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#4444915 - 06/29/17 12:30 PM IRS
AirgunSavant Offline


Registered: 07/22/15
Posts: 3772
Loc: MD
A buddy of mine was so happy that for the first time ever in his 60 years he got a refund check from the IRS
in 2015. Today he called me sounding very sad. They now want him to pay $9K for 2015 tax errors.
Nice- my kind of luck. This is the first time he ever filed an extension for 2016. I'm guessing that made them look into his affairs........
I don't want to get on the wrong side of the IRS!

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#4444920 - 06/29/17 12:35 PM Re: IRS [Re: AirgunSavant]
supton Online   content


Registered: 11/09/08
Posts: 11912
Loc: NH
If he wanted a check back... he could just overpay. I don't like how the system is set up (I'd rather state I want x dollars removed from each check, not y deductions), but I do recall saying that I could have more taken out for taxes if I wanted.
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#4444932 - 06/29/17 12:48 PM Re: IRS [Re: AirgunSavant]
Bandito440 Offline


Registered: 02/13/12
Posts: 3854
Loc: NEUS
If he got a refund in error, the error was the fault of whomever prepared his return.

When people get legitimate income tax refunds, it's because they were overpaying all year and giving an interest-free loan to the Tresury Dept. Everyone's goal should be to have their tax return come as close to zero as possible.
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#4444933 - 06/29/17 12:49 PM Re: IRS [Re: AirgunSavant]
Wolf359 Offline


Registered: 04/27/12
Posts: 4741
Loc: MA
Originally Posted By: AirgunSavant
A buddy of mine was so happy that for the first time ever in his 60 years he got a refund check from the IRS
in 2015. Today he called me sounding very sad. They now want him to pay $9K for 2015 tax errors.
Nice- my kind of luck. This is the first time he ever filed an extension for 2016. I'm guessing that made them look into his affairs........
I don't want to get on the wrong side of the IRS!


I never understood why people were happy to get a refund. That means you made an interest free loan to the government and then got your money back. It's better the other way, owe some money that means you got an interest free loan from the government as long as you're not paying a penalty.

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#4444969 - 06/29/17 01:18 PM Re: IRS [Re: Wolf359]
Leo99 Offline


Registered: 03/30/14
Posts: 3039
Loc: NJ
Originally Posted By: Wolf359
Originally Posted By: AirgunSavant
A buddy of mine was so happy that for the first time ever in his 60 years he got a refund check from the IRS
in 2015. Today he called me sounding very sad. They now want him to pay $9K for 2015 tax errors.
Nice- my kind of luck. This is the first time he ever filed an extension for 2016. I'm guessing that made them look into his affairs........
I don't want to get on the wrong side of the IRS!


I never understood why people were happy to get a refund. That means you made an interest free loan to the government and then got your money back. It's better the other way, owe some money that means you got an interest free loan from the government as long as you're not paying a penalty.


You really don't understand this? If people were disciplined enough to save x dollars each paycheck then you'd be right but most are not and getting a check for 4 figures in the spring is a good thing. And if you owe the IRS too much money, they penalize you. I like getting a refund.
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#4444990 - 06/29/17 01:37 PM Re: IRS [Re: AirgunSavant]
Eddie Offline


Registered: 12/07/03
Posts: 9558
Loc: Florida, Cape Coral
I try to figure my tax load as close to zero as possible. I don't like the idea of using the IRS as a savings account without getting paid interest. Sounds like the topic starters friend needs to get profession tax help. Ed
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#4445007 - 06/29/17 01:55 PM Re: IRS [Re: AirgunSavant]
Panzerman Offline


Registered: 12/16/06
Posts: 4203
Loc: Port Orange, Florida
Or be a deadbeat and get a Earned Income Tax Credit.
My sister-in-law consistently gets back three times what she pays in tax every year.
I don't think alot of people realize the poor, they not only don't pay taxes, they take from the kitty.
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#4445012 - 06/29/17 02:01 PM Re: IRS [Re: AirgunSavant]
Chris142 Online   content


Registered: 06/05/03
Posts: 16812
Loc: Deplorable in apple valley, ca
My tax person made a huge mistake on mine in 2012. Added an extra zero to my reported income...that took forever to fix plus I got several letters requesting payment I didnt have etc..
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#4445020 - 06/29/17 02:08 PM Re: IRS [Re: AirgunSavant]
Kestas Offline



Registered: 06/04/02
Posts: 12321
Loc: The Motor City
It used to be you were okay if your final tax bill was within 20% of what was taken out. Now they've tightened it to 10%.

Michigan tacks a 25% penalty if you're off too much.

A long time ago it used to be that your tax was due in one lump sum at the end of the year. I guess the IRS had too many problems with people that can't set aside their money for the tax man, so they decided to have this pay as you earn system.

Over the years they've even stepped that up with the quarterly requirements, which caused unfair hardships to me personally when I cashed in my investments to buy a home. The huge capital gains on my investments became taxable and the IRS penalized me for not foreseeing that I was going to buy a home. They expected me to pay one quarter of my final tax bill five months before I decided to buy a house. I don't have that kind of crystal ball!

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#4445038 - 06/29/17 02:29 PM Re: IRS [Re: Panzerman]
pbm Offline


Registered: 04/19/04
Posts: 7591
Loc: New York
Originally Posted By: Panzerman
Or be a deadbeat and get a Earned Income Tax Credit.
My sister-in-law consistently gets back three times what she pays in tax every year.
I don't think alot of people realize the poor, they not only don't pay taxes, they take from the kitty.


47% of Americans pay NO income taxes and many of those get refunds.....I guess they don't use the roads or any other government services....
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#4445055 - 06/29/17 02:44 PM Re: IRS [Re: AirgunSavant]
L_Sludger Offline


Registered: 10/04/09
Posts: 3947
Loc: Ohio
The IRS is like any large organization. There are good people that work there too! It just has a very unpopular role in society as tax collector.
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#4445090 - 06/29/17 03:23 PM Re: IRS [Re: Wolf359]
blupupher Offline


Registered: 08/27/04
Posts: 4414
Loc: Katy, Republic of Texas
Originally Posted By: Wolf359

I never understood why people were happy to get a refund. That means you made an interest free loan to the government and then got your money back. It's better the other way, owe some money that means you got an interest free loan from the government as long as you're not paying a penalty.


Yes, because interest rates are so great.
I think the average savings account is paying 0.06% right now. That is a whole $0.60 on $1000 over a year. Yippee, I am rich.
Sure there are some CD's and such that may pay ~1.4% now, but the money is tied up for the term of the CD, same for IRA's and other investments.
Yes you can get higher rates, but the risk greatly increases the higher you go.

I would rather get a $1000 refund than pay $10 come tax time. So I loose a dollar in interest. Big whoop.
My refund mostly goes into my savings account though. I do not use it as "found money" to waste on stuff.
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#4445167 - 06/29/17 04:43 PM Re: IRS [Re: AirgunSavant]
AirgunSavant Offline


Registered: 07/22/15
Posts: 3772
Loc: MD
I don't want any IRS interaction.
No refunds and no letters! Pay and leave me alone....Yikes!

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#4445174 - 06/29/17 04:56 PM Re: IRS [Re: blupupher]
Bandito440 Offline


Registered: 02/13/12
Posts: 3854
Loc: NEUS
Originally Posted By: blupupher
Originally Posted By: Wolf359
I never understood why people were happy to get a refund. That means you made an interest free loan to the government and then got your money back. It's better the other way, owe some money that means you got an interest free loan from the government as long as you're not paying a penalty.
Yes, because interest rates are so great.
I think the average savings account is paying 0.06% right now. That is a whole $0.60 on $1000 over a year. Yippee, I am rich.
Sure there are some CD's and such that may pay ~1.4% now, but the money is tied up for the term of the CD, same for IRA's and other investments.
Yes you can get higher rates, but the risk greatly increases the higher you go.

I would rather get a $1000 refund than pay $10 come tax time. So I loose a dollar in interest. Big whoop.
My refund mostly goes into my savings account though. I do not use it as "found money" to waste on stuff.

Let's use componding interest to figure out what you're missing.

Starting with $1,000 and depositing $38.46 every other week instead of letting the Treasury Dept. hold onto it.

Assuming 7% annualized gains in an index fund over 30 years of a career.

You would have made deposits of $30,000 and your ending balance would be $110,373.79.
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#4445196 - 06/29/17 05:13 PM Re: IRS [Re: AirgunSavant]
Wolf359 Offline


Registered: 04/27/12
Posts: 4741
Loc: MA
Originally Posted By: AirgunSavant
I don't want any IRS interaction.
No refunds and no letters! Pay and leave me alone....Yikes!


Reminds me of this comic even though it's not true.

http://www.cbr.com/comic-book-legends-revealed-399/

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