Do We Have Any Tax Experts In Here??

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Dylan1982
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Do We Have Any Tax Experts In Here??

Postby Dylan1982 » Tue Feb 04, 2014 8:47 pm

I am trying to decide if I should ckaim 0 like I always do or claim 1.


Here's my scenario. I always claim 0. I want the IRS to take as much taxes out so at the end of the year I get my interest free loan back to me lol

But lately I've been pondering if I should claim 1. I am hoping that I won't owe at the end of the year. Is there a way to see if I claim 1, I will still get a refund. I could use a little extra coind each paycheck.

BTW, odd years I claim my son, even years my ex claims him. So odd years I claim HOH and even years I claim SINGLE.


Can any honestly help me out??
Chase Freedom - $12,500 (2/2013)
GM Card - $7,700 (7/2002)
CitiBank (Thank You Preferred) - $6,400 (6/2012)
CitiBank (Diamond Preferred) - $4,600 (6/2012)
Rogers & Hollands - $3,300 (3/2006)
Target REDcard - $3,000 (11/2014)
BestBuy - $1,600 (9/2003)
Discount Tires - $1,000 (2/2004)
Kohl's - $300 (4/2012)


darkguy2
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Postby darkguy2 » Wed Feb 05, 2014 12:51 am

It depends on what your return has been. If you get a large return then you are supposed to increase them. It should be at the point where you get a very small or no return. So if you get a large return this year then increase your deductions. I always claim 1 and I am a student. I still get a rather large return so I may increase mine this year.
Discover IT - $5,700
Chase Freedom - $5,700
Costco Citi - $13,000
Sallie Mae - $4,000
Chase Sapphire Preferred - $6,000
Chase Sapphire Reserve - $19,500
Citi Double Cash - $6,500
Amex BCE - $13,000

FICOs: Discover (777), SallieMae (764), Amex (767), Citi (772)
FAKOs: CK- TU (760), EQ (760)

Dylan1982
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Postby Dylan1982 » Wed Feb 05, 2014 1:01 am

This year I am getting back ~$4,300 from FED and $250 from STATE. I also claimed my son this year. I did my taxes on my own as well using Turbo Tax.


I always claim 0..


Should I increase it to a 1 then?


Last year claiming 0 and SINGLE this was my refund

FED = $1929
State = $115
Chase Freedom - $12,500 (2/2013)
GM Card - $7,700 (7/2002)
CitiBank (Thank You Preferred) - $6,400 (6/2012)
CitiBank (Diamond Preferred) - $4,600 (6/2012)
Rogers & Hollands - $3,300 (3/2006)
Target REDcard - $3,000 (11/2014)
BestBuy - $1,600 (9/2003)
Discount Tires - $1,000 (2/2004)
Kohl's - $300 (4/2012)

darkguy2
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Postby darkguy2 » Wed Feb 05, 2014 10:52 am

Yes you should. There is no point to having a return that high. Worst case scenario is that you will owe a bit. But the thing is you will still have the same amount of money in the end. The amount of taxes you owe does not change based on the number of deductions you take. So you will have to pay the same amount. If you have to pay then that means that you got to use that extra cash earlier. There really is no benefit to a high return.
Discover IT - $5,700
Chase Freedom - $5,700
Costco Citi - $13,000
Sallie Mae - $4,000
Chase Sapphire Preferred - $6,000
Chase Sapphire Reserve - $19,500
Citi Double Cash - $6,500
Amex BCE - $13,000

FICOs: Discover (777), SallieMae (764), Amex (767), Citi (772)
FAKOs: CK- TU (760), EQ (760)

whit
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Postby whit » Wed Feb 05, 2014 2:35 pm

I think it's a matter of preference; I don't really see the point in that extra few dollars in interest, and I don't plan on spending my tax return, or I try very hard not to these days

before I used to just pick the one that would tax me the heaviest so that in the end, I never owe, I always get money back

reminds me back when I was not so great with money and paychecks, still in school, somehow I managed not to cash a check given to me by gap, for around 600$

they ended up sending the check to me because their system found I never cashed it

since then I just prefer to have the money withheld and then when I get it, dump it into the savings I never touch

if you can manage your money well, you can decide. for me, the hoops of having a savings I never touch, a savings for emergency, an account for bills, etc..that spread works best for me and my lack of self control

so it's not really a tax expert question I think, so much as a personal preference. either way you're going to pay x amount in taxes

unless ur missing out on tax breaks/writeoffs

Dylan1982
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Postby Dylan1982 » Fri Feb 07, 2014 9:58 pm

darkguy2 wrote:Yes you should. There is no point to having a return that high. Worst case scenario is that you will owe a bit. But the thing is you will still have the same amount of money in the end. The amount of taxes you owe does not change based on the number of deductions you take. So you will have to pay the same amount. If you have to pay then that means that you got to use that extra cash earlier. There really is no benefit to a high return.

Well, for me it is different..

Odd years (2015, 2017, 2019, 2021, 2023 etc... etc...) I will be claiming my son. So yes, if I claim 1 on my W4 I will still get a refund b/c I will be claiming my son as well as Head of Household (HOH).


Now on even years (2016, 2018, 2020, 2022, 2024 etc... etc...) I will be SINGLE. If I claim 0 I will get the most taxes taken out of my check and get a refund at the end of the year. Now if I claim 1, (less taxes taken out) will I end up owing on the those years where I claim 0???


I'm very frugal and responsible with my money. I could use the extra money in my pocket. being that I am divorced, I do pay a pretty penny for Child Support as well as Health Insurance for my child and I...


So any other thoughts or opinions? Should I claim 1 on the ODD years and 0 on the EVEN years? Or should Ijsut claim 1 from here on out?????
Chase Freedom - $12,500 (2/2013)
GM Card - $7,700 (7/2002)
CitiBank (Thank You Preferred) - $6,400 (6/2012)
CitiBank (Diamond Preferred) - $4,600 (6/2012)
Rogers & Hollands - $3,300 (3/2006)
Target REDcard - $3,000 (11/2014)
BestBuy - $1,600 (9/2003)
Discount Tires - $1,000 (2/2004)
Kohl's - $300 (4/2012)

Dylan1982
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Location: Chicago

Postby Dylan1982 » Thu Feb 13, 2014 12:56 am

On Monday, February 10th, I changed my withholding from "0" to a "1"


I figured I'll be safe. On the years where I do not claim my son, I always got a refund of ~$1900. And let's say by switiching to a "1" I get an additional ~$30 per bi-weekly payched ($60/month) that is +~$800 in my pocket. So I still feel safe switching to a "1" as I am sure the IRS is taking a lot of taxes out.

If you all feel I am wrong, please let me know!
Chase Freedom - $12,500 (2/2013)
GM Card - $7,700 (7/2002)
CitiBank (Thank You Preferred) - $6,400 (6/2012)
CitiBank (Diamond Preferred) - $4,600 (6/2012)
Rogers & Hollands - $3,300 (3/2006)
Target REDcard - $3,000 (11/2014)
BestBuy - $1,600 (9/2003)
Discount Tires - $1,000 (2/2004)
Kohl's - $300 (4/2012)

Dylan1982
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Posts: 323
Joined: Tue Mar 06, 2012 12:15 am
Location: Chicago

Postby Dylan1982 » Fri Feb 21, 2014 10:46 am

After changing my withholding from 0 to 1 on 2/10, I got paid today and my check was ~$35 higher for my two weeks that I work. So ~$70/month in my pocket..
Chase Freedom - $12,500 (2/2013)
GM Card - $7,700 (7/2002)
CitiBank (Thank You Preferred) - $6,400 (6/2012)
CitiBank (Diamond Preferred) - $4,600 (6/2012)
Rogers & Hollands - $3,300 (3/2006)
Target REDcard - $3,000 (11/2014)
BestBuy - $1,600 (9/2003)
Discount Tires - $1,000 (2/2004)
Kohl's - $300 (4/2012)

JoDa
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Postby JoDa » Sat Feb 22, 2014 12:14 am

For federal taxes, each exemption you claim exempts $3950 in income from taxes for the 2014 tax year. It's a pretty simple calculation, you just total up your deductions, divide by 3950, and round down (for example, if you have $12K in deductions, you claim 3 and get a small refund at the end of the year). Each state and locality has their own exemption amounts, so look up yours and do the same calculation. You can change these deductions at any time, so it's no problem to claim an extra exemption for your child one year and then take it off the next. Your employer may even allow you to do this through their website, but even if they don't, you can just print out a new W-4 and hand it to HR.

Between my mortgage, local income taxes, and other deductions, I claim 4 federal exemptions and 7 local ones. As I do have *some* variable income/deductions (small bonuses, perhaps a rent increase or expense decrease on my rental properties), my outcome varies *a little* from year-to-year. Most years I get a small return from both federal and local (<$200 each), but sometimes I owe a little (the worst ever was $80 local and getting a return of about half that fed...so I was "out" about $40).
CSP $19K
BOA $4K
UMP $11.5K
Target Visa $1.5K

Dylan1982
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Joined: Tue Mar 06, 2012 12:15 am
Location: Chicago

Postby Dylan1982 » Sat Feb 22, 2014 7:55 am

So at the end of 2014, will I owe? I understand the whole deductions stuff... Can you walk me through it??


What qualifies as a deduction? I don't get the while standard deduction fo $3,950 either....... I hate taxes... and maybe that's why I always claim 0 and always get a refund every year......
Chase Freedom - $12,500 (2/2013)
GM Card - $7,700 (7/2002)
CitiBank (Thank You Preferred) - $6,400 (6/2012)
CitiBank (Diamond Preferred) - $4,600 (6/2012)
Rogers & Hollands - $3,300 (3/2006)
Target REDcard - $3,000 (11/2014)
BestBuy - $1,600 (9/2003)
Discount Tires - $1,000 (2/2004)
Kohl's - $300 (4/2012)



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