Every year I see the amount I OWE TO THE GOVERNMENT steadily increasing, and I hate it. OK, so I don’t own a home, have any student loans needing payoff, or have any children. Or a husband. I get it. My net worth as far as tangible and nontangible assets is solely ME, and therefore I should give relatively more of everything I earn back to the national purse. Cruel logic, but fine. But since I hear nearly all my friends or family members around me sighing in agony about the pittance they’re expecting of a refund (or, about the tiny windfall, although that’s all relative)…it’s a tougher pill to swallow. Really? Shut up! is what I wanna tell them. I’ve gone through my taxes with a fine tooth comb and I still owe more than just a chunk of change.
And yes, I’m aware that many others have it much worse so…rant over.
Anyway, if you are similarly depressed and already looking ahead to 2011 taxes, here are some really small tips (coming from a non-financial advisor, mind you), and possibly useless bits of info I’ve gleaned in my attempt to find a silver lining in the cloud known as “Pay to the order of: IRS”…
1. Both the standard deduction AND the personal exemption will increase slightly for 2011. It’ll be $5,800 and $3,750 for singles claiming themselves. Does this mean the tax is also proportionately increasing for varying income levels? Er, I have no idea. But I figure an increase in both numbers can’t be a bad thing.
2. The first-time homebuyer’s credit of $8,000 will expire after April 30 of this year. Is this good news? Well, it is for those of us who aren’t really sure we wanna buy a home right now (me), and don’t want the tease of that tax credit clouding our judgment.
3. Apparently there’s a small credit available for current homeowners who install certain energy-improving accoutrements like windows, doors, furnaces, etc. Does not help me whatsoever. Still: good to know, right? Maybe it will help you!
Here’s my really short and not-so-ambitious recommended 2011 Taxes To Do List:
* Start a savings sub-account NOW for what you think you’ll owe in 2011. If you get a refund, great. If you’re like me and you don’t think your income or homeownership status or the like will change dramatically, you had better start saving. I recommend ING Direct for their comparatively awesome interest rates.
* Talk to a tax advisor… Really, how does one prep this far in advance for taxes? Increase 401K contribution? Reduce my withholdings? Oh, the possibilities are endless… You know, I don’t even WANT a refund! You hear that, Uncle Sam?! I just want to finish out my taxes and come to big fat $0. Never has a zero seemed so appealing!
Have any tax tips you wanna share? (Rants and raves are also welcome.)
P.S. I’m totally not a tax expert (in case you couldn’t tell). Here the sources I gleaned for some of the 2011 info above: