Exemptions claimed on W-4 form
- Thread starter Quattro Pete
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It's probably that worthless stimulous.. obama gave us a stimulous via fed withholding decrease.. but come tax time, the take it back.
I've had to withhold at 0 and add $25 each paycheck to offset this stupidity.
I've had to withhold at 0 and add $25 each paycheck to offset this stupidity.
Originally Posted By: EricF
It's probably that worthless stimulous.. obama gave us a stimulous via fed withholding decrease.. but come tax time, the take it back.
I've had to withhold at 0 and add $25 each paycheck to offset this stupidity.
What? Are you talking about the payroll tax cut?
It's probably that worthless stimulous.. obama gave us a stimulous via fed withholding decrease.. but come tax time, the take it back.
I've had to withhold at 0 and add $25 each paycheck to offset this stupidity.
What? Are you talking about the payroll tax cut?
Originally Posted By: Quattro Pete
Originally Posted By: CivicFan
So the only solution is to put money in a traditional IRA to reduce the AGI.
I am already putting some away into a 401(K), which should have similar effect, but wife is not putting away any. She will start, and hopefully that will help some.
You have until April 15 to s put money into a traditional IRA effective for calendar year 2011. Maybe if you guys open it, it will reduce your AGI low enough to avoid the AMT.
Originally Posted By: CivicFan
So the only solution is to put money in a traditional IRA to reduce the AGI.
I am already putting some away into a 401(K), which should have similar effect, but wife is not putting away any. She will start, and hopefully that will help some.
You have until April 15 to s put money into a traditional IRA effective for calendar year 2011. Maybe if you guys open it, it will reduce your AGI low enough to avoid the AMT.
JHZR2
Staff member
If you make enough, despite being married you need to be single zero plus pay extra. Learned that the first year we were married when we got hit with an $8k tax bill. Here I thought married with 2 exemptions was going to be accurate...
JHZR2
Staff member
Originally Posted By: CivicFan
Originally Posted By: dishdude
What triggers AMT?
Usually income level above a certain threshold.
But I believe only when you try to claim too many deductible things.
It was more or less not worth us donating things or money, because AMT kept us at a certain tax level.
Originally Posted By: dishdude
What triggers AMT?
Usually income level above a certain threshold.
But I believe only when you try to claim too many deductible things.
It was more or less not worth us donating things or money, because AMT kept us at a certain tax level.
Originally Posted By: CivicFan
Originally Posted By: Quattro Pete
Originally Posted By: CivicFan
So the only solution is to put money in a traditional IRA to reduce the AGI.
I am already putting some away into a 401(K), which should have similar effect, but wife is not putting away any. She will start, and hopefully that will help some.
You have until April 15 to s put money into a traditional IRA effective for calendar year 2011. Maybe if you guys open it, it will reduce your AGI low enough to avoid the AMT.
AMT is a real bad deal. I don't think you can deduct your way out of it.
Last time I paid AMT, it was because of deductions, and it wiped them completely out. The AMT victim can pay really large amounts of tax, and still get nailed for additional AMT. It's just a bad deal.
Originally Posted By: Quattro Pete
Originally Posted By: CivicFan
So the only solution is to put money in a traditional IRA to reduce the AGI.
I am already putting some away into a 401(K), which should have similar effect, but wife is not putting away any. She will start, and hopefully that will help some.
You have until April 15 to s put money into a traditional IRA effective for calendar year 2011. Maybe if you guys open it, it will reduce your AGI low enough to avoid the AMT.
AMT is a real bad deal. I don't think you can deduct your way out of it.
Last time I paid AMT, it was because of deductions, and it wiped them completely out. The AMT victim can pay really large amounts of tax, and still get nailed for additional AMT. It's just a bad deal.
Yes, with AMT, you have to add back some of the deductions. The traditional IRA is a deduction before AGI and it is not added back. A lot of other deductions, both before and after AGI, are added back.
http://www.irs.gov/pub/irs-pdf/f6251.pdf
http://www.irs.gov/pub/irs-pdf/f6251.pdf
Form 6251 is carp.
WOW
WOW
If you are paying AMT, it means you have "arrived"! Complaining about having to pay AMT is similar to landed class complaining about their servants not doing a good job 
Well, at least that was the idea behind the original AMT but these days if you are in the upper half of middle class, you get the honor of paying AMT.
- Vikas
Well, at least that was the idea behind the original AMT but these days if you are in the upper half of middle class, you get the honor of paying AMT.
- Vikas
Originally Posted By: CivicFan
Originally Posted By: dishdude
What triggers AMT?
Usually income level above a certain threshold.
That is way too short an answer. AMT is triggered by a combination of income level and what are called tax preference items. For example, your state tax deduction is a tax preference item, also some tax free interest. There are many others. Another thing that triggers AMT is long term capital gains. AMT is like doing a second tax return with a different set of laws.
Originally Posted By: dishdude
What triggers AMT?
Usually income level above a certain threshold.
That is way too short an answer. AMT is triggered by a combination of income level and what are called tax preference items. For example, your state tax deduction is a tax preference item, also some tax free interest. There are many others. Another thing that triggers AMT is long term capital gains. AMT is like doing a second tax return with a different set of laws.
Originally Posted By: Vikas
If you are paying AMT, it means you have "arrived"! Complaining about having to pay AMT is similar to landed class complaining about their servants not doing a good job
For the record, I am not complaining about it. I was just trying to figure out what I was doing wrong on my W-4 that I ended up owing so much at the end of the year.
If you are paying AMT, it means you have "arrived"! Complaining about having to pay AMT is similar to landed class complaining about their servants not doing a good job
For the record, I am not complaining about it. I was just trying to figure out what I was doing wrong on my W-4 that I ended up owing so much at the end of the year.
JHZR2
Staff member
Originally Posted By: Quattro Pete
Originally Posted By: Vikas
If you are paying AMT, it means you have "arrived"! Complaining about having to pay AMT is similar to landed class complaining about their servants not doing a good job
For the record, I am not complaining about it. I was just trying to figure out what I was doing wrong on my W-4 that I ended up owing so much at the end of the year.
LOL, I am. For the E-class Mercedes I paid in taxes, to get slapped with that was just insulting, especially since I had made a lot of donations to reduce my tax burden (glad I had other intents for donating as well...).
AMT is really a lousy thing that is harming a segment of the population that it shouldnt.
Originally Posted By: Vikas
If you are paying AMT, it means you have "arrived"! Complaining about having to pay AMT is similar to landed class complaining about their servants not doing a good job
For the record, I am not complaining about it. I was just trying to figure out what I was doing wrong on my W-4 that I ended up owing so much at the end of the year.
LOL, I am. For the E-class Mercedes I paid in taxes, to get slapped with that was just insulting, especially since I had made a lot of donations to reduce my tax burden (glad I had other intents for donating as well...).
AMT is really a lousy thing that is harming a segment of the population that it shouldnt.
Different folk have a different definition of fair. I hardly think it's fair that some have to pay a higher percentage of their marginal dollar just because they've arrived.
Time for the flat tax. No one pays more than 18% in total federal tax liability.
The problem isn't that we tax the rich too little. The problem is the folks in DC spend too much. Giving them more money won't fix their spending addiction
Hopefully my comments are a-political. Because I see it as both parties are guilty. Their spending choices may be different, but the results are the same, the folks in the middle get the bill and the debt.
Time for the flat tax. No one pays more than 18% in total federal tax liability.
The problem isn't that we tax the rich too little. The problem is the folks in DC spend too much. Giving them more money won't fix their spending addiction
Hopefully my comments are a-political. Because I see it as both parties are guilty. Their spending choices may be different, but the results are the same, the folks in the middle get the bill and the debt.
I'd be willing to go lower. The problem is, the government spends close to 18% of GDP on average. So as long as folks want all these government programs, I think they should be willing to pay for them.
Originally Posted By: CivicFan
I don't know about that 18% or any other flat tax. My uncle makes $9,500 a year. $1,710 tax will force him into the streets to be homeless and semi-hungry.
Originally Posted By: CivicFan
I don't know about that 18% or any other flat tax. My uncle makes $9,500 a year. $1,710 tax will force him into the streets to be homeless and semi-hungry.
Originally Posted By: JHZR2
....
... to get slapped with that was just insulting, especially since I had made a lot of donations to reduce my tax burden (glad I had other intents for donating as well...).
AMT is really a lousy thing that is harming a segment of the population that it shouldnt.
One thing I do to take some of the sting out of AMT is to just never bother with a tax refund - I let the IRS keep the overpayment and I treat it like it doesn't exist. That cut my last AMT surprise from $14K to $6K.
What irks me about AMT is the unpredictability - you plan on one set of tax rules, and then you owe tax on a different set.
That's fundamentally unfair.
....
... to get slapped with that was just insulting, especially since I had made a lot of donations to reduce my tax burden (glad I had other intents for donating as well...).
AMT is really a lousy thing that is harming a segment of the population that it shouldnt.
One thing I do to take some of the sting out of AMT is to just never bother with a tax refund - I let the IRS keep the overpayment and I treat it like it doesn't exist. That cut my last AMT surprise from $14K to $6K.
What irks me about AMT is the unpredictability - you plan on one set of tax rules, and then you owe tax on a different set.
That's fundamentally unfair.
I am not so sure. I think AMT is actually lot simpler once you get to the bottom line. It is essentially, "how much you made?" "OK then pay us % percent" I suspect we can compute that percentage and it is probably a constant. You ignore all the deductions, exemptions, credits etc when it comes to AMT.
Every year congress talks about fixing AMT but I just don't see they will be giving up this gravy train any time soon.
> "For the E-class Mercedes I paid in taxes,"
I like your method of counting money! I tell the same to my son when I pay his college tuition (1 fully loaded E-class every single year!) Especially when he asks me how come we are still driving old cars but our friends and relatives have shiny new E-classes.
- Vikas
Every year congress talks about fixing AMT but I just don't see they will be giving up this gravy train any time soon.
> "For the E-class Mercedes I paid in taxes,"
I like your method of counting money! I tell the same to my son when I pay his college tuition (1 fully loaded E-class every single year!) Especially when he asks me how come we are still driving old cars but our friends and relatives have shiny new E-classes.
- Vikas
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