Do people really get refunds over 10K?

[audreyh1]

It’s from Fidelity Charitable, not Fidelity. They know it’s a large donor advised fund operation.

 

[skyking1]

I paid ~1800 this year and I am pleased with that. I can't remember when we got a refund.
I can walk into the office and have them tweak the withholding manually anytime I want. Since I figured that out and started projecting our liability out, I get fairly close.

 

[RobLJ]

I haven't read the 2nd thread of posts.
However, I have a 403b and it requires--no exceptions--withdrawing 20% for Fed Tax on all withdrawals. This was an annoyance the first 4 years, since DW is 4 years younger and I was withdrawing and paying a bit more than twice what the tax would be owed. but now since DW qualifies for IRA withdrawals, I make my withdrawal first, then withdraw from her 401k later; since my withdrawal covers taxes, I don't have to worry about her withdrawal.

I'm not sure whether this is a requirement for all 403bs but it is true of several people I know. It is more an annoyance; once you know you can plan around it.
If you are a single withdrawer, then that would be a pain in the ass.

 

[Tuirc]

Rough numbers, salary 84k, pretax 23K. Tax due appears to be under 6K and they withheld ~ 20K. This is for current year 2023.

I used https://www.irscalculators.com/tax-calculator. I will have some interest/cap gains later but still that seems remarkably far off to me.

Yes, I "got" $22k this year. I blame this on myself and a lot of income changes happening at once. I was penalized the prior year even though I was putting in the max (married & 0). That was probably because my wife was working and shouldn't have been. It was really a just something for her to do because she liked the job. But it was bringing in too much money (and too little money). So, it pushed up a little into the "no man's land" area of the tax code where there's no help for you, but you really aren't making that much money.

Then, because of one thing and another at work I ended up getting promoted twice last year. So, ultimately, I was contributing more to taxes per pay period than I was being taxed. I was paying an extra $900, per pay period to try to stay ahead of the tax man without doing quarterlies. We did our taxes about a month ago and turns out that we were a bit aggressive in our contribution. We'll get back $22k. I've now adjusted back to pay an additional $300 per pay period. If I have to write a smallish check next April, I'm ok with that. Frankly, I was ok writing bigger checks in April, but my greedy Uncle wouldn't have it.

 

[Koolau]

Yes, I "got" $22k this year. I blame this on myself and a lot of income changes happening at once. I was penalized the prior year even though I was putting in the max (married & 0). That was probably because my wife was working and shouldn't have been. It was really a just something for her to do because she liked the job. But it was bringing in too much money (and too little money). So, it pushed up a little into the "no man's land" area of the tax code where there's no help for you, but you really aren't making that much money.

Then, because of one thing and another at work I ended up getting promoted twice last year. So, ultimately, I was contributing more to taxes per pay period than I was being taxed. I was paying an extra $900, per pay period to try to stay ahead of the tax man without doing quarterlies. We did our taxes about a month ago and turns out that we were a bit aggressive in our contribution. We'll get back $22k. I've now adjusted back to pay an additional $300 per pay period. If I have to write a smallish check next April, I'm ok with that. Frankly, I was ok writing bigger checks in April, but my greedy Uncle wouldn't have it.

Heh, heh, Solution: FIRE ASAP!

 

[phil1ben]

In retirement a good portion of my income comes from interests I have in limited partnerships owning more than 50 apartment complexes. Thus I receive more than 50 K-1s each year. It is virtually impossible to estimate my tax liability. So I pay 110% of the previous year's taxes as estimated tax to avoid penalty. The result is that I often have to pay a substantial amount or receive a substantial refund dependent on the K-1s which I do not see until March.

 

[big-papa]

Happens to me all the time. Part of it is I try to target about a $6K refund ($5K for I-bonds purchased via a refund and a $1K buffer in case I do something stupid in my calculations). I also have to contend with the fact that my employer under-withholds tax for my RSU's and my taxable investment account consists of only ETFs which don't report the breakdown between qualified and nonqualified dividends till after the first of the next year. And depending on corporate bonus, ESPP, and RSU values, I sometimes slip into the next bracket. So some estimating involved.

This year was one of those years where the refund was a good deal over my $6K target.

Should all be easier next year as it will be the first full year of retirement and a bit more deterministic.

Cheers.

 

[nobody]

I got about 10k back about 20 years. I worked in Antarctica for 18 months straight. Since I was working outside of the US for over 12 months straight got most of it back. I don't know the details, it was part of the 2 years I hired a tax guy.

 

[MarieIG]

Well, it seems that I was successful in pushing most of my interest income (via treasuries) into 2023 - so we did "overpay."

I am taking some back - and rolling the rest over towards this year, to cover that additional interest income. The good news, I suppose, is that I won't have to increase my estimated income tax payments this year.

 

[Koolau]

In retirement a good portion of my income comes from interests I have in limited partnerships owning more than 50 apartment complexes. Thus I receive more than 50 K-1s each year. It is virtually impossible to estimate my tax liability. So I pay 110% of the previous year's taxes as estimated tax to avoid penalty. The result is that I often have to pay a substantial amount or receive a substantial refund dependent on the K-1s which I do not see until March.

I only ever had to worry about one K-1. The old family business. Our K-1 was always a hassle. I had to contact the CPA handling it - getting him to get it done. He always made me call the family member that bought the business to get the raw data. Then when the K-1 arrived, I always had to hand carry it (late) to the CPA doing our taxes. I was so glad when the last one arrived. Oh, and it meant I had to file taxes in 2 states as well as Federal. Thank goodness that is all over.

I feel sorry for you needing to deal with 50 K-1s.

 

[mwilson]

Speaking from recent experience, if you submit your > $10k 2022 quarterly estimated payment with the 2021 voucher the gov't will happy issue a large refund while also penalizing your late payment.

 

[Koolau]

Speaking from recent experience, if you submit your > $10k 2022 quarterly estimated payment with the 2021 voucher the gov't will happy issue a large refund while also penalizing your late payment.

Wait. Are we supposed to be surprised?