Possible $14,000+ pay day! - Page 2

Just because you report it, doesn't mean you are being taxed...not going to take the time to find it in black and white. Simple reconciliation of your 1040 will show this. I do agree that it is wise to only pay in about 90% of your tax liability through with-holding from employer or quarterly payments if self employed, I do not like to ask the feds for my money back.

Since when is a tax refund income? Its a refund of taxes allready payed in.

[QUOTE=asandahl;53137]

Originally Posted by skylinejackjr

Doesn't work that way.



Yes it does work that way. when you file taxes you have to report the previous years income. A tax refund is considered income.

Absolutely, positively does not work that way.

Originally Posted by asandahl

I would be pissed off if I got 14k back. That is total crap. Why would you let the government use your money for an entire year interest free? and then you have to report that as income on next years taxes.

You seriously need to educate yourself a lot more on taxes and the law.

Originally Posted by skylinejackjr

George, that was on the 5th. Today is the 7th. What did you find out?

Well no one can provide a straight answer as to whether or not the adoption is eligible for the tax credit. So, what we are doing, is filing our taxes, without that credit, and then doing an amendment and adding the tax credit to it. If the IRS deems the adoption credit not eligible, they just deny that claim and process the other.

So unfortunately, won't know nothing for several weeks.

Originally Posted by asandahl

Yes it does work that way. when you file taxes you have to report the previous years income. A tax refund is considered income.

You kidding me right? Since when? Tax refunds are like inheritances that you get when someone passes away and leaves you money. No one counts it as income, as it is a ONE TIME PAYMENT. I know. I have to report income every so often to social services, because of my wife and 2 kids having insurance through them.

They only want to know about the income that we make. Not anything about tax refunds, inheritances, etc.

And before you say yes, when my aunt passed away, she left me a little over $30,000. When I asked them about it, they said no, they didn't care about it.

Your tax refund is a refund of either all or a part of your income that you pay into the government over the past year.

Also, I see I need to repeat this. The child is NOT special needs. The situation behind the adoption is special needs.

Our daughter is a normal little 4 soon to be 5 year old girl, who is soon to be in kindergarten, and does cheerleading.

[QUOTE=ralphie;53502]

Originally Posted by asandahl

Your state refund if you get one would be taxed by the feds since they didn't get their hands on it the first time around. State taxes are used as a deduction so the feds couldn't tax you on it for that tax year. You would need to be using itemized deductions for this though. If you don't itemize your deductions and you're reporting the refund as income or if you have been reporting your federal refund you should probably have a professional look over your taxes.

Your best bet is to make sure you have to pay in just a little at tax time. Let the government give you an interest free loan for a little while.

You and asandahl and anyone else can file taxes any way you all like. It's up to each individual. But, I can tell you this in my 45 years on this earth I have worked for mom n pop operations, big national corporations, local companies, myself, and the United States Govt. and NEVER have I paid taxes on ANY refund. Not federal, nor state. If you are paying taxes on refunds then you are doing something very wrong.

Originally Posted by Dumpster-Dee

And George, I think you need to do some research on why it is best, in general, NOT to get a refund.

A refund in general, or the adoption credit refund?

I have been filing taxes since I was 18, and have yet to have any issues. I report all income I get, except of course birthdays, tips, inheritances, gift money, etc.

In general. I'm not going to try to explain. It is best for you to do your own research. It's not that it creates a problem. It's just in your best interest.

Dee is right. I have my w2 set up in a way that when I did my taxes this year I am getting back $420 from the feds and I owe the sate $380. So I will be netting a profit of $40. Its way better for me to have the extra $100 a paycheck every 2 weeks and do with that money what want then to get a $2600 refund at the end of the year and let the FEDS use my money interest free. So basicaly in my scenario I am throwing away about $100 in interest if I were to get the refund at the end of the year instead of every paycheck at a modist 3%.

Originally Posted by PartTimeScrapper

Dee is right. I have my w2 set up in a way that when I did my taxes this year I am getting back $420 from the feds and I owe the sate $380. So I will be netting a profit of $40. Its way better for me to have the extra $100 a paycheck every 2 weeks and do with that money what want then to get a $2600 refund at the end of the year and let the FEDS use my money interest free. So basicaly in my scenario I am throwing away about $100 in interest if I were to get the refund at the end of the year instead of every paycheck at a modist 3%.

Perhaps it is how the w2 is set up.

All I know, is I claim 2 dependents, and I don't withheld any income. I can see where you are coming from PTS, for sure.

However, the IRS is the one thing I know not to mess with. I have seen friends and family get burned bad by the IRS in different situations.

Even if I owe anything out of pocket, I rather be straight, then have them knock on my door.

Also, so far, I have always gotten money back. Only thing I have ever paid which has come out of my return is the fee to file, which is generally a little over $400. Sometimes more.

Originally Posted by Dumpster-Dee

This seems to be just a misunderstanding of IRS form 1099-G. Anything from the IRS is confusing, so it's easy to misinterpret this. Ya' ll don't have to jump all over each other when one of us makes an inaccurate statement. Can't you just explain why you think it isn't accurate. And George, I think you need to do some research on why it is best, in general, NOT to get a refund.

O.k. Dee, Maybe I came on too strong. I'm sorry if hurt anyones feelings here. I certainly didn't mean to "jump on anyone". I figured when I said "Doesn't work that way." that someone may have taken a little time "to do a little research" themselves. Don't know if they did or not. So let me see if I can clarify this a little.

http://www.irs.gov/publications/p525/ar02.html#d0e5298

Read under Miscellaneous Income, Recoveries. Now I'll post in part what it says about federal refunds incase someone is too lazy to click on the link: "Federal income tax refund. Refunds of federal income taxes are not included in your income because they are never allowed as a deduction from income."

Now when it comes to state refunds the rules change.:eek: "State tax refund. If you received a state or local income tax refund (or credit or offset) in 2011, you generally must include it in income if you deducted the tax in an earlier year. The payer should send Form 1099-G, Certain Government Payments, to you by January 31, 2012. The IRS also will receive a copy of the Form 1099-G. If you file Form 1040, use the worksheet in the 2011 Form 1040 instructions for line 10 to figure the amount (if any) to include in your income. See Itemized Deduction Recoveries , later, for when you must use Worksheet 2 , later in this publication.
If you could choose to deduct for a tax year either:
State and local income taxes, or

State and local general sales taxes, then

the maximum refund that you may have to include in income is limited to the excess of the tax you chose to deduct for that year over the tax you did not choose to deduct for that year.
Example 1. For 2010 you can choose an $11,000 state income tax deduction or a $10,000 state general sales tax deduction. You choose to deduct the state income tax. In 2011 you receive a $2,500 state income tax refund. The maximum refund that you may have to include in income is $1,000, since you could have deducted $10,000 in state general sales tax.
Example 2. For 2010 you can choose an $11,500 state general sales tax deduction based on actual expenses or an $11,200 state income tax deduction. You choose to deduct the general sales tax deduction. In 2011 you return an item you had purchased and receive a $500 sales tax refund. In 2011 you also receive a $1,500 state income tax refund. The maximum refund that you may have to include in income is $500, since it is less than the excess of the tax deducted ($11,500) over the tax you did not choose to deduct ($11,200 − $1,500 = $9,700). Since you did not choose to deduct the state income tax, you do not include the state income tax refund in income.":confused::confused:

Me personally? I have never jumped through all of those hoops to pay taxes on a state refund. And never will. Like I said, it depends on how each individual files.

This research took me less than 5 minutes. But the problem came in where people just will not take the advice given on here time and time again. RESEARCH AND READ! It would appear some would just rather ask silly questions or make asinine remarks. I really hope this clears a few things up for folks.

skylinejackjr,

Thanks for the information.

While I was reading that, I was trying to think if I ever filed state taxes. I think this year, was the first year that we did not. I always get money back on Federal, ad sometimes I get a small amount back on state (if I remember correctly).

I will say this, if anyone ever has a doubt when your filing, then get the reassurance plan. Not sure if everyone offers it, but I know H&R Block does.

All the plan is, if the IRS audits you, then the a rep from H&R Block will go to court with you.

Never been audited yet, but as you all know by now, I play things close to the chest. I do take chances, just not with the government.

Why would you not file state taxes? Doesn't make sense.

Originally Posted by asandahl

Way wrong. Im not trying to start any thing with you. I hope you dont get an IRS audit on that 30K! If it was your wife that passed, then no, you wouldnt pay tax on that.

Okay, so me, my tax lady, my lawyer, and social services are all wrong? Okay.

Been almost 2 years strong and still no audit.

Check your tax information again.

Originally Posted by KZBell

Why would you not file state taxes? Doesn't make sense.

I think it had something to do with falling under the minimum requirement, or something.