quote:Originally posted by ketchupqueen: Tatiana, what about 6 or 12 month CDs? Then YOU get the interest on it instead of the gov't having use of it, but it ties up the money...
Is there a 6 or 12 month CD that will deduct out of your paycheck and let you gradually add to it over time? The interest rates right now are really low anyway. I could earn an extra $10 in interest, or I could do it this really easy way. I like the easy way. For me it makes sense. Also, it's a way to make tax time less agonizing for me. Now I look forward to it!
Posts: 6246 | Registered: Aug 2004
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I can take that money each year and put it on an important project. This year it's paying for my son's medical expenses. Some year soon it will hopefully pay for a new roof for my house. I want to add a carport since my garage isn't really meant for putting a car inside. Every 10 years or so I have to rebuild my deck. This year I really need my house painted on the outside but that will probably have to wait. It's very nice to have money saved up to do one good project a year.
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quote:Originally posted by lobo: It seems most people are getting a refund (including me). I wonder if it is intentionallly set up that way so that we are happy to get a refund and don't think about how much we actually paid in taxes...?
That's actually the purpose of withholding. They know that if we were forced to write a check each year for the tax burden, there'd be open rebellion. If it also included the hidden taxes in the prices of the things we buy (which comes from the taxes on the manufacturer) and the hidden tax of inflated money supply, there'd be blood in the streets.
Lots of people, myself included, don't have our taxes withheld. In fact, since we have to pay quarterly estimated taxes, we actually write four checks a year. Somehow, we manage not to riot in the streets or foment revolution against the government every three months. Posts: 1321 | Registered: Sep 1999
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So people that are not paying taxes are getting a tax refund? Or are you talking about welfare cases?
Posts: 571 | Registered: Mar 2001
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lobo: yes, that's what a negative income tax is. It is a way of transferring money to the poor. Think of it as a welfare program (and one of the better ones, since it keeps distortions relatively minimal).
Posts: 15770 | Registered: Dec 2001
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quote:Originally posted by Lisa: They know that if we were forced to write a check each year for the tax burden, there'd be open rebellion. If it also included the hidden taxes in the prices of the things we buy (which comes from the taxes on the manufacturer) and the hidden tax of inflated money supply, there'd be blood in the streets.
So, do you actually believe this?
Posts: 15421 | Registered: Aug 2005
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quote:This year I really need my house painted on the outside but that will probably have to wait.
You know, you DO have another adult living with you. Buy some exterior paint and drop the cans in his room as a hint.
Posts: 37449 | Registered: May 1999
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quote:Originally posted by Tarrsk: Lots of people, myself included, don't have our taxes withheld. In fact, since we have to pay quarterly estimated taxes, we actually write four checks a year. Somehow, we manage not to riot in the streets or foment revolution against the government every three months.
If it was every three months, I wouldn't mind. I have occasionally considered rioting over the current 2 month/3 month/4 month/3 month schedule. Who the heck decided that made sense? Something regular would be so much easier to remember. Posts: 650 | Registered: Mar 2005
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Tatiana: If you get around $8k back this year, you've left more like $100 to $175 on the table (and that's at the abysmal interest rates, recently):
Basically, put money for six months into a high-yield savings account; you can easily get one that gets 2.5% even now, and twelve months ago no problem. At six months (> $30 interest), dump the money into a six month CD -- six months ago, six month CDs had an average yield of about 3.2%, so you could have easily gotten 3.5%, maybe 4%. That's about $70, plus another $30-ish from the stuff you're still depositing in the savings account.
That's not an optimal plan, but it is a very simple one, and would have gotten you an additional $130. Last time you left more like $300 to $400 on the table (there were some very nice CD rates).
Posts: 15770 | Registered: Dec 2001
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quote:Originally posted by Lisa: They know that if we were forced to write a check each year for the tax burden, there'd be open rebellion. If it also included the hidden taxes in the prices of the things we buy (which comes from the taxes on the manufacturer) and the hidden tax of inflated money supply, there'd be blood in the streets.
So, do you actually believe this?
Yes. Most Jatraqueros are unrepresentative of the general population.
Posts: 12266 | Registered: Jul 2005
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In the Canadian tax system, both the self-employed and the retired living off of their own savings/RRIF have to manually send in cheques for taxes. I'll keep an eye out for rebellion.
Also, if like me you have a tax refund coming and you were going to invest that in the stock market in pretty much any form (rather than cash), you can thank the government for accidentally saving you from a roughly 20% loss rather than be worried about losing out on interest which is taxable at your marginal tax rate anyways
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Lisa: apparently almost every self-employed person in the US is not representative of the general population. In my experience, that's true, but it means they tend to be more combative. Oh, and the sole proprietors.
Posts: 15770 | Registered: Dec 2001
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quote:Originally posted by Lisa: [QUOTE]Yes. Most Jatraqueros are unrepresentative of the general population.
I write four such checks each year. I'll let you know when I am overcome by murderous libertarian rage.
Posts: 15421 | Registered: Aug 2005
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If we were all forced to write checks, it would certainly be educational for some people. I have one friend I was speaking with once, and I asked about how much income tax he pays per year. He said, "I don't pay taxes. I get a return every year!" He thought he got back everything he paid throughout the year.
And this is an otherwise smart guy.
Posts: 1080 | Registered: Apr 2006
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quote:Originally posted by scholarette: Turbo tax was free for me and I do the 1040. This year it did not mention it was only free for people under a certain income level like it did last year.
I wasn't clear. They're not charging (other than the cost of the program) for the first return. Just for each additional one. So if you only do your own taxes, no problem. If -- like Tatiana's brother-in-law or my dad -- you do many people's returns, then you do have a problem.
Posts: 32919 | Registered: Mar 2003
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No, that wasn't the case with him. He just didn't understand that he was only getting back what he overpaid, not what he paid. He never bothered to look at the specific numbers throughout the year.
Posts: 1080 | Registered: Apr 2006
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Buy some exterior paint and drop the cans in his room as a hint.
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