Notice on your property tax bill what the state school tax portion is. The towns with lakefront property pay more to the state for school tax. And they would like us to pay more.

yep... it's a percentage.... 60% OF $2000 = $1200
60% OF $12000 = $7200

Please sell your 1.2 million dollar water front home for a $75000 double wide in a mobile home park then you won't be asked to pay more!

You are right. We don't have to live on the water if we don't want to pay the tax.

From 1913 to 2018, for the last 105-years, real estate people in NH have been tell'n their prospect clients that all that property tax gets deducted from their federal income tax .... anyway you count it ..... so's it don't really matter ..... and, thank-you Uncle Sam!
..........

....and no, I don't have a paid subscription to the Concord Monitor, yet this link above is working? Seems like a very timely news article on the NH legislature's recent vote on two minimum wage increase proposals.

LMAO - I guess I should consider myself "lucky" working in Massachusetts and living in NH. Great huh? Oh but wait.... I hate to break it to you I have to pay the same 5.1% income tax to Massachusetts just like any other Massachusetts resident.

You still can - up to 10K after that you can't. In fact you should be happy about this, it's capped at the same amount for everyone. Why are you so critical of this? After all if your property tax is over 10K you're surely rich and as the Democrats love to say the rich need to pay their "fair share" so this prevents "rich" people from deducting more than "poor" people. This is exactly what you want. Or do you? What... you upset when it hits you in the pocketbook? Awe that's to bad now isn't it.

I can tell you this. I’ve done over 150 personal returns so far this season and the $10,000 Really has not affected many of my clients. Basically due to the fact that the effective tax rate is lower and the child credit is higher. what I have noticed is that the refunds are tending to be smaller because the withholding charts have changed and people are taking home more during the week in their paycheck resulting in smaller refunds


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Joey, thanks for posting that. I am amazed that so many people just don't seem to get the connections between what they have taken out of their pay check and what they actually owe. I couldn't tell you how many times I have read that people are paying more this year because they just don't understand they didn't have enough taken out of their pay each pay period.

They also don't get that while the tax deduction on property tax is now capped, other incentives such as the increase in the standard deduction for MOST people actually works out way better.

I know. People don't understand. They really don't even understand how much more they would have to spend if they could keep more of their own. We always said they should go to one window and pick up their check and go to the next window and pay their taxes. Then they would really see what they pay.

I have had to have a though conversation with every client about how the new tax law is effecting them. In high property tax and high property value states like NY NJ MA CA CT the tax new law has not helped but for those who do not own a home or have low property and state income tax they new law works better. Remember these are broad statements that do not take in other factors such as the new increase child credit.


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IMO getting a tax refund is the biggest waste of money that you will ever get.
You let the government use your money interest free just because you want a big refund..crazy.

Or .......a more cynical thought ........ you could give everyone an increase on social safety net programs like welfare and such and and take out the same amount as the increase in taxes for no net increase or decrease in take home pay. Then make all future increases or decreases in taxes applicable to the recent increase in benefits.

As Tis mentioned folks are apathetic with regard to taxes and how it all works. After all if your paying nothing you don't care what others pay.

But if you got a statement every week and realized with those free monies to begin with you could get even more beer and drugs every week it might change the debate.


As mentioned: This is simplified broad statemen do not read more into it.

It’s really not crazy at all. You not talking about 10’s of thousands of dollars and with today’s interest rates you are losing an extremely minimal amount of interest especially when you consider it is amortized over every paycheck. Most do not have the disciple to save the 25-100 per week extra they are receiving in each paycheck and also do not want to risk owing 4/15. Many of my clients use it as a forced savings and when they receive their refunds they go on vacation, pay credit card bills or improve their homes.


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Spend, spend, spend! A good accountant would figure out how much taxes should come out each pay period so that at the end of the year $000 would be coming back, and then reccomend that the extra money be automatically put in a 401K for their future retirement.
This is what I did when the 401K first came out..but HEY, to each their own.

Thanks for you advise. It will be Very valuable in my 30 year practice. I NEVER said it’s what I recommend it’s what my clients want and this is after recommending all retirement plans are maxed out. At the end of the day I give advice and my clients make there own decisions I cannot make it for them.

But I guess you are a better CPA than I am.


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It's not crazy, I agree with Rusty, too. So many people want to make sure they get money back when April comes. Yes, some because they never save and others because they feel like they are getting a gift of money to spend. But it is hard for a good accountant or anybody to figure out how much somebody is going to owe or get back because most people don't have just a simple paycheck. If you did only have that, a single person claiming one exemption should be just about right. ( I am just agreeing with you Joey.)

You are welcome, anytime I can educate people it makes my day. :emb:

I can pay a nickel for your education you are giving me and I would be overpaying. [emoji23]


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Exactly! I have never understood why anyone wants a big refund. Personally I chose to pay in each year so my earnings can work for ME. The feds are not entitled to my money until April 15th(ish), I will hold it in an interest bearing account until then.

That is not entirely true. They are entitled to have their money equally over the course of the year. If you owe too much on 4/15 you will be assessed a late payment penalty that is much more than the interest you are earning holding onto the funds.


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Understood, they are entitled to have the feds hold their money. As I said, "I personally choose to"....

Your earlier post suggested people may be using the IRS as a savings account to pay off credit cards (often 18+% APR) once they get their refund. An extra $50-$100/wk could easily eliminate the perceived need for a credit card all together. This is what is mind boggling to me.

To each their own.

Exactly. I was stating the position of some of my clients not my advice or opinion. For the majority of my clients the use their refunds for extra luxuries like vacations and home improvements.


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This article explains why people should not be getting a big refund and I feel the same way:

"Here’s what you could be doing with your money if you had it for that year. Let’s assume you had $2,800, around the amount of the average refund.

1. You could save for retirement. When you let the government sit on nearly $3,000 for up to 12 months, you’re giving up a huge opportunity for savings. What if, instead of waiting for the IRS to refund you your overpayments each spring, you bumped up your 401(k) contributions by a percentage point or two (or more)? Over several decades of your working career, that change could earn you a more comfortable existence in retirement. “There are ups and downs in the market,” says Jude Coard, a tax partner with Berdon LLP in New York City, “but if you’re a long-term investor and you don’t put that money in until you get your refund, you’re basically losing a year’s worth of appreciation on it.”

2. You could have an emergency fund. That $2,800 is no small chunk of change. If you had an unexpected car expense or medical bill, you’d probably be really happy you had it. Emergency funds don’t spring up overnight — you have to put money aside, little by little. If you don’t have one, an extra $233 a month would help start to fill yours out. (Your goal is to have enough funds to tide you over for six months worth of household expenses.)

3. You could pay down debt. As mentioned, a refund of $2,800 is an extra $233 a month in greenbacks you could have had in your pocket, which you could have used to pay off debt or to have kept yourself from getting into debt. About half of U.S. households report carrying a credit card balance. “You could dedicate that extra money to paying down their balances, which could save you as much as 20% on that money,” Coard says. Even if you’re not paying that high of an interest rate on your plastic, the average credit card charges 13% to 15% in interest, so keeping your balance low (or nonexistent) is a good idea."

https://learnvest.com/article/got-a-...-dont-want-one

Good article but in the real world not easy to convince some clients.


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I agree. When I hire somebody and help them fill out their paperwork, they ask me about it but most of them want to get money back.

.... become the king of snow!
 

Seems like people like to upgrade their snowblowers, moving on up from TroyBilt and Craftsman, to Ariens and Toro and Husqvarna, and if they is totally unhinged ..... to a Honda.

How does that translate to "What to do with your federal income tax refund?" Tax refund time, the months of April and May coincide with very low demand time for snowblowers, and a good time to find that still very strong $200 used snowblower in craigslist.

Turn your tax refund into an orange or red snowblower, and spend all summer long, thinking about next winter's snow .... winter, winter, winter!

That $1000 tax return could have earned $20 in a savings account. :banana: Most people blow that on something stupid so it's more likely that big return would be better spent. I would agree if you are getting a BIG tax return you should probably adjust your withholdings.

Yes. In all practicality most people don’t see the extra 20-50 dollars and are not disciplined enough to save it on their own. I also am referring to clients that receive refunds up to 4-5k not huge refunds of 10k plus. You need to know your clients, financial situation, their lifestyle and spending habits then make your recommendations. I will always pushing clients to max our whatever retirement plan is available to them, give til it hurts you will thank me later.




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Some interesting data in this analysis.

https://blog.hireahelper.com/2019-st...tate-tax-bill/

Thank you. Great article loads of interesting info and stats that are good tools to help determine where to retire


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What federal tax refund
 

Maybe I'm in the minority here. Basically same income in 2018 as 2017. The difference is that in 2018 we ended up owing just under $4,000 when we filed our taxes. Also, we increased the withholding during 2018. Now, if I take the same deductions in 2018 as in 2017 we would have owed an additional $485. How is that tax reform working. Eliminating most deductions. Don't get me wrong, I have no problem with paying taxes. Fortunately. we are not in the situation where we are living minute to minute.

______________________________

I am a retired workaholic and continuing aquaholic

most of the independent studies said that around 6% had increased taxes

ALL of the rates were lower. It was unallowed deductions etc. that may have caused some to pay more.

It’s a very long and exhausting discussion but most tax payers had smaller refunds or larger amounts due but this was the result of greatly reduced withholdings not higher tax rates when in fact most paid less in tax as a whole with lower tax rates. Obviously many factors and no two tax returns are alike. Generally when taxpayers have paid more in 2018 was the result of living in highly taxed states like NY MA NJ CT CA


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Not having to pay the alt min is what saved me a lot of money

Variable income
 

For us, big tax obligation for 2016 which was predictable. Obligation for 2017 was larger than expected, but at a manageable level. This year, we paid estimated tax based on 2017 and now it looks like 2018 will be a refund year (haven't filed final yet). I'm more concerned about those idiots in Concord that added capital gains to the NH Interest and Dividends INCOME tax this year (Who says we don't have an INCOME tax?) I'm hopeful that Gov. Sununu will veto that bill. We had a surplus under the Republican budget and tax plan. Why do we need to raise taxes? Our Democrat legislature is loyal to the Washington DC DNC and is not representing NH residents.
Apologies to those who think taxes are not a Lakes Region issue.

People just don't understand their taxes, Joey. Thanks for posting.

I hope he vetoes it too. They never have enough money. We do have an income tax. What is business profits tax and business enterprise tax if not an income tax?

No problem. Your are correct people read articles and listen to the news that do not paint the complete tax picture. This was my most exhaustive tax season in 35 years and I went through the tax reform act of 1986 that had major changes.


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