Did my taxes

[jay santos]

www.esmarttax.com

There might be better sites, but I shopped for the cheapest one a few years ago and have stuck with them. I pay $15 to file fed and state and seem to get the direct deposit within a week and a half or so. Took me about an hour this time.

Thanks to bonus getting taxed at high rates, five kids, big mortage, tithing, healthy 401K and health care flex account payment rates, I'm getting a TON of money back.

[Jeff Lebowski]

Originally Posted by jay santos

Thanks to bonus getting taxed at high rates, five kids, big mortage, tithing, healthy 401K and health care flex account payment rates, I'm getting a TON of money back.

Meaning you paid too much during the year. Free loan to Uncle Sam.

[jay santos]

Originally Posted by Jeff Lebowski

Meaning you paid too much during the year. Free loan to Uncle Sam.

Hey if there was a way around it, I wouldn't do it that way. But it does make for a happy February. Actually forced savings is not a bad concept when you have a wife that spends 1.1 times what you bring home, no matter the number.

[Jeff Lebowski]

Originally Posted by jay santos

Hey if there was a way around it, I wouldn't do it that way. But it does make for a happy February.

There is a way around it. Modify your W4 to get lower witholding and then pay estimated taxes.

Originally Posted by jay santos

Actually forced savings is not a bad concept when you have a wife that spends 1.1 times what you bring home, no matter the number.

True. Hard to argue with that.

[jay santos]

Originally Posted by Jeff Lebowski

There is a way around it. Modify your W4 to get lower witholding and then pay estimated taxes.



True. Hard to argue with that.

On my W4 I pay $50 to fed per pay check.

They told me if you do zero it raises a red flag for audit.

[Jeff Lebowski]

Originally Posted by jay santos

On my W4 I pay $50 to fed per pay check.

They told me if you do zero it raises a red flag for audit.

So how did you get so much witheld?

[jay santos]

Originally Posted by Jeff Lebowski

So how did you get so much witheld?

bonus

[jay santos]

Plus with five kids that's five grand in your pocket even if you don't pay or owe any taxes.

[hyrum]

Originally Posted by jay santos

bonus

If you have tons of deductions on your W4 it should also apply to your bonus, no?

On my w4 there are two items, deductions and extra per month. I put the appropriate number of deductions to account for my salary and an extra per month (as a dollar amount) to cover other income (taxable investments, consulting). If my other income starts to get too high in a particular year I have the lovely experience of filing estimated taxes every 3 mos.

In your case I guess you need to write "10" or something large for Federal deductions.

I try to automate savings withdrawals and don't tell the wife much about the extent of "other income" to keep the spending side under control.

[pelagius]

Originally Posted by hyrum

If you have tons of deductions on your W4 it should also apply to your bonus, no?

Yes, the deductions still apply but bonuses are almost always taxed too much because the withholding schedule assumes that you get paid that same (extra) amount every week/month/payment cycle. So if you make $4000 a month and receive an one time $4000 bonus in December, the withholding schedule thinks you are making $96,000 a year and not $52,000 (so it overwithholds in December).