Tax question

ChrisSlicks · 01-20-2010, 10:45 AM

Quote:

Originally Posted by Mike

And, you guys are looking at it the wrong way, its not how much you owe at the end of the year or how much you get back, its the total that you pay. This withholding and refund business is BS. Everyone should have to pay quarterly and not have it withheld so you can see what you really are paying in taxes.

I got a state refund of 1287 state and 5622 federal last year, but I actually paid 7501 to the state and 25236 to the feds, so those refund amounts dont really mean squat, other than I paid too much in my quarterlies for my small business and withholding from my main job.

Of course it is the total number that counts. The goal would be to get a refund of $0, which would mean that you paid the correct amount of tax monthly throughout the year rather than giving the government a large tax free loan.
If you are self employed then you would pay quarterly and estimate the amount of tax you want to pay, and hopefully at the end of the year your estimates were close enough that you don't end up with a big surprise.