HDF 322 Lecture 9 Outline of Last Lecture I Taxes and Financial Planning Outline of Current Lecture II Overpay and Underpay III Pay as you go IV W 4 Forms V Estimation Withholding VI Underpayment Penalty VII Filing Status VIII Dependent Tests IX Minimum Filing Requirements X Dependent Standard Deduction Current Lecture I Overpay and Underpay as a country we overpay our taxes that is not viewed as good financial planning bc you are giving govt access to your funds that could be earning a small return II Pay as you go We have started pay as you go system we would have you send 20 40 bucks in before 40s After WWII people struggling so did pay as you go That means out of every pay check you will have WITHHOLDING if you are self employed or income not subject to withholding then you do ESTIMATION The employer self employed do ESTIMATION III W 4 Forms These notes represent a detailed interpretation of the professor s lecture GradeBuddy is best used as a supplement to your own notes not as a substitute Not penalty if taxed owed is less than 1 000 due to no withholding for estimation of taxes these dates aren t quarterly though because we want you to get all of your statements interest capital gains back so you can estimate the final quarter of that prior year correctly IV Estimation Withholding You have to withhold or quarterly tax pay at the end of every year at least 90 of TAX LIABILITY TAXES OWED WHAT YOU PAY V Underpayment Penalty a Pay at least 90 of your tax liability for the current year You have to withhold or quarterly tax pay at the end of every year at least 90 of TAX LIABILITY TAXES VI Filing Status we are always on the LAST day of the year Dec 31 day of the calendar year as to what your filing status is VII Dependent Tests a Qualifying Child or Qualifying Relative must qualify for all requirements VIII Minimum Filing Requirements a How much taxable income can you have and not pay any income tax IX Dependent Standard Deduction a Dependents are entitled to either basic 1 000 for unearned income OR the amount of earned income SD
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