Federal vs State withholdings
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Anonymous
| I've done my taxes for 2012 and discovered that even though I claim the same number of exemptions for both federal and state tax purposes, my state tax refund is about 5 times larger than my federal refund. The only additional deduction I'm taking for state tax purposes is the $2500 in education savings. Could anyone think of a reason for such a discrepancy? |
Anonymous
| Our state refund is usually larger too. |
Anonymous
|
The better question is, why would expect them to be the same? It is all in the math and on the value that your state places on an exemption. If you are getting a large refund then you overpaid during the year substantially. That says to me that your exemptions did not lower your taxable income in any given pay period very much.
There are plenty of web tools out there to estimate the effects of different numbers of exemptions on your year end taxes. Try one of them so you can properly set them this year. |
Anonymous
| States like virginia are tax friendly |