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Join Date: Jan 2008
Location: Washington County PA
To determine if one benefits or actually pays more taxes: One must compare the income from 2017 to income 2018, the tax paid each year, the tax bracket each year as shown on the tax forms being sent to the IRS. Simply looking at how much taxes one owed this year or how much one received back each year is not a true test to determine any impact and by not going so can be very misleading.
I know individuals who take their tax information to a tax preparer never look at the completed forms and believe they are paying more or less taxes fully based on their return amount or taxes due. Often these individuals are quick to voice their opinion as to their refund results. Again this can be very misleading.
Everyone concerned about the amount of taxes due at the end of the year or those who choose to receive a certain amount of refund dollars at their disposal in a one time payment from the government should know they can control their refund/payment for the next tax year.
The taxpayer can fill out a new W4 form for next years taxes. If one does not do their own taxes or does not feel comfortable filling out a W4 they can discuss tax planning with their preparer. Should ones income change during the year as with a bonus, pay increase or decrease on income they can prepare a W4 at any time during the year to make desired adjustments to their liking.
Three general forms of tax payer thinking:
It makes some feel good to pay more each pay check to receive a refund. This is allowing the government to use their $$ all year long and return the tax payers money without the tax payer receiving any interest.... Thus a refund.
The opposite thinking is to get more each pay check to use the governments money all year long and at filing time pay the government back an interest free loan. Thus taxes due.
The third form of thinking by some is owe a small amount or receive a small refund or just enough to pay their tax preparer for their services.
Either way one is paying the same amount of taxes. The difference is the tax payer is choosing who is going to hold, control the use the tax payer dollars until the filing date.
In addition under the new system and with the many on line tax preparers it is much easier for one to prepare their own tax forms by imputing and answering simple questions....Thus another savings on taxes.
NRA Benefactor Member