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Not much advise to add but if I only paid 11K at the end of the year in addition to my quarterly payments I would be thrilled. But as already mentioned start a 401K and max out you can't touch it for a while but better in your account than theirs.
MD I am also curious how did the LLC make a difference as opposed to 1099? |
I took it that the OP had to pay an EXTRA 11k previously, and ONLY an extra 5K this past year.
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If you participate in an employer sponsored 401(k), IRA contributions deduction phases out beginning at AGI=96k and is fully phased at AGI=116k. |
That is how I took it as well. People who get big tax refunds, should plan better. My taxes are pretty much a wash coming April 15, with me getting something back from the Feds, and owning the state a few bucks.
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The IRS allows you to take losses on a business for a certain number of years. Its a no-brainer. Pick something related to a hobby that you spend money on, and start channeling your expenses legitimately in that direction. You'll be surprised at how fast it will add up. The barriers to creating a business are very small these days. Another no-brainer is a rental property or two. The depreciation (which I don't really understand that well) is a great way to offset income. Its been magical for me. I pay my accountant over $1,000 a year and have for the past 20 years. Its money VERY well spent!
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I track every years taxes and 1040 inputs in an excel spreadsheet. All deductions are logged
The irs uses a formula to calculated taxes. So you can predict your taxes based on the inputs. Essentially I track my 1040 and predict next years liability Now, each year is different, like you. I set a target tax, and set my w4 to match. By July I repeat and make adjustments to my w4. My goal is to only get back a small amount or owe a small amount. Works for me |
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