Speaking of Taxes, How Much Do You Pay?

[Mamabegood]

I ask this question, only because we haven't "paid" taxes in years--we always get the whole thing refunded. I know we shouldn't let the government keep our money and earn interest on it, but I'm too afraid to change our witholding status in case we end up owing a ton of money at the end of the year.

My dh earns around $74K a year (not a huge income here in CA), and we have 5 kids--I don't think we've paid anything since 2001, when we only had 3. I'm grateful to keep it for our family, but it does seem weird not to be "contributing" to the running of the state/country.
:confused:

[angela in ohio]

Do you mean you pay nothing out of each paycheck, and then you get a refund on top of that. Or that you pay in each paycheck and then it all comes back to you?

[Renee in FL]

We pay nothing out of the paycheck and still get $4-5K returned. Earned Income Credit and Child Tax Credits.....

[Andie]

You could adjust your witholding a bit at a time to ensure you won't owe, and have a little more take-home. There are many calculators available on the web that could help you.

We do pay taxes, and I've gotten our w/holding figured out so that we get only a very small ($100-300) refund. I'd rather have our money during the year. This is all going out the window this year, though, with dh's new job we'll owe more, so I was more conservative and had more w/held.

Even with high w/holding on the state side, we write a check every year. This isn't the place for my tantrum about that, though. ;)

[PariSarah]

Which I think is silly. It makes much more sense for [insert university name here] to pay me, since they're the ones benefiting most immediately from my work.

But I appreciate y'all's contribution.

:rolleyes:

[Tracey in TX]

Silly goose, of course you're contributing! You are creating the next generation of productive, law-abiding citizens. :)

Seriously, just because you get a rebate doesn't mean you aren't contributing. A portion of the money is still being used for governmental purposes. The current tax code is written to enable everyone to pay their fair share. Money refunded is more than your deemed share; the remainder is expected to be put into the marketplace to keep the economy moving--and to feed and clothe your family.

[Kelli in TN]

Which I think is silly. It makes much more sense for [insert university name here] to pay me, since they're the ones benefiting most immediately from my work.

But I appreciate y'all's contribution.

:rolleyes:


Okay, well then technically y'all are paying my dh too. And in exchange for your contribution he makes bad guys (and gals) stop being bad or go directly to jail.

And he checks them for drugs, which involves vials of pee, and I think he should get paid a lot more money for that part of the job.

But, in spite of the fact that the government signs his check, the government still takes part of it away from us. I don't know how much. When dh talks about taxes my eyes glaze over and I go into a trance. If that doesn't shut him up I start talking about homeschooling.

[Karenciavo]

Last year we paid a little over $32,000 in Federal Income tax. http://www.smileygenerator.us/community/searchsmiley/s/sick2.gif

[PariSarah]

Okay, well then technically y'all are paying my dh too. And in exchange for your contribution he makes bad guys (and gals) stop being bad or go directly to jail.

And he checks them for drugs, which involves vials of pee, and I think he should get paid a lot more money for that part of the job.

If anybody starts a petition stating that government employees forced to deal with bodily fluids should get an Ick Factor Bonus, I'll sign it!

:D

[WTMindy]

Are you talking total or at the end of the year how much do we owe? My dh usually works all sort of number crunching magic to get it to where we owe nothing nor do we get anything back (we don't want the government to use our money interest free if we don't have to).

Income tax: 2,800
Property tax: 4,000
SS tax: 7,000
Sales tax: 1,000-ish

[Wendi]

Silly goose, of course you're contributing! You are creating the next generation of productive, law-abiding citizens. :)

Seriously, just because you get a rebate doesn't mean you aren't contributing. A portion of the money is still being used for governmental purposes. The current tax code is written to enable everyone to pay their fair share. Money refunded is more than your deemed share; the remainder is expected to be put into the marketplace to keep the economy moving--and to feed and clothe your family.

I'm not sure if I understand you. If someone pays no taxes (and about 30-40% of filers pay no income taxes), they aren't "contributing" as far as income tax goes. (Of course, they still pay Social Security tax, sales tax, and -if they own a home - property tax, etc., so they're certainly contributing in a lot of ways to the public finances.) The "rebates" that are being considered are not rebates of what each family has paid; many people who receive them will be those families who don't pay income tax. And of course, higher income families pay much more in taxes, but will receive no rebate.

Wendi

[Colleen]

I'm not sure if I understand you. If someone pays no taxes (and about 30-40% of filers pay no income taxes), they aren't "contributing" as far as income tax goes. (Of course, they still pay Social Security tax, sales tax, and -if they own a home - property tax, etc., so they're certainly contributing in a lot of ways to the public finances.) The "rebates" that are being considered are not rebates of what each family has paid; many people who receive them will be those families who don't pay income tax. And of course, higher income families pay much more in taxes, but will receive no rebate.

Wendi

Yep. What she said.

[Colleen]

My dh usually works all sort of number crunching magic to get it to where we owe nothing nor do we get anything back.

Yeah, that's the ideal. Doesn't work for most of us who own businesses, unfortunately. We were looking at close to $50k in taxes this year. Lowered it a bit by buying a different farm truck on December 31, but we'll still be handing over a very hefty chunk of change. It's sad. From a financial perspective (and health care, etc), this country is highly unfriendly to the self-employed.

[WTMindy]

Yeah, that's the ideal. Doesn't work for most of us who own businesses, unfortunately. We were looking at close to $50k in taxes this year. Lowered it a bit by buying a different farm truck on December 31, but we'll still be handing over a very hefty chunk of change. It's sad. From a financial perspective (and health care, etc), this country is highly unfriendly to the self-employed.

Very very true!

[angela in ohio]

We pay nothing out of the paycheck and still get $4-5K returned. Earned Income Credit and Child Tax Credits.....

You could get some of the EIC during the year, I believe. That would reduce your refund, as you would be getting it in advance.

Since you aren't actually paying anything in, the government isn't earning interest on your money (it's the government's money until the day you file the return and prove you earn EIC and child tax credit,) though. All other things equal, though, it is always better to receive money sooner than later.

[Jenny in Atl]

Ya, hubby self employed, we pay ~ $7,200 for our health insurance (we were paying about 12k but took a higher deductible so now non of our regular visits are covered), ~ 10,000 in medical (doctors, deductibles & meds), $8,000 for income tax, and we are in the hole for at least that much trying to cover basics. The joke is if I did go out and get paid work, it would hurt us even more rather than help, higher tax bracket; and we don't even make that much. What's the new stat, middle class is 100k a year. I guess that makes us lower or working class?

[Renee in FL]

Ya, hubby self employed, we pay ~ $7,200 for our health insurance (we were paying about 12k but took a higher deductible so now non of our regular visits are covered), ~ 10,000 in medical (doctors, deductibles & meds), $8,000 for income tax, and we are in the hole for at least that much trying to cover basics. The joke is if I did go out and get paid work, it would hurt us even more rather than help, higher tax bracket; and we don't even make that much. What's the new stat, middle class is 100k a year. I guess that makes us lower or working class?

LOL - I guess that makes me less than lower class?

We are self-employed, but so far it is a loss, so no taxes. Even if we make a profit, it will have to be $35K+ before we actually pay $1 ourselves due to tax credits, etc. We can't get Advanced EIC because we don't have a paycheck. I hope to have to pay taxes someday....that means we are finally getting somewhere!

[Kathy in MD]

Plus any business profits? I got the impression that the OP was speaking only of income taxes.

[Gigi]

Family of 6.

On this years return we owed about $3,500 (after deductions), but with the child tax credit of $4,000.00 we get $500.00 back plus the $1500 that we had paid. Our current withholding on our paycheck is M-16 which we did after using the worksheet on the irs.gov site.

We pay 10% tithing + mortgage interest + student loan interest so our deductions are quite high. Our social security and medicaid however are about $6000.00.

Then of course we have state tax and property tax....

Now that I realize we actually are getting money instead of paying it I feel a little guilty. (but I will still take it.)

[Hillary in KS]

What? I'm sure others have pointed out that you ARE paying taxes. You just *overpay* during the year and get some sent back to you.

If you're tired of getting a refuned each spring, figure out how much you're overpaying, divide it by 12, and take that # to the HR person at work and ask them to help you figure out the corect number of withholdings. (For example, if you're overpaying $300 per month, ask Mr. HR how many exemptions do you need to claim in order to keep $300 per month in your paycheck.)

[Colleen]

I got the impression that the OP was speaking only of income taxes.

That's what I'm talking about: federal income tax only.

[Wendi]

Not really, Hillary. Many people really do pay no income taxes. (I've recently heard statistics varying between 30-40% of filers who pay no tax, and some of these actually receive $$ when they file.) If you have a large family, like the OP, and meet income requirements, then you actually receive free money every year, and pay nothing. That's how the tax credits work. They're credited to your "account". If you owe more than the credit, you pay the difference. If you owe less, or if you had too much withheld, you get money paid to you.

In the OP's case, because she has a large family, her credits add up to much more than she ends up "owing" each year, so she doesn't pay taxes. She gets money paid to her instead.

Wendi

[PiCO]

I paid a little over $4,000 in 2006 in federal income tax. My accountant said I'll pay more this year- I was evidently getting a deal for two years for being widowed.

I paid an enormous amount in property taxes- I own the property where I run my business.