The (unknown ) authors of the 2017 Tax bill seemed to have borrowed more than a little from the scams perpetrated by shady loan providers.
You know, the offers received in the mail that look like a check made out to you for some amount of money.
The fine print, if read, tells you that this is a high interest loan if the check is
‘cashed’.
So in the excitement of the resultant changes brought by the “Tax Cuts and Jobs Act”, many saw an increase in their paycheck.
In most cases the cause was that the Finance/Payroll department changed the amount of money withheld from your paycheck, along with perhaps an increase in your paycheck due to a pay increase.
Some people saw little of no change, due to a combination of withholding adjustments and increases in deductions for health insurance.
There were admonitions through out he 2018 year that maybe you should examine your personal withholding to balance out changes in the new tax law that were still being worked out.
Fast forward to 2019 and tax preparation time.
Wow, what a surprise.
My taxes went up. Almost exactly the amount of the withholding adjustment.
No amount of sugar coating can explain away that fact.
It does not matter what color of lipstick you put on that pig.
My taxes increased by a factor of three.
I understand that may people did not see this increase.
The “Official Word” is that many pay no taxes or receive substantial refunds under the new tax scheme.
Cool.
I pay my taxes. I do not seek work arounds.
I have not received a federal tax refund for decades.
The magnitude of the increase and the means by which it was perpetrated are interesting, to say the least.
So I will increase my withholding rate and diminish my take home.
Due to health care cost increases I will see a decline even though I received a small raise.
Now I will re-figure and reassess charitable donations, as they are no longer deductible.
I never saw charitable donations as a tax dodge, they made some measurable difference in my tax bill.
Charitable donations are now in the domain of the 1% ( maybe the 2-3% ) who have much higher deductions than I can muster.
I suppose that it has more to do with my puny mortgage and the relatively small amount of interest.
Not going in to greater debt to ‘regain that advantage’.
Sadly, not much can be done till the next election cycle.
That old fake Chinese curse “May You Live In Interesting Times” sure does come to mind.