Death and Taxes, 2016 version

This just proves our tax code is too complicated... Too many deductibles. You shouldn't, by chance, almost get screwed out of money.
Yeah, the tax preparer was doing what she had to do based on the 1099 I was sent since it showed the $30k as taxable income. Luckily I recognized that as BS and scramble to get it corrected. Damn sure wasn't going to take about a $9k hit when I didn't have to!
 
I so dislike this time of year.
 
After not getting my return until December last year, I already received mine this year.
 
Filed on Friday since we owed major $$$$$. I hate taxes.


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There are plenty of hard working folks out there who simply over-withhold and get a small-to-large refund at the end of the year.

And my opinion is that is silly. Somewhere along the line they conned all the sheeple into thinking this is a good thing.
 
This just proves our tax code is too complicated... Too many deductibles. You shouldn't, by chance, almost get screwed out of money.

Complicated is an understatement! The tax code is 285,000 pages thick. Ours cost $1,600 to have prepared this year. My wife and I can't wait to retire in a couple years and move to a low tax state and dramatically reduce our overall taxes and tax rates.
 
WTF is a refund? I pay close to $6K annually just for tax prep, and pay a 5 figure bill quarterly....
 
I read today 45% of households pay zero tax for one reason or another. Cry all you want about low income people needing the money but paying nothing in taxes is ridiculous. How can you have only 6/10 people paying their way. I'm not advocating a flat tax or whatever but getting a free ride is wrong.
 
I read today 45% of households pay zero tax for one reason or another. Cry all you want about low income people needing the money but paying nothing in taxes is ridiculous. How can you have only 6/10 people paying their way. I'm not advocating a flat tax or whatever but getting a free ride is wrong.

Yep!

Check this out:

http://taxfoundation.org/article/summary-latest-federal-income-tax-data-2015-update

The table is worth following the link. In 2013 the Top 1% earned 19% of all USAGI and paid 38% of all federal personal income taxes. The bottom 50% earned 11.5% of AGI and paid 2.8% of all personal federal income taxes. That's why the promise of "free", government-provided anything is so attractive. Odds are the target voter isn't paying for it.
 
So the 49% in between the top 1% and bottom 50% paid 59.2% of all taxes?

If the bottom paid their fair share then we wouldn't need to run with deficit


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So the 49% in between the top 1% and bottom 50% paid 59.2% of all taxes?

If the bottom paid their fair share then we wouldn't need to run with deficit


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I don't know if it would go that far but I have to think those people paying some tax would help....
 
So the 49% in between the top 1% and bottom 50% paid 59.2% of all taxes?

If the bottom paid their fair share then we wouldn't need to run with deficit


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Those that make over $100k pay 79.4% of federal income taxes.

FT_15.03.23_taxesInd.png
 
Those that make over $100k pay 79.4% of federal income taxes.

FT_15.03.23_taxesInd.png

While making up 17% of those returns filed. Which is ridiculous IMO that <20% pays almost 80% of the taxes. If I understand the graph correctly.
 
Those that make over $100k pay 79.4% of federal income taxes.

FT_15.03.23_taxesInd.png

I like your infographic because it speaks to how few people pay so much in taxes, but I've found I win (or at least recess/end) arguments about "fairness" when I say "Top 1%, 19% of all income, 38% of all taxes. How much less do you want them to pay to make it "fair"?

And I'm not in the 1% - yet.
 
Yeah, the tax preparer was doing what she had to do based on the 1099 I was sent since it showed the $30k as taxable income. Luckily I recognized that as BS and scramble to get it corrected. Damn sure wasn't going to take about a $9k hit when I didn't have to!

i don't know for sure, but sounds like a preparer not asking the right questions. we had a couple similar situations with clients this year. An inherited IRA that was a Roth was coded incorrectly by the investment house. We delivered the bad news to the client, but also pointed out the large taxable income with no withholding so that they could comment on whether that was accurate. Sure enough it wasn't, they contacted the investment house and squared it up, saving tens of thousands in taxes.

I had a couple clients with restricted options/units that were reported terribly by their own employers. no basis information provided, incorrect preparation of W-2s. then they have to pay me to help sort it out for them. so the tax savings by getting it right is reduced by my fees. kinda sucks for them.
 
I read today 45% of households pay zero tax for one reason or another. Cry all you want about low income people needing the money but paying nothing in taxes is ridiculous. How can you have only 6/10 people paying their way. I'm not advocating a flat tax or whatever but getting a free ride is wrong.

from a federal standpoint that's true. but these are consumption people and wage earners who pay high payroll and sales tax relative to their gross earnings as compared to higher earners.
 
And my opinion is that is silly. Somewhere along the line they conned all the sheeple into thinking this is a good thing.

You'll get no disagreement from me there - giving the government a loan for the year makes bad fiscal sense for the individual and creates a bigger monster out of uncontrolled government spending.

BUT there are plenty of people out there who work their butts off and just don't give taxes as much thought as perhaps they should. I was simply pointing out that those who get refunds aren't automatically 'takers'.
 
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You'll get no disagreement from me there - giving the government. a loan for the year makes bad fiscal sense for the individual and creates a bigger monster out of uncontrolled government spending.

BUT there are plenty of people out there who work their butts off and just don't give taxes as much thought as perhaps they should. I was simply pointing out that those get refunds aren't automatically 'takers'.

The federal withholding was a very bad law and made most people blind to how much they pay in taxes. I would argue that the government could have never reached it's current bloated size without the withholding law. Imagine if everyone had to write a monthly check to the federal and state governments like they do for a house or car payment. For my wife and me, our tax payments exceed all other payments combined, including what we put away for retirement. There is something wrong when 44% of your gross income goes to the the government in the form of income taxes. Shame on me for living in California for the last 18 years but our burden of paying 10% plus in state income tax will go away as soon as my daughter graduates in 2 years.
 
I read today 45% of households pay zero tax for one reason or another. Cry all you want about low income people needing the money but paying nothing in taxes is ridiculous. How can you have only 6/10 people paying their way. I'm not advocating a flat tax or whatever but getting a free ride is wrong.



Unless you never purchase or consume anything in this country, you're paying taxes.

I hate paying taxes (and I pay a lot). But I'll never be angry at those who are "lucky" enough to not make enough money to pay taxes.
 
The federal withholding was a very bad law and made most people blind to how much they pay in taxes. I would argue that the government could have never reached it's current bloated size without the withholding law. Imagine if everyone had to write a monthly check to the federal and state governments like they do for a house or car payment. For my wife and me, our tax payments exceed all other payments combined, including what we put away for retirement. There is something wrong when 44% of your gross income goes to the the government in the form of income taxes. Shame on me for living in California for the last 18 years but our burden of paying 10% plus in state income tax will go away as soon as my daughter graduates in 2 years.

Agreed? I don't argue any of those points - at all.
 
Pay close to 10k annualy for preperation and another five figures quarterly. Being self employed is sometimes a hassle.

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Pay close to 10k annualy for preperation and another five figures quarterly. Being self employed is sometimes a hassle.

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Amen to that - I won't get into the numbers but I could employ more and be a better human being if the government got the hell out of my way.
 
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Only reason I even posted about what I pay is it seems a lot of folks seem to think business owners don't pay their "fair share" of taxes which is just not the case.

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Yeah, the tax preparer was doing what she had to do based on the 1099 I was sent since it showed the $30k as taxable income. Luckily I recognized that as BS and scramble to get it corrected. Damn sure wasn't going to take about a $9k hit when I didn't have to!
It sounds like a complex tax situation, though I must say I'm initially confused by your receipt of a 1099 at all. I was under the impression that inheritance is not a taxable event.

I got ours done Sunday night - first time in a long time I didn't do them early. I won't wait this long again. I used Turbo Tax, as usual. We stupidly loan the govt our money and get the refund. I know it's dumb but we would just spend the extra money if taken on a pay check to pay check basis whereas the refund goes to savings and becomes a rainy day fund.
 
It sounds like a complex tax situation, though I must say I'm initially confused by your receipt of a 1099 at all. I was under the impression that inheritance is not a taxable event.

I got ours done Sunday night - first time in a long time I didn't do them early. I won't wait this long again. I used Turbo Tax, as usual. We stupidly loan the govt our money and get the refund. I know it's dumb but we would just spend the extra money if taken on a pay check to pay check basis whereas the refund goes to savings and becomes a rainy day fund.
It depends of what you inherited and whether you took a distribution from it or reinvested it. This particular instrument was a Roth IRA that had been opened over 5 years ago so none of the distribution should have been taxable income. The person processing the distribution classified it as a traditional IRA which was why it all showed as taxable income. The 1099 is sent regardless but there should not have been anything in the taxable income box which was the issue I had to get corrected to save me about $9k in tax liability.
 
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