Sunday, March 17, 2013

Sometimes Claiming All Your Legal Deductions Can Cost You More #Tax

Most of us are awed by the complexity of even our own seemingly simple tax situations ... Yahoo Finance has an article that has some comfort along with good advice for you:  http://finance.yahoo.com/news/6-tax-terrors-and-how-to-overcome-them-170130521.html

An additional thought:  Try calculating it different ways before deciding on one.  You can often save money, even on the simplest returns.

Here's a recent example I helped with:


A single person came to see me with just two W-2 forms and a donation receipt from a charitable organization.  They were a renter ... so no mortgage interest or property tax, and had just a few medical expenses, and even less of anything else to claim. 

Still, the state income tax withheld from paychecks along with the charitable contribution were enough to be larger than their standard deduction.  Itemizing did increase their federal tax refund.compared with claiming that standard deduction.

Here's where it gets interesting.

They live in a state that requires you to itemize deductions for the state if you itemize on your federal tax return.  Their state likewise requires you to claim the standard deduction if that is what you did on your federal return. 

Because state income tax claimed on the federal return was added back to income on their state return, the result was a larger increase in state tax due than what itemizing saved them on the federal. 

For them they had lower total tax by claiming the standard deduction on both the federal and state returns.  It paid to look at it both ways before hitting the button to e-file their returns.

Yahoo's advice to ask questions and consider your various choices paid off.  Your options are probably different than my example, the point here is to take a deep breath (or several) and carefully look at the options you have.  Most of us do have more than one possible way to legally file our taxes.  Don't wait to the last minute, so you have time to try it one way, then sleep on it and try another.  Often this will save you money.





28 comments:

  1. This comment has been removed by a blog administrator.

    ReplyDelete
  2. This comment has been removed by a blog administrator.

    ReplyDelete
  3. Thanks Doug for the info. I'm just glad we have you figuring it out for us.

    ReplyDelete
  4. very beneficial information. specifically for ones that do not print pictures yet only use the
    computer system as a word processor, which is a big number.


    Feel free to visit my blog Xerox Phaser 8560 Error Codes

    ReplyDelete
  5. Great post. I was checking continuously this blog and I'm impressed! Very helpful information specially the last part :) I care for such info much. I was seeking this certain information for a long time. Thank you and good luck.

    My web-site ... alan jackson

    ReplyDelete
  6. It's going to be finish of mine day, however before ending I am reading this impressive post to improve my experience.

    my weblog :: workouts to increase vertical jump

    ReplyDelete
  7. Very Pretty Earrings! Appreciate your sharing.

    Gonna consider the website now!

    Also visit my homepage - seogeni.com

    ReplyDelete
  8. Great blog Doug! You provide alot of useful answers to peoples finance questions.

    ReplyDelete
  9. Hellο acquaintancеs, how іs the whole thing, аnd whаt уou
    woulԁ liκe to saу concerning thiѕ аrticle, in my ѵiew its actuаlly гemarkable designеd foг me.



    Also viѕit my page :: fast cash advance

    ReplyDelete
  10. I'm not sure where you're getting your informatіon, but goоd topic.

    I neеdѕ to spend sοme time studyіng moгe ог figuring out morе.
    Thanks for great infοrmаtion І was оn thе lookout for this info
    fοr my mission.

    Look into my webѕite - fast cash payday loans

    ReplyDelete
  11. After i head to this site there's new issues and enhanced will likely to be able to study from. Haha I've knowledgeable your supply code
    in addition many instances to master how you're performing things so we're able to
    use them my web Page.
    Thanks! I'll coach you about processes to effortless.

    ReplyDelete
  12. Hi there, just wanted to tell you, I enjoyed
    this article. It was practical. Keep on posting!

    Look at my web page exercises to increase vertical leap

    ReplyDelete
  13. I have been exploring for a little bit for any
    high quality articles or blog posts in this kind of space .
    Exploring in Yahoo I ultimately stumbled upon this website.
    Reading this information So i'm glad to exhibit that I've
    an incredibly good uncanny feeling I came upon exactly
    what I needed. I such a lot indisputably will make
    sure to do not omit this site and give it a glance on a continuing basis.


    Feel free to visit my blog; workouts To jump Higher

    ReplyDelete
  14. Remarkable things here. I am very happy to look your article.
    Thank you a lot and I am looking forward to touch you.
    Will you please drop me a mail?

    my web site; workouts to increase vertical jump

    ReplyDelete
  15. I am Kindhujan, i'm 17+,with160 cm of hight and 45 Kg(ninety nine.208 lbs)
    I desired to acquire weight and grow. but my mother and father are only 55 in top is there will be a problem in developing taller with all the technology..and will i develop tall any much more? and the way?

    My blog :: mike chang monster mass download

    ReplyDelete
  16. wonderful points altogether, you simply gained a new reader.
    What may you recommend in regards to your submit that you made
    some days in the past? Any certain?

    Look into my blog post - Mens Victorinox Swiss Army

    ReplyDelete
  17. What's up everybody, here every person is sharing such know-how, thus it's pleasant
    to read this blog, and I used to pay a quick visit
    this weblog daily.

    Here is my homepage; http://ecustomdiet.com/groups/a-few-exercises-for-improving-your-vertical/

    ReplyDelete
  18. Your style is very unique compared to other people I've read stuff from. Thanks for posting when you have the opportunity, Guess I'll just book mark this site.


    My site http://kedestudio.com/wiki/index.php?title=Usuario:VirgilPLI

    ReplyDelete
  19. What concerning the colour printing. You ask which is less expensive in B&W yet what about general use.
    My inkjet smears every color I try to print. So is laser better for all around
    top quality at an affordable price.

    Also visit my weblog ... http://galilee.ezpt.kr/

    ReplyDelete
  20. Incredible points. Sound arguments. Keep up the amazing effort.


    my website :: xerox 8560 yellow

    ReplyDelete
  21. Back in the past days (meaning: 10 years ago) printservers
    would usually have their own collection of information that would certainly be appended to every printjob,
    practically increasing the complication of the task.
    That was occasionally sufficient to make a gadget run out of memory.
    I don't know if it still makes much of a distinction nowadays.

    Here is my weblog mbamini.blogspot.co.uk

    ReplyDelete
  22. Nice post. I used to be checking continuously this blog and I'm impressed! Very useful info specially the last part :) I deal with such information a lot. I used to be seeking this certain info for a very long time. Thank you and good luck.

    Here is my site; vigrx plus

    ReplyDelete
  23. When I originally commented I clicked the "Notify me when new comments are added" checkbox and now each time a comment is added I get several emails with the
    same comment. Is there any way you can remove me from that service?
    Thanks a lot!

    My blog post; workouts for vertical leap

    ReplyDelete
  24. I always used to read article in news papers but now as I am a user of web therefore from now I am using net for content, thanks to web.


    Feel free to visit my web blog ... vliegtickets

    ReplyDelete
  25. Sir, pls deliver that video clip to my e-mail I.
    D. It will be assistance ful 2 make pcb simple. Thankyou.


    My site ... http://kristyleigh.com

    ReplyDelete
  26. Hello my loved one! I want to say that this post is amazing, nice written
    and come with approximately all significant infos. I'd like to peer extra posts like this .

    Review my web page http://Www.privatecloudandhosting.info/

    ReplyDelete
  27. When we choose to do the opposite of nothing, then we can do something to help others and make a difference.
    Caution: when a hole is made in a can, there may be
    metallic edges that can cut one's mouth. Moreover, there you could also play Scrabble in the internet, TV game shows or game consoles.

    Also visit my weblog :: Play The Game Angry Birds

    ReplyDelete