First time ever I owe taxes

It’s hard to give weigh in on this without knowing your agi over the last 4-5 years.

But sounds like you’ve gotten steady raises and never adjusted your withholding.

Church donations usually won’t have any effect unless you gave more than the standard deduction, which this year is 27,700 for married filing jointly.

Isn't your withholding a percentage of your income? So shouldn't it still be the same even if he's gotten raises?

Do you have a taxable brokerage or a bunch of cash in a High Yield Savings Account that is throwing off interest or dividends?

There isn’t any withholding in those and it can quickly throw things off.

Forgot to include that if you get money back it’s a bad thing. It means the government was given an interest free loan from you

People used to effectively 0% interest environment and then it pops to 4%+…if someone has a sizable amount of cash, it’s $4K for every $100K and it’ll hit the tax bill at the marginal tax rate so can be 24%+ or $1000 in extra taxes.

1) ate you withholding married or single?

2) does one of you make significantly more than the other?

3) does one of have a lot of variable values income such as bonuses or stock incentives?

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But sounds like you’ve gotten steady raises and never adjusted your withholding.

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Believe i may become a member of the first time i owe taxes club this year. The raises have come but it's hard to adjust the withholdings when everything keeps going up price wise. We will find out real soon when we do our taxes in the next week.

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What am I missing?

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technically, you want to owe/receive as little as possible during tax season.

those refunds you were used to getting wasn't a gift from the government. it was your own money. you gave too much of it to the gov't during that year and they were just giving it back. hence the term "refund".


if you owe a couple hundred bucks, that's fine. if you only get a couple of hundred back, that's fine as well. $2800 is a bit of a stretch. i'd go back through and make sure you didn't "fat-finger" any of the numbers with your income.


what system are you using to do your taxes? turbo tax usually let's you sign into your retirement accounts for that stuff. W2 should be a simple upload.

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When I did my deductions, things I always got credit for now never move the needle. We give a lot to our church and certain charities and that always made a dent, but this year not $1. What am I missing?

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My guess is you take the standard deduction and have not realized until now that you cannot write off charitable donations, if you are looking for a reason your taxes are higher. When you are saying the charitable donations are not moving the needle a $1, that tells me you are taking the standard deduction. But if they benefited you last year then you had to itemize (after Trump tax cuts you can no long write off charitable donations if you take the standard deduction).

You must make a pretty decent amount of money if charitable donations helped you last year because you now have to itemize for that to benefit you. If you are itemizing, did you reach the AMT threshold this year? Also, given your presumed high income if you are itemizing, the child tax credit may be phased out for you. This would account for the $2800+ increase in taxes owed.

Generally speaking, taxes should not be higher this year than last year. The thresholds got a very large bump this year to adjust for inflation. All things being equal, you have to be making a decent amount more this year to owe more taxes.

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$2800 is a bit of a stretch. i'd go back through and make sure you didn't "fat-finger" any of the numbers with your income.

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Yeah, it's a $3300 swing and without any reasonable explanation, I feel a strong error review is warranted.

OP: Did you have any sale of property, or significant transaction for which you have capital gains exposure? Did you move a bunch of money into a high-interest account last year?

We're brainstorming because you're right that something is up with the numbers, but you have the best information on what might be a big change. There was no policy change I'm aware of that could result in this big a swing on similar numbers.