Needing more than two PhDs to file taxes

Needing more than two PhDs to file taxes

This past week was the deadline for the joyous occasion of filing your 2011 taxes. This was the first time that DrWife and I have had to file taxes in the US in several years due to being overseas. For us, filling out our tax forms was a soul crushing lesson that simple math eludes us. At least we got a happy ending. In short, we’ve learned that either more education than two PhDs in Mechanical Engineering is needed to fill out your tax forms or the IRS and Congress needs to simplify the tax process.

[Before I go on, I want to put a disclaimer in here. This post and forum is not meant to be a political statement one way or the other. Constructive criticism and comments will always be accepted. This is not meant to devolve into a political discussion about which political party contains the more out-of-touch idiots because frankly, it’s about equal. Off topic comments will be removed by the editors.]

Now that that’s over…

This all stemmed, for us, about filling out our W4 forms when we first started our jobs last year. I remember when I was handed my W4 form at work I immediately asked, “What the hell is this thing?” This is because we were working where there is not such thing as a W4 and all of  your exemptions and tax rates are already worked out for you. Essentially, you have no say in the matter (which I think is a good thing). So I shrugged and started to fill out the W4. DrWife did the same with her W4. And we both came to the conclusion that we needed to use those stupid charts on the back of the form (Mistake #1). After working out the numbers, and then like a good pair of engineers, and checking each other’s math we ended up agreeing. But the numbers seemed off. So we checked another source, the IRSs W4 calculator. We plugged in our numbers and they were good to a few 10’s of dollars. Close enough for government work, at least. 😀 We set our exemptions and extra withholding accordingly and went on our merry way.

(Fast forward to a few weeks ago)

DrWife was filling out the tax forms and was getting absurdly wrong numbers. I started looking over her shoulders and it everything she was doing seemed to make sense. But there was no way we could have been that far off. Other than our incomes, we didn’t have anything else to deal with. No mortgage interest, no stocks, no capital gains, no consulting/self-employment, minor charitable contributions. So we went to a tax professional and they came back with basically the same numbers (to within $100 or so). It turns out that we set our withholding on our W4s to be obscenely high and we were having about 3x as much withheld from each paycheck than we should have.

In the end, we’re happy because we’re getting a refund and we’re buying a house so that helps. But we checked the W4s and the IRSs calculator and they made sense. Just for a sanity check, I went back over to the IRS’s website and re-checked my original calculations and still came up with that absurd withholding number. It seems that the combination of two PhD degrees in Mechanical Engineering is not enough to fill out your W4s.



“In short, we’ve learned that either more education than two PhDs in Mechanical Engineering is needed to fill out your tax form…”

Well, there you go. If you had PhDs in electrical engineering, I’m sure it would be much better. 😛


As it turns out, we’ve had the opposite problem. With the suggested deductions, we weren’t having enough withheld. Two years ago, we got a horrible shock. We went back and readjusted. And we still had a horrible shock this year. My husband has given up and basically started claiming zero deductions. I think it gets really messy when you have more than one person earning an income.

“I think it gets really messy when you have more than one person earning an income.”
That’s exactly what we’ve figured out. Those charts are not meant for two relatively high income earners with nearly the same salary.

The IRS withholdings are designed to over-estimate. By overpaying, you’re essentially giving the government an interest free loan for a few months. When they give you a refund, it’s more of an economic stimulus than the same amount of money would be spread over twelve months, because you’re more likely to go out and spend it since it’s “extra” money. Frankly, after owing on my taxes for the past couple years, I’ve deliberately upped my estimated tax payments so that maybe I can get a refund next year.

Also, if you want complicated, try filing taxes while on fellowship (where there’s no withholding), with a brief stint of TAing (with a W4) and getting married all in one year. At least I only worked in one state this year. If you think federal taxes are bad, try doing Californian taxes…

The number one way to get deductions right: “Hey (co-worker), what the heck do you use for your deduction?”

And then fix it the next year, like I assume you’ll do. As my Dad always told me, if he gets his refund/owing within $100 at tax time (with all the allowable/legal deductions), he’s done his job right.

That’s what I thought I was doing, but my threshold is a little higher (+/- $500). You can see how that worked out (just check Cherish’s comment above)…

The California taxes are easier than the Federal ones, as long as you are a resident for the entire year. It is only when you are resident for only part of the year that the California taxes get messy.

I’ve been slightly under-withheld for the past couple of years, because my wife’s salary from the school she works for is so small that they don’t bother withholding any income tax (I don’t think that you can declare negative numbers of dependents).

More on my taxes at

I do three things to make TaxLife easy:
I don’t do my own taxes, (I’m sure a BSEE isn’t enough)
I use a credit card for all consulting related expenses so that the deductions are clear. My credit card sends me a year end summary broken down into categories! No chasing around the house after receipts.
I claim zero for all W-4 related income.

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