Never understimate the usefulness of Turbo Tax
#16
Re: Never understimate the usefulness of Turbo Tax
Thanks for all these interesting comments about withholding. The way it works for me is that my employer simply insists on withholding a certain amount -- it has a scale of withholding that it imposes on all employees. You can fill in a form to get the amount of withholding reduced, but you can't do it until you've been in the US for 6 months. I've now filled that form in, but haven't had any less withheld yet. I'd love it if I could find a way to get less withheld, but according to the accounts people with my employer, there is no way that they can or will do it.
#17
Re: Never understimate the usefulness of Turbo Tax
It's not up to your employer. You fill out the W4 the way you want, and the consequences of that action all belong to you. In fact, it even sounds like your employer might not be exactly following the law....
#18
Re: Never understimate the usefulness of Turbo Tax
Thanks very much for that. OK, great. I am going to see what I can do. They have published scales of withholding etc., which they say is imposed on them by the IRS.
#19
Re: Never understimate the usefulness of Turbo Tax
This is my first year of filing tax as a LPR.
I earned bugger all in 2006 apart from some rental income. Mrs G1ant only worked the last five months of 2006 and paid about $900 in tax.
This morning I got a refund of almost $3500 paid into my bank. Turbo Tax found all sorts of stuff to claim for that I wouild never have even thought about. I even got a chunk of the Sales Tax back on the car I bought.
In >> $900 Back << $3450 = amazing.
I have a feeling that things will be more painful next year but for now I'm happy as Larry.
alex.
I earned bugger all in 2006 apart from some rental income. Mrs G1ant only worked the last five months of 2006 and paid about $900 in tax.
This morning I got a refund of almost $3500 paid into my bank. Turbo Tax found all sorts of stuff to claim for that I wouild never have even thought about. I even got a chunk of the Sales Tax back on the car I bought.
In >> $900 Back << $3450 = amazing.
I have a feeling that things will be more painful next year but for now I'm happy as Larry.
alex.
I had not claimed or entered the right State tax and got a shitty letter.
But Good on ya.
#20
Mr. Grumpy
Joined: Jun 2003
Location: Nashville, TN
Posts: 3,100
Re: Never understimate the usefulness of Turbo Tax
I just filed for an extension, probably have to pay a penalty, but no big deal, I'd rather have the money liquid in case any good oppos come up.
#22
Re: Never understimate the usefulness of Turbo Tax
Anyone else think it is scandalous, though, the way that the US govt. withholds so much tax? The government must get billions of withheld tax every year and earn massive interest on it. And no one here seems to care. In fact they like the system, not realizing that they are using it as a zero-interest savings policy.
#23
Re: Never understimate the usefulness of Turbo Tax
Thanks for all these interesting comments about withholding. The way it works for me is that my employer simply insists on withholding a certain amount -- it has a scale of withholding that it imposes on all employees. You can fill in a form to get the amount of withholding reduced, but you can't do it until you've been in the US for 6 months. I've now filled that form in, but haven't had any less withheld yet. I'd love it if I could find a way to get less withheld, but according to the accounts people with my employer, there is no way that they can or will do it.
#25
Re: Never understimate the usefulness of Turbo Tax
we had significant "complications" based on share dealing, moving states, relocation packages, signing bonuses... all sorts of stuff... I was sure we'd end up paying lots back but in the end... $400 check sent to the IRS and I'm a happy bunny.
gotta love Turbo Tax
gotta love Turbo Tax
#26
Re: Never understimate the usefulness of Turbo Tax
On visajourney.com, the issue of having one spouse be a resident of another country for the first part of the tax year came up.
The very simplified advice from many was that if a spouse worked in another country from Jan 1 -> any time before June 30, that the foreign income could be unconditionally excluded using Form 2555 (so long as income is less than $82k).
However, TurboTax decided that Toon's income did NOT qualify to be exempted under Form 2555 (though he made less than $82k).
I *think* that everything in his cas hinges upon the "Physical Presence Test" which requires the "resident alien" (Toon) to have been resident for 330 days in a 12-month period (and it can be any 12-month period). However, since Toon spent about 130 days in the US in 2006 (visiting me), then went back and worked for four months, then moved here, it would seem that the Physical Presence Test doesn't apply.
So that means filing for the Foreign Income Tax Credit instead, which includes the joys of figuring the appropriate conversion rate from Euro to dollar on the date the taxes in Holland were paid!
The very simplified advice from many was that if a spouse worked in another country from Jan 1 -> any time before June 30, that the foreign income could be unconditionally excluded using Form 2555 (so long as income is less than $82k).
However, TurboTax decided that Toon's income did NOT qualify to be exempted under Form 2555 (though he made less than $82k).
I *think* that everything in his cas hinges upon the "Physical Presence Test" which requires the "resident alien" (Toon) to have been resident for 330 days in a 12-month period (and it can be any 12-month period). However, since Toon spent about 130 days in the US in 2006 (visiting me), then went back and worked for four months, then moved here, it would seem that the Physical Presence Test doesn't apply.
So that means filing for the Foreign Income Tax Credit instead, which includes the joys of figuring the appropriate conversion rate from Euro to dollar on the date the taxes in Holland were paid!
#27
Re: Never understimate the usefulness of Turbo Tax
But all that relocation gubins, I was worried about that myself, but it never appeared on my W2's as salary or bonus, the company absorbed those costs themselves by paying direct for me, which was great...bloomin' huge relocation expense considering we only moved one state over which meant I didn't get the usual signing on bonus, but that's alright, as a junior, the relocation package was massively higher than what the sign on bonus would have been
#28
Re: Never understimate the usefulness of Turbo Tax
don't you just use the yearly average for the exchange rate?
#29
Re: Never understimate the usefulness of Turbo Tax
No, they want you to use it as it was on the bloody date the taxes were paid.... you can elect a different date under certain circumstances but then if you do that blah blah blah all future tax earnings / credits have to be calculated given that same rate. Since I don't anticipate Toon being paid in Euros I guess we could use the exchange rate that is most advantageous to us (within the time he was in Europe).