I’ll give you an upvote to bring you back to zero, and just add that these are usually taken out of a future tax CREDIT, so it isn’t something someone would pay BACK, but it would certainly reduce a future refund. That however, could happen via an adjustment to the standard deduction, etc. so it’ll go unnoticed by most.
Yeah, can you imagine that negotiation 6 months from now? Who has the upper hand? The guy who wants to let you keep your money or the guy who wants you to pay it back? This is a brilliant move.
Yeah? I mean, "bribing" voters with their own money is pretty okay with me. Do you mean "tax credits" instead of "tax cuts"?
Well the plan was to increase tax receipts with low unemployment, withdrawal troops from foreign wars and re-negotiate the bad trade deals in our favor. I'm assuming you are libertarian and want small government. Tell me, what has Rand and Ron done the past 3 decades in Congress that we could emulate on a large scale to reduce the national debt?
It's late for me to be doing maths, but if you claim the right amount of exemptions on your W-4, you don't usually owe or get much of a refund. Claiming the right amount of exemptions lets you keep most of your money, without anticipating a refund (read: giving the government an interest free loan).
Now, if you are claiming the right amount of exemptions, and they defer the payroll tax, aren't you going to either make the adjustment to your W-4, claiming zero exemptions, or have to bank the "extra" cash you are now getting to pay back, because now you will be getting "more" on your checks?
I am not a tax person at all, I am just wondering how exemptions are offset from a payroll rax deferral.
You don’t adjust your w4. Even last year with the payroll tax change, the withholdings just updated on the payroll softwares and the manual tax spreadsheets (if anyone does payroll taxes manually when hand writing checks.)
W4s just tell your employer how much to withhold, based on selecting IRS criteria. You don’t say ‘24% bracket’, you say ‘head of household’ etc.
The # of exemptions actually doesn’t exist anymore on the w4. They took that away in 2019.
This still doesn't answer my question. I can still claim dependents and filing status on my W-4. And it impacts how much I owe, or get a refund on.
It sounds like a payroll tax deferment would by like claiming exempt from withholding by default, if it is "automatic", meaning I start seeing more money on my check, but they still want it back at some point. People might not be cognizant of this until tax season, and that money may already be spent, then you might have to pay "double" taxes to catch up through the next tax season, if you can't pay it when the deferment comes due. Am I not being clear with what I am asking?
You are clear, and I understand your statement. What we are missing each other on the main theme. I describe altering the standard deduction above, but the most likely scenario is they would be giving you a reduction in your withholdings as an 'early' refundable credit anyway. So getting it this year (spread across six months’ paychecks) would simply remove it from a future year...it isn't owing more taxes when you do that year, it is just getting that credit now...(and still getting this year’s) You are envisioning a loan, to be paid back. I’m describing an advance on a future discount, so to speak. A discount you get every year, so this year you get it twice, next year none. Not a loan, just early.
On the exemptions: The IRS dropped them last year, and you don't get to claim the arbitrary numbers you used to. There is no way to file exempt now when you are not exempt. There is no way to lower your taxes either....you used to enter extra exemptions, but that is gone. The only options is to pre-calculate your estimated deductions v. the standard deduction (pg. 3) and/or reduce the amount of withholdings directly related to your child tax credit (see step 3 on the form, it's in dollars now) IF you will make low enough to claim it. For a reference, here is the current W4
I’ll give you an upvote to bring you back to zero, and just add that these are usually taken out of a future tax CREDIT, so it isn’t something someone would pay BACK, but it would certainly reduce a future refund. That however, could happen via an adjustment to the standard deduction, etc. so it’ll go unnoticed by most.
Yeah, can you imagine that negotiation 6 months from now? Who has the upper hand? The guy who wants to let you keep your money or the guy who wants you to pay it back? This is a brilliant move.
Yeah? I mean, "bribing" voters with their own money is pretty okay with me. Do you mean "tax credits" instead of "tax cuts"?
Well the plan was to increase tax receipts with low unemployment, withdrawal troops from foreign wars and re-negotiate the bad trade deals in our favor. I'm assuming you are libertarian and want small government. Tell me, what has Rand and Ron done the past 3 decades in Congress that we could emulate on a large scale to reduce the national debt?
I think we’re just speaking from different reference points. It isn’t paid back if it happens this way, it is simply a tax credit taken EARLY.
Again, that’s only if this is the avenue it plays out. We still don’t know the details.
Interesting. First time I've read this information.
Just saying it’s one of many possibilities.
It's late for me to be doing maths, but if you claim the right amount of exemptions on your W-4, you don't usually owe or get much of a refund. Claiming the right amount of exemptions lets you keep most of your money, without anticipating a refund (read: giving the government an interest free loan).
Now, if you are claiming the right amount of exemptions, and they defer the payroll tax, aren't you going to either make the adjustment to your W-4, claiming zero exemptions, or have to bank the "extra" cash you are now getting to pay back, because now you will be getting "more" on your checks?
I am not a tax person at all, I am just wondering how exemptions are offset from a payroll rax deferral.
You don’t adjust your w4. Even last year with the payroll tax change, the withholdings just updated on the payroll softwares and the manual tax spreadsheets (if anyone does payroll taxes manually when hand writing checks.)
W4s just tell your employer how much to withhold, based on selecting IRS criteria. You don’t say ‘24% bracket’, you say ‘head of household’ etc.
The # of exemptions actually doesn’t exist anymore on the w4. They took that away in 2019.
This still doesn't answer my question. I can still claim dependents and filing status on my W-4. And it impacts how much I owe, or get a refund on.
It sounds like a payroll tax deferment would by like claiming exempt from withholding by default, if it is "automatic", meaning I start seeing more money on my check, but they still want it back at some point. People might not be cognizant of this until tax season, and that money may already be spent, then you might have to pay "double" taxes to catch up through the next tax season, if you can't pay it when the deferment comes due. Am I not being clear with what I am asking?
You are clear, and I understand your statement. What we are missing each other on the main theme. I describe altering the standard deduction above, but the most likely scenario is they would be giving you a reduction in your withholdings as an 'early' refundable credit anyway. So getting it this year (spread across six months’ paychecks) would simply remove it from a future year...it isn't owing more taxes when you do that year, it is just getting that credit now...(and still getting this year’s) You are envisioning a loan, to be paid back. I’m describing an advance on a future discount, so to speak. A discount you get every year, so this year you get it twice, next year none. Not a loan, just early.
On the exemptions: The IRS dropped them last year, and you don't get to claim the arbitrary numbers you used to. There is no way to file exempt now when you are not exempt. There is no way to lower your taxes either....you used to enter extra exemptions, but that is gone. The only options is to pre-calculate your estimated deductions v. the standard deduction (pg. 3) and/or reduce the amount of withholdings directly related to your child tax credit (see step 3 on the form, it's in dollars now) IF you will make low enough to claim it. For a reference, here is the current W4