Taxes! Oh the Fun of It!

*totally agrees with HB*

I always get a few hundred €. I never had to correct or add anything to the taxproposal, I love it it's great to het some extra money for christmas presents.

 

You fund the IRA BTA??
You're gonna be on G.W.B's hit list shortly

 

I think that one of the things that you are not taking into account as far as so many more U.S. people having professionals prepare their tax returns is that the U.S. tax returns are so much more complex than just about anywhere else on Earth.

Compared to the U.S. forms, the Canadian ones are a snap.

As far as I am concerned, I have always prepared my own tax returns - but then again up until December I was a public accountant and I was paid to prepare other people's tax returns so I guess I don't really count.

As usual, I will be waiting until the last minute to file my tax return - but that is because I owe money again. Quite frankly, I have no desire to have a refund - that means that I have given the government an interest free loan - which seems fairly silly to me.

 

Pfft. I get a tax refund because I'm a financial midget, not a financial titan

 

We did ours the old fashioned way. Then I just for kicks went to irs.gov. They have options this year to e-file for free. You get linked to another website were you use that companies software for free. By doing so, we added another 100 to our federal return. We itemized, and apparently you can deduct your taxes paid at the state level. When using the software, they added in some other items withheld, like our State Disability Insurance, SDI, into the state and local taxes deduction. Plus, we found out we could deduct our vehicle registration fees. I tried it on several sites and they all did the same. Of course, I am a little skeptical on whether these will get to the IRS or not, so with the info in hand, we're going to redo the paper forms this weekend. What nice surprise though.

 

My federal return was about 5X as much as my state return, but that is pretty typical for me.

HB, there are two basic types of tax forms in the U.S., the short form and the long form. As their names imply, the short form is easy to fill out yourself, and the long form much more difficult. Which one you fill out depends a lot on where you are in life. When I was single, no kids, lived in an apartment, had virtually no investments, and worked a single job, I did the short form. At the time, the only write-off I had was my student loan, and you can write that off on both the short form and the long form.

The long form is helpful in getting a bigger return, but only if you are in a situation where you have additional investments, a mortgage, get married, etc. When I was single I wouldn't get any more back doing the long form than I did using the short form.

As far using an accountant, yes, I do, because experience has shown me that I typically get significantly more money back when my accountant does my taxes. I didn't believe this at first, so the first year my wife and I were married, I did all the calculations myself, and figured out we were owed a return of about $2500. My wife then went to the accountant, and he came back with a return of $3300. So, the $175 I pay this guy I easily get back in my refund. I went to him again this year, and once again, we got a little over $3000. So for me, it's a no-brainer to use an accountant - not using me one costs me money and costs me time.

 

In the UK, if your employed, basically, no tax return, you pay as you go.

Now because I had a company car for a while way back yonder, I have to do a return. So last year, I did mine, should have been a +/- a couple of quid since all my income is taxed at source.

OH NO! Tax demand for £200k+ I framed it, they'd added an extra nought into my salary. I only wish.

This coming tax return I will have to get both lawyers and accountants to look at, which since I'm an accountant myself is a touch sad, but as Rally mentioned complex investments makes for complex tax affairs.

 

Yeah, in the UK, I remember the tax was even simpler than in NZ. I didn't have to do a tax return at all. The correct amount of tax was taken out of my monthly salary and that was that.

The problem in the USA is that your tax law seems to be so complicated that you all end up overpaying tax during the year.

I'll be doing a tax return in NZ soon, but it will be pretty basic too. It's really just a re-check that the Pay As You Earn tax you paid during the year was calculated properly. If you get lots and lots of money from interest and/or dividends then you might get a slight adjustment but that's about it. I don't really understand why tax becomes a bigger deal for you Americans as soon as you get married and have a mortgage.

 

We filed our taxes online back in February, and got a pretty good refund. But last year was better.

 

Here in Canada, I've had a refund every year. Mind you that may change if I ever get a real job...

 

Your mortgage interest is tax deductible?! Even on the house you live in? Wow. No wonder you guys all manage to get big refunds all the time.

In our tax system, nothing is tax deductible except for expenses incurred in the generation of taxable income. No taxable income is generated from the house you live in so you can't deduct any costs related to that house. You can only deduct mortgage interest if it is on a house you rent out to someone else (to earn rental income that you will then be taxed on).

 

When we moved out here, we had to take out two loans. One was for a down payment because we hadn't sold our old home yet. The payments on that one are mostly interest. So there was a lot of interest to deduct there. I went to three or four different websites to see what would happen. From finding some more deductions, we upped our federal refudnd by about an extra $200!

 

Bah, As this boards resident CPA it always amazes me that people think they can do their own taxes. Being smart has nothing to do with it, it all has to do with the knowledge. I would never consider myself qualified to practice law or medecine, but you would be surprised at how many doctors and lawyers think they can do accounting and taxes.

 

Snook, I think your comments only apply to the USA. As stated above, in New Zealand, 95% of people will have only one material source of income and no deductions. Every literate person in NZ should be capable of filling in half a dozen boxes on their tax return and calculating whether their PAYE has been deducted correctly during the year. They then might get a refund if, for example, they only worked a part year (but had their income tax deducted based on a full year's income).

In NZ, the only people who should need to have an accountant do their tax return would be those who run businesses, have more than one rental property, or have complicated and/or offshore investment arrangements.

Unlike the USA, our tax system is not a goldmine for tax lawyers and small accounting firms.

 

Uggh! I got hammered this year. My former employer didn't take out enough - So I owe $3,447.00. Not happy about that.

This was the first time I had a proefessional accountant do my taxes, and it's the first time I've ever owed...An odd coincidence!

 

LOL, yes the implication is that you have probably been cheating on your taxes for years and didn't even know it.

 

Sir Bel, sue him

But I have to make by taxes, too. I don't look forward to it, it's a hell of a work. I gonna do a good deal of organisational stuff the rest of the week. Bleh. Hate paperwork.