The biggest surprise for most people will be that they won’t get a refund next year. While the intent of the refORM was to reduce tAxes for most people, the decision to change the federal withholding tables in 2017 is going to kill your refund.
Most people will owe less tAxes, but they will also have less withheld from their paychecks. This means you get more money now, but don’t expeCT to get more money in your paycheck toDay AND get a big refund at the end of the year. I think this is going to catch a lot of people off guard!
I’m trying to calculate if we need to adjust our withholdings this year. The IRS calculator is unfriendly, as you need to know exaCTly what you filed. I tried TurboTax’s Taxcaster, but for some reason it doesn’t pull in the tax infORMation I provided 3 months ago, and expeCTs me to go dig up the same infORMation.
This should be easy for TurboTax and for your customers. Why isn’t it?
I think it unfair for IRS to require qtrly estimates based on 100% of current year tax (in my situation), when it is August and no fORMs have been released yet. So I have to rely on your taxcaster (serious errors), or the 1040ES in my desktop 2017 TT premier.
so, your taxcaster does not produce the same income tax amount as your 1040ES, both based on 2018 tables. your 1040ES matches to the dollar my own calculation using tables. your caster is significantly higher, using multiple scenarios. since black box, no way to tell what your programming error is in caster.
moving to alt min tax, using your 1040ES, I have to calculate it myself and type it in. fine, but all we have is 2017 fORMs, and rules have changed. so I used own program and came very close to your caster, but only if I moved all business income to another line item. in your caster, if one inputs business income, the alt min tax increases by a HUGE amount, w/ no other changes. since business income is tAxed the same for regular and alt min, should be no change (unless the new 20% deduCTion is an addback). your new alt min is near 50% of the business income. something badly wrong. Finally, the rules for 20% deduCTion for QBI are not yet out, but I read that if income is over $400k, one loses the 20% deduCTion. your caster ignores that, because I put in all my Data, and it forces the 20% deduCTion on any fORM of business income. there is no way around it, other than to not report the business income, move it to other. this causes SE tax to be wrong as well. your caster has flaws.
as to the 3.8% obama tax on net investment income. your 2017 program compares the modified agi – $250k to the net inv income, and takes the lower. it is unclear for 2018 if we are allowed the deduCTions from net inv income, such as inv fees, state tAxes and inv interest (all sizable). the 1040es, and the caster, both assume zero deduCTions (cannot tell if program error or the law changed), but they simply take agi (not allowing the STD deduCTion) and multiply by 3.8%, overstating the NII tax, at least compared to 2017.
fortunately, the 1040ES in the desktop 2017 program seems to cover the new scenarios, except for the inability to calculate the new alt min tax and the lack of clarity for how new tax law treats calcuation of NII for that tax.
can you give me an estimate now what my refund or what I may owe for 2018
To estimate what your refund will look like, you can use our Tax Caster available online or on mobile app.
For a limited time only, we are offering a free 15-minute consultation with a tax expert that can help you better understand tax refORM, and how the new tax law changes could affeCT you. Click herehttps://turbotax.intuit.com/tax-reform/.
The taxcaster Gabi mentioned will ask for your 2017 infORMation and will forecast your 2017 tax due or refund, BUT it also includes a column to the right that shows your 2018 tax liability based on the same infORMation. Until TurboTax upDates the taxcaster for 2018 you can enter your 2018 estimates, ignore the 2017 amount, and use the 2018 column. As a bonus you can see what your tax would have been if the tax law had not passed.