Tax Year 2020 Calculation and Filing Question vis a vis Upcoming Increases

Greetings, and Happy New Year.

Given that Harris and Biden have promised, repeatedly, to repeal all
Trump administration tax cuts, and to implement tax increases,
the question becomes:

Will such increases apply to Tax Year 2020?

Basis for asking. For myself and others who adjusted their withholding
to be close to or slightly over-withheld to a zero balance, based on
the tax liability that would be incurred during the current tax cuts,
the tax liability will surge much higher as so ordered by Harris and Biden.

Under-withholding by over $500 can cause the tax payer to incur
a penalty as a percent of the over $500 tax liability amount.
Yes, there are certain conditions whereby the IRS will waive the penalty.

If the Harris Biden tax net increase is to apply to the year 2020 return,
then the taxpayer will need to file a quarterly return by Jan 15
to remit the anticipated tax liability increase, and later adjust
withholding (or quarterly filing) to conform to the mandates of Harris and Biden.

And so it becomes financially important to know if Harris and Biden's
plan for us, will apply to Tax Year 2020 or (for sure) 2021 and beyond.

Many thanks, for all your hard work here on ATS.

a reply to: Adonsa

Being that some people will have already filed by the time Inauguration Day comes, I don't think any roll backs could apply to tax year 2020. With the IRS though, who knows...anything is possible.

If the scam plays out, the scammers won't be in power until after the end of the year.

I don't see how they could back date taxes, the IRS might be a bunch of crooks but they've got a keen sense of order.

a reply to: Adonsa

No.
Any tax changes will not effect 2020 retroactively.

But I will say if biden does what I expect we will all be hit hard next year.

originally posted by: Bluntone22
a reply to: Adonsa

No.
Any tax changes will not effect 2020 retroactively.

But I will say if biden does what I expect we will all be hit hard next year.

Yup. Just making 401k's not deductible equates to a tax increase.
I'd love to see the media ask him about that, and the mental gymnastics he'd reply with.

a reply to: peter_kandra

Hey now.. The American people have spoken.
They will now see that elections have consequences.

a reply to: Adonsa

Best way to estimate exactly how it will be under the Harris/Biden administration...is to figure paying 40% more in taxes, earning 40% less in income...and have someone kick you in the nuts.

a reply to: Adonsa

Don't forget the Obamacare penalty "tax" for not having health insurance.

Biden's bringing that back as well.

Can't tell you how it is going to work, I know I hardly ever got a refund, I always applied the refund to the next year and paid in quarterly or maybe if there was a lot of refund I skipped the first quarter payment because of all my business insurances coming due in March. I had to pay a penalty a couple of times, but it was not much. I was self employed as a residential builder, it is different than being an employee. I learned in the first few years of business to make sure to have enough paid in so the big payment of taxes coupled to the penalty did not mess things up in the spring when I had to renew my insurances. Payments for employees taxes I did every three months, and only once was I short in March because of yearly start up costs and that was a big penalty for being a month late on filing. I had workers laid off for the winter, only one employee, good thing I did not have all of them working during the time between January and March.

If we believe that our representatives are so inept then why do Americans continue to file their taxes?

Even if a number like 20% of us refused to pay taxes, that would send a big message.

They won't listen until we mess with their money...

OUR MONEY!

a reply to: Adonsa

First - there has been no new tax legislation passed as yet so the existing rules stand and any changes are unlikely to be retroactive.

Second - you will be seeing an increase this year in taxes, assuming that you are in a lower tax bracket, that was a part of the Trump tax scheme:



Therefore - worrying about what the incoming administration is going to do is pointless until they actually do something. What is worth looking into, and asking a professional, not ATS members, is how your taxes will go up under the currently existing tax law set into place by the outgoing administration.

I have heard from a radio program Trish Reagon hosted that the IRS has plans to increase audits of small businesses by 50%. The feds are trying really, really hard to shut us down.