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So, we underpaid and for the first time ever, got hit with a $400 penalty for underpayment throughout the year. What could a CPA do that HR Block software can’t do?
In some sense, nothing.
In another sense, last year a CPA might have asked you enough questions and determined you needed to have more withheld this year and hence you would have avoided penalty and interest. But then again, you could have asked yourselves the same questions and arrived at the same answer.
I love how that works in only one direction. By that same theory, the irs is as guilty for taking too much of our pay throughout the year and sending us a refund later. Same thing. We should charge them a penalty for allowing us to withhold too much money throughout the year.
The IRS is guilty of nothing in the scenario you described. YOU determine how much to send in, not them. They didn’t take anything. The burden is on you to get it right.
OP - I still have my CPA cert somewhere in the garage. It's been inactive for about 15 years, but I would do your return for only $599. Plus parts. And labor.
In another sense, last year a CPA might have asked you enough questions and determined you needed to have more withheld this year and hence you would have avoided penalty and interest. But then again, you could have asked yourselves the same questions and arrived at the same answer.
I always use a tax attorney to prepare my taxes. I just have to make sure she gets off the ski slopes with enough time left to work on them.
Excellent, excellent point. My brother has had his neighbor/friend do his taxes using TurboTax for the price of a beer or three for a decade. (His friend works for some non-tax-department of Intuit.) But 2023 was my brother's first year without a dependent and BAM! turns out he owes more than $8K plus penalties because he failed to adjust any withholding on his various streams of passive and retirement income.
"Why didn't my friend warn me?" he moaned to me. Well, were you paying him to give you tax advice? No, of course you weren't. And you weren't paying enough attention yourself.
Obviously one doesn't need a CPA to do one's taxes. But we have to recognize our limitations and act accordingly. My brother manages his own investments but failed to recognize the blind spot he had where his taxes were concerned.
If they’re not taking the money, why do they care when they get it as long as it’s not considered late, which is April 15? What if I made the bulk of the money in November and December? It really is none of their business. They shouldn’t be taking the money in the first place.
My employer withholds the money. When I started my job, they asked how many dependents I have. I said 2. That’s it. That’s all I ever did with every job I ever had. And there was never a problem in 40 years and 5 employers. All of a sudden, not enough money is being withheld. Isn’t my employer at fault for not withholding enough? I wasn’t asked how much to withhold and I never was. My company is taking less than 10%. Why? Don’t they follow some kind of guideline? I never had this problem before.
OP - I still have my CPA cert somewhere in the garage. It's been inactive for about 15 years, but I would do your return for only $599. Plus parts. And labor.
Keep it in the garage. I wouldn’t give you $1. I could do it myself with the same results you would get. But thanks anyway.
If they’re not taking the money, why do they care when they get it as long as it’s not considered late, which is April 15? What if I made the bulk of the money in November and December? It really is none of their business. They shouldn’t be taking the money in the first place.
Why are you playing what if’s when you don’t even understand what’s going on?
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My employer withholds the money.
Correct not the irs and based on you input
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When I started my job, they asked how many dependents I have. I said 2. That’s it. That’s all I ever did with every job I ever had. And there was never a problem in 40 years and 5 employers. All of a sudden, not enough money is being withheld.
It’s clear you anrnet familiar with form w4
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Isn’t my employer at fault for not withholding enough?
No its 100% your fault
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I wasn’t asked how much to withhold and I never was.
So what ?
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My company is taking less than 10%. Why?
Because they are following your input
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Don’t they follow some kind of guideline? I never had this problem before.
They do and they follow your input, that’s the issue and you don’t understand nor utilize the functionality of your w4
If they’re not taking the money, why do they care when they get it as long as it’s not considered late, which is April 15? What if I made the bulk of the money in November and December? It really is none of their business. They shouldn’t be taking the money in the first place.
My employer withholds the money. When I started my job, they asked how many dependents I have. I said 2. That’s it. That’s all I ever did with every job I ever had. And there was never a problem in 40 years and 5 employers. All of a sudden, not enough money is being withheld. Isn’t my employer at fault for not withholding enough? I wasn’t asked how much to withhold and I never was. My company is taking less than 10%. Why? Don’t they follow some kind of guideline? I never had this problem before.
OMG.
I am always amazed at how many people have zero understanding about income taxes.
OP, you should probably hire a CPA, at least to educate you.
If they’re not taking the money, why do they care when they get it as long as it’s not considered late, which is April 15? What if I made the bulk of the money in November and December? It really is none of their business. They shouldn’t be taking the money in the first place.
My employer withholds the money. When I started my job, they asked how many dependents I have. I said 2. That’s it. That’s all I ever did with every job I ever had. And there was never a problem in 40 years and 5 employers. All of a sudden, not enough money is being withheld. Isn’t my employer at fault for not withholding enough? I wasn’t asked how much to withhold and I never was. My company is taking less than 10%. Why? Don’t they follow some kind of guideline? I never had this problem before.
The first thing I would ask do you actually have 2 dependents and are there any additional income flows.
The first thing I would ask do you actually have 2 dependents and are there any additional income flows.
It’s less about the dependents and more about the other income that’s the issue. Both should be added for accuracy but if you earn 100k elsewhere outside of a part time job earning 20k they aren’t going to withhold enough without knowing of the other 100k
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