What is going on with taxes for 2023

Hello ATS,

That time of year again, taxes. I'm not one of those people that claim zero dependants to ensure a massive tax refund. It doesn't make sense to give the GOV an interest free loan, I try to break even.

Nothing has changed for me, I have almost the same income (salary, no overtime), same dependents and living conditions from 2022 yet this year I owe a lot on my 2023 return.

Seriously, what changed? I know we aren't getting the child tax credit boost we had from years back. I went back to my 2022 pay statements and I'm paying roughly the same for taxes. I know tax brackets change but how do you go from getting back $500 a year to owing thousands? Did my work place just mess up that bad? It doesn't seem like it, I'm still using the same personal budget.

I don't get it. Is anyone else seeing this?

a reply to: MauiWaui

I got $600.00 less than I got in 2022. State taxes were the cause.

a reply to: MauiWaui

Same here.

Welcome to Bidenomics.

a reply to: MauiWaui

Seriously, what changed?

Bidenomics and 80,000 new IRS agent that need to be paid.

You can't magically become a third world country; it takes some major planning and a massive snow job less aware people will fall for.

Start a home business, you can deduct a portion of your home utilities and taxes in addition to home improvements and other overhead costs. Then spend more than you bring in with the business, at least on the books, and claim the losses on your income taxes. That will only last for 3 years before the IRS makes you redefine your home business as a hobby that you can't claim losses from. In the third year claim a small profit, then go back to losing money the following year or two before claiming a profit again.

Have your real source of income be your regular job and claim that, but use the home business as a deduction. That would be as legit as you can get for putting money into your home and some personal interests to get back a better return on your taxes from the day job. I know it seems shady, but if you do it right it will be legal and on the level. Say you are into something like boats, cars, motorcycles, whatever, you start a business related to your interests and spend the money on things you would have anyway, but they now become a tax deduction.

Let's say somehow you do great with a home business, well then, take fewer hours in your day job and claim that income under a lower tax bracket while you lose money (wink-wink) on your home business.

ETA: As a home business with a sales tax license, you can buy inventory at wholesale (far cheaper than retail), then, if it is perishable, you can write off the losses without paying taxes on it if it goes bad before you sell it (a very good loophole). However, if you buy wholesale and then utilize it you pay a use tax, not too bad considering you avoided the retail markup. If you actually sell something, pay the sales tax, you will have to anyway to keep the license, you will just need to set some limits to make the books come out even if you are doing business with tax deductions in mind.

a reply to: MauiWaui

Same here I paid almost 36,000 in taxes and still owed it is just theft at this point , then I looked at filing for an extension just to # with them and there’s no point because to file your extension you have to pay the estimated amount anyway now

I'm serious in my last post. With the way I wrangled my income and taxes, I only had $20 withheld this time around when I figured it all out. Technically, they kept over half the withholding until the deductions and other tax stuff, including heating credits, etc., dropped my taxes down to $20. Before I had the home business (I started in Jan 2020), I actually owed income taxes! Unfortunately, I'm letting it go to become a hobby income next time around. I'm kind of banking on Armageddon now.

ETA: I'll be using some of my returns to pay my property taxes that I could use as a deduction with a home business. Ironically my day job income is ultimately from my county I owe property taxes. Render unto Caesar.

a reply to: MauiWaui

I think you may be misinformed.

Having zero dependents doesn't get you a massive return.

My returns over the last 20+ years have been about 40% of a usual paycheck.

And it's been about 20% the last 3 years.

I got 900 about back this year.

originally posted by: watchitburn
a reply to: MauiWaui

I think you may be misinformed.

Having zero dependents doesn't get you a massive return.

Claim yourself as a dependent, one dependent with the standard deductions at the very least.

a reply to: MauiWaui

Former State tax agent (20+ yrs) retired, and paid tax preparer, also retired as of 2020 here.

Without more details, which I would strongly advise against revealing here, it's hard to give you a good answer.

FICA might have changed for 2023 resulting in an underpayment situation on your overall tax liability. But again, hard to say. I am assuming that you double checked your math.

If I were president I'd have a stamp with my name on it and I'd pardon any American who refused to pay their taxes.

At the very least we should decide where our taxes go

At the end of filing, there should be boxes you can check.

WHERE WOULD YOU LIKE YOUR TAXES TO GO?
[ ] Military
[ ] Welfare
[X] Infrastructure
[X] Public Schools
[X] Parks/Forests

Dude, not just you. Nothing changed other than taking on a contractor job for two months. I owed bigly, just wrote Uncle Sam, the porch dwellers, the basement dwelling hot pocket eaters, and the state a huge check this year, WTF! I’m beyond pissed.

How can I get taxed, then taxed again at the end of the year!

a reply to: TheMichiganSwampBuck
Ah, start a home business? You been watching the film "The Accountant". Please be patient, it's coming up to voting year and you will be throw a few tax sweeteners to get you to vote for the "right" party.

a reply to: crayzeed

That was a great movie.

Apparently, they are making "The Accountant 2".

a reply to: TheMichiganSwampBuck

Pretty much why the 80,000 new IRS agents. To audit the crap out of small business and pidilly entities that look shady.

I know folks who brag about paying nothing every year on their small business and writing off ridiculous things you can’t make up.

I’ll pay my fair share but not one penny over. This year is a WTF year though.

a reply to: andy06shake
A bit off topic. andy, you want to watch "Reacher" the series, there are 2.

a reply to: crayzeed

another off topic post, Reacher so far is a damn good show if they don't blank with it could go on for years. tom cruise wishes he could pull off Reacher like Alan Ritchson does.

a reply to: MauiWaui

Sounds to me that you are rich, because democrats and biden said they were going to tax the rich not the regular folks.

Elitists much

To be fair republican tax reform has been a joke as well.

If they really want to tax the rich and make them pay their fair share then they would implement a flat tax without deductions or 70k pages of loophole for the non W2 workers.

a reply to: TheMichiganSwampBuck

My understanding on this is that they changed the rules in 2020 and you can't use deductions from one business for another as easily in the past.

For example a high income w2 owner wouldn't be able to run a side property real estate business and use that to deduct tax liabilities from the w2 income unless they can prove the spend 51% of their time on the real estate company.

With shortterm rentals there are other restrictions as well that has to be rented out x amount of days of the year with no longer than 7 days rentals making y percent of the year.