Taxes Suck

Of course you would have been better off with kids and a wife. That gets you double your current standard deduction and another personal exemption and and possibly the child tax credit. But then again if your wife had income, who knows. It's all relative.

Really has nothing to do with your gambling forms.

 

You obviously don't have a wife and kids... kids take way more money than the tax man will ever! [emoji12]

 

Well yeah. Better off on that specific piece of paper.

 

And also consider reviewing your withholding form at work. If you aren't already withholding at zero exemptions, you prolly should.

 

I claim 0. It's just the winnings pushed me over the top which cost me in the long term.

 

My wife has a purse tax. I will be receiving my semiannual bonus at the end of March and she will be buying a Chanel bag with some of those earnings.

 

Wouldn't you rather pay more taxes then have to bleed every month or deal with the havoc that is wrecked on your body from giving birth?

Sorry, I couldn't resist.

FYI- OP no matter what gender you are...you will pay the same amount in taxes.

 

You are right and I did get hit in a PM with the "male" comment. I should have specified being a single TAXPAYER will cause more taxes to be deducted. So, yes, I did not mean to make this a gender specific thread on taxes as no matter which gender the tax rate is the same for both. Sorry for making it seem like my comment was gender specific.

 

I may not understand completely but if they took out taxes at the time of the win your additional tax owed due to higher income should be close to a "wash" and it would seem in effect your jackpot $'s were just not what they first appeared to be. Are you saying you will now owe MORE?
I would then agree with the previous poster who suggested ratcheting down from 1$ to .50 to .25 with each hit. And I would say good luck to you but that also seems to be the root of the problem.

 

Even if you dont itemize normally, you should be able to itemize now if you deduct most or all of your wins, You would then get at least a partial tax gain. Lets say you are currently 3k from being able to itemize, the first 3k of offsetting would gain nothing, but anything over that would be beneficial.

 

Tax brackets are graduated. That means if you make 10k per year or 100k per year you pay the same amount on that first 10k. When you jump to the next tax bracket it doesn't cost more on everything you make. Only the amount that exceeds the new bracket minimum is at the higher rate.

 

Wow - folks really do not understand taxes.

1 - Having wife and kids, or supporting them will reduce your taxable income. But, the cost will more than make up the difference. Do not do that for tax reasons. Paying a mortgage MIGHT help you move to itemized vs standard deduction. Maybe.

2 - Having W2-gs for those that do not itemize really does suck. It is true income. If you win $4,000, it is almost the same as if your boss gave you a $4,000 raise. Actually slight less damaging, as you do not pay FICA (SS) on that.

3 - Tax brackets ONLY impact money that is in the higher bracket.

4 - Claiming zero does not change you taxable income. It only changes what is help back during the year. Your annual tax is exactly the same.

5 - And of course, you can not deduct expenses of a leisure trip to Vegas. You MIGHT be able to deduct some expenses if a business trip, or classified as a professional gambler (not easy).

Taxes may suck, but in the end they are actually quite simple to deal with.

 

I hate paying taxes, but I am actually getting such a big tax return this year that it's paying for our next vacation to Vegas. Gotta love federal tax deductions for environmentally-friendly purchases (i.e. plug-in hybrid electric car and the solar panels we installed to produce the energy to charge the car). Add in our mortgage interest deduction and -- BAM -- Vegas money.

 

Do you?

 

I love the fact that the government is encouraging me to produce less air pollution. Hope everyone else in New Jersey follows my lead so maybe we'll have fewer ozone days and breathing the air in the summer won't hurt old people's lungs. Some people don't care about that kind of stuff, though, I guess.

 

FINALLY someone that understands tax brackets.

Tax brackets are piecewise functions... you are only taxed at that particular brackets rate for the amount that falls in that bracket.

EXAMPLE:

Bracket 1 is 5% and ranges from 0 to $100
Bracket 2 is 10% and ranges from $101 to $300
Bracket 3 is 20% and ranges from $301 and up

If you make $320, you are NOT paying $64 in taxes... you pay $29 in taxes ($5 + $20 + $4)

$5 = 5% of $100
$20 = 10% of $200 ($300 - $100)
$4 = 20% of $20 ($320 - $300)

Another way to think about it:

You are taxed at 5% for the first $100 you make, then you are taxes at 10% for the NEXT $200 you make, then you are taxed at 20% for everything else you make...


If you can't itemize, taxes can suck pretty bad though.

For people with consistent incomes, I recommend to forecast out your total income and total taxes for the year, then run a mock tax return and adjust your withholdings accordingly to get as close to zero as you can...

 

Are you aware that the air is vastly cleaner than it was 50 years ago, or 40, or 30? It's never been this clean.

 

If the air is so clean, then why do we keep having ozone days in New Jersey? It's because we're driving cars that emit poisonous gases as exhaust and powering our homes with fossil fuels that do exactly the same thing. If we can encourage people to use cleaner energy, we should do so, so we can breathe better. I'm excited about new electric cars being produced starting next year that will get 200 miles per charge and can recharge to 80% battery capacity in a half hour. (The battery packs are going to be produced in the new megafactory outside Reno, NV) That's going to change the entire world and our government has extended tax incentives to encourage people to buy them until economies of scale reduce the prices to the point where the incentives aren't necessary anymore.

I have to admit our home set-up for our plug-in hybrid is pretty amazing. Our car is a lower-cost model, so it only gets about 20 miles or so on electric before the gas engine kicks in, but for those 20 miles, the car basically runs on sunlight. Incredible technology. Well worth the tax incentives.

 

1000 cars today put out less pollution than 1 did in 1970, smokestacks are all scrubbed(hardly any left anyway), when I was a kid everyone had incinerators in their house to burn trash, there wood be soot and ash on cars in the morning. Going further back people would die in bad pollution inversions. There are ozone alerts, etc, now because they've changed the standards.

 

One man's tax incentive is another's corporate welfare. It's all about who's ox is being gored.

I drove a friend's Tesla, pretty nifty. But we had to pull over twice to "top off" at a supercharger on the turnpike. Spent $7 for Starbucks, though.

For sure, the standby battery pack for homes connected to an inverter will be a game changer, the video presentation by Elon Musk was very convincing.