Taxes are done!

[TheMix]

Because people don't know how to withhold taxes anymore

If by "people", you mean companies, then I 100% agree.

We probably mentioned it last year, but we got hosed with a huge tax bill. Early in the year I flipped my 401K deduction from pre-tax to post-tax. Best I can figure is that my company just kept taking out the same amount. However, since I know made a lot more money post-tax, we ended up way short on taxes taken out.

To adjust for that, most of last year I had extra money taken out of each paycheck.

Well, apparently this year my company figured out how to do the taxes correctly. So essentially everything extra I put in was completely unnecessary. We are getting a big refund, but I'd rather have had the money in my paychecks.

[Z-Corn]

Through no effort or skill on my part we ended up pretty even this year.

My work doesn't take out my local taxes because they are based in a Podunk town on the other side of the state that doesn't collect local taxes. With that, and minus the usual rebate we get for Student Loan interest which we didn't pay last year, all shook out to $186 refund total.

I, as with all windfalls, will put that money right back out on the streets.

[Kraken]

New Jersey residents will pay the most taxes over their lifetime.

Residents of New Jersey, Massachusetts, and Connecticut will face the highest tax burdens over a lifetime, according to a new study.

Those living in New Jersey will pay on average a grand total of $931,698, above the $827,185 for Massachusetts residents, and $805,213 for Connecticut. Nationwide, Americans will pay $525,037 over their lives, which includes taxes on income, property, cars, and retail spending, according to the study from financial technology company Self.

The average person will spend about one-third of their earnings on taxes, according to the study, which is based on the 2019 Consumer Expenditure Report from the Bureau of Labor Statistics. The analysis extrapolates tax rates that were then in effect out over an 18- to 79-year lifespan.
...
At the other end of the scale, West Virginians will pay the least over their lives, at $321,000, the study showed.

[Hrdina]

Because people don't know how to withhold taxes anymore I ended up owing 1,800 this year. Normally that would suck balls but I knew it was coming and just put the money on the side. I also got so many stimulus checks that it really made it not matter all that much.

I'm one of those. I wish I owed only $1800.

My kids are starting to age out, so I really need to contact payroll and get my withholding changed...

Then again maybe I'd rather just pay the "underpayment fee" and keep my money most of the year?

New Jersey residents will pay the most taxes over their lifetime.

Residents of New Jersey, Massachusetts, and Connecticut will face the highest tax burdens over a lifetime, according to a new study.

Tell me something I don't already know...

[Kraken]

New Jersey residents will pay the most taxes over their lifetime.

Residents of New Jersey, Massachusetts, and Connecticut will face the highest tax burdens over a lifetime, according to a new study.

Tell me something I don't already know...

Did you also know that the top five states in per capita income in the US in 2020 were (in order) DC, CT, MA, NY, and NJ? It stands to reason that we would pay the most taxes on our phat paychecks. Although NJ is certainly an outlier there, being $110,000 higher than the first runner-up.

[Isgrimnur]

[Hrdina]

New Jersey residents will pay the most taxes over their lifetime.

Residents of New Jersey, Massachusetts, and Connecticut will face the highest tax burdens over a lifetime, according to a new study.

Tell me something I don't already know...

Did you also know that the top five states in per capita income in the US in 2020 were (in order) DC, CT, MA, NY, and NJ? It stands to reason that we would pay the most taxes on our phat paychecks. Although NJ is certainly an outlier there, being $110,000 higher than the first runner-up.

That may be true, but comparing NJ against some nearby states (PA and DE anyway) we pay more sales tax and much much more real estate tax.

In addition, NJ is near the bottom of the barrel in terms of our net transfer of funds between the state and the US government. It was bad before, and the recent US tax changes to cap deductions for state & real estate taxes didn't help. At least that Boston Globe article said that some congresscritters are paying lip service to wanting to get rid of those caps.

NJ is one of a handful of states subsidizing the rest of you slackers.

[gilraen]

IRS expects "enormous challenges" this year:

Typically, IRS officials enter filing season with an unaddressed backlog of roughly 1 million returns. This year, however, the IRS will enter the filing season facing “several times” that, Treasury officials said, although they declined to give a more precise estimate. The IRS website says that as of Dec. 23, 2021, it still had 6 million unprocessed individual returns, and as of the start of this month it still had more than 2 million unprocessed amended tax returns, a separate category.

The IRS closed last filing season with more than 35 million unprocessed returns — a fourfold increase from the last year before the pandemic. As the backlog increased, the IRS also failed to respond to the enormous increase in calls for assistance. Only 9 percent of calls were answered by an IRS customer service representative, while only 3 percent were answered for the 1040 support line for individual income tax returns, according to the National Taxpayer Advocate, a watchdog group.

[Octavious]

New Jersey residents will pay the most taxes over their lifetime.

Residents of New Jersey, Massachusetts, and Connecticut will face the highest tax burdens over a lifetime, according to a new study.

Tell me something I don't already know...

Did you also know that the top five states in per capita income in the US in 2020 were (in order) DC, CT, MA, NY, and NJ? It stands to reason that we would pay the most taxes on our phat paychecks. Although NJ is certainly an outlier there, being $110,000 higher than the first runner-up.

That may be true, but comparing NJ against some nearby states (PA and DE anyway) we pay more sales tax and much much more real estate tax.

In addition, NJ is near the bottom of the barrel in terms of our net transfer of funds between the state and the US government. It was bad before, and the recent US tax changes to cap deductions for state & real estate taxes didn't help. At least that Boston Globe article said that some congresscritters are paying lip service to wanting to get rid of those caps.

NJ is one of a handful of states subsidizing the rest of you slackers.

I can't understand why anyone who doesn't already live in the state would want to buy a house here. I have family members paying 13-15 thousand a year in property taxes. It's just bonkers. You could have your house fully paid off and be paying over a grand a month in taxes. I'm firmly stuck here until the kiddo finishes school and then I can't see me staying much longer. Assuming the housing market doesn't totally tank again.

[Octavious]

Did my taxes and shocker I owe exactly what the prepayment was + like 200 bucks. Good thing I put it to the side. Whatever...

[Kraken]

Geez, I just paid my Q4 payroll taxes today. Property taxes on two houses are due 2/1. Haven't issued my W-2 yet or even sent my company file to my CPA, much less started on income taxes. Oh, and just for yucks the state decided that I'm a monthly depositor now instead of quarterly because I made a wee bit too much money last year.

Being a corporation is becoming more effort than it's worth. I'm thinking about folding Kraken Enterprises and becoming a 1099 worker instead.

[Octavious]

It's so easy to do my taxes now. Takes like 20 minutes. I don't really feel like actually finishing it after seeing what I owed. I'll take my sweet ass time, but I knew it was coming. The shuffling of credits and crap is just nonsense. There is going to be a lot of bitching when people get much smaller returns this year. I'm going to adjust my withholdings again just to be on the safe side. It's ridiculous for years I had it within 200 bucks and now it's all over the place.

[pr0ner]

Laughs at the idea of being able to do my taxes before March.

[Carpet_pissr]

Does anyone know any workarounds or loopholes for someone that was a FT W2 worker for part of the year, and self-employed for the rest? I know about the 15% self employed tax on net earnings, but I think there is also a fixed amount, or maybe I'm thinking of a minimum that you get hit with?

[Octavious]

Laughs at the idea of being able to do my taxes before March.

Ya my taxes are so simple. With the standard deduction increase from a few years ago there's no point for me to itemize. So It's pretty much fill out the W2 stuff answer a few questions and I'm done. I have to make sure I update my witholdings again in the next month as I'm sick of owing money. Annoyyyyyinnnggggg

[stessier]

My taxes are simple too because they removed the deductions. But because I have an HSA, TurboTax requires me to use the deluxe version to file. It is literally one form that says I have an HSA - that's it. $80 please instead of free. Soooooooooooooo annoying.

[pr0ner]

Laughs at the idea of being able to do my taxes before March.

Ya my taxes are so simple. With the standard deduction increase from a few years ago there's no point for me to itemize. So It's pretty much fill out the W2 stuff answer a few questions and I'm done. I have to make sure I update my witholdings again in the next month as I'm sick of owing money. Annoyyyyyinnnggggg

Yeah, I get to itemize and add investment income. I have 3 of the 8 total forms I need to do my taxes.

[coopasonic]

It's so easy to do my taxes now. Takes like 20 minutes.

It takes like 5 minutes total for me. I print out a couple things, hand them to my wife, three weeks later we get big envelope in the mail with some papers to sign and a bill for tax prep, we send that back and a week later money appears in my bank account.

Our tax guy will take documents electronically but my wife's brain doesn't work that way. It doesn't make much difference to me.

I haven't done my own taxes since I've been married. Her investments are way too complicated and legally I am not even supposed to have access to the numbers.

[LordMortis]

My taxes are simple too because they removed the deductions. But because I have an HSA, TurboTax requires me to use the deluxe version to file. It is literally one form that says I have an HSA - that's it. $80 please instead of free. Soooooooooooooo annoying.

I have a schedule K that takes me to premier every year. This is the last year for that monstrosity!

[malchior]

Are taxes ever done?

I ask because I just got a notice from the state of NJ saying I underpaid in 2018 in the amount of about $200. Come 2022 I get a notice that I have a week to pay $800 due to penalties and interest. No wonder people are fleeing this state in droves. You never know when the next punch from this corrupt and ridiculously poorly run government will land.

[RMC]

I did my taxes like a week ago, and already got my refund, not a ton of money back, but I didn't have to pay. Since I was averaging writing a check I like getting a little back.

[malchior]

Yeah - I was in the middle of doing my taxes when this dropped in. I was a little disgruntled to start because I changed jobs and there are issues to deal with. But to have a tax issue from 2018 crop up like this is infuriating.

Beyond my outraged hot take - I just got off the phone with the tax division and now need to get my CPA involved because one of my jobs issued a W2C that conflicted with my original taxes. I get the accounting side of the thing. If I owe, I owe. However, the fact that they wait 3 years to notify me of a tiny underpayment on a much larger tax bill and use it as an exercise to demand a total 347% return on that money due across 2018...is garbage. Pure hot garbage. This might have been the final straw. My wife has been pushing to leave the state and this isn't the first time NJ has dropped a tax discrepancy out of the sky. Those came within a year and I paid the difference without much a thought. This is extortionate IMO.

[Octavious]

How do they justify such a huge penalty? That's not even Bernie Madoff levels of profit so it makes no sense.

[coopasonic]

This might have been the final straw. My wife has been pushing to leave the state and this isn't the first time NJ has dropped a tax discrepancy out of the sky.

No state income tax in TX and property tax is much better as well. I mean yeah, your kids will be learning creationism, that slavery wasn't really a thing or at least they were treated very well and your power maybe not stay if it gets cold or windy and, oh yeah, tornadoes, but hey, lower tax burden!

I figure a couple more weeks before we have all the paperwork to send to the tax guy. I expect our refund to be smaller than usual due to the child tax credit payments, but I'll take what I can get. It might help when I add a 16 year old driver to my car insurance this summer.

[RMC]

How do they justify such a huge penalty? That's not even Bernie Madoff levels of profit so it makes no sense.

It's the government. when my wife and I were first married, I made all the money, but we had all the utilities in her name, and she worked at an after school day care. She made like 1500 bucks, so taxes were not a lot.

Somehow we missed that we should have paid city taxes for the 7 or so months we lived there. they had no idea I was there with my income, but went after my wife. She was dealing with a sick grand parent, and missed the date she was supposed to show up, she called them that day and rescheudled.

When she went in the next day, she wrote a check for the 8 dollars she missed in taxes. Then she was held in contempt of court for missing the "appointment" by a day, and we had to payt like 200 bucks, which about broke us back then. Also, the judge was an ass to her, and it was on her background check. All over 8 dollars, hell small claims court would laugh you out for that kind of money.

But the government abuses power all the time. Taxes give those government employees a feeling of power.

[malchior]

How do they justify such a huge penalty? That's not even Bernie Madoff levels of profit so it makes no sense.

It's complicated but essentially there is interest on the underpayment but also interest on installments I should have been making because of the underpayment. A Kafkaesque nightmare in other words. The machine just spits out numbers. The problem is the law combined with a super, super, super inefficient Division of Taxation. 3 years to find a discrepancy in a W2? Which is their claim. All the numbers don't match up with my filed return (because they adjusted them based on "compiled" data). I haven't validated any of that yet. It might even be a mistake on my preparers part but they put me on the clock that started 3 years ago. In any case, there is no reason for them to get the process right and timely because they reap the reward for their failure. It's just wrong. I'm obviously going to ping my state rep and all that but it's beyond absurd.

[malchior]

But the government abuses power all the time. Taxes give those government employees a feeling of power.

FWIW the employee was very sympathetic - she was just relaying the reasons for the discrepancy. And she isn't in any power to make changes. It's a heartless machine with problems. I'm sort of sick of random things like this falling out of the sky here. This isn't the first time. In the end, I can move not very far across a blue line on the map at the edge of my state and join communities sick of this nonsense too. I won't save on property taxes because they essentially are NJ in exile there with the same local government set up. However, I'd still pay significantly less state income tax *and* - it isn't laden with caveats and gotchas.

[RMC]

But the government abuses power all the time. Taxes give those government employees a feeling of power.

FWIW the employee was very sympathetic - she was just relaying the reasons for the discrepancy. And she isn't in any power to make changes. It's a heartless machine with problems. I'm sort of sick of random things like this falling out of the sky here. This isn't the first time. In the end, I can move not very far across a blue line on the map at the edge of my state and join communities sick of this nonsense too. I won't save on property taxes because they essentially are NJ in exile there with the same government set up but I'd still pay significantly less state income tax *and* - it isn't laden with caveats and gotchas.

That's great to hear, but still a large abuse of the government power, if you ask me.

[malchior]

That's great to hear, but still a large abuse of the government power, if you ask me.

It's totally an abuse of power. I have no real recourse to fight this. The amount isn't significant enough to warrant fighting it. I still have to pay a CPA to re-review this too so it'll cost more money to make sure I don't get blasted again for 2019 or 2020. I asked if 2017 or prior years were "safe" and she said there is no statute of limitations for underpayment. I mean come on. My only recourse is to vote with my feet. It is long overdue and feels about time to do so.

[Kraken]

Are taxes ever done?

No. The state of MA changed me from a quarterly to a monthly payroll tax depositer, so I sent them my withholding this week. Sent my company file to my accountant a few days ago and found out I really should get a new copy of QuickBooks, which as of this year went subscription-only to the tune of $250 annually. I filed my annual report with the Secretary of State ($110) and made my estimated corporate excise deposit ($456). Then I remembered that I forgot to file my FUTA (Form 940). It's only $42, but because it was due Jan. 31 I'm sure the IRS will smite me.

I haven't even started on our personal returns yet. Maybe this weekend. We almost always end up paying out so I have zero motivation, other than not getting smitten.

[Madmarcus]

Our tax info is just starting to trickle in and the initial meeting with the tax guy isn't until March 9th so I'm clearly not done. I've gotten really used to have a tax guy over these last 4 (tax) years. It will feel odd to keep him on after I retire but I'm not sure I want to go back to doing our own. And I know my wife doesn't want to go back to doing it!

[Zarathud]

You received a notice because they had to assess before the statute passed. They identified a discrepancy — either on your end or the employer’s. They don’t have to rely on your employer’s form. Or your return.

Taxes suck, but they’re not an abuse of power. If they don’t charge interest and penalties when you don’t calculate the tax right, the abuse will be worse.

[Isgrimnur]

Ask them to remove the penalties. The worst they can do is say no.

[RMC]

You received a notice because they had to assess before the statute passed. They identified a discrepancy — either on your end or the employer’s. They don’t have to rely on your employer’s form. Or your return.

Taxes suck, but they’re not an abuse of power. If they don’t charge interest and penalties when you don’t calculate the tax right, the abuse will be worse.

Sorry, I think I started the abuse of power thing. Taxes are not an abuse of power, they are a needed function for society to continue to thrive. My real meaning is that when they treat you like a criminal for a small error, and then compound the penalties to an astronomical rate that is unheard of.

Also, my experience is tempered from my wife's 8 dollar error that cost us over 200, and puit a black mark on her background check that actually cost her a job. Now the funny thing was, she was certified to teach high school and the FBI gave her a cleared slate, but when she went to teach some classes at Jo Ann fabrics, they told her that her past "criminal" record would not allow them to employ her. Lol.. Okay...

[malchior]

You received a notice because they had to assess before the statute passed. They identified a discrepancy — either on your end or the employer’s. They don’t have to rely on your employer’s form. Or your return.

Taxes suck, but they’re not an abuse of power.

Sure but it seems pretty abusive when I have issues every two years with my professionally prepared straightforward returns. I only have W2 and some interest income. No fancy income. NJ doesn't allow pretty much any deductions. They suck every last penny they can out of you. Yet NJ won't hesitate to accept too much and come back every 1-2 years to club me over the head with some phantom adjustment.

That NJ makes opaque adjustments, doesn't provide me the information to understand the discrepancy and then says to me - prove us wrong is pretty crappy. How can I when all you tell me is you "compiled data" and "made an adjustment". Literal words. "Perhaps an employer issued a W2C?" Was it? They can't answer that question. I don't even know where to look.

Anyway, I'd have no problem with it if it was 1) timely 2) even a little transparent and 3) reasonable penalties. That is what makes this feel like an abuse of power to me. They have all the power. I have none. I have to pay or else. And I'm fed up with it from NJ. On top the penalty/interest calculation and the explanation for it is Soviet. That underpayment triggered quarterly estimated payments requirements which doubled the interest due. First, I don't understand yet why this even happened since it was a less than 2% discrepancy. In any case they charged me that *additional* interest on those missed quarterly payments which didn't exist until they found the discrepancy. Interest on phantom payments. In other words, this $200 discrepancy on a $8000 tax bill started a snowball chain reaction that'd make a mob boss blush. NJ is hot garbage on the income tax front.

If they don’t charge interest and penalties when you don’t calculate the tax right, the abuse will be worse.

Except they do it to people like me who can't fight it instead of the people actually abusing the system. This argument falls VERY FLAT with me.

Ask them to remove the penalties. The worst they can do is say no.

Already asked and denied. The interest and penalties are statutory. Their 3-year delay in finding this supposed error and telling me about it is my problem. What I have to do is prove the $200 discrepancy is wrong and then they'll readjust everything. But that'll require me to prove that their numbers are wrong. And I have no idea where their numbers come from. I have total adjusted figures. Was it my wife's W2? Was it mine? I don't know. Did they mistakenly match my name with someone else and add in some income? I have no idea. It's a black box.

In context, this isn't some backbreaking thing but the principle of the matter is that this keeps happening and like I said I'm just fed up. It's enough that we're legitimately wondering if it is worth saving 5 to 6 thousand a year at least to live in Yardley, PA (just to throw out a town) where the community standards are very similar to our current one without the Soviet State of NJ picking my pocket. It's pretty tempting.

I'm planning on reaching out to my representative to see if they can help at least get to the right person who can help me figure this out. I'll give the system a chance to not be shitty but I am not going to hold my breath.

Edit: *Chef kiss* I went to the NJ legislature page to look up contact info for my state senator/representative and the NJ legislature web site is throwing 404 errors.

[Scraper]

I'm just going to do my normal "Fuck Taxes" that I do this time of year when I figure out I have to pay way too much once again.

[stessier]

Did my taxes - annoyingly had to go up to TurboTax Premiere because a stock I own spun off a company and the partial share was sold. I'm pretty sure without that I could have filed for free. Drat.

The Child Tax Credit prepayments lowered my expected return by about $2000. I set aside all the prepayments, so not a big deal, but I can see those who didn't understand what was happening being a wee bit miffed.

[Grifman]

I'm done. Took me an hour or two last night to summarize all the data that I had pulled together as it came in, then an hour tonight to enter into Turbotax. Pretty painless, getting about $1,000 back net refund (refund federal, owe on state taxes). But I still have to do my mom's in the next few weeks.

[Kraken]

I compiled everything and handed off to Wife for her input, which is minor since she didn't have any 1099 income again this year (her teaching income is w-2 and there's not even much of that), meaning we can't take the home office/business deductions that were always so thorny. I'll ship the package off to the CPA, along with a check that's way too fat, this weekend. If Wife doesn't have any freelance income again next year, I'm going to buy turbotax and do it myself.

[Daehawk]

I saw someone online posting about troubles with Turbotax...something about not being able to back out of a page and being forced to send it when it was wrong or something. Someone else said thats when you turn off the PC to exit . Not sure what it was all about.