2018 Income Taxes

I mailed in my 2018 US and NJ income tax returns last Friday, a whole 3 days before the Monday deadline. They had been more or less done for several weeks but because I owed money this year I didn't feel any great urgency to complete the process.  However on the preceding Tuesday my phone and internet went out with Verizon giving a repair estimate of the following Tuesday.  The lack of internet left me with time on my hands which I used to get the returns done a little early.  It also meant I couldn't submit them electronically and had to mail them but I am inclined to do that anyway when I owe money because I am a little nervous about allowing them to pull money from my bank account.

I owed money primarily because I had a large involuntary capital gain (from CVS buying Aetna) last year and I hadn't increased my estimated taxes by quite enough to cover the additional capital gains tax.  The lower federal withholding rates also contributed but the new law did provide me a tax cut.  I ran my 2018 income though the 2017 program and discovered my federal tax was about 6.5% less because of the new law.  Similarly running my 2017 income through the 2018 program showed my 2017 federal tax would have been about 9% less if the new law had taken effect a year earlier.  In both cases the general pattern was the same, my ordinary income tax and the net investment income (or Obama care) tax went up because of the new limit on deducting state and local taxes but I still saved money because I no longer had to pay the Alternative Minimum Tax (AMT).  The AMT doesn't allow deductions for state and local taxes so I hadn't been benefiting from those deductions for some time.

I didn't have any particular issues with Turbo Tax Deluxe which I used again this year perhaps because I am getting use to its annoying features.  It still tries sell you upgrades but they aren't really needed.