New Federal Tax Code

softtouch

Member
Looks like the new tax code is going to work good for us old (86) retirees.
Fixed income: pension & ss.
Other: Small 401K (program started late in my working career), savings interest and stock dividends.
2018: $1330 more adjusted gross and $1202 less federal tax.
 

stgislander

Active Member
I hear that if you take the new standard deduction on your Fed return, MD forces you to take their standard deduction on the state return.
 
I used TurboTax and filed Federal standard deduction, but when processing the state, it seemed I had an option to file itemized. Wound up standard deduction on both, so not sure if it would have forced it on me.
 
My refund went wayyy down this year.

thanks alot trump
That doesn't necessarily mean you didn't pay less taxes if you were getting more in each pay check. What was the difference between what you paid in total federal taxes for this year vs. last year?
 

softtouch

Member
Fidelity Investments Institutional Operations Co. Which manages my former employer's pension fund, reduced my Federal tax withholdings by 7½%. They do this automatically based on changes to the tax code. I do have the option to adjust it if I wish.
 
Fidelity Investments Institutional Operations Co. Which manages my former employer's pension fund, reduced my Federal tax withholdings by 7½%. They do this automatically based on changes to the tax code. I do have the option to adjust it if I wish.
I have Fidelity for my company retirement pension also, and they did the same. I did manually adjust my State withholdings, tho.
 

Goldenhawk

Member
Ideally I would keep ALL my withholdings myself, and earn interest on them, and write one tax check at the end of the year. Instead, Uncle Sam insists that I send him some of my money with every paycheck, because I can't be trusted to do the right thing each year. Which is probably true for most people. But it sucks having to choose between paying a "you didn't comply" penalty and giving up my interest and the use of my money all year long.

I personally think if we went back to having to write one ginormous check each year, Congress would get a lot more heat to reduce spending and taxes. Nutjobs like AOC and Bernie who want to spend trillions of unfunded dollars on social programs would be quickly sent packing.
 

DoWhat

Sexy Stud
PREMO Member
We both claim single and 0.. wonder if we can claim negative dependents.
I had the wife change hers to single and 1.
But I know we will still owe next year too, but not as much.
Anything over 1K owed you get hit with a penalty.
Our penalty this year according to Turbo tax was $37.
 
Two years ago I wanted a new toy, so I took $20k from my retirement fund. Forgot about taxes. I owed about $6500 for 2017 taxes. Surprisingly, no penalty.

Got smart, re-calculated everything, changed deductions and they (fed and state) owe me about $2k this year.
 

Goldenhawk

Member
Got smart, re-calculated everything, changed deductions and they (fed and state) owe me about $2k this year.
So... you let the feds borrow $2K of your money, interest free, for a year. That's how I read that. If you have to pay at the end of the year, you kept your own money until it was really and truly due.
 
That's certainly one way to look at it, but $2k is pocket change to me. The amount of interest I might have gotten on it isn't worth fussing to get my deductions near the zero mark.
 

Goldenhawk

Member
To put it in a different context, how would you feel if you had to pay your mortgage company $150 extra out of each biweekly paycheck, and they sent you a $4K refund check at the end of the year? I think you'd be furious about them keeping YOUR money. That's exactly what's happening if you get a refund check from Uncle Sam in April.
 

Goldenhawk

Member
On the other hand, if you're the kind of person who loves finding $100 stashed in a jacket pocket, and doesn't mind that it was missing since last winter, maybe having a refund check is cool.
 
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