What did/will you do with your return?

[halftimer]

I know the goal is to owe/get as close to $0 as possible, and not make interest free loans to government. However our situation was complex last year so we ended up with a pretty big refund. I admit I'm happy it went that way instead of the alternative! We had already saved up for our next overseas trip, and the refund is actually the exact amount we budgeted. So it looks like the refund will be spent on a few weeks in Japan and the old vacation/trip fund just got spent on: new boxer briefs from the internet (oh yeah, exciting and jealousy inducing!) and noise cancelling headphones for the flight. And of course some combination of index funds/donations/family support with the other $5700 of course. I'm thinking a 90:9:1 ratio but I haven't won that fight yet.

[HipGnosis]

I know the goal is to owe/get as close to $0 as possible, and not make interest free loans to government.

Shouldn't the goal be to owe as much as possible w/o incurring a penalty (and saving to pay it, of course)?

[SC93]

Anyone that loans the government money without any interest, I have a deal for you. Loan me the same amount of money you loan the government except at the end of the year I will pay it in full with a $5 bonus! That way you get an extra $5. Hey, it's more than you get with the IRS! I can put your money to good use and make me a bundle with it like the government does.

[use2betrix]

Anyone that loans the government money without any interest, I have a deal for you. Loan me the same amount of money you loan the government except at the end of the year I will pay it in full with a $5 bonus! That way you get an extra $5. Hey, it's more than you get with the IRS! I can put your money to good use and make me a bundle with it like the government does.

Wow great logic! I’ve never heard that before. Did you come up with that groundbreaking thought yourself or did you just repeat what’s already been mentioned several times in this thread in different wording like you came up with it yourself?

[nawhite]

I know the goal is to owe/get as close to $0 as possible, and not make interest free loans to government.

Shouldn't the goal be to owe as much as possible w/o incurring a penalty (and saving to pay it, of course)?

This is effectively what I ended up doing unintentionally. I unexpectedly owed close to $4000 which clobbered the emergency fund. Fortunately we didn't owe a penalty because we paid half as much tax last year.

Differences were, 1) we made more which put us over the traditional IRA cutoff so those contributions had to be Roths instead. 2) Our rental did much better with fewer major repairs and 3) we didn't spend $3000 on solar equipment this year. Add it all up and our effective rate went from around 8% to around 12%.

[obstinate]

I owe ... A lot. So the question is more along the lines of what am I going to liquidate to pay. :O

[Michael in ABQ]

Even with my withholdings very high and a $10k Roth 401k conversion I still got back about $2k on the federal side. Half will go to pay my state taxes since the National Guard still shows my state as Washington which has no income tax. Thus no withholding on that $15k of income to New Mexico who hit me with a $2 penalty for underpayment.

The remaining $900 or so will go into our savings to buy a full size van since we're about to outgrow our minivan when baby #6 comes along.

[zolotiyeruki]

Even with my withholdings very high and a $10k Roth 401k conversion I still got back about $2k on the federal side. Half will go to pay my state taxes since the National Guard still shows my state as Washington which has no income tax. Thus no withholding on that $15k of income to New Mexico who hit me with a $2 penalty for underpayment.

The remaining $900 or so will go into our savings to buy a full size van since we're about to outgrow our minivan when baby #6 comes along.

FWIW, we migrated to an 8-seat Honda Odyssey when #6 was imminent.  It's worked great the last 3 years.  We're really trying to see if we can avoid the full-size van long enough for the kids to grow up and move out...

[jinga nation]

Have to pay $2500 due to significant increases in W2 and rental incomes. In the past had a less than +/- $100 payment or refund.

Will have to adjust additional W2 withholding. No sleep lost over this. Life goes on.

[OurTown]

I usually end up paying somewhere between $1 and $1,000. 

[Michael in ABQ]

Even with my withholdings very high and a $10k Roth 401k conversion I still got back about $2k on the federal side. Half will go to pay my state taxes since the National Guard still shows my state as Washington which has no income tax. Thus no withholding on that $15k of income to New Mexico who hit me with a $2 penalty for underpayment.

The remaining $900 or so will go into our savings to buy a full size van since we're about to outgrow our minivan when baby #6 comes along.

FWIW, we migrated to an 8-seat Honda Odyssey when #6 was imminent.  It's worked great the last 3 years.  We're really trying to see if we can avoid the full-size van long enough for the kids to grow up and move out...

Our oldest will be 10 when the new baby is born so with all of the kids in car seats or boosters seats I'm not sure an 8-seat minivan will work. Plus with a full size van we can separate the older boys a bit more to cut down some on the "He's touching me! His arm in on my seat! Stop looking at me!" etc.

[zolotiyeruki]

Even with my withholdings very high and a $10k Roth 401k conversion I still got back about $2k on the federal side. Half will go to pay my state taxes since the National Guard still shows my state as Washington which has no income tax. Thus no withholding on that $15k of income to New Mexico who hit me with a $2 penalty for underpayment.

The remaining $900 or so will go into our savings to buy a full size van since we're about to outgrow our minivan when baby #6 comes along.

FWIW, we migrated to an 8-seat Honda Odyssey when #6 was imminent.  It's worked great the last 3 years.  We're really trying to see if we can avoid the full-size van long enough for the kids to grow up and move out...

Our oldest will be 10 when the new baby is born so with all of the kids in car seats or boosters seats I'm not sure an 8-seat minivan will work. Plus with a full size van we can separate the older boys a bit more to cut down some on the "He's touching me! His arm in on my seat! Stop looking at me!" etc.

How long do you keep your kids in boosters/car seats?  Our oldest was 10 when our 6th was born.  For the first couple years, we had 2 boosters + 2 car seats, and it wasn't a problem.

[Fish Sweet]

Got a pretty significant return because I've been making more income and shifting my investments around without thinking about how it would impact my deductions.

My 'treat myself' reward was an electric kettle, I was considering splurging on a massage, and the rest was intended to go straight into VTSAX, but my primary computer just went down so I may unmustachianly get a replacement in an iPad Pro instead.

[Fishindude]

I owe about $16,000.
Is there any way you can just opt out of this crazy taxation thing for a year?

[zolotiyeruki]

I owe about $16,000.
Is there any way you can just opt out of this crazy taxation thing for a year?

Sure you can, but the IRS does not look kindly on it... :P

[Michael in ABQ]

I owe about $16,000.
Is there any way you can just opt out of this crazy taxation thing for a year?

I think Wesley Snipes had a great way for getting out of paying taxes. You should look up how he did it.

[Calvawt]

Apologies if I shared this previously, but a few years ago, our tax return was stolen.  Since then, I have adjusted our withholding so that there is no return to steal.  It isn't fun to write a check to the IRS, but it is definitely preferable to having funds out there for shitweasels to steal.  I make sure that we have enough in savings to cover our taxes, so it isn't a problem.  So there, shitweasels.

Can I get a definition or picture of a shitweasel?

[protostache]

I royally messed up our estimated tax payments last year so we're getting a $14k refund. We got "prove your identity" letters from both the feds and the state so it's going to be awhile before we see it, but most of it has already been spent on a new roof. The rest will end up in our taxable account.

[2Birds1Stone]

H&B

[boarder42]

Buy some VTSAX was planning to owe but opened up a DAF last minute due to tax law changes and we got a huge chunk back.

[TVRodriguez]

Even with my withholdings very high and a $10k Roth 401k conversion I still got back about $2k on the federal side. Half will go to pay my state taxes since the National Guard still shows my state as Washington which has no income tax. Thus no withholding on that $15k of income to New Mexico who hit me with a $2 penalty for underpayment.

The remaining $900 or so will go into our savings to buy a full size van since we're about to outgrow our minivan when baby #6 comes along.

FWIW, we migrated to an 8-seat Honda Odyssey when #6 was imminent.  It's worked great the last 3 years.  We're really trying to see if we can avoid the full-size van long enough for the kids to grow up and move out...

Our oldest will be 10 when the new baby is born so with all of the kids in car seats or boosters seats I'm not sure an 8-seat minivan will work. Plus with a full size van we can separate the older boys a bit more to cut down some on the "He's touching me! His arm in on my seat! Stop looking at me!" etc.

How long do you keep your kids in boosters/car seats?  Our oldest was 10 when our 6th was born.  For the first couple years, we had 2 boosters + 2 car seats, and it wasn't a problem.

Each kid grows at their own rate, and age and weight are only two factors--belt should be at the shoulder, not at the neck, so torso length comes into it, too.  Our oldest is nearly 11, and he got out of the booster seat a couple months ago.  Our second just turned 9, and she just got out of the booster seat last week.  Our 7 year old is still in the booster.

[TVRodriguez]

I just finalized our tax returns today, and I was surprised to see at refund of over $200!  Nice, since I thought we'd owe a couple hundred.  It's not getting earmarked for anything in particular.  I earmark business profits.  Most of those went to hurricane impact windows for our whole house.  I am thrilled with this purchase.  Some of the rest went towards our 2017 IRAs, and some went to our 2018 HSA contribution. 

[Physicsteacher]

We owed the federal government $85 and got a $162 refund from our state. Today I cashed the check from the state. So far I've purchased $9 worth of classroom supplies and a grilled veggie gyro.

[SC93]

Anyone that loans the government money without any interest, I have a deal for you. Loan me the same amount of money you loan the government except at the end of the year I will pay it in full with a $5 bonus! That way you get an extra $5. Hey, it's more than you get with the IRS! I can put your money to good use and make me a bundle with it like the government does.

Wow great logic! I’ve never heard that before. Did you come up with that groundbreaking thought yourself or did you just repeat what’s already been mentioned several times in this thread in different wording like you came up with it yourself?

That came straight from your moms mouth, not mine. :)

[better late]

I've been procrastinating doing them. We are going to owe- a lot - in federal.  yikes.

[Slow&Steady]

Finally did my taxes yesterday.  Looks like although I will get a bigger refund from federal than I usually aim for, most of that is owed to the state.  So my few hundred dollars will be tucked into savings until after maternity leave and then be sent to SL payment. 

The baby stuff splurge (that was probably never going to happen) will not be happening.

[87tweetybirds]

Each kid grows at their own rate, and age and weight are only two factors--belt should be at the shoulder, not at the neck, so torso length comes into it, too.  Our oldest is nearly 11, and he got out of the booster seat a couple months ago.  Our second just turned 9, and she just got out of the booster seat last week.  Our 7 year old is still in the booster.

I'm a shorty, so by that definition at 30 I should still be in a booster seat. Not saying its wrong, just not always practical. If I used a booster seat I couldn't reach the gas pedal. Not to mention I don't think my behind would fit between the armrests on most of the booster seats I've seen.

[mm1970]

I'm pretty sure we owe, like we do every year...

[Dicey]

I know the goal is to owe/get as close to $0 as possible, and not make interest free loans to government.

Shouldn't the goal be to owe as much as possible w/o incurring a penalty (and saving to pay it, of course)?

This is normally our our approach, but we like it when we get just enough to pay the CPA. We were good to go again for 2017 until The Orange One pulled his eleventh hour tax shenanigans. In the final days of December, we opened a Donor Advised Fund and made a significant contribution, which we pulled from our cash reserves. Our charitable giving was already high for the year, now it's through the roof.

Our CPA will e-file for us on the last day. We have zero plans for the money. Don't need anything, already FI/RE. MPP for sure. We will probably just dump it into our reserves while we continue to scout for our next flip or BRRR.

[deek]

Change of plans! Dropping my return on COBRA!! Going to have to suffer through that for 2 months. So excited!

[2Birds1Stone]

Apologies if I shared this previously, but a few years ago, our tax return was stolen.  Since then, I have adjusted our withholding so that there is no return to steal.  It isn't fun to write a check to the IRS, but it is definitely preferable to having funds out there for shitweasels to steal.  I make sure that we have enough in savings to cover our taxes, so it isn't a problem.  So there, shitweasels.

Unfortunately if someone uses your tax ID/SSN to file a bogus return on your behalf, they could still claim enough deductions to get a return back, just becuase YOUR withholding get's you to a $0 in an honest manner, doesn't mean the crooks won't lie about deductions/credits that you didn't actually earn.

Am I completely off base there? 

[Dicey]

Apologies if I shared this previously, but a few years ago, our tax return was stolen.  Since then, I have adjusted our withholding so that there is no return to steal.  It isn't fun to write a check to the IRS, but it is definitely preferable to having funds out there for shitweasels to steal.  I make sure that we have enough in savings to cover our taxes, so it isn't a problem.  So there, shitweasels.

Unfortunately if someone uses your tax ID/SSN to file a bogus return on your behalf, they could still claim enough deductions to get a return back, just becuase YOUR withholding get's you to a $0 in an honest manner, doesn't mean the crooks won't lie about deductions/credits that you didn't actually earn.

Am I completely off base there?

Quoting to say ugh, that sounds about right, the shitweasels.

Also quoting to use my new favorite word so I can anchor it into my brain for future reference.  Shitweasel, shitweasel, shitweasel. Thanks @rosarugosa !

[Stachetastic]

We share a dependent and alternate years we claim him. Last year was a wash, and this year I'm expecting a small refund. If there is a refund, it will go to help replenish the savings after we re-roof one of the rentals this Spring.

[I'm a red panda]

I know the goal is to owe/get as close to $0 as possible, and not make interest free loans to government.

Shouldn't the goal be to owe as much as possible w/o incurring a penalty (and saving to pay it, of course)?

This is normally our our approach, but we like it when we get just enough to pay the CPA. We were good to go again for 2017 until The Orange One pulled his eleventh hour tax shenanigans. In the final days of December, we opened a Donor Advised Fund and made a significant contribution, which we pulled from our cash reserves. Our charitable giving was already high for the year, now it's through the roof.

Our CPA will e-file for us on the last day. We have zero plans for the money. Don't need anything, already FI/RE. MPP for sure. We will probably just dump it into our reserves while we continue to scout for our next flip or BRRR.

This is what happened to us too. Since the tax laws changed late in the game, we had super late changes too.  We don't usually have more than a 2-3 figure refund. So 5 figures was a lot.

[Much Fishing to Do]

I know the goal is to owe/get as close to $0 as possible, and not make interest free loans to government.

Shouldn't the goal be to owe as much as possible w/o incurring a penalty (and saving to pay it, of course)?

Shouldn't the goal be to owe as much as possible and make more than the penalties cost you? (which are basically 4% interest).....Ok, maybe thats finally going one step to far, but this is basically the thought that makes me not worry about estimated taxes, if I underpay I end up owing a "penalty" that is not that far off from the value of holding the money anyway

[TheAnonOne]

Can I be the un-MMM one of us today?

I had nearly 5k come back, and ended up spending 1k on a few things for my motorcycle (though I would have anyway, the return just conveniently comes in the spring).

The rest I held onto because I set my 401k at 100% of my income. This was back in late jan/early feb. My 401k is already maxed!

[Miss Piggy]

Just as a friendly little reminder so you can sound every bit as smart as you are:

   - A tax RETURN is the form used to state your earnings and figure out your tax liability.

   - A tax REFUND is the amount you get back if you overpaid. I believe this thread is about the refund, not the return.

That said, I think we'll use ours to pre-pay some of 2018's quarterly taxes and purchase some mutual funds. How exciting is that!!??

[Dicey]

Just as a friendly little reminder so you can sound every bit as smart as you are:

   - A tax RETURN is the form used to state your earnings and figure out your tax liability.

   - A tax REFUND is the amount you get back if you overpaid. I believe this thread is about the refund, not the return.

That said, I think we'll use ours to pre-pay some of 2018's quarterly taxes and purchase some mutual funds. How exciting is that!!??

Very!

[Cranky]

Each kid grows at their own rate, and age and weight are only two factors--belt should be at the shoulder, not at the neck, so torso length comes into it, too.  Our oldest is nearly 11, and he got out of the booster seat a couple months ago.  Our second just turned 9, and she just got out of the booster seat last week.  Our 7 year old is still in the booster.

I'm a shorty, so by that definition at 30 I should still be in a booster seat. Not saying its wrong, just not always practical. If I used a booster seat I couldn't reach the gas pedal. Not to mention I don't think my behind would fit between the armrests on most of the booster seats I've seen.

You actually *should* use a belt adjuster to make it sit correctly.

[NoraLenderbee]

I know the goal is to owe/get as close to $0 as possible, and not make interest free loans to government.

Shouldn't the goal be to owe as much as possible w/o incurring a penalty (and saving to pay it, of course)?

Shouldn't the goal be to owe as much as possible and make more than the penalties cost you? (which are basically 4% interest).....Ok, maybe thats finally going one step to far, but this is basically the thought that makes me not worry about estimated taxes, if I underpay I end up owing a "penalty" that is not that far off from the value of holding the money anyway

Where can you make a guaranteed 4% while being sure of having your money out exactly when you need it?

[lexde]

Put mine straight to student loans. It was only about $1k though so nothing to sweat either way.

[obstinate]

Where can you make a guaranteed 4% while being sure of having your money out exactly when you need it?

Depending on your tolerance for risk, that is the wrong question. The question is: where can you put the money such that the expected value is positive.

That being said, I don't know if the risk really pays in this case.

[NoraLenderbee]

We owe about $4,000. Husband made some money trading options, and I exercised RSUs from work. Might increase withholding for next year, because I don't like having a $4,000 bill. But it's not the worst problem to have.

[rosarugosa]

Apologies if I shared this previously, but a few years ago, our tax return was stolen.  Since then, I have adjusted our withholding so that there is no return to steal.  It isn't fun to write a check to the IRS, but it is definitely preferable to having funds out there for shitweasels to steal.  I make sure that we have enough in savings to cover our taxes, so it isn't a problem.  So there, shitweasels.

Unfortunately if someone uses your tax ID/SSN to file a bogus return on your behalf, they could still claim enough deductions to get a return back, just becuase YOUR withholding get's you to a $0 in an honest manner, doesn't mean the crooks won't lie about deductions/credits that you didn't actually earn.

Am I completely off base there?

Quoting to say ugh, that sounds about right, the shitweasels.

Also quoting to use my new favorite word so I can anchor it into my brain for future reference.  Shitweasel, shitweasel, shitweasel. Thanks @rosarugosa !

Glad you like it, Dicey!  I did not coin it, but I'm happy to share!

[Just Joe]

Will stick it in savings for now. We'll need a new roof this year. Also wanting a to build a detached garage and still dont have my homework done there so i don't know what the cost will be.

[Mesmoiselle]

Thankfully, got a lower return this year. I took it, and another 4k and started a ROTH IRA so it could play footsy with my Traditional IRA. :)

[Mesmoiselle]

Here are some ideas that I would like to see on this thread so that I can either get my judgy-pants or my envy-pants on:
1. Buy a Vitamix! Judgy AND Envy both together!

I'm rolling over here. my blender broke and I sat on the idea of a Vitamix for three weeks before I finally realized I didn't even want the Vitamix because I thought it'd be better. I wanted a Vitamix because all my vegan friends had one. Bought another cheapo, it will probably last me another 3 years like the last cheapo did. XD

[Roadrunner53]

Yu have already bought a blender but in the future you might contact Vitamix to see if they have any refurbs for a cheaper price.

[cmk]

We made the last payment on the last semester of our youngest son's college education.  They're lucky that we were willing and able to help them out.  We paid what they couldn't, and good grades were required.  The oldest has expressed his thanks that he didn't have to start life encumbered by loans, hopefully little bro will realize that soon.  Feels awesome to see them as adults and becoming successful!  And very nice to have the extra $$$ to save toward our retirement!

[MM_MG]

We usually owe, but due to some changes at SO's work last year we ended up getting a small return.   It will simply be tossed into the taxable account of VTSAX.