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This years refund/penalty has a lot to do with your withholdings. I have done a few people’s taxes this season and Chad is definitely right about the mileage! I think the new system will balance out more with about 50/50 get refunds/penalties, whereas in the past few years 75% or more of people got refunds. So yes, the government having less of our money throughout the year makes more sense for us, but people don’t understand why they aren’t getting a refund. One person who had historically gotten a mileage deduction ended up owing a substantial amount, so they decided to go with the standard deduction instead. It seems to me that the largest factor in affecting a return is the child tax credit and earned income credit.
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Can someone explain how "they" can change the tax code, then hit you with a penalty for not adjusting your withholding that year? Am I missing something here?
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The IRS made everyone’s employer change withholdings when the new tax law came out, and some of the withholdings were incorrectly calculated
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02-08-2019, 02:09 PM
(This post was last modified: 02-08-2019, 02:23 PM by fenders53.)
That makes sense but Chas mentioned a "penalty". After reading it again, I assume he is actually just referring to additional tax tax owed. And I understand how that will make the financially challenged somehow think their tax rates went up when they file.
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Fenders,
With your rental property being profitable, you can get up to a 20% deduction on the profit.