Getting a head start on your taxes - Club Lexus Forums


Go Back   Club Lexus Forums > General Forums > The Clubhouse
Log In 

Getting a head start on your taxes

Reply
 
 
 
 
Thread Tools Search this Thread
Old 01-01-16, 05:15 PM   #1
mmarshall
Lexus Fanatic
Trader Score: (0)
 
mmarshall's Avatar
 
Join Date: Oct 2003
Location: Virginia
Posts: 56,160
Default Getting a head start on your taxes

Click the image to open in full size.

Yes, tax time can be a PITA each spring (in my case, it helps because I always get good refunds LOL). But, if you are like me and do your own taxes (and I keep careful records of all of my monthly finances to make it easier and more honest), you can get some of the figures ready in advance, on some of the forms, by just doing a little checking, and have at least part of the work done in advance, so that it doesn't hit you all at once in March or April.

Some figures, of course, like wages, tips, pensions/annuities, you can't get in advance (though you can come close)........you have to wait for the W-2s (or comparable forms) from your employer to get the exact totals...and/or the taxable totals. For total interest on things like savings accounts/CDs,/checking accounts/money-market funds, etc...(Schedule B on your Federal taxes) your bank will send out a form each year, but you can usually figure it out for yourself in advance just by looking at your monthly statement totals or those written down in your own passbook or checkbook. if you want to be doubly sure, of course, wait for the official statement. Real Estate tax, and Personal Property tax (yep, we have that silly car tax here in Virginia), which many people chose to deduct on their Schedule A, should be from your own records.....you don't need any forms. Mortgage interest, which may also deduct...yeah, you might wait for a statement for that, as it can be rather complex. If you got back a state-tax refund last year (as I always do) which has to be added to this year's taxable income, the state sends out a form each spring stating how much last year's refund was, but, you will already have that figure from your own last year's State Tax records. For stocks, bonds, etc.....and the taxable/nontaxable figures, you might be able to figure some of that out yourself in advance, but it's best to wait for the official statement you will get from your 401K/IRA holder or brokerage firm. That statement will also have figures in it that you can't know or figure in advance, Like Qualified Dividends and Ordinary Dividends. For Charitable Contributions that you will deduct on Schedule A of your Federal taxes (I tithe a classic 10%, so that's a big chunk of my own deductions/refund), you can also save some work in advance by simply going through your own checkbook, finding out how much you wrote in checks for any particular church or charity, and simply adding up the totals. (I go by the official date on the checks, which is when the deduction is legally effective). If the charity didn't screw up their record-keeping (that might happen once in a while), that figure should match whatever statement they send you at the end of each tax year. If you have automatic deductions from your bank-account going to the charity, of course, you can get them from your monthly statements.

So, no, you can't do it ALL in advance....you DO need some forms and statements that you will simply have to wait for. But a fair amount of it CAN be done in advance, and save at least SOME of the crunch-work come March or April. Today, for example, I got all of my charity totals, real estate, personal property, and state-tax refund figures from last year ready.

Have Fun.

MM
__________________

Last edited by mmarshall; 01-01-16 at 05:21 PM.
mmarshall is offline   Reply With Quote
Old 01-02-16, 02:43 PM   #2
bitkahuna
resisting entropy
Trader Score: (18)
 
bitkahuna's Avatar
 
Join Date: Feb 2001
Location: Present
Posts: 48,136
Default

Quote:
Originally Posted by SW15LS View Post
Only you would think of getting a jump start on your taxes on New Years Day
please don't make a snide personal remark right away in mmarshall's helpful thread. if you don't like it, back away from the keyboard.
__________________
TLN #911 * Stop Global Whining
9/11- never forget
nosce te ipsum
bitkahuna is offline   Reply With Quote
Old 01-02-16, 05:23 PM   #3
tecman
Lexus Test Driver
Trader Score: (0)
 
tecman's Avatar
 
Join Date: Aug 2013
Location: Ga
Posts: 971
Default

Unfortunately with the tax code being as complicated as it is I am unable to do my taxes alone. I have a corporation (One man owned by me) and a rental property. I even question my CPA knowing all of the tax codes with his education. I fired my last CPA because I did notice a mistake. How many mistakes has my current CPA made that I missed? I pay $2500 or so a year for his service and most of it is an automatic computer calculation that is drafted from my account, so no paperwork (quarterly payroll is not requested).

We need a better system

Sorry to vent my tax frustrations on your DIY thread mmarshall
__________________
2011GX Black
2003 MDX Black
tecman is offline   Reply With Quote
Old 01-03-16, 02:42 PM   #4
RXSF
Moderator
Trader Score: (0)
 
RXSF's Avatar
 
Join Date: Aug 2006
Location: San Francisco, CA
Posts: 10,718
Default

I get an extension so I dont have to think about it until next October
__________________
2011 RX450h, 2002 IS300, 2009 C350
Retired- 2004 RX330, 1999 RX300
RXSF is offline   Reply With Quote
Old 01-03-16, 06:24 PM   #5
SW15LS
Lexus Fanatic
Trader Score: (0)
 
SW15LS's Avatar
 
Join Date: May 2012
Location: MD
Posts: 12,334
Default

Quote:
Originally Posted by RXSF View Post
I get an extension so I dont have to think about it until next October
Same here lol
__________________

~Steve
2015 LS460 AWD. Nebula Grey with Light Grey/Shimamoku Interior
2015 Kia Sedona SX-Limited, Black Berry with Burgundy Interior.
~Previous Lexus Vehicles~
2013 GS350, 2010 ES350, 2003 ES300 In the family: 2004 LS430, 1998 LS400
SW15LS is online now   Reply With Quote
Old 01-03-16, 07:30 PM   #6
mmarshall
Lexus Fanatic
Trader Score: (0)
 
mmarshall's Avatar
 
Join Date: Oct 2003
Location: Virginia
Posts: 56,160
Default

Quote:
Originally Posted by tecman View Post
Unfortunately with the tax code being as complicated as it is I am unable to do my taxes alone. I have a corporation (One man owned by me) and a rental property. I even question my CPA knowing all of the tax codes with his education. I fired my last CPA because I did notice a mistake. How many mistakes has my current CPA made that I missed? I pay $2500 or so a year for his service and most of it is an automatic computer calculation that is drafted from my account, so no paperwork (quarterly payroll is not requested).

We need a better system

Sorry to vent my tax frustrations on your DIY thread mmarshall
No problem. I fully understand your feelings. Taxes can be a PITA. I know very few people who actually enjoy doing them, although, if applicable, it's nice to look forward to a refund at the end of it....it at least rewards your labor). Some of the worst and most complex forms are Schedule D and Form 6251 for the Alternative Minimum Tax (AMT). I have to fill out the 6251 form each year (and there's another form you have to fill out first to determine if you even have to fill out form 6251 in the first place LOL)....but fortunately, I've never had to actually pay any AMT.

I fully agree that the system needs to be simpler and less time-consuming. But, in the meantime, we're stuck with the current mess.....and just have to make the best of it.

In the past, several politicians and Presidential Candidates (including Steve Forbes and Herman Cain) have run on campaigns of simplifying the tax code with a basic flat-tax for everyone at the same rate and eliminating many deductions used as loopholes, but none of these candidates have (yet) been elected. Ben Carson and Ted Cruz have made some references to it, but don't really seem to be that committed to it like Forbes and Cain were.
__________________

Last edited by mmarshall; 01-03-16 at 07:42 PM.
mmarshall is offline   Reply With Quote
Old 01-03-16, 09:44 PM   #7
SW15LS
Lexus Fanatic
Trader Score: (0)
 
SW15LS's Avatar
 
Join Date: May 2012
Location: MD
Posts: 12,334
Default

Unfortunately...I never get refunds LOL

Really it makes no sense to get a refund, its your money...its just money you have overpaid and have essentially given to the government on an interest free loan.

I always prefer to owe, owe in some way that doesn't cost me interest or penalties that is.
__________________

~Steve
2015 LS460 AWD. Nebula Grey with Light Grey/Shimamoku Interior
2015 Kia Sedona SX-Limited, Black Berry with Burgundy Interior.
~Previous Lexus Vehicles~
2013 GS350, 2010 ES350, 2003 ES300 In the family: 2004 LS430, 1998 LS400
SW15LS is online now   Reply With Quote
Old 01-03-16, 09:53 PM   #8
mmarshall
Lexus Fanatic
Trader Score: (0)
 
mmarshall's Avatar
 
Join Date: Oct 2003
Location: Virginia
Posts: 56,160
Default

Quote:
Originally Posted by SW15LS View Post
Unfortunately...I never get refunds LOL

Really it makes no sense to get a refund, its your money...its just money you have overpaid and have essentially given to the government on an interest free loan.
I've heard that argument before, and yes, there is some truth to it. But, on the other hand, over-withholding not only gives you a nice refund in the spring, but can also help teach one to live within a strict budget, and learn discipline in their finances. Some people, if given the chance, will impulsively spend every cent they make, and not have anything left over to pay their tax bills with (Indeed, that's why the whole concept of withholding was started back in the 1930s...the Government was losing too much revenue from people who were broke by the time the tax bills were due, and couldn't pay it).


Quote:
I always prefer to owe, owe in some way that doesn't cost me interest or penalties that is.
Just make sure that what you owe is less than 10% of your total. There is a penalty for anything over 10%.
__________________

Last edited by mmarshall; 01-03-16 at 09:57 PM.
mmarshall is offline   Reply With Quote
Old 01-03-16, 10:04 PM   #9
SW15LS
Lexus Fanatic
Trader Score: (0)
 
SW15LS's Avatar
 
Join Date: May 2012
Location: MD
Posts: 12,334
Default

Quote:
Originally Posted by mmarshall View Post
I've heard that argument before, and yes, there is some truth to it. But, on the other hand, over-withholding not only gives you a nice refund in the spring, but can also help teach one to live within a strict budget, and learn discipline in their finances. Some people, if given the chance, will impulsively spend every cent they make, and not have anything left over to pay their tax bills with (Indeed, that's why the whole concept of withholding was started back in the 1930s...the Government was losing too much revenue from people who were broke by the time the tax bills were due, and couldn't pay it).
Theres not "some truth to it", it IS true. That money is your money. When you overpay your taxes you let Uncle Sam hold onto it for free.

Anybody who overwithholding taxes saves their budget is pretty bad off. I'm somebody who is self employed and I have *no* withholding. Its hard, but that still doesn't explain *over* withholding.
__________________

~Steve
2015 LS460 AWD. Nebula Grey with Light Grey/Shimamoku Interior
2015 Kia Sedona SX-Limited, Black Berry with Burgundy Interior.
~Previous Lexus Vehicles~
2013 GS350, 2010 ES350, 2003 ES300 In the family: 2004 LS430, 1998 LS400
SW15LS is online now   Reply With Quote
Old 01-03-16, 10:21 PM   #10
mmarshall
Lexus Fanatic
Trader Score: (0)
 
mmarshall's Avatar
 
Join Date: Oct 2003
Location: Virginia
Posts: 56,160
Default

Quote:
Originally Posted by SW15LS View Post
Theres not "some truth to it", it IS true. That money is your money. When you overpay your taxes you let Uncle Sam hold onto it for free.

Anybody who overwithholding taxes saves their budget is pretty bad off. I'm somebody who is self employed and I have *no* withholding. Its hard, but that still doesn't explain *over* withholding.
Most people, though, are not in your circumstances financially. They are not self-employed; they work for someone else or for an organization, and have no choice......they have to have withholding by law, though one can vary the amount with a W-4. I agree, though, that the part of it that is not an actual tax bill is your money to start with....not Uncle Sam's.
__________________
mmarshall is offline   Reply With Quote
Old 01-03-16, 10:27 PM   #11
SW15LS
Lexus Fanatic
Trader Score: (0)
 
SW15LS's Avatar
 
Join Date: May 2012
Location: MD
Posts: 12,334
Default

Quote:
Originally Posted by mmarshall View Post
Most people, though, are not in your circumstances financially. They are not self-employed; they work for someone else or for an organization, and have no choice......they have to have withholding by law, though one can vary the amount with a W-4. I agree, though, that the part of it that is not an actual tax bill is your money to start with....not Uncle Sam's.
I'm not saying they shouldn't withhold, I'm saying they shouldn't over-withhold. Over-withholding is a sign of poor financial discipline IMHO, not good. I see it all the time, people get a $5k refund and go blow it on stuff. Well...thats $400 a month they could have had in their paycheck that they've given Uncle Sam for free...then when Uncle Sam gives it back to them after he's enjoyed the use of it for a year they go blow it because its "found" money.
__________________

~Steve
2015 LS460 AWD. Nebula Grey with Light Grey/Shimamoku Interior
2015 Kia Sedona SX-Limited, Black Berry with Burgundy Interior.
~Previous Lexus Vehicles~
2013 GS350, 2010 ES350, 2003 ES300 In the family: 2004 LS430, 1998 LS400
SW15LS is online now   Reply With Quote
Old 01-04-16, 12:22 AM   #12
abounly
Lexus Champion
Trader Score: (26)
 
Join Date: Sep 2008
Location: ca
Posts: 4,284
Default

Hmm newbie on taxes here.

I have never had a job before and now that I do i'm clueless on tax. I hear my coworkers tell me to go exempt when I get a fat check (hourly pay). But I figure you're going to get tax on that regardless either when you get the check or during tax season.

If I were to pay someone to do my taxes for me who what would the average price range from? Is the W-2 all I need for my taxes to be done? Co-workers said their person does it for $100 while another does it for $500? What could I claim as a deductible? Anything related to my job, such as education, gas for work?

I have never gone exempt and always paid taxes. I would assume that I would get a tax refund?
__________________
11 IS250 F-Sport
SWERVE
https://www.facebook.com/SwerveKrew
abounly is offline   Reply With Quote
Old 01-04-16, 08:04 AM   #13
mmarshall
Lexus Fanatic
Trader Score: (0)
 
mmarshall's Avatar
 
Join Date: Oct 2003
Location: Virginia
Posts: 56,160
Default

Quote:
Originally Posted by abounly View Post

If I were to pay someone to do my taxes for me who what would the average price range from?
A tax-preparation business like H&R Block (probably the most well-known one nationally) usually charges a couple of hundred for the whole operation....Federal and State combined. Some of that may depend on the complexity. With a private lawyer or CPA doing the work, that would depend on whatever price you and him (or her) come up with and agree to. Whatever you do spend on tax-preparation, BTW, is deductible......IRS gives you a break on that.


Quote:
Is the W-2 all I need for my taxes to be done?
Yes....unless you are like most people and have a bank account, IRA/401K, and/or income from other sources. In that case, you will need several different documents. Charities you donate to will also send you a form at the end of each year with the yearly totals, but, as I explained in the open ini post, you can sometimes get those figures in advance.


Quote:
Co-workers said their person does it for $100 while another does it for $500?
Yes, that's the general range for a professional tax business....and maybe for some private individuals.


Quote:
What could I claim as a deductible? Anything related to my job, such as education, gas for work?
If you use your car for job-related purposes, you can claim mileage on the Federal return...check the Schedule A instructions for details. You can also deduct lease payments if you lease a car and use it for job-related purposes. If your employer tells you to buy something necessary for your job, and doesn't reimburse you for it, you can claim that expense (I believe if it's over 7.5% of your Adjusted Gross Income).

Quote:
I have never gone exempt and always paid taxes. I would assume that I would get a tax refund?
Not sure I understand what you mean here?
__________________
mmarshall is offline   Reply With Quote
Old 01-04-16, 11:00 AM   #14
abounly
Lexus Champion
Trader Score: (26)
 
Join Date: Sep 2008
Location: ca
Posts: 4,284
Default

Good to know mmarshall! Thanks for shedding some light on this topic for me.

Quote:
Originally Posted by mmarshall View Post
Not sure I understand what you mean here?
I'm able to go tax exempt, then pay the taxes later instead of them automatically taking it away from my paycheck.

I don't see a reason to go exempt unless you are a dire need of the money now (say if there was an emergency).
__________________
11 IS250 F-Sport
SWERVE
https://www.facebook.com/SwerveKrew
abounly is offline   Reply With Quote
Old 01-04-16, 11:38 AM   #15
RXSF
Moderator
Trader Score: (0)
 
RXSF's Avatar
 
Join Date: Aug 2006
Location: San Francisco, CA
Posts: 10,718
Default

Quote:
Originally Posted by abounly View Post
Hmm newbie on taxes here.

I have never had a job before and now that I do i'm clueless on tax. I hear my coworkers tell me to go exempt when I get a fat check (hourly pay). But I figure you're going to get tax on that regardless either when you get the check or during tax season.

If I were to pay someone to do my taxes for me who what would the average price range from? Is the W-2 all I need for my taxes to be done? Co-workers said their person does it for $100 while another does it for $500? What could I claim as a deductible? Anything related to my job, such as education, gas for work?

I have never gone exempt and always paid taxes. I would assume that I would get a tax refund?
Seeing as how you probably dont own a home and only have a job, you probably dont have anything to deduct. The government gives everyone a standard deduction. For 2015, the deduction is $6,300. This means that for however much you make, the government already "disregards" $6,300 of your income so that portion is not taxed. For people who own a home, for example, who would have mortgage interest of more than $6,300, they would "itemize" their deductions to prove to the IRS that they deserve a deduction higher than $6,300.

Anyone who simply has a W2 and nothing else to deal with shouldn't pay more than $100 to have someone do their taxes. You might have heard of the 1040 which is the main form you use to file taxes. However, you might even quality for the 1040EZ form, if you are planning to do everything by hand. I think TurboTax also has a free edition for people in your situation, who simply have very little to deal with.

The only way you are going to learn about taxes is to do it when the time comes. My suggestion for you is to purchase one of the paid or more advanced versions of turbotax and do your own taxes. The program costs around $40-$50 and multiple people can use it, so you can split it with your friends or family. The program is very intuitive and it asks you 'yes' or 'no' questions and fills out the forms for you and then also helps you file it electronically.

When I was starting out, I found turbotax extremely beneficial in helping me with "hypothetical" situations. On the corner of the screen, it gives you our current refund (or taxes owed) and the number changes with each input you make. Therefor, you can learn by yourself what counts as an additional deduction, etc. and you know what you can do for the following year.

Still a bit early for you to be thinking about it. W2s dont usually come out until late January or even into February.
__________________
2011 RX450h, 2002 IS300, 2009 C350
Retired- 2004 RX330, 1999 RX300

Last edited by RXSF; 01-04-16 at 11:45 AM.
RXSF is offline   Reply With Quote
 
 
 
Reply

Similar Threads
Thread Thread Starter Forum Replies Last Post
Extreme Dimensions Tax Refund Sale! ExtremeDimensions Club Lexus Vendor Product Announcements 0 02-11-15 05:39 PM
15 Financial Resolutions LEXUS_KID The Clubhouse 8 01-12-15 07:27 AM
Pre-Paid Maintenance Refund Issue DMC9114 RX - 3rd Gen (2010-2015) 3 09-22-12 02:09 AM
Anybody live in Virginia? Question about Personal property tax rate h777 The Clubhouse 1 02-11-07 05:24 PM


Thread Tools Search this Thread
Search this Thread:

Advanced Search

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off

Forum Jump


All times are GMT -7. The time now is 02:17 PM.



Copyright © 2000-2015 Internet Brands, Inc. All Rights Reserved
Privacy Policy | Disclaimer | Terms of Use | JOBS