State Tax Return

[uptomyneck]

Why is it that I always break even on my State tax return? I need to move to a state where they give more credits for things such as 401k's, child care, dependents and so on...like NY. Here in PA I either owe a $1, balance out even or get about $18 dollars back because I put some small change in my son's 529.

 

Arggg

[Seabee]

But breaking even is a good thing. If you want a refund you could increase your withholding.

[ElderGeek]

But breaking even is a good thing. If you want a refund you could increase your withholding.

 

My thoughts exactly.. when I lived in NY, I always got a larger refund from the state

than I did from the IRS, and my withholding allowances were the same for both. It

took me a while to realize that NY's rate of withholding was *way* higher than was

necessary to satisfy the average tax obligation for someone with that number of

exemptions. I was, in effect, loaning the state of NY over a thousand dollars of my

money interest free, and then waiting months to get it paid back to me.

 

Feh. I dropped myself from 5 withholding allowances to 2, and things then balanced

out at tax-time. That was nearly 20 years ago, so I can't say how they do it now, but

I did find out that it was one of the "tricks" they used to get through their financial crises.

[uptomyneck]

I just may do this.

[squirrelgirl]

Ever since DD, I have received a refund on federal. 2007 tax year was the FIRST year I didn't owe to the state...

 

I don't mind owing a little bit.

[Anubis]

But breaking even is a good thing.

Amen and Hallelujah!

 

I wish that kind of education was plastered on every single IRS and state tax form!

 

Breaking even is the absolute best situation you can be in. You're not put in the position of having to come up with a stack of cash you don't have, and you don't have to suffer with lower paychecks over the course of a year just in order to get a make-believe bonus every year at tax time. I've been coming within +/- $50 on both my federal and state returns for the past several years, and it's comforting to know that I'm not going to have to endure a shock to my wallet or have to struggle week-to-week because too much is being withheld.

 

Pat yourself on the back for breaking even on the state return, and work hard this year to make both your state and federal return break even next year!

[Kevin20]

But breaking even is a good thing.

 

I wish that kind of education was plastered on every single IRS and state tax form!

 

Breaking even is the absolute best situation you can be in. You're not put in the position of having to come up with a stack of cash you don't have, and you don't have to suffer with lower paychecks over the course of a year just in order to get a make-believe bonus every year at tax time. I've been coming within +/- $50 on both my federal and state returns for the past several years, and it's comforting to know that I'm not going to have to endure a shock to my wallet or have to struggle week-to-week because too much is being withheld.

 

Why on earth people want a refund is a mystery, as that means you have stupidly handed over an interest free loan to the government, even as you struggle to pay your own bills.

 

I don't even like breaking even. I quite deliberately underpay, and so this year I will very happily pay back Uncle Sam the interest-free loan HE gave ME.

 

As for states, half the reason I live in Texas is that there is no state income tax, so I don't have to deal with that nonsense.

[mdj2000]

refund = giving the government an interest free loan... now why exactly would someone want to do that?

[sonicanatidae]

I did that in the past, now I'm more towards owing/receiving zero.

 

The reason I did in the past, is I wasnt disciplined enough to save money

 

without raiding my savings account constantly. Having the govt. maintain

 

a "savings account" for me was a work-around/solution until I was disciplined

 

enough to do it on my own.

 

When you are able to manage your money, without it managing you,

 

then go for zero owed/paid, but until then, its not a bad way to build

 

up some sort of savings for whatever reason.

 

 

Sure, its not the most efficient/best method, but its not the end of the world.

 

 

For the OP's original question, I dont think moving to another state will

have much effect on your state taxes. I live in Louisiana and, like you, I

just about break even every year. Federal I can manipulate, but I've

pretty much left the State Withholding alone since it roughly zeros out.

Edited January 15, 2009 by sonicanatidae

[cb_opus]

Why is it that I always break even on my State tax return? I need to move to a state where they give more credits for things such as 401k's, child care, dependents and so on...like NY. Here in PA I either owe a $1, balance out even or get about $18 dollars back because I put some small change in my son's 529.

 

Arggg

 

+1

 

I have to laugh, I've written many, many $1 checks to the Commonwealth of Pennsylvania.

 

The most ridiculous thing was when they wrote me and told me I didn't pay them their $1, and that I owed them $1.75 due to penalties and interest.

 

They would not let me fax them a copy of my cancelled $1 check, so I had to buy a stamp for .30 to save .75 on a $1 tax bill because they're too inept and inefficient and lazy to check their bank deposits.

[uptomyneck]

Why is it that I always break even on my State tax return? I need to move to a state where they give more credits for things such as 401k's, child care, dependents and so on...like NY. Here in PA I either owe a $1, balance out even or get about $18 dollars back because I put some small change in my son's 529.

 

Arggg

 

+1

 

I have to laugh, I've written many, many $1 checks to the Commonwealth of Pennsylvania.

 

The most ridiculous thing was when they wrote me and told me I didn't pay them their $1, and that I owed them $1.75 due to penalties and interest.

 

They would not let me fax them a copy of my cancelled $1 check, so I had to buy a stamp for .30 to save .75 on a $1 tax bill because they're too inept and inefficient and lazy to check their bank deposits.

 

 

 

Yeah man, PA is crazy!

[Cactus Flower]

refund = giving the government an interest free loan... now why exactly would someone want to do that?

 

 

Folks that use it as a forced savings account .

 

what are money market accounts paying ... just shy of 0%?

[Uncle Leo]

Why on earth people want a refund is a mystery, as that means you have stupidly handed over an interest free loan to the government, even as you struggle to pay your own bills.

 

I don't even like breaking even. I quite deliberately underpay, and so this year I will very happily pay back Uncle Sam the interest-free loan HE gave ME.

 

I understand that on an intellectual level, but I'd still rather break even or get a small amount back. It just galls me to have to pay them "even more money". Emotional reaction, not logical, I know.

Edited January 23, 2009 by Uncle Leo

[Guest Bree82]

At the age of 26 I finally understood the true meaning of taxes. I have ALWAYS gotten a refund. Last year between Fed and State we got back $12,000 as we were taking our direct deposit advances every paycheck due to my emergency surgery sending us backwards. We sure could have used that extra $1,000 a month - would have saved a lot of headache and fees.

[mudnuri]

imagine working in 1 state that has an income tax, and living in another that has income tax.

 

i get to pay 2 states, the 1st, takes 5.8% of my income, the 2nd I almost break even. Add to that, my employer does NOT take out my 2nd states taxes.....its bologna

 

brandy

[Guest Bree82]

Well - here in California we may be getting IOUs as refunds!