planbs4

I went on turbo tax last night and after filling out all my info, it said my Fed refund is only 441.00 and I OWED CA state tax 91.00. I used the full limit 49,500 to deduct. My taxable income was under 20K and I'm dependent. (I just had a lot of money saved up to get this car). Shouldn't I be receiving more money back? Sales tax was 8.75%

I was wondering how much other people were getting back. If you don't want to give out exact #s, that's fine, I just want a ballpark figure.


Thanks.

rktskicar

to check on how much your new car purchase helped you, go into turbo tax and set sales tax rate for car @ 0.01% and check the refund/owed at top of turbo tax. Report back.

Bruce

ShadowJet

PlanB,

I have also used Turbo Tax and already filed my taxes.

If your taxable income was only $20,000, then this sounds about right. The higher the tax bracket you are in, the more you will benefit from the car tax deduction. Of course, this is all variable depending on other deductions and you claiming dependency for your total refund.

Turbo Tax, in my experience, is very reliable and you may want to consider allowing the gov't to withhold more so you don't owe money come next tax season.

John Thacker

Though if he's responsible enough to save up money to buy an S4, I'd prefer owing a small amount of the government to getting a refund.

Never have understood why some people like getting refunds. Why loan extra money to the government tax-free? I guess they're not good enough at budgeting or saving throughout the year.

canyoncarver

If you have a steady income (salary) then it's pretty easy to dial in to get as close to a zero return as possible.

On the other hand if you own a business it gets progressively harder to do this. One year you might owe $5000 in taxes and another year you might get that same amount back.

So, yes, I'm happy when we get a return vs. having to pay.

Zerepjd

I had a friend whose sole purpose in life was to hit zero return. He was a little off though. The government wasn't making any extra money off him.

Me. I really don't care as long as I don't owe.

ShadowJet

Well yea, obviously it's better to get absolute 0 owed and 0 refunded. I'm just saying, for the future without the car incentive, it's possible to bring it closer to the ideal equilibrium through some adjustments.

warblade

Wait a sec, you deducted the entire car purchase? I thought the tax credit was only based on the sales tax of the car. My fiancee bought a new car last year and that's what our tax guy did.

ShadowJet

It's only based on the sales tax, not the purchase price. The $49500 number is the limit for sales tax deduction. Meaning, if you bought a car over $49500, only $49500 x (sales tax rate) could be deducted.