question about tax rebate (1 Viewer)

[bubbawilson]

If i am to receive, lets say 4000.00 back on my 08 tax return will the 1800.00 I receive from the rebate be deducted from it, leaving me with 2200.00? Is this correct?

 

[SaintMeaux]

It can be confusing, here is a good thread about the subject: http://www.saintsreport.com/forums/showthread.php?t=59250

Start at about pg 15.

 

[FWtex]

Here is a downer to consider.

The "rebate" you get this year will be taken back from you with next year(08 return filed in 09). If Hillary or Obama win the presidency and the Dems maintain control of congress I speculate there will be a RETROACTIVE tax increase as their first order of business in 09. This is what Bill did his first month in office.

If this happens, then 09 returns will have very few refunds and plenty ****** off people who for the first time have to pay more taxes. Of course Hillary or Obama will blame it on Bush for giving you the money early.

 

[bubbawilson]

so taking the rebate out of the equation, if i am due 4000.00 back on my 08 return with how i normally would file, i would still get 4000.00 back?

 

[SWJJ]

yes, and the rebate will be sent to you seperately, just file as normal.

 

[jayd265]

Here is a downer to consider.

The "rebate" you get this year will be taken back from you with next year(08 return filed in 09). If Hillary or Obama win the presidency and the Dems maintain control of congress I speculate there will be a RETROACTIVE tax increase as their first order of business in 09. This is what Bill did his first month in office.

If this happens, then 09 returns will have very few refunds and plenty ****** off people who for the first time have to pay more taxes. Of course Hillary or Obama will blame it on Bush for giving you the money early.

dang, i didnt understand that. this year my wife and i have to pay $1200 according to turbo tax. we didnt "send" it off yet so we going to an accountant to see if they can help us out a little with it.

i dont understand why we have to pay, we claimed married and 0 all year long. any ideas?

 

[CT Saints Fan]

dang, i didnt understand that. this year my wife and i have to pay $1200 according to turbo tax. we didnt "send" it off yet so we going to an accountant to see if they can help us out a little with it.

i dont understand why we have to pay, we claimed married and 0 all year long. any ideas?

In general, you need more deductions. For 2008, you need to have $100 more taxes withheld per month. You can either change your withholdings to single and 0 or just fill out the form to withhold an additional $100 per month, or $50 for each of you - $25 per pay period.

 

[UK SAINTS]

dang, i didnt understand that. this year my wife and i have to pay $1200 according to turbo tax. we didnt "send" it off yet so we going to an accountant to see if they can help us out a little with it.

i dont understand why we have to pay, we claimed married and 0 all year long. any ideas?

jayd265

Do you and the wife have children living with you? Do you own or rent? Do you have other income such as interest income or received a 401(k) distribution?
Did you end up itemizing or taking the standard deduction?
There are several factors to take into account.....

 

[gumbeau]

If you are claiming all the deductions you can then owing is a good thing.

Don't up the money the government takes out of your paycheck just so they have to give some back to you.

You would be much better off putting that money in a plain savings account over the year and making a few dollars interest on it before you give it to Unka Sam.

Ideally, you would plan to owe just under the threshold of penalty.

I work it so I owe 2-3 grand a year because its my money and I want to keep it and use it as long as possible.

 

[UK SAINTS]

If you are claiming all the deductions you can then owing is a good thing.

Don't up the money the government takes out of your paycheck just so they have to give some back to you.

You would be much better off putting that money in a plain savings account over the year and making a few dollars interest on it before you give it to Unka Sam.

Ideally, you would plan to owe just under the threshold of penalty.

I work it so I owe 2-3 grand a year because its my money and I want to keep it and use it as long as possible.

Extremely good advice assuming you have the discipline to save and not spend the money (or at least have enough in your savings to not put a burdon on you when it comes time to pay).

 

[saintfan]

dang, i didnt understand that. this year my wife and i have to pay $1200 according to turbo tax. we didnt "send" it off yet so we going to an accountant to see if they can help us out a little with it.

I dont understand why we have to pay, we claimed married and 0 all year long. any ideas?

There are many factors affecting why you owe despite claiming M-0.

1. Have you claimed all the deductions to which you are entitled? Are you using Schedule A? If so, you may be missing some deductions.

2. The comments by CT Saints Fan would be a very good solution, if you did everything correctly.

3. What is the seperate income of you and your wife? How many different W-2s do you have? When a company deducts taxes from your pay, they do so using a formula based solely on the income you earned at that job. When you combine incomes (as you would do filing Married Filing Jointly), then the income tax bracket changes to a rate higher than what was withheld. The more W-2s you have, the more likely your income tax withheld rate is too low.

4. Do you have children? Are you claiming Earned Income Tax Credit, if entitled?

There are a lot of questions here, and Turbo Tax, as good as it (or any tax program) may be, is only as good as the knowledge you have on tax preparation. By all means see a tax professional before you send it off to make sure you claimed everything allowed.

If all else fails, and you want to owe less taxes next year, use CT Saints Fan suggestions.

And as an aside, the comments by Gumbeau are correct, why give the government any more interest free money than you have to. As a tax accountant, I advise that you never over-withhold on your taxes, but you should be as close as possible to zero owed. As a pragmatic individual, I also know that many people use the larger tax refund as a means of savings because they do not have the personal discipline to save. I can certainly understand that rationale also. Do what is best for your circumstances.

 

[CT Saints Fan]

There are many factors affecting why you owe despite claiming M-0.

1. Have you claimed all the deductions to which you are entitled? Are you using Schedule A? If so, you may be missing some deductions.

I was considering that he is 19 and newly married - my guess is that they are probably filing EZ and just taking the standard deductions. My assumption was that the return is correct, and so in order to not have to come up with an additional $1,200 on April 15, their budget would be better able to handle that added expense $25 at a time.

 

[saintfan]

I was considering that he is 19 and newly married - my guess is that they are probably filing EZ and just taking the standard deductions. My assumption was that the return is correct, and so in order to not have to come up with an additional $1,200 on April 15, their budget would be better able to handle that added expense $25 at a time.

Good points. What I don't understand is how a 19 year old, who presumably is not making a lot of money, and is claiming M-0, can owe so much to the IRS. I wonder if there are not some 1099's involved.

It also just occurred to me, I wonder if there are educational expenses that can be deducted, such as the Hope Credit.

 

[Goats]

We had a meeting with the IRS on Monday...... The rebate WILL NOT be deducted from next years tax return.

 

[UncleTrvlingJim]

Yes, this is the same rumor that circulated with the last rebate. It's an extra $600/$1200/$$$ in your pocket. It will not come out of your taxes next year. Geez.

That said, it's a still a bad plan.