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Overwhelmed

December 29th, 2012 at 02:59 pm

I sat down to try to estimate our taxes for 2012 and I'm overwhelmed. I think it is because there are documents all over the place because of the move.

We cannot deduct state income taxes withheld because DH income is not taxable in our state. Therefore, we are eligible to deduct state sales tax. Ugh...I don't know how to figure that. The program I used must have estimated it last year. ETA: I did find a calculator on the IRS website, but it is only good for 2011

I did do a rough estimate this summer, and that calculation shows we will owe $262. However, I noticed that I didn't include our state refund from 2011 in that calculation. And that refund was $2,309...I would think that would make a difference.

It also looks like we don't have enough itemized deductions to exceed the standard deduction. Darn. This will be the first year that has happened to us. All because of low interest rates!! I guess the government can use the money more than our bank.

I think the main thing I'm coming away from is that this tax return will be different this year. I just need to expect that we will owe money. I will wait to do the actual calculation once all the forms come in and a program is ready to do the calculations for me!

6 Responses to “Overwhelmed”

  1. mjrube94 Says:

    Don't get too stressed. At least you're way ahead of the game thinking about this now, and not on April 14th!

  2. Petunia 100 Says:

    Did you itemize last year? If not, your state tax refund is not taxable. (State income tax refunds are only taxable to the extent you received a benefit for deducting them).

  3. creditcardfree Says:

    Yes, Petunia we did itemize last year...so it will be taxable.

  4. Amber Says:

    Hang in there;I'm not too familiar with deductions, hang in there.

  5. scfr Says:

    Sounds like a good plan to wait until all the forms are in and the IRS has had time to update everything. I usually wait until after Jan 31st. Getting a standard deduction is actually a good thing, if you think about it. It means you aren't paying a ton in interest and medical expenses, etc. Owing a little isn't the end of the world either ... It means you weren't loaning money to the federal government interest-free. Smile

  6. creditcardfree Says:

    Thanks, scfr! I appreciate your way of looking at the standard deduction. I have no problem paying, however, I was wanting to get a little more firm on the amount. At this point, I will just wait until I have more information readily available. A lesson in patience. Wink

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