2018 Taxes, Better Or worse For You?

About the same as last year, paying some big bucks.

I cried at my youngest daughters wedding a few years back... I lost my last tax deduction.

Rob

 

I took a bath. I am an outside sales rep and could not deduct any unreimbursed business expenses like mileage or tolls.

 

I paid less overall.

 

Slightly worse, though I am not complaining. I thought it would be much worse. Part of our problem is being penalized for working outside the so-called Affordable Care system.

 

We needed to move away from these deductions that were abused, & toward a flat rate with no funny business. Everyone needs to pay, & not shelter their responsibility, including low income, it’s a part of being one as a country in my opinion.
From personal experience my tax preparer always took the maximum food/entertainment allowance for time away from home, didn’t matter what you really spent, it was just how many trips/days x $100 or whatever it was. Cell phone-deductable..computer-deductable....union dues-deductable....boots-deductable....& on & on. She did the majority of returns for the company & people got used to getting 5-6 grand back every year. Now she says they are all crying & many have to pay. Is this unfair or is a wrong being righted?!
Thanks President Trump.
My 401k is doing just fine, better than fine.....thanks President Trump. I paid 2300 this year, I was happy, last year I paid 6k. I am blessed because it causes me no hardship to pay it. Thank you Lord.

 

I paid a pile last year and got back a pile this year.

 

I got a lot more back this year.

 

People, the proof of whether or not you did better than last year is not if you got a bigger refund or if you had to pay more in, the proof is in your tax rate. Basically the tax the government says you're supposed to pay on your adjusted gross income. That has gone down for something like 85% of taxpayers (but oddly, not for all wealthy people.)

Many people didn't adjust their withholding allowances in January 2018. So, before the new tax laws if a guy were married, two kids, claiming 3 exemptions, getting paid $1,000 a week, he would have had $73 a week withheld from his paycheck. When he filed his taxes for 2017 let's say he got a refund of $1,500.

Now here comes the new tax law. Our hypothetical taxpayer did not adjust his withholding way back in January 2018, still claiming 3 exemptions. He gets paid $1,000 a week but now only $57 is being withheld from his paycheck. He notices he's got a little more in his paycheck but when he files his taxes for 2018 he "only" gets a refund of $800. He thinks he's not getting a tax cut.

Of course there are other factors at work, as Adonia says, where if you relied on itemizing deductions in the past and now the new, standard deduction doesn't give you as much to deduct, well then it could be you aren't getting a tax cut. But most people did get one.

 

H&R Block has analyzed millions of tax returns nationwide and they say that taxes have come down about 25%, on average.

H&R Block data shows taxes down 25 percent due to TCJA impact

TCJA impact: taxes down 25 percent | H&R Block Newsroom

 

Even the NY Times grudgingly admits:

Face It: You (Probably) Got a Tax Cut

Studies consistently find that the 2017 law cut taxes for most Americans. Most of them don’t buy it.

If you’re an American taxpayer, you probably got a tax cut last year. And there’s a good chance you don’t believe it.

Face It: You (Probably) Got a Tax Cut

 

That describes my situation. I understand the reduced tax rate means a smaller refund for many people, although they are paying fewer tax dollars overall. However, my unreimbursed business expenses are extremely high, so I am one of the losers. It is what it is.