Amazon Will Pay a Whopping $0 in Federal Taxes on $11.2 Billion Profits

[Voice of Reason 10,298]

45 minutes ago, Steeleballz said:

 

   Sixty percent is still crazy though. Then again so is 0%.  

 

   The biggest problem we have with this is the complexity and the sheer amount of pork that has been written into the tax code over the years. Before they make any more changes to marginal rates or income tiers, they really need to clean up and completely overhaul the existing code. Obviously a corporation the size of Amazon is not ever going to be something simple to address, but for 98% of us, it should be back to a straight forward, predictable system that doesn't have a bazillion loop holes to mess around with. 

For my taxes this year, it was VERY simple.  Standard deduction.  No longer allowed to deduct anything for work, and mortgage stuff was way below the standard.  My estimated ETR is 12.2% now, but I haven't filed yet, so not 100% set yet.

 

But I could get behind a 15% flat tax.  Or 12%.

[Nature Boy 2.0 8,370]

46 minutes ago, ALFKAD said:

For my taxes this year, it was VERY simple.  Standard deduction.  No longer allowed to deduct anything for work, and mortgage stuff was way below the standard.  My estimated ETR is 12.2% now, but I haven't filed yet, so not 100% set yet.

 

But I could get behind a 15% flat tax.  Or 12%.

My deductions also are less than the standard even with a little stretching. I am also paying zero income taxes this year, I had a rental property catch on fire. They gave me a nice sum to fix it up, I took the money and gave the house to the guy that lived in the garage apt. He was happy. I was happy , took a huge loss on the property

[Steeleballz 7,550]

54 minutes ago, ALFKAD said:

For my taxes this year, it was VERY simple.  Standard deduction.  No longer allowed to deduct anything for work, and mortgage stuff was way below the standard.  My estimated ETR is 12.2% now, but I haven't filed yet, so not 100% set yet.

 

But I could get behind a 15% flat tax.  Or 12%.

 

   Yeah, works that way for most people now. That wasn't necessarily what I had in mind when I said simplify though. I don't think itemizing is all that complex. 

 

   We were short $1500 that we have to pay. I thought I had everything planned perfectly, but I forgot we can no longer claim the child tax credit for my daughter b/c she turned 17 in December. 

[Dashinka 24,488]

5 hours ago, Lemonslice said:

They do... corporate taxes are certainly a thing, Rate is about 21%.

 

 

What I mean is that anything a corporation pays in taxes comes from those that pay money to the corporations.  Therefore corporate taxes are just another tax on consumers.

[Voice of Reason 10,298]

5 hours ago, Steeleballz said:

 

   Yeah, works that way for most people now. That wasn't necessarily what I had in mind when I said simplify though. I don't think itemizing is all that complex. 

 

   We were short $1500 that we have to pay. I thought I had everything planned perfectly, but I forgot we can no longer claim the child tax credit for my daughter b/c she turned 17 in December. 

Yeah, I have to pay $1650 or so this year.  Have been adjusting my exemptions the past 5 years, but part of my income is variable (rentals), so it's tough to nail it down.  I was hoping to pay about $100.  TT says I owe a penalty of $17 for underpayment,  and even offered to add it to my tax due for me.  I said, "Naw, let the IRS bill me for going over the $1000 owed mark."  (From now on. I will leave the numbers where they are ,and just have an extra amount taken out, simple to adjust that each spring.)

 

Which I find interesting... have a self-employed friend who has filed taxes and paid full taxes due in April every year for the past 20-30 years.  Doesn't pay the quarterly estimated tax.  Has never paid a penalty, and he usually owes $8-10K.  Yet I get hit for a $17 penalty.  Hmmm.

 

I understand now what you meant by simple.  I agree that itemization and filing isn't that hard, buy have saved friends from costly mistakes doing dumb things like claiming mileage driven to work from home.  Another complication is working and living in different states.  Shouldnt be so hard.  File in your home state, and let the work state tale what they are entitled to from the home state.  But no... have to file in multiple states.

[Steeleballz 7,550]

16 minutes ago, ALFKAD said:

Yeah, I have to pay $1650 or so this year.  Have been adjusting my exemptions the past 5 years, but part of my income is variable (rentals), so it's tough to nail it down.  I was hoping to pay about $100.  TT says I owe a penalty of $17 for underpayment,  and even offered to add it to my tax due for me.  I said, "Naw, let the IRS bill me for going over the $1000 owed mark."  (From now on. I will leave the numbers where they are ,and just have an extra amount taken out, simple to adjust that each spring.)

 

Which I find interesting... have a self-employed friend who has filed taxes and paid full taxes due in April every year for the past 20-30 years.  Doesn't pay the quarterly estimated tax.  Has never paid a penalty, and he usually owes $8-10K.  Yet I get hit for a $17 penalty.  Hmmm.

 

I understand now what you meant by simple.  I agree that itemization and filing isn't that hard, buy have saved friends from costly mistakes doing dumb things like claiming mileage driven to work from home.  Another complication is working and living in different states.  Shouldnt be so hard.  File in your home state, and let the work state tale what they are entitled to from the home state.  But no... have to file in multiple states.

 

  They have changed the rules for this year. Instead of 90%, as long as you had 85% of what you owe withheld, you won't have to pay a penalty. Also for any year, if you had 100% withheld the previous tax year, you won't have to pay the penalty. 

 

   Darn though, I looked far and wide but I can't find how they actually calculate the penalty. I got the same message from Taxslayer, but it just said I might have to pay a penalty. Didn't say how much. 

[Voice of Reason 10,298]

19 minutes ago, Steeleballz said:

 

  They have changed the rules for this year. Instead of 90%, as long as you had 85% of what you owe withheld, you won't have to pay a penalty. Also for any year, if you had 100% withheld the previous tax year, you won't have to pay the penalty. 

 

   Darn though, I looked far and wide but I can't find how they actually calculate the penalty. I got the same message from Taxslayer, but it just said I might have to pay a penalty. Didn't say how much. 

https://www.irs.gov/pub/irs-pdf/f2210.pdf

 

I haven't run the numbers on this manually yet, but I plan to just for the exercise.  But as I said, the IRS will have to send me a bill for $17 before I pay it.  It's the principle of the matter...

 I have been overpaying for most of the past 35+ years, and they never gave me a dime of interest.

 

I got a refund last year, so I think I qualify for the 100% rule, but TurboTax says otherwise.  I'll run the 2210 myself and see what shakes out.

[Steeleballz 7,550]

12 minutes ago, ALFKAD said:

https://www.irs.gov/pub/irs-pdf/f2210.pdf

 

I haven't run the numbers on this manually yet, but I plan to just for the exercise.  But as I said, the IRS will have to send me a bill for $17 before I pay it.  It's the principle of the matter...

 I have been overpaying for most of the past 35+ years, and they never gave me a dime of interest.

 

I got a refund last year, so I think I qualify for the 100% rule, but TurboTax says otherwise.  I'll run the 2210 myself and see what shakes out.

 

  Yeah, that's why I wouldn't go by what TurboTax says. Let the IRS calculate it. TaxSlayer at least said we "might" owe the penalty but they recommended doing the worksheet manually to figure that out. I filed about 2 weeks ago and I haven't heard that I owe a penalty yet, but I imagine it would take a couple of months at least before I find out for sure.

[Voice of Reason 10,298]

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Edited February 18, 2019 by ALFKAD

[NikLR 13,227]

Had married friends who both claim single no exemptions on their w4s.   They have one child together and are filing MFJ.  They owe like $300.   Wife made a lot more this year than she has in previous years. 

 

Hubs and I still getting back a bunch since he claims single on w4 and I claim married 0.  I was really annoyed that my charity contributions needed to be over $500 though to be claimed.  

[Voice of Reason 10,298]

18 minutes ago, Steeleballz said:

 

  Yeah, that's why I wouldn't go by what TurboTax says. Let the IRS calculate it. TaxSlayer at least said we "might" owe the penalty but they recommended doing the worksheet manually to figure that out. I filed about 2 weeks ago and I haven't heard that I owe a penalty yet, but I imagine it would take a couple of months at least before I find out for sure.

I wouldn't be surprised if it takes into summer, especially with the shutdown.

 

I always file paper on April 13th, even when I got refunds.  Will do the same this year, owing them.  So I'm hoping I won't hear about the penalty at all, or at least not til September or so.

 

I read the instructions for the 2210, thinking I could estimate it while I'm sitting here wasting time.  No dice.  Gotta go line by line, with a slowness.  Darn convoluted IRS forms...

 

Why can't it be... "You underpaid by this much.  Multiply that amount by 0.02654, and that is your penalty"??  It could be so simple.

 

Back to my friend's situation... how could a person pay zero taxes throughout the year, write a check for X or XX thousand dollars every year at tax time, and never have to pay a penalty?  When we discussed the penalty last year, he genuinely believed I was making it up.  

[Voice of Reason 10,298]

7 minutes ago, NikLR said:

Had married friends who both claim single no exemptions on their w4s.   They have one child together and are filing MFJ.  They owe like $300.   Wife made a lot more this year than she has in previous years. 

 

Hubs and I still getting back a bunch since he claims single on w4 and I claim married 0.  I was really annoyed that my charity contributions needed to be over $500 though to be claimed.  

Why would you do your taxes such that you overpay so much and get a refund?

[NikLR 13,227]

2 hours ago, ALFKAD said:

Why would you do your taxes such that you overpay so much and get a refund?

Because, if the money is there, it'll be spent.  Hubs isn't so good at the saving thing.    So it's like a savings account he can't touch that goes towards large purchase items, like a fridge, or siding etc.. 

[NikLR 13,227]

besides look our friends.  They pay single on their w4s and STILL owe money at the end of the year.  He works for the govt and she works in pay roll at a health insurance place.  Go figure. 

[Voice of Reason 10,298]

48 minutes ago, NikLR said:

Because, if the money is there, it'll be spent.  Hubs isn't so good at the saving thing.    So it's like a savings account he can't touch that goes towards large purchase items, like a fridge, or siding etc.. 

Fair enough.  My brother is like that.  And it took me several years to get over that mind set.  Owing the government is a GOOD thing.  Means you got to use your money thru the year, as opposed to giving the IRS an interest-free loan, which is exactly what a refund is.  Change your exemptions, calculate how much extra you bring home, put that money into an online savings account that makes 2.10%, and you will be money ahead next tax season, trust me!

 

As for your friends... There is IRS help for calculating exemptions and such. It’s really pretty straightforward if one has a steady income.  They just need to claim 3 or 4 exemptions each, most likely.  Me, I claim married and 4, even though it’s just the two of us.  Trouble is, part of my income is variable, and this year was low in write offs, so I ended up taking out to little taxes.  Now I shall have an extra $200 taken out each month, and that should put me owing the IRS less than $1000 next year.