Socalguy24 Posted April 10, 2020 Share Posted April 10, 2020 Hi guys, This is my first full year as a PA and as expected my income has increased. I just had my preliminary taxes done, but have not filed. I am single and I filed 0 dependents, but yet I believe with standard deductions I am scheduled to owe 3000 federal and 1000 state. I do have student loans and was wondering does this seem right and if it is should I be exploring possible deductions that might add up more than the standard and if so can you give me some examples? thank you guys for all your help! Quote Link to comment Share on other sites More sharing options...
ohiovolffemtp Posted April 10, 2020 Share Posted April 10, 2020 I'm not an IRS enrolled agent nor did I stay at a Holiday Inn express. However, my tax preparer who is an IRS enrolled agent told me last year when she did my taxes I was only the 8th out of all of her clients who benefited from itemizing deductions. In our case (wife and I filing jointly, kids grown and off the family payroll) it was our mortgage interest and charitable contributions that pushed us over the edge. If you are single and don't have a mortgage it's unlikely that you will benefit from itemizing. Pretty much any tax preparer can determine that for you if doing your taxes yourself doesn't give you the answer. 2 1 Quote Link to comment Share on other sites More sharing options...
mgriffiths Posted April 10, 2020 Share Posted April 10, 2020 8 hours ago, ohiovolffemtp said: charitable contributions Yes...with the new tax laws signed by Trump a few years ago, pretty much anyone who doesn't give significant charitable contributions will not benefit from itemizing. Even many who do give to charity still won't benefit from itemizing. 2 Quote Link to comment Share on other sites More sharing options...
VeryOldPA Posted April 10, 2020 Share Posted April 10, 2020 Are you paid as a private contractor on a 1099? That would make a huge difference I have not itemized deductions for several years now 1 Quote Link to comment Share on other sites More sharing options...
Moderator ventana Posted April 10, 2020 Moderator Share Posted April 10, 2020 I use HRBlock tax prep software I read everything careful and play around with things to make sure I totally understand it feel like I do a better job myself then hiring and account consider getting a little extra money withheld from each paycheck so you get a refund every year..... nope it is not the most prudent plan as you are giving the gov't a tax free loan (they hold your money till you get it back) but emotionally I can handle a refund, i can't handle (choose not to) a big fat tax bill...... 2 Quote Link to comment Share on other sites More sharing options...
deltawave Posted April 10, 2020 Share Posted April 10, 2020 Pay for a real accountant. Spending a few hundred could save you $1000+. The randoms on the internet are not going to be able to tell you your best course for your situation. Pay a professional. 1 3 Quote Link to comment Share on other sites More sharing options...
Moderator ventana Posted April 11, 2020 Moderator Share Posted April 11, 2020 5 hours ago, deltawave said: Pay for a real accountant. Spending a few hundred could save you $1000+. The randoms on the internet are not going to be able to tell you your best course for your situation. Pay a professional. Not totally true. I have an LLC and a sub s Corp. my account has done a couple things wrong over the years with the LLC that if I had not caught it would have cost me a lot. it is about caring. Reading. Asking questions(atleast on the personal tax level). I do have an account doing the LLC as the carry over NOL and depreciation is too much to eep track of. But for personal taxes of a younger PA with any complexity...... well I would give it a try. Quote Link to comment Share on other sites More sharing options...
TWR Posted April 11, 2020 Share Posted April 11, 2020 Ventana, Maybe time for a new accountant! Socialguy24 Practice medicine and let an experienced CPA do your taxes Both just my humble opinion! 1 Quote Link to comment Share on other sites More sharing options...
Boatswain2PA Posted April 11, 2020 Share Posted April 11, 2020 My opinion - if you are smart enough to practice medicine you can certainly do your own simple taxes. If you and family are strictly a W-2 employees and not itemizing then it is piece of cake. Of course, nothing morally wrong with paying someone else if you just don't want to. As taxes become more complicated (1099 work, LLCs, side gigs, etc), then that changes significantly. To the OP: Yes, high earner with no dependents (and no EITC or CTC) then it is not unreasonable to find yourself owing at end of year. Certainly worth spending some of your time getting smart on tax issues (like knowing what EITC and CTC are) to ensure you are getting every deduction you can. You can ask your HR to deduct another $250/month from your pay to ensure you don't have this next year....or just prepare for it by saving it yourself. 1 Quote Link to comment Share on other sites More sharing options...
GetMeOuttaThisMess Posted April 11, 2020 Share Posted April 11, 2020 Assuming this year will be somewhat like last year just take your shortage, divide it by your number of pay periods and W/H at single/zero and add the extra amount. I'm not involved with state taxes since Tx. doesn't have a state income tax. If you're salaried it's easy to create a spreadsheet with the tax components and it will show you exactly what your take home would be, your W/H amounts, and then take those amounts and do a dry run on 2020 taxes using the 2019 information. 1 Quote Link to comment Share on other sites More sharing options...
greenmood Posted April 12, 2020 Share Posted April 12, 2020 Yes. You will always owe now unless you adjust your withholding. Even with dependents (I have two), a mortgage, etc I still owed every year until last year when I finally got it evened out. One year, we had to pay a fine to the IRS because they essentially said we should have known we needed to withhold more. My employer withholds extra now. Quote Link to comment Share on other sites More sharing options...
SedRate Posted April 12, 2020 Share Posted April 12, 2020 On 4/10/2020 at 6:15 PM, ventana said: Not totally true. I have an LLC and a sub s Corp. my account has done a couple things wrong over the years with the LLC that if I had not caught it would have cost me a lot. it is about caring. Reading. Asking questions(atleast on the personal tax level). I do have an account doing the LLC as the carry over NOL and depreciation is too much to eep track of. But for personal taxes of a younger PA with any complexity...... well I would give it a try. Same here. Had issues with the two accountants/tax guys we were referred to over the years, and the one had been doing this for 20 years and the other over 30. Had to pay lots of money just to double-check and correct the work, unfortunately. Quote Link to comment Share on other sites More sharing options...
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