<prompt> Human: Hello PF, The wife and I completed our taxes last week and we owe a lot more money than we were assuming. We owe about 5300 to the Feds and 2300 to Oregon. We are seeing a CPA today but wanted to get some ideas on what you guys think.I make about 60,000 claiming myself only and my wife makes about 73,000. She mistakenly claimed 3 for federal and 1 for state. She contributes to a 401k and carries our health insurance which cost us 3900.00. We paid so much in tax last year -- 26,800!!!We own a rental property, which we are taking about a 240 dollar loss on every month, meaning rents paid do not equal the mortgage. The total income for the rental was 11,700.00 this included management fees, which has been deducted. After depreciating our property 25 years straight line, deducting interest and taxes, the total was about 9300.00. As a result our AGI was about 141,000. The property has been in service as a rental since 2012 and last year was the first year that the home was depreciated as rental income.Unfortunately fortunately? we are married without kids and for our primary residence we rent because where we live the cost of property is ridiculous. We both had some student loan interest deducted but that did not make much of a difference. We also had some medical expenses but the expenses did not meet 10 of our income to itemize them. We have no more available deductions regarding our rental property as its in another city and our management company does everything needed. We understand the mistake with my wifes W4 has definitely impacted what we owe but could this mistake really cost us 8k? Is it between this mistake and the extra income for rents received that we owe so much? Quite honestly our rental property is a hardship and due to the market we dont have enough equity to refinance, I dont fully understand why a rental property is considered income when it is at a loss. Should we depreciate the house differently? Can our health insurance premiums be deducted?How do we prevent this next year, other than changing our withholdings? File separately? Make an LLC? Anything??We used HR Block Software.Thanks  <response>: We paid so much in tax last year -- 26,800!!!Welcome to the middle class? 