TaxCaster for 2018 estimated taxes

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HoneyBee
Posts: 56
Joined: Sun Apr 24, 2011 8:45 pm

TaxCaster for 2018 estimated taxes

Post by HoneyBee » Sat Dec 08, 2018 6:38 pm

I used TaxCaster to estimate my 2018 taxes and was surprised to see that it shows we will owe about $8500 in addition to my w/holding. I got a similar result with the H&R Block estimator. I presume both of these programs have been updated based on the 2018 tax reform.

Based on new tax rates for MFJ, we should have gone from the 28% bracket to a 24% bracket but it is not looking like we will get a tax cut for 2018.

This is disturbing because most of our income is from my full time job with withholding and I make some quarterly payments to take into account investment income.

Is anyone else getting unexpected results from these programs?

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CAsage
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Joined: Sun Mar 27, 2016 6:25 pm

Re: TaxCaster for 2018 estimated taxes

Post by CAsage » Sat Dec 08, 2018 7:20 pm

There were many changes to the 2018 taxes, such as dependents, exemptions (gone), limits on State and Local tax deductions, standard deductions, .... so it's simply not possible to answer your question without knowing a lot more details in what was in your tax return - it's not just a lower tax bracket. Suggest you print out your sample 2018 and compare it to your prior 2017, and then you may see what areas changed. Lots of prior posts in this forum about those changes..... and lots of people finding that they did not get a tax reduction.
Salvia Clevelandii "Winifred Gilman" my favorite. YMMV; not a professional advisor.

HoneyBee
Posts: 56
Joined: Sun Apr 24, 2011 8:45 pm

Re: TaxCaster for 2018 estimated taxes

Post by HoneyBee » Sat Dec 08, 2018 8:50 pm

I did all that and the only real change in our situation is that the last child is out of college and no longer a dependent, but given the larger standard deduction it should not make an $8000 change. The other issues such as cap on real estate taxes, etc. are not relevant to our situation.

ronno2018
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Joined: Sat Apr 14, 2018 9:31 am

Re: TaxCaster for 2018 estimated taxes

Post by ronno2018 » Sat Dec 08, 2018 9:03 pm

Wow, this is interesting.

I really want to make a partisan comment. :sharebeer

HoneyBee
Posts: 56
Joined: Sun Apr 24, 2011 8:45 pm

Re: TaxCaster for 2018 estimated taxes

Post by HoneyBee » Sat Dec 08, 2018 9:28 pm

ronno, so did I, but I resisted the urge.

pdavi21
Posts: 195
Joined: Sat Jan 30, 2016 4:04 pm

Re: TaxCaster for 2018 estimated taxes

Post by pdavi21 » Sat Dec 08, 2018 9:40 pm

While most people will pay less, many will pay more under the new tax law...particularly if you itemize (particularly SALT over 10k and mortgage) and don't qualify for the child tax credit.

Of course, that is not really actionable, but recalculating your taxes by hand, or using several calculators when the new forms come out would help you confirm the amount you owe is being calculated correctly.

kaneohe
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Joined: Mon Sep 22, 2008 12:38 pm

Re: TaxCaster for 2018 estimated taxes

Post by kaneohe » Sat Dec 08, 2018 9:55 pm

Did you compare the total taxes for both yrs and also the total withholding for both yrs? Sounds like you are looking at the difference between
total tax and withholding..........might help to look at the individual components. I thought I read earlier in the yr that withholding was less
than in previous yrs so if you weren't careful, the situation you have might happen.

rkhusky
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Joined: Thu Aug 18, 2011 8:09 pm

Re: TaxCaster for 2018 estimated taxes

Post by rkhusky » Sat Dec 08, 2018 9:56 pm

I love the increased child tax credit.

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munemaker
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Joined: Sat Jan 18, 2014 6:14 pm

Re: TaxCaster for 2018 estimated taxes

Post by munemaker » Sat Dec 08, 2018 10:42 pm

HoneyBee wrote:
Sat Dec 08, 2018 6:38 pm
I used TaxCaster to estimate my 2018 taxes and was surprised to see that it shows we will owe about $8500 in addition to my w/holding. I got a similar result with the H&R Block estimator. I presume both of these programs have been updated based on the 2018 tax reform.

Based on new tax rates for MFJ, we should have gone from the 28% bracket to a 24% bracket but it is not looking like we will get a tax cut for 2018.

This is disturbing because most of our income is from my full time job with withholding and I make some quarterly payments to take into account investment income.

Is anyone else getting unexpected results from these programs?
Suggestion: One contributing factor could be that the withholding rates were changed to reflect the lower taxes. Instead of just looking at how much you owe, look at how much tax you paid as a percent of your adjusted gross income (last line on the front page of the 1040, I believe). Maybe your tax is being withheld at the wrong rate. Is your income higher this year?

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DarkNyte
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Joined: Mon May 18, 2015 10:15 am

Re: TaxCaster for 2018 estimated taxes

Post by DarkNyte » Sun Dec 09, 2018 12:02 am

I usually do my final estimate for my taxes using HR Block when it first comes out. Problem I've run into this year is the software isn't even complete yet. I can't find any reference to deduction for qualified business income. Without this my tax estimate is extremely increased since all of my income is 1099. Not sure when they will actually add this into the software, but it's really frustrating when the regular tools for estimating taxes are all useless.

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FiveK
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Joined: Sun Mar 16, 2014 2:43 pm

Re: TaxCaster for 2018 estimated taxes

Post by FiveK » Sun Dec 09, 2018 12:53 am

DarkNyte wrote:
Sun Dec 09, 2018 12:02 am
I usually do my final estimate for my taxes using HR Block when it first comes out. Problem I've run into this year is the software isn't even complete yet. I can't find any reference to deduction for qualified business income. Without this my tax estimate is extremely increased since all of my income is 1099. Not sure when they will actually add this into the software, but it's really frustrating when the regular tools for estimating taxes are all useless.
If your return isn't too complex, the personal finance toolbox spreadsheet does do the QBI deduction along with many (but not all) other tax situations.

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