More Taxpayers Will Owe The IRS In April Because Of Underwithholding, Report Says

[pauldun170]

Hope your employer wasn't in a rush. Some of you were gushing about changes in your check sooner than others..

More Taxpayers Will Owe The IRS In April Because Of Underwithholding, Report Says
More Americans will be writing a check to the IRS in April because their employers are not withholding enough from their paychecks following the new tax law, the Government Accountability Office says in a new report.

Based on simulations run by the Treasury Department, the GAO says taxes for 30 million Americans — 21 percent of taxpayers — are being underwithheld by their employers, meaning they are getting a larger check this year, but will owe at tax time in April. According to the simulations, 73 percent of taxpayers will be overwithheld and receive a refund from the Internal Revenue Service.

When the simulation was run as if there had been no change in the tax law, 18 percent of taxpayers, or about 27 million, would have experienced underwithholding and 76 percent would have been overwithheld. In both scenarios, just 6 percent of taxpayers would have the correct amount of withholding.

Who should be concerned? According to the GAO, a hypothetical taxpayer who is married with two children, earning $180,000 annually, $20,000 of which comes from non-wage income and who itemizes deductions.
https://www.npr.org/2018/08/01/6344...in-april-due-to-under-withholding-report-says

 

[UNCjigga]

Republicans should be worried...what's left of their base might be stupid enough to believe that they lied about tax cuts for all in order to pass welfare for the filthy rich.

 

[vi edit]

Who should be concerned? According to the GAO, a hypothetical taxpayer who is married with two children, earning $180,000 annually, $20,000 of which comes from non-wage income and who itemizes deductions.

Well fuck me sideways....guess I better lube up.

 

[Fanatical Meat]

Who should be concerned? According to the GAO, a hypothetical taxpayer who is married with two children, earning $180,000 annually, $20,000 of which comes from non-wage income and who itemizes deductions.

Well fuck me sideways....guess I better lube up.

Only 180k?

Noob











#sarcasm

 

[s0me0nesmind1]

Uhhh, it isn't exactly hard to put some formulas into excel and figure out (and estimate) what you are overpaying/underpaying for your taxes for the year. I have a spreadsheet that I keep up to date with every paycheck - and it has estimates for all remaining paychecks.

Stupid article seems stupid.

Who should be concerned? According to the GAO, a hypothetical taxpayer who is married with two children, earning $180,000 annually, $20,000 of which comes from non-wage income and who itemizes deductions.

Well fuck me sideways....guess I better lube up.

The ONLY part of that formula that will make you potentially owe in taxes is the fact that itemizing is no longer as helpful as it once was.

If you make $180k and have 2 children - based on those 2 factors alone you will owe less in taxes than previously. The tax brackets are smaller - in addition to the child tax credit being much larger.

 

[vi edit]

The thing is that most of us rely on our employers to keep the witholding tables in check. If they didn't update tables to keep things in line with tax code then you may have a surprise waiting for you.

 

[glenn1]

Republicans should be worried...what's left of their base might be stupid enough to believe that they lied about tax cuts for all in order to pass welfare for the filthy rich.

So tell them the truth that you'd had your way the tax cut would have never happened and thus they would have avoided them having to pay a tax bill due to under-withholding by way of not getting the benefit of the tax cut. Given that large swathes of the population cares more about the monthly payment than total costs paid you'd probably even convince a few. "Oh man, you mean if I agree to higher taxes throughout the year then I won't have to write a check on April 15th? Where do I sign up?"

 

[s0me0nesmind1]

There is no doubt in my mind that the entire foundation of that tax reform was to screw over high paying, high taxation states. Likely to get upper-middle class employees to potentially move to LCOL republican states. Just my theory though.

I kinda have to say rightfully so though - our tax system should not incentivize living in a HCOL area vs. a LCOL area.

The tax reform hurts states that are likely to itemize. Those being: California, Washington, Illinois, New York, etc...

 

[dank69]

Republicans should be worried...what's left of their base might be stupid enough to believe that they lied about tax cuts for all in order to pass welfare for the filthy rich.

Why would they be worried? By the time their retarded base finds out the 2018 midterms will have been over for months.

 

[Jhhnn]

So tell them the truth that you'd had your way the tax cut would have never happened and thus they would have avoided them having to pay a tax bill due to under-withholding by way of not getting the benefit of the tax cut. Given that large swathes of the population cares more about the monthly payment than total costs paid you'd probably even convince a few. "Oh man, you mean if I agree to higher taxes throughout the year then I won't have to write a check on April 15th? Where do I sign up?"

Marvelous gobbledegook. People depend on their withholdings being right, on not having to write that check. Lots of people use over withholding as a form of savings. Instead of getting a little bit back they get to pay instead. Oh, Joy! When it doesn't work out they'll realize they're getting screwed. You know, the old smoke & mirrors routine. Fortunately for the GOP that won't happen until next year, after the election.

 

[glenn1]

Marvelous gobbledegook. People depend on their withholdings being right, on not having to write that check. Lots of people use over withholding as a form of savings. Instead of getting a little bit back they get to pay instead. Oh, Joy! When it doesn't work out they'll realize they're getting screwed. You know, the old smoke & mirrors routine. Fortunately for the GOP that won't happen until next year, after the election.

Like I said, be the party which focuses on the monthly payments rather than the total costs. You can call it the progressive "rent to own" program for reducing April 15th tax payments. Maybe you can even open a pawn shop wing of the Democratic Party to help them reduce the sting of underwithholding even more.

 

[vi edit]

Like I said, be the party which focuses on the monthly payments rather than the total costs. You can call it the progressive "rent to own" program for reducing April 15th tax payments. Maybe you can even open a pawn shop wing of the Democratic Party to help them reduce the sting of underwithholding even more.

A tax "cut" should mean I owe less taxes, no?
If I'm on the hook for $30,000 in federal taxes and they pass a bill that says I now owe $25,000 that's a tax cut.
Take my 30,000 I owe, divide it by 26 paychecks and it's $1153 a check.
If they cut it to $25,000 I'm on the hook for, my employer witholdings should drop down to $961.

I shouldn't have to owe the difference back in April. That's not a "cut".

 

[s0me0nesmind1]

A tax "cut" should mean I owe less taxes, no?
If I'm on the hook for $30,000 in federal taxes and they pass a bill that says I now owe $25,000 that's a tax cut.
Take my 30,000 I owe, divide it by 26 paychecks and it's $1153 a check.
If they cut it to $25,000 I'm on the hook for, my employer witholdings should drop down to $961.

I shouldn't have to owe the difference back in April. That's not a "cut".

The whole employer witholding narrative is incredibly stupid to begin with. There is no reason to trust it in anyway.

The employer withholding has no idea:
1) What your wife./spouse's income is - which can always change from bonuses or salary increase/decrease, loss of job etc..
2) Your other income (Interest, etc..)
3) Your benefits - such as tax itemization, deductions (e.g. student loans), or tax credits (child tax credit).

It ultimately is not effective for keeping up with those. I can honestly share a very easy to use Excel template that anyone can keep up to date if you are expected to owe or get refunded at the end of the year.

 

[glenn1]

A tax "cut" should mean I owe less taxes, no?
If I'm on the hook for $30,000 in federal taxes and they pass a bill that says I now owe $25,000 that's a tax cut.
Take my 30,000 I owe, divide it by 26 paychecks and it's $1153 a check.
If they cut it to $25,000 I'm on the hook for, my employer witholdings should drop down to $961.

I shouldn't have to owe the difference back in April. That's not a "cut".

And if the employer doesn't drop withholding to $961 then you still owe the exact same amount of taxes, namely $25k in your example. If it went the other direction and your total tax burden was raised to $30k then it wouldn't matter if your employer withheld for $1,153 per check or $961, you still owe the same $30k to Uncle Sam. You're another good candidate for the Democrat's "just look at the monthly payments line and not the true total cost."

 

[hal2kilo]

The thing is that most of us rely on our employers to keep the witholding tables in check. If they didn't update tables to keep things in line with tax code then you may have a surprise waiting for you.

You don't think the gument would do that on purpose. Wow, look at my paycheck those tax breaks really worked.

 

[Thump553]

The first negative effects of the Trump tax giveaway will be felt five months after the mid-term elections. This is not a negative for GOP politicians, nor will they treat it as such. Be prepared to see commercial after commercial this fall how the GOP put more money in your take home pay, etc.

Anyone smart enough to figure out the actual tax cuts effects on them by November or earlier is almost certainly not going to be voting for the GOP in any event, unless they are a member of the billionaire class who wants to freeload more.

 

[compuwiz1]

A tax "cut" should mean I owe less taxes, no?
If I'm on the hook for $30,000 in federal taxes and they pass a bill that says I now owe $25,000 that's a tax cut.
Take my 30,000 I owe, divide it by 26 paychecks and it's $1153 a check.
If they cut it to $25,000 I'm on the hook for, my employer witholdings should drop down to $961.

I shouldn't have to owe the difference back in April. That's not a "cut".

It is our responsibility to make sure we are having the proper money allocated toward our taxes, not the employers. I have had many employees decide they want to claim "exempt", because they had some low paying months, or some high paying ones, thinking they want more money in their pockets, and will settle it up later. Problem is, once they go exempt and get used to the extra money, they suddenly forget about switching back to the proper number of exemptions. Even though I could claim 2, being married, I prefer to claim 1.

 

[zinfamous]

There is no doubt in my mind that the entire foundation of that tax reform was to screw over high paying, high taxation states. Likely to get upper-middle class employees to potentially move to LCOL republican states. Just my theory though.

I kinda have to say rightfully so though - our tax system should not incentivize living in a HCOL area vs. a LCOL area.

The tax reform hurts states that are likely to itemize. Those being: California, Washington, Illinois, New York, etc...

people live where there are good jobs. Smart people don't move to bumfuck Idaho because there aren't many jobs for smart people. Punishing smart people for having good jobs, and thus living in HCOL states, doesn't solve your republican problem of your terror of smart people and such states' unwillingness to court smart people by incentivizing high-paying, smart jobs.

This isn't a chicken-and-egg problem. The A leads to B equation has long been understood.

If, as you say, the GOP plan was to coerce liberals to move to republican states, then I'm not sure why they would want that. As unsuccessful a plan that would be, even if it were to happen, the GOP would be forever unable to win a national election due to the overwhelming majority of democrats and independents that don't support the GOP.

 

[boomerang]

So 3 million taxpayers may be underwithheld. Color me laughing.

Any data on how many taxpayers are typically underwithheld? Smart taxpayers will always be underwithheld. Dumb taxpayers like to take advantage of the federal income tax savings plan that pays zero interest but refunds them back a sizable check in the spring. The .gov does love an interest free loan.

 

[fskimospy]

So tell them the truth that you'd had your way the tax cut would have never happened and thus they would have avoided them having to pay a tax bill due to under-withholding by way of not getting the benefit of the tax cut. Given that large swathes of the population cares more about the monthly payment than total costs paid you'd probably even convince a few. "Oh man, you mean if I agree to higher taxes throughout the year then I won't have to write a check on April 15th? Where do I sign up?"

Saying ‘under me the tax bill wouldn’t have happened’ seems like a pretty smart move considering it polls in the 30’s, haha.

 

[Viper1j]

Hope your employer wasn't in a rush. Some of you were gushing about changes in your check sooner than others..

One of the perks of owning your own business. I cooked my books well enough to make the Swedish Chef from the Muppets proud. I didn't give Donny a single penny this year

 

[fskimospy]

There is no doubt in my mind that the entire foundation of that tax reform was to screw over high paying, high taxation states. Likely to get upper-middle class employees to potentially move to LCOL republican states. Just my theory though.

I kinda have to say rightfully so though - our tax system should not incentivize living in a HCOL area vs. a LCOL area.

The tax reform hurts states that are likely to itemize. Those being: California, Washington, Illinois, New York, etc...

I agree there is no reason to subsidize high state taxes and such but the fact remains that under our current system those states are significant donors of federal taxes. If they wanted to remove that preference they should have cut taxes elsewhere for them. There’s little reason to create an even larger federal taxation disparity other than to reward people who voted for you.

 

[glenn1]

I agree there is no reason to subsidize high state taxes and such but the fact remains that under our current system those states are significant donors of federal taxes. If they wanted to remove that preference they should have cut taxes elsewhere for them. There’s little reason to create an even larger federal taxation disparity other than to reward people who voted for you.

I thought you were in favor of progressive taxes? Or is that just the progressive taxes that you didn’t expect actually to pay yourself?

 

[fskimospy]

I thought you were in favor of progressive taxes? Or is that just the progressive taxes that you didn’t expect actually to pay yourself?

How many times are you going to try the same bit? Not everyone is a hypocrite like you are. I’m perfectly fine with eliminating SALT as that makes the tax code more progressive. We could very easily replace that tax break with a more progressive one. How is this hard to understand.

We should be aware that the most productive areas of the country are already heavily subsidizing areas like the one you live in. While I’m completely down to help you guys out until you can become more competitive you don’t want to make the disparity too large and kill the geese laying the golden eggs so to speak.

 

[compuwiz1]

One of the perks of owning your own business. I cooked my books well enough to make the Swedish Chef from the Muppets proud. I didn't give Donny a single penny this year

So, the n00b admits to criminal activity on a forum. The internet does not forget!
Or, you're a pimp daddy, or welfare queen? Please tell us which. lol