2012 Federal/State/Local Estimated Taxes for Pennsylvania

Naturally, everybody situtation is going to be different, depending upon many

circumstances.

My situation, married, over 65, retired.

Income consists of social secuiry and pension; plus bonus money.

no other income.

My federal tax comes out to be 23.48%

My state income tax (Pa) comes out to be 2.73%

Local Tax comes out to be -0-.

Results by CPA.

 

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2s72s0k9mm8gdPermalink Reply by 2s72s0k9mm8gd on February 14, 2012 at 1:55pm

My tax lady printed out some Federal quarterly payment coupons for me. Said I can stretch it out over the next 4 quarters or make a lump sum payment based on extrapolated income for 2012 (within 1st QTR.). Same with PA income tax. Looking like 33% federal (head of household) and 3.07% State for me. If income ends up being lower , excess will be refunded next year. BUT if you underpay estimated tax there will be a penalty when you file next year.

Since I am still working I plan on maxing out my 401K @16%.....may be enough to drop me to 28% tax bracket. Gonna play it safe , though , and send Uncle Sam 33% and hope for the best. At least I won't be penalized for underpaying! 

Permalink Reply by Terry W. on February 14, 2012 at 2:14pm

Glenn:

Sounds like you have all under control.

Too bad the banking industry does not pay squat for our money anymore.

2s72s0k9mm8gdPermalink Reply by 2s72s0k9mm8gd on February 14, 2012 at 2:36pm

Thanks Terry. Damn shame we finally get a few bucks and can't make squat on it , but that's the way the cookie crumbles! :-) Would be nice if interest at least kept up with inflation though.

Congrats on the Santa Fe ! About 45 more H.P. than my Tacoma!

Permalink Reply by craig on February 14, 2012 at 3:40pm

 Your right about not making squat on it, but that is only if you put it all into very conservative investment instruments. I sold my share of a startup back in the mid '90's and faced this same dilemma, wanting to invest wisely. I'm not a stock broker, just someone that self educates on things he doesn't know...like drilling, investing, whatever. I give no recommendation on what to do because every one has there own needs and goals. 

IF you are the kind of person that doesn't want to make investment decisions be very careful who it is that you entrust your money with. Not to seem stereotypical, but there are a fair number of 'stock brokers, etc' out there that are only interested in what they can make off of your portfolio.  I had one broker along the way that was actually someone I knew for some time. Suffice it to say he lost over 50% of my first savings, in 3 yrs, all the while living it up. And the market wasn't really crappy at the time. That's when I decided to get gain some more knowledge and learn about investing. Just be very cautious, large amounts of money make some people do stupid things!

Permalink Reply by Linda A on February 15, 2012 at 9:21am

Always stay in charge of your own money, and if you don't know the stock market or don't invest it there yourself, do NOT allow someone else to control your money.

Look at things to purchase which allow a tax deduction; additional property; giving to children, grandchildren, churches etc.  You can give $13K to anyone - they don't have to claim it as income and YOU get the deducton.  Much better than giving it to the

'tax man'...

Permalink Reply by grayhairedgrandpa on February 15, 2012 at 11:37am

Just a point of clarification...if you give money to your church (or any other tax-exempt 501c3 organization), you can take a charitable deduction on Schedule A of your federal tax return. You are correct that a gift of $13k to "anyone" does not need to be claimed by them as income...but I don't think this simple gift can be taken as any sort of tax deduction. Setting up and funding a 529 education account for a child/grandchild will typically give you a state, but not a federal tax deduction.

I agree with Linda and Craig that if you have no knowledge of the stock market, stay away until you gain some knowledge on how to invest.

Permalink Reply by Billy Park Whyde on February 15, 2012 at 11:45am

Some of you have thought about a new car. Instead of the trade in route get shafted deal you could donate the car to say goodwill get a full market price donation write off. 

Permalink Reply by Linda A on February 15, 2012 at 1:21pm

My CPA said the $13k gift IS deductible...

Investing in the stock market is gambling because everyone, including the fed govt. controls it, but you!  Likewise, many don't know 401k's & IRA's are technically owned by the govt that is why they make the rules in how they are managed.  Soon, the rules will change so much, you will have NO control over that money either, but it will happen in baby steps, w/o notifications... :(

Permalink Reply by Billy Park Whyde on February 15, 2012 at 3:04pm

When people bragged about their 401-K and how much they were worth I knew some one had been sucked in, those same people are now saying they lost thousand of dollars. Hmm but in reality they never had that money in the first place. 

Permalink Reply by Terry W. on February 15, 2012 at 3:28pm

Linda:

From what I have found out from the internet, that No, you cannot

deduct the 13K gift.  I would love to give me kids the money by

giving them the 13K, and then be able to deduct it from my income.

That would do wonders for my federal and state taxes for 2012.

Something about the CPA that I had do my projected taxes for 2012.Asked him if a person was blind (completely) in one eye, is there additional

deduction.  He didn't know.  I was waiting for him to tell me he would check and get back to me, but no.....let's look for a new CPA!!

Permalink Reply by Linda A on February 16, 2012 at 4:01am

Terry, I did mis read response from my CPA from a couple years ago (the amount has increased since then) - HERE is what he said:

"First of all, an individual does not take a deduction for a gift to another individual.  The "gift tax" is imposed on the gift giver.  An individual can give up to $12,000 on an annual basis to an individual without incurring a gift tax liability.  The gift tax liability would generally not require a cash outlay.  Instead, the taxable gift merely reduces the total amount of your lifetime exemption.  This means you have less estate tax exemption for assets you pass on at the time of your death.  It can get pretty confusing.

The receipt of a gift is not taxable to the recipient, even if it is over
$12,000."

Permalink Reply by Billy Park Whyde on February 16, 2012 at 4:14am

Does anyone know if a tax attorney would be a better choice over a CPA?

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