Tax question

[Nutria]

Actually I think of it more like "funding" our vacations each.

I fund our vacations by doing our own saving instead of having Uncle Sam do it for us.

[Nutria]

Instead we usually owe.

So do we, a few hundred. I put our 2014 state refund away for expected 2015 fed taxes due...

[tripods68]

I fund our vacations by doing our own saving instead of having Uncle Sam do it for us.

We're saving a lot more this year compared previous year--2014 and first few months of 2015 since we don't have other debt except our mortgage.

So this year--based on our monthly budget (following Dave Ramsey's zero based) we can saved an extra 17K taxable savings plus another $5K towards ROTH.

Under retirement savings:
Our combined pretax contributions is 54% for 2016. 15% of the 54% goes towards mandatory pensions contributions. The rest goes to 403b & 457.

...I guess that's why we are always getting tax refund; we keep our taxable income low every year even at 25% bracket. Anything we receive above is just a bonus!

[GrowingTheGreen]

How much do you have left on your debt and at what interest rate is each of those amounts?

Typically, people recommend just getting the match until debt is paid off, but it can sometimes make sense to contribute more to your 401k. If you're in the 28% tax bracket, you'd need to contribute ~$3571 in order to not owe anything.

Do you have an HSA? If so, that could be another avenue to reducing your tax bill.

If you've got the $3500 in cash and can make the contribution in order to avoid the $1k in taxes, you're still making a positive impact on your net worth.