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I had to pay a fair bit to the state but got an about equal back from the feds. So for me it was a wash and it looks like I'm a lucky one
 
The amount of tax due or the amount of refund that you receive really tells you very little. A person can adjust their withholding to either get no refund or a large refund or even a big tax due when they file. You have to look at your effective tax rate. Your effective tax rate is calculated by dividing the total tax you paid for the year by the total taxable income you have for the year.

My effective federal tax rate for 2017 was 9.9%.
My effective federal tax rate for 2018 was 8.7%.

So yes I was better off under the new tax law. Not everyone benefited from the tax law change. Especially hurt were those that have large deductions for state and local taxes which were suddenly limited to $10,000 for the year. This hit filers in states like California and New York which have high state and local taxes.

The other reason many people are owing tax instead of getting a refund is that the IRS changed the withholding tables to reflect the lower overall tax rate. So if a person did not change their withholding allowances for the year then a smaller amount was being withheld throughout the year. At filing time they got a huge surprise.

Many people like to receive large refunds. A large refund means you made an interest-free loan to Uncle Sam. I do understand that many people use this as a forced savings plan and then when they get their refund they use it for large purchases or vacations. If this works for you, I'm not going to tell you to change it.
 
bubblegum the IRS and the new withholdings! I made slightly more this year, and had to pay almost 3k more. This is the first time I have ever had to write a check. $5000 check! I have never had a large return couple hundred bucks, but I have never had to pay!!! No warning till January. Yea this a hot topic at my house atm.
 
I filed an extension Friday (fed) and today (state).

I've been really busy with property and work the last month or two, then my car being wrecked before that, and my daughter's car issues before that, so I still haven't found the scale tickets for the timber sale. I paid the fed about $3500 more and the state about $350 on the extensions, but I hope I will get some of that back.

I had been taking 3 extra exemptions previous years because that worked well with my interest and tax deductions for my property - having to pay about $1K per year at tax time - which was just right.

But last year I had the timber sale so that threw everything out of whack. When a new co. bought us they dropped my previous exemptions to zero and I left it that way because I knew I would owe on the timber sale.

I did some back of the napkin calcs on the basis and net profit and that is what I based my AGI on and paid the estimated tax on, but after further research I am hoping I can deduct a portion of my property taxes and mortgage interest too - maybe not as I deducted those from previous income taxes before. We'll see; I am going to see a specialist who handles timber sales in a couple of weeks (or later).

It sure is a load off my mind that I now have six months to find the scale tickets if I have to.

So I don't really have a clue how I made out - either way. The changes to standard deductions have no impact on me; I always itemize now. Now my kids, they probably will do better with the std deductions - married and they don't have as much deductions as I have.
 
We adjust our withholding amount twice a year to try and balance things to get as close to a zero balance. We came out pretty far into the black this year thanks to our new to us child deductible.

W4s are a tool to be used to make adjustments as needed. You can literally change your tax withholding every paycheck if you wanted. Not many folks know this.

I also really would love for high schools to teach basic taxes. They aren't too difficult, but they sure like keeping the basic knowledge in the dark.
 
We finally got a decent refund, after years of owing, but it was cold comfort. We have, literally, no allowances on our W4s, and on my paycheck extra taken out. All so we can come close to breaking even.

Between federal income tax, capital gains tax, social(ist) security, medicare, state income tax, property tax, gasoline tax, propane tax, sales tax (whilst out of state), NFA tax, and the rest of the assorted taxes, fees, filings, and other bullplop, we're paying in around 60¢ on every dollar we're pulling down.

And, yet, there are plenty in the state and federal legislature, including a particularly brain-dead freshman congresswoman from New York, who think we're not "paying our fair share". As far as I am concerned, they can pound sand. :s0165:
 

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