has anyone gotten their return yet?

[desertblues]

Originally Posted by Billi

How do you know before in the UK what is the right amount?


We pay a certain sum each month that corresponds exactly to the income and when the year is over we have to make a tax declaration where we can claim for refunds (for paying for a house, for having additional expenses related to working, for other tax reductions...). So in practice we give our government a credit.

Same with us: we've still got a child living in the house > 18 years and studying, so we get a refund for her.
My daughter gets her tax from her (little) sidejob back. She's allowed to earn a certain amount next to the College-money she gets from the State (90 euros a month, because she lives with her parents; if not it would somewhere between 400 and 500 euros a month).That is the amount she gets for maximum 6 years (doesn't have to pay it back).
If she needs more or longer, she can take a student-loan with low interest and (I think) 10-15 years period to pay it back. But we don't want that: we're her bank.

[vivaldirules]

We filed in mid-February and the negative tax refund check we mailed with it was cashed nine days later.

[HarryT]

Originally Posted by vivaldirules

We filed in mid-February and the negative tax refund check we mailed with it was cashed nine days later.

It strikes me that you've been sensible. You kept your money, and then paid what you owed. Much better than lending the government your money, interest free, and then getting it back again .

[vivaldirules]

Originally Posted by HarryT

In the UK, unless you do something "complicated", such as run your own business, all tax is paid automatically by your employer, your mortgage lender, or whatever. Having to fill in a tax return is relatively unusual. I have to fill one in, because I run a business, but the vast majority of people don't.

Perhaps one issue is that there are several marginal tax rates here and a large number of possible deductions and credits that influence how much each of us pays. So even if the bank were to withhold taxes on the interest they pay me, they won't know what percentage to do so. It's sufficiently complicated that every August, I estimate our taxes for the current year to make sure I won't be overly surprised at the end of the year.

[vivaldirules]

Originally Posted by HarryT

It strikes me that you've been sensible. You kept your money, and then paid what you owed. Much better than lending the government your money, interest free, and then getting it back again .

Well, in fact, I try to maximize how much I owe (but try to avoid owing too much or else there is a penalty for that, too). But in the last couple of years interest rates of 0.000000000132% (is it even that high??) don't amount to many nickels in my pocket.

[kindlekitten]

Originally Posted by HarryT

Probably a silly question, but why do Americans get tax refunds? Why not just pay the right amount of tax to start with, like we do in the UK?

we have a BUNCH of different adjustments that can be made to our taxes not restricted to employment and mortgages. losses, donations, investments and so on play a big part of our taxes as well. in my case I have some unusual things going on with my mortgage taxes so last year and this year I get a large amount back. at this point in time I cannot do anything to adjust it, and I have no idea how long it may continue. I would very much prefer having the money available to me every month rather than let the government play with it. this time it happens to work well for me though as I have some hefty business start up costs and it is coming in right at an almost perfect time

[dsvick]

Originally Posted by HarryT

It strikes me that you've been sensible. You kept your money, and then paid what you owed. Much better than lending the government your money, interest free, and then getting it back again .

That is what all the financial experts say as well, "...at best the goal is to owe and be owed nothing, at worst you should owe a small amount, which corresponds to an interest free loan from the government." In all honesty though, getting a nice check from a tax return is pretty nice, it lets people make some big purchases that they otherwise wouldn't have been able to save for if they got an extra $50 a month. Call it lack of discipline or whatever but I know I fall into that category.

The problem though like KK and VR mentioned is that the tax laws are sufficiently complex here that there really is no way to accurately take the right amount out every time. In order to take the right amount of taxes out for the whole year your employer would need to know how many dependents you have and will claim, how much mortgage interest you paid, how much money did you make from investments, did you have any one of a hundred other special cases .....

It seems like every month there is talk of tax reform here but it never goes anywhere since there are too many special interest groups involved that have their own little deductions they want to protect.

[desertblues]

And what about; if you can't pay up? Can the State then be the cause of your bankruptcy?

[HarryT]

Originally Posted by desertblues

And what about; if you can't pay up? Can the State then be the cause of your bankruptcy?

Being unable to pay your tax bill is a very common source of bankruptcy in the UK; I'd imagine it's the same in the US.

[desertblues]

In our country practically everything is taxed, including one's pay. For an ordinary citizen it would be hard to get bankrupt by not paying one's tax bill, as tax is deducted every month.
But it happens that people who declare the wrong income, market vendors or businessmen or frauds: yes, they'll get an assessment and have to pay up.
If they can't at once, they have to pay in parts. It's not the usual thing here to go bankrupt on tax-issues.

[HarryT]

Football (soccer) clubs seem to be rather prone to going bankrupt on tax issues here. It's happened to a number of them in the last few years.

[kindlekitten]

Originally Posted by desertblues

And what about; if you can't pay up? Can the State then be the cause of your bankruptcy?

you cannot discharge owed taxes in bankruptcy here. you have to pay them no matter what. now paying them could certainly cause an inability to pay other obligations which could indeed cause a bankruptcy. but you would still owe the taxes

[kindlekitten]

I just went on the "where is my return" link at the IRS... April 5th... *sigh*