It really penalizes you for getting married since filing separately would like prevent you from hitting the threshhold.

Have you tried to see if filing seperately would help any?

 

[Doggiedog]

Originally posted by: Queasy

Originally posted by: Doggiedog

Originally posted by: isasir
I was reading an article the other day on the AMT, which flat out acknowledged that it's a broken system that's going to continue to hurt the upper middle class and more and more people as the years go by, but will likely never get revised any time soon, since it's such a cash cow for the government.

Could you refer me to it?

This tax is really messed up. Its something you younger guys who are considering getting married should start worrying about since the tax bracket keeps going lower and lower each year. It really penalizes you for getting married since filing separately would like prevent you from hitting the threshhold.

Have you tried to see if filing seperately would help any?

It would but I can't since we are married and live together.

 

[jadinolf]

Originally posted by: PingSpike
Some how, this is all John Kerry's fault.

Yep, d@mned leftie.

 

[Queasy]

Originally posted by: Doggiedog

Originally posted by: Queasy

Originally posted by: Doggiedog

Originally posted by: isasir
I was reading an article the other day on the AMT, which flat out acknowledged that it's a broken system that's going to continue to hurt the upper middle class and more and more people as the years go by, but will likely never get revised any time soon, since it's such a cash cow for the government.

Could you refer me to it?

This tax is really messed up. Its something you younger guys who are considering getting married should start worrying about since the tax bracket keeps going lower and lower each year. It really penalizes you for getting married since filing separately would like prevent you from hitting the threshhold.

Have you tried to see if filing seperately would help any?

It would but I can't since we are married and live together.

I thought there was a "Married But Filing Seperately" option? Is that only for when you are not living together?

 

[Doggiedog]

I believe so but don't quote me on that. I'm a tax noob.

 

[Drakkon]

Originally posted by: Doggiedog

Originally posted by: Queasy

Originally posted by: Doggiedog

Originally posted by: isasir
I was reading an article the other day on the AMT, which flat out acknowledged that it's a broken system that's going to continue to hurt the upper middle class and more and more people as the years go by, but will likely never get revised any time soon, since it's such a cash cow for the government.

Could you refer me to it?

This tax is really messed up. Its something you younger guys who are considering getting married should start worrying about since the tax bracket keeps going lower and lower each year. It really penalizes you for getting married since filing separately would like prevent you from hitting the threshhold.

Have you tried to see if filing seperately would help any?

It would but I can't since we are married and live together.

this doesn't matter...your still allowed to file seperately...
http://www.wwwebtax.com/general/filing_status.htm#sep

 

[StageLeft]

Originally posted by: Doggiedog

Originally posted by: mhillary
Why?

Apparently (I did not know this since I'm tax illiterate) the government instituted something a while back called the alternative minimum tax requirement. This was used in order to prevent people from using over inflated expenses to offset their tax liabilities, oftentimes by wealthy people. The government basically slapped a hard tax on people making above a certain income level. This level has come down every year and is hitting the upper middle class. It hurts even more for married couples because your combined salaries can push you into the threshold, hence the name the marriage tax. The only way to reduce this liability is to put more in a 401K, contribute to charity or lower your income bracket. Almost nothing else will help. You do not withhold for this tax. It is just assessed. It slapped on an additional $8K in taxes for me. When you are in this tax bracket, you lose your child tax benefits as well.

You might say I don't have to worry about this since I don't get paid that much but if you and your spouse make $120K combined (which isn't unreasonable), you may get hit with this tax.

Ick, that's freaking nasty, and 120k is not terribly much for two people. It's a good income, but nothing insane.

Re: Married filing separately, I don't think it's that simple. I posted a question on AT for 2003 tax year, because I figured I would get WAY more money back filing separately, in great part because I could have mrsskoorb file as herself, with a standard deduction, and I could use our mortgage interest as an itemized on mine. When we file jointly we essentially throw her standard away, because the mortgage interest (among other deductibles) is essentially split between us. I can't remember the reason, but people said I didn't really qualify for married filing separately.

 

[allisolm]

I could have mrsskoorb file as herself, with a standard deduction, and I could use our mortgage interest as an itemized on mine.

I think that was your problem.. Don't believe one of you can claim standard and one itemize.

 

[Queasy]

Yeah, filing seperately can be more expensive than filing jointly. I experimented with it the first couple of years I was married and filing seperately always came out to be more expensive. I was just curious to see if it would help the OP in this case by avoiding the Alternative Minimum Tax.

 

[Doggiedog]

Originally posted by: Queasy
Yeah, filing seperately can be more expensive than filing jointly. I experimented with it the first couple of years I was married and filing seperately always came out to be more expensive. I was just curious to see if it would help the OP in this case by avoiding the Alternative Minimum Tax.

I make a lot more than what she makes but she still does well so it probably wouldn't make a difference. The accountant/tax attorney I went to was very good. He said in my situation, there's really no way out.

 

[HendrixFan]

Originally posted by: Doggiedog

Originally posted by: isasir
I was reading an article the other day on the AMT, which flat out acknowledged that it's a broken system that's going to continue to hurt the upper middle class and more and more people as the years go by, but will likely never get revised any time soon, since it's such a cash cow for the government.

Could you refer me to it?

This tax is really messed up. Its something you younger guys who are considering getting married should start worrying about since the tax bracket keeps going lower and lower each year. It really penalizes you for getting married since filing separately would like prevent you from hitting the threshhold.

I did a quick google search and came up withthis link. Obviously the site is a little biased, but the information pertaining to the AMT seems to be pretty straighforward.

 

[Doggiedog]

Originally posted by: HendrixFan

Originally posted by: Doggiedog

Originally posted by: isasir
I was reading an article the other day on the AMT, which flat out acknowledged that it's a broken system that's going to continue to hurt the upper middle class and more and more people as the years go by, but will likely never get revised any time soon, since it's such a cash cow for the government.

Could you refer me to it?

This tax is really messed up. Its something you younger guys who are considering getting married should start worrying about since the tax bracket keeps going lower and lower each year. It really penalizes you for getting married since filing separately would like prevent you from hitting the threshhold.

I did a quick google search and came up withthis link. Obviously the site is a little biased, but the information pertaining to the AMT seems to be pretty straighforward.

Thanks for the link.

 

[FoBoT]

1. earn less money
2. pay less tax
3.
4. profit? er, maybe not. oh well

 

[EagleKeeper]

Filing seperately requires that both either itemize or take the standard deduction.

Also, some benifits can not be claimed when pulling this stunt.


Again, the best bet is to use Tax s/w and juggle the combinations to determine the path of least pain.