WOW getting good sized tax refunds

Marie5656

Marie5656

SF VIP
Location
Batavia, NY
I took our taxes in yesterday to get them done. We were expecting to pay on our federal taxes, as we usually do. Plus we were of the impression we would have to pay fed. on my SS benefits. Wrong. Between federal and state (NY) we are getting over $700 back. I stopped earning taxable income in May, started collecting benefits in June.

It will be a plus because DH will have about a 3-4 week delay from his last paycheck to his first benefits check this year. I asked the accountant about withholding federal taxes from our benefits. He said no bother..we will not be earning enough to have to pay taxes. We probably will not even have to file returns after 2019 return..which will have some earned income from DH before his retirement. He said he will give us more info next year when we file.

I am pleased.

 

I have a bit more than necessary held out of our funds, so we always get a nice refund on both the Fed and State returns every year. With these new tax brackets for 2018...reducing the Fed take by 3%, and doubling the standard deduction, we may get enough back to pay for our annual mid-winter trip to Las Vegas.
 

what is nice in ny is ss is not taxed by the state nor is my wifes pension taxable by the state and our long term care insurance gets a 1600 state tax credit , not a deduction .

i work 1 day a week so i made enough to fund not only my ira but you can do one for a non working retired spouse too . picked up 13k in deductions , plus we had 5 digits in dental expenses and all our insurances .

so all in all we got about 7k back from federal and state. to bad i had to tell them to keep it for estimated for 2018 .
 
Marie i'm glad the refund was a pleasant surprise.

i to used to like getting a large refund until i read somewhere that letting the government use my money all year then giving me a "refund" that paid no interest on that money was not smart money management.


the article went on to explain it's better to calculate total taxable income and adjust % taken out so that the money the government was using for free could spend as a person saw fit throughout the year. one way for us was to invest. even though the amount wasn't much the saying of "giant oaks from acorns grow". worked as hoped for.


still doing the same in retirement with our brokerage account, but to each their own on strategy.
 
New term: "Intaxication". Definition: The euphoria felt upon getting a tax refund until you realize that it was your money in the first place.

That aside, what little interest I would have made had I kept the money in a savings account is overridden by the fun of getting a tax refund and planning what to spend it on. I look upon it as a forced savings account.
 
That's fantastic Marie. Enjoy the "windfall" (even though technically it's like giving the government an interest free loan). I remember those days...I was "poor girl" back then. I'd always split my return 3 ways. I'd save 1/3, pay off bills with 1/3 and allow myself to spend 1/3 (usually most on my son). This year I have to pay, as I have for several years. I have to pay more than double what I did last year due to investments. :(
 

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