Tax Cut savings calculator

The site only lists a $210 deduction for me, but since all my income is rental income, I can take 20% right off the top of my net. That will be over $10K deducted from income at 25% (now 22%).

It will save me $2,500, as I am in the 25% tax bracket, plus 3% of ~$40K+ that was going to be taxed at a bracket 3%+ more than the new tax rates. Add in $1,200. A total of potentially almost $4K.
 
The calculator suggests that we'll get a $230 cut (actually from $470 tax increase to a $1,000 tax cut).

My more detailed calculations suggest that we'll have a $267 tax increase, which is within the range suggested by the calculator.
 
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"$520 tax cut - Between $270 and $940 for most households like these in 2018."
 
Estimate +12 to 16K, :facepalm: but I won't know for sure until I talk to the accountant.
 
MarieIG said:
Estimate +12 to 16K, :facepalm: but I won't know for sure until I talk to the accountant.
Click to expand...

Unless you are writing off $40K-$50K+ in property taxes and interest, that is a lot of extra taxes, especially with a lower rate.

Why do your taxes go up so much?
 
Thanks for the link. Looks like about a $Grand savings for us. Oddly, I'm in a "high" tax state, but don't pay high state taxes because of the retiree deductions at the state level (SS and pension and some 401(k) income are not taxed for retirees.) YMMV
 
Thanks for the link Mulligan. My calculation says we'll get an extra $1600. We'll see next year if that is right.
 
Were in for an $1,150 increase. I could make this higher, but wifey tells me that we still need to tithe and contribute to necessary charities.

I
 
If any desktop TurboTax users want a more exact calculator than the NYT one, I noticed that TTax has updated their What-If form for 2018.

As I expected, we are in the 25% of taxpayers that will be paying more. With the exact same inputs, $668 in 2017 vs $5403 in 2018 means a whopping 685% increase for us.

To get to the What-If tool in TurboTax:
- press Ctrl+2 (Cmd+2 on a Mac) or choose Forms from the View menu
- click the Open Form icon then start typing "what-if" in the search box and select What-if Worksheet when it appears
- check the box at the top of the what-if form to copy column 1 to column 2
- check the box in column 2 to use 2018 tax rates
 
cathy63 said:
If any desktop TurboTax users want a more exact calculator than the NYT one, I noticed that TTax has updated their What-If form for 2018.

As I expected, we are in the 25% of taxpayers that will be paying more. With the exact same inputs, $668 in 2017 vs $5403 in 2018 means a whopping 685% increase for us.

To get to the What-If tool in TurboTax:
- press Ctrl+2 (Cmd+2 on a Mac) or choose Forms from the View menu
- click the Open Form icon then start typing "what-if" in the search box and select What-if Worksheet when it appears
- check the box at the top of the what-if form to copy column 1 to column 2
- check the box in column 2 to use 2018 tax rates
Click to expand...

Thanks for that. I have my own spreadsheets, but like to use TurboTax for what-if if I can, and I was wondering if they had updated to 2018.
 
Lawrencewendall said:
Kind of related. The IRS came out with a calculator to determine if your 2018 withholdings will leave you with a bill next year.

May want to run your numbers. If I didn't bump my withholdings for the remainder of 2018 up by $185 a pay period, I would be hit with a 5k Federal bill next year. :mad:

https://apps.irs.gov/app/withholdingcalculator/index.jsp
Click to expand...

It's going to be interesting to see how this all plays out next spring. A lot of people who don't pay attention to withholding are going to be shocked and feel like they're paying more even though they might actually be paying less.

I'm just going to pay the safe harbor amount, but at least I know that I'm intentionally underpaying and am expecting the ~$5K bill that'll hit us next April.
 
cathy63 said:
If any desktop TurboTax users want a more exact calculator than the NYT one, I noticed that TTax has updated their What-If form for 2018.

As I expected, we are in the 25% of taxpayers that will be paying more. With the exact same inputs, $668 in 2017 vs $5403 in 2018 means a whopping 685% increase for us.

To get to the What-If tool in TurboTax:
- press Ctrl+2 (Cmd+2 on a Mac) or choose Forms from the View menu
- click the Open Form icon then start typing "what-if" in the search box and select What-if Worksheet when it appears
- check the box at the top of the what-if form to copy column 1 to column 2
- check the box in column 2 to use 2018 tax rates
Click to expand...

It gets a bit tricky if you are doing Roth conversions to the top of the 0% LTCG tax bracket.

All else equal, we'll lose ~$3,400 of deductions/exemptions under the new law so our Roth conversions will be that much less.... partially offset by a $1,300 increase in the top of the 0% LTCG TI from 2017 to 2018... so our Roth conversions will be $2,100 lower but our taxable income will be $1,300 higher.

Tax will be ~$60 lower.... $2,100 lower ordinary income at 3% (12% vs 15%). Under the new law the next $2,100 in Roth conversions would cost me 27% (12% + 15%) so I'm not going to do that.

So for us, net losers principally due the deductions/exemptions change.
 
Last edited:
cathy63 said:
If any desktop TurboTax users want a more exact calculator than the NYT one, I noticed that TTax has updated their What-If form for 2018.

As I expected, we are in the 25% of taxpayers that will be paying more. With the exact same inputs, $668 in 2017 vs $5403 in 2018 means a whopping 685% increase for us.

To get to the What-If tool in TurboTax:
- press Ctrl+2 (Cmd+2 on a Mac) or choose Forms from the View menu
- click the Open Form icon then start typing "what-if" in the search box and select What-if Worksheet when it appears
- check the box at the top of the what-if form to copy column 1 to column 2
- check the box in column 2 to use 2018 tax rates
Click to expand...
Nice tip!
I notice that TOTAL TAX is $750 less in 2018. Some or all is due to turning 65?

Between our two separate employers, bi-weekly tax paid is down about $110. Noticed this previously, and will increase my 401(k) contributions to offset the problem.
 
I'm not trusting the IRS calculator. It says I should be claiming Married & 14 allowances on my W4. I'm currently claiming Single, 0 allowances and an extra $50 a check, which by my calculations should get us a ~$350 refund.


I use H&R Block and their 2018 planning calculator won't be ready until March 23. I predict there will be lots of wailing and gnashing of teeth next year at this time.
 
cathy63 said:
It's going to be interesting to see how this all plays out next spring. A lot of people who don't pay attention to withholding are going to be shocked and feel like they're paying more even though they might actually be paying less.

I'm just going to pay the safe harbor amount, but at least I know that I'm intentionally underpaying and am expecting the ~$5K bill that'll hit us next April.
Click to expand...

That was DESIGNED by the current party in power...(potentially expecting a slight shift...and a reversion by the electorate in the following _{presidential}_ election). it’s just strategy, but too many won’t understand, and blame it on the newbies


[AFA the results after the change for us: it supposedly gives us over $1600 less tax ]
 
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Lawrencewendall said:
Kind of related. The IRS came out with a calculator to determine if your 2018 withholdings will leave you with a bill next year.

May want to run your numbers. If I didn't bump my withholdings for the remainder of 2018 up by $185 a pay period, I would be hit with a 5k Federal bill next year. :mad:

https://apps.irs.gov/app/withholdingcalculator/index.jsp
Click to expand...

The Irs calculator does not include asking about qualified dividends and cap gains, and assumes one is essentially a w-2 employee, asking about salary.
So grossly inadaquate. (it assumes all interest and dividends occur at the rate full rate)
 
Most of our income is from rental property - but I find conflicting thoughts on whether the rental income will get the 20% tax exclusion for pass through income. We do NOT hold the rentals as LLCs. Our tax person indicates that the IRS hasn't really given guidance on whether non-LLC or S corp rental income will get the favorable treatment.
 
cathy63 said:
If any desktop TurboTax users want a more exact calculator than the NYT one, I noticed that TTax has updated their What-If form for 2018.

As I expected, we are in the 25% of taxpayers that will be paying more. With the exact same inputs, $668 in 2017 vs $5403 in 2018 means a whopping 685% increase for us.

To get to the What-If tool in TurboTax:
- press Ctrl+2 (Cmd+2 on a Mac) or choose Forms from the View menu
- click the Open Form icon then start typing "what-if" in the search box and select What-if Worksheet when it appears
- check the box at the top of the what-if form to copy column 1 to column 2
- check the box in column 2 to use 2018 tax rates
Click to expand...

Thank you. This was very helpful. Even though I'm a long-term user of TurboTax, I didn't know about this feature. Previously, I would create a what-if return from the current return and this was good enough since not many things changed. However, with the new tax law changes and some large swings in various types of income on my return, my 2018 picture will be quite different. None of the online calculators come close to being able to work with the complexities in my return.
 
SumDay said:
I'm not trusting the IRS calculator. It says I should be claiming Married & 14 allowances on my W4. I'm currently claiming Single, 0 allowances and an extra $50 a check, which by my calculations should get us a ~$350 refund.


I use H&R Block and their 2018 planning calculator won't be ready until March 23. I predict there will be lots of wailing and gnashing of teeth next year at this time.
Click to expand...



I agree. DH and I volunteer with AARP, doing tax returns for seniors and lower-income families. It’s remarkable how many people don’t understand the difference between tax liability and withholding.
 
Interesting to see this today, I worked on our 2017 taxes last night and wanted to get an idea what 2018 was going to look like.

We are both on SS, and also take withdrawals from our IRAs. We will continue to pay income tax on 50% of our SS benefits, but I wanted to see what raising our IRA withdrawal would do to taxes due.

Found this calculator.
https://financialducksinarow.com/11520/taxability-social-security
 
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