April 11, 2016
Life, death, and taxes, my friends. But unlike the other two, taxes happen on schedule every year.
And this year, boy o boy am I not so ready.
Life doesn’t discriminate
Between the sinners and the saints
It takes and it takes and it takes
And we keep living anyway
– Wait For It, Hamilton
In 2014, I started using a CPA to put together the return itself. I still compile all our financial documents and a spreadsheet listing everything, including our itemized deductions, so really the CPA just has to plug the numbers in and advise me on the trickier parts like the investment property.
It feels absolutely silly in retrospect to feel guilty over hiring it out but it was hard to fight the feeling that as the Family CFO, I was abrogating my responsibility by doing so. Of course I could do it myself but I don’t have that kind of time to spare, and the headache was getting to be too much. See? Even now I feel like I have to justify the decision.
Never mind. This year, I’m extra grateful for making that decision because what we’re looking at would have been much worse at the butt-end of 20 hours of tax agony.
It’s a long story, and I can’t get into the specifics of it, but we have an on-paper only “income source” from a family thing, from which we don’t derive any true income. This year, there was a huge one-time income bump that we wouldn’t see but, of course, would impact our return. I knew we’d owe something. That part I was braced for.
The other part, the first draft of the return, staggered me. No, let’s be honest, it knocked me on my ass. Might have actually stopped breathing for a few solid minutes.
We would have had a modest tax refund this year from both state and federal. Instead, the bill totals up over $13,000. It’s not that we failed to pay quarterly taxes, this is truly a one-time thing, and it won’t be a problem going forward after this year. That’s cold comfort in a cold spring, but payment is due on April 18th this year, so, yay grace period?
We’ll have to use our long-term savings to pay that sucker, which sucks, but at least we can swing it. Meanwhile, let me sit down and put my head between my knees until the world stops spinning.
Have you filed? Are you likely to get a refund or a bill?
*Part of Financially Savvy Saturdays on brokeGIRLrich, Disease Called Debt and I Am the Future Me
April 10, 2015
Every single year, no matter how organized I think I was the previous year, I wasn’t. Then I’m having to dig for hours to find and sort all the necessary documentation for my tax filing. This year’s even more complicated than last because we have rental property in the mix, so I was determined not to repeat a decade of errors.
This year, finally, FINALLY, it seems like I might have developed a good system.
Throughout the year:
I keep a running spreadsheet of rental property income and expenses which will be matched against the property management company’s 1099.
I keep another running spreadsheet of all deductible expenses as they’re incurred: mileage, non-reimbursed business expenses, donations.
At tax time:
I save all files with category information. For example, a 1099 from Ally Bank would be named: Income 1099-M Ally Bank.pdf. A donation receipt is saved as: Deduction Donation Goodwill 01-09-15.pdf.
Sorted by name, all my income and deduction forms will naturally group together, and I can easily combine them into a single PDF if necessary.
One spreadsheet to organize them all!
I match all the forms and receipts against my running spreadsheet and then pull that information into a Summary Spreadsheet for the tax year. I also compare this to the previous year’s Summary to confirm everything’s there, or if I forgot to download Bank of HadAGoodBonus’s 1099-INT form. Our banking changes year to year but not a ton so this is a good way to double check.
Any relevant notes about life changes and people-related information are included in that spreadsheet: names of people filing and our dependents, any changes from the previous year, etc.
Since I recently started using an accountant for all the legwork, my concession to the value of my time, it’s been even more imperative to make sure all the information is there and easy to understand. I generally catch a minor mistake or two when I review any prepared taxes, mine or otherwise, so my very detail-obsessed brain knows that I shouldn’t be handing over a virtual shoebox of receipts if I don’t want a horked up return filed.
Alas, it’s to be another extension for us this year, but I have hopes that next year we’ll be filing by Jan 30th, just like the good old days!
:: Do you have an amazing organizing system? Tell me all about it!
April 7, 2014
I declare a Minor Victory. After wading through 20 forms and itemizing deductions for home, charitable deductions, expenses and so on, I’ve finally gotten the taxes sorted enough to file for our extension. Maybe a numbing effect sets in after the first several hours, or the pain is so unbelievable that you entirely forget what it was like, much like how I’ve heard childbirth described. No kidding, that was torment stretched across 3 weekends and I’ve only just bought us a reprieve until October. On the bright side, I always forget that California grants an automatic extension so all that pain was for federal taxes.
While looking forward to working with a good tax preparer/advisor, I get that weird “I have to pre-clean for the housecleaners” feeling. You know what I’m talking about, right? Friends who had housekeepers/housecleaners (or still do) always spend half a day picking up in preparation for people to come clean. It totally baffles me. But Moom inspired me to sort all the just-about filed paperwork so it’s not a file folder chock full of confusion; everything’s scanned and itemized in a spreadsheet now.
This is the second year I’ve used TaxAct and around Hour 13, I started wondering what possessed me to use them again. The relief of being done with taxes must have overcome all memory of my frustrations in using the software last year. Since I’d already committed, I rationalized that this was just my way of being fair, that the frustration really had to do with the software, not just doing taxes.
Let’s be honest, there was a lot of that frustration:
1. Filing an extension requires an estimate of your tax liability and payment by April 15th. Slog through the entire filing process and then send in Form 4868, Application for Automatic Extension of Time To File U.S. Individual Income Tax Return.
2. Finally filing again in October (instead of January or February at the latest) when the last straggler Schedule K comes in: Form 1040; Schedules A-C, SE; Form 6251; Form 2106; Form 4562
3. Filing amendments because the last straggler Schedule K was wrong – Forms 1040x and 540x.
Human error aside, the linear-but-NOT interface was terrible
TaxAct walks you through each of the forms, start to finish, via their questionnaire. Answer yes to this or that question and it opens up the relevant form. This works if you have all your information at hand, organized, and ready to be flipped through.
The problem is, you can’t easily skip certain questions and then just use their “Back” button to weave your way back up the tree. Go backwards that way and you’re liable to find yourself up a creek instead, lost in some random cul-de-sac of form questions, or rowing your way through a whole series of questions that aren’t the direction you meant to go.
New Stuff
When you have a number of new forms or situations to work into the picture, it’s not necessarily intuitive when you should be adding which forms to which sections if you only know which Schedule it should appear on but not much else. I ended up adding and deleting forms multiple times trying to get things into the correct sections/sequence. It wasn’t until the end where I found the summary page for either the Income or Deductions section where it was much easier to fill things out piecemeal; and I still couldn’t tell you where to find that.
Once I further complicate our financial lives with other investments, I won’t have hair left to pull out while doing taxes. Another vote for hiring a pro!
Stupid inconveniences
If you’d, say, spent 4 hours working and turned your attention away briefly, you get logged out. It saves your work, of course, but when you try to log back in, there’s a 30% chance it’ll decide that you disabled cookies (when you didn’t) and insists that you have to accept them again (but I DO!). It’s an annoyance but let’s be honest, every minute wasted trying to do taxes is as frustrating as those minutes and hours spent actually working on them.
Honestly, the software’s probably halfway decent but for the amount of time I had to waste figuring it out, or figuring out where information should go because they failed to provide enough information, I won’t be using them again.
April 2, 2014
We’ve been extra busy the past few weekends with work and not-work; it’s only going to get worse as I’m staring down the barrel of April 15th. I’m going to have to file for an extension again and it gives me hives that that hasn’t been settled yet.
After spending hours sorting through our paperwork, though, it’s finally time to admit that this is no longer even a little bit fun, and it’s time to hire a professional. The moment that decision was made, it felt like a metric ton of stress was lifted off my shoulders – though a bit prematurely since I’ve not yet actually hired said professional or turned everything over yet.
:: How many of y’all still file your own taxes? If not, when did you turn to outside help? If you’re sitting pretty, enjoy some light reading!
MONEY
Funny About Money avoids a huge service fee
Evan (My Journey to Millions) just charted his dividend income and growth. I just did this too!
“…what I heard over and over again was people saying if someone gave them credit, they must have determined they could afford it. It was as if they had no responsibility to determine what they could afford.”
Vanguard on why so many Americans go bankrupt
CAREER
Joan C. Williams at the Washington Post on Women, work and the art of gender judo
Why faculty work so much
Slate interview Ira Glass in On Air and On Error
NEAT THINGS
MutantSupermodel made this fantastic Bat-tutu a while ago and I love that she’s got an Etsy shop now.
AMAZING leopard seal photos, Nat Geo photographer
Have you met Hessel & Hannes yet? They are the CUTEST chocolate lab and cat pair.
[VIDEO] A lovely serenade through pregnancy (Tom Fletcher of McFly), hattip @grlredballoon
[VIDEO] Wolf loves belly rubs, who knew? Amazing.
Not quite a wolf but of the related Pay Attention to ME variety
I love what happened when Pat Rothfuss played a game with his son
April 17, 2013
We’re a little more than three months into living on a combined budget. And even though this is the first time PiC’s lived on such a detailed budget, we still seem to be doing sort of ok.
I say “sort of” because:
+ we’re not fighting tooth and nail over living by a budget (yay!)
+ we’re not fighting over anything budget at all (yay!) (yes, I assume there’s going to be some amount of disagreement and conflict when you’re learning to live in new boundaries)
– we’re not exactly ON the budget in some places (boo!)
– we still need to discuss how to offset some of the early spending highs (boo!)
It’s a wash, as far as operations go.
As far as execution … we’re having a touch of trouble staying in our budgeted amount in certain categories and not yet doing a good job of pulling back in specific areas to make up for it. This goes against the grain. I’m a money hoarder and I would much rather spend on the low side of any budgeted amount throughout the year and have some left over. This is, of course, not PiC’s style. 🙂
Nearly four months into the year, I’d expect that our spending should be at about 33% of the budgeted amount across all categories. I’m seeing spending as low as 3 and 7% (less regular/essential categories) and as high as 47 and 53% (ahem someone’s allowance).
Overall, though, we only went over our monthly total once in the last three months and the monthly averages are very close to what we expect to be spending each month. That helps ease the sting of what feels like budgetary failure.
Management is….
a bit complicated right now: we primarily use my American Express, and his Southwest Visa when it’s a non-American Express establishment. Then we have the odd cash or check expenditures. It all gets tallied into a spreadsheet on a (we try) weekly basis.
We’ve also finally opened a joint checking account to pay the bills from so that’ll help smooth out the problem of taking it turnabout to pay bills. And, happy day! I may be able to start closing out some of my other banking accounts. I’ve got accounts across four banks right now.
Admittedly, I’ve been refusing to close my oldest checking account because it’s the one I opened when I first turned eighteen and was allowed to open my very open checking account. (PF sentimentality!) And I enjoy the freedom of having the choice of accessing ATMs for two B&M banks… but considering I have two branches of the other bank nearby and go to the ATM about 6 times a year, that’s not a good reason.
Observations …
We eat a lot. Or rather, we spend a hell of a lot of money on not terribly fancy food. We don’t even buy beer (except once in several months), we only get basic (but good IMO) cheddar, we have a regular rotation of relatively “cheap” food & recipes around things like whole chickens but it’s more than offset by the handful of convenience foods that we buy for my fibro-body benefit.
Saving Money …
I’m over the moon about changing our cell phone plan with T-Mobile. SingleMa and I got into a conversation on Twitter about cell phone plans. Next day, we found the new contract-free plans and each saved a ton! She reduced her bill by $40/month, ours should be less by $50/month. Woot! That annual $600 will go a long way to making up for buying a new phone a bit earlier than I wanted to. I hated dealing with the nonsense of their customer service which has gotten pretty iffy these past couple of years. It used to be rock solid but not so much anymore. A shame. I also finally sent in Mom’s death certificate to cancel her phone line, something I’m trying to be totally pragmatic about but I have to admit gives me a bit of a pang.
And after a couple months of paying too much for internet ($43) when our last promotion lapsed, I surfed AT&T’s promotions for Internet without a Phone Line while signed into my account and lo! They still pulled up the cheap-cheap plans! I experimentally put it in my cart, put the live customer service chat on, and found that I could indeed switch to the $20/month plan without cancelling service. Check. That. Out. AT&T, making life easy for an existing customer. Unbelievable. And I love it.
Total to be saved this year (8 months of each line being cheaper): $400 + 160 = $560!
Tax Time …
We got bitten by AMT this year. Sonnuva … it wasn’t terrible, insofar as the money’s concerned. My headache was another thing entirely, trying to learn everything specifically relevant I could about AMT on the fly. There was definitely cursing associated with this year’s taxes.
I managed to get all the forms in for an April 14th filing but then found out afterward that one of the forms was an estimate and the “responsible” (@$$shole) accountant didn’t bother to say so until well after the fact. Again: cursing. Bitter? Yes. Now I have to file amendments for this year as soon as those new forms are in. Another hour and a half of my life re-committed to doing unnecessary taxes. Still, the bulk of it’s done and that’s something to be grateful for.
::How are you folks doing with your money these days?
October 8, 2012
A belated CONGRATULATIONS to Lazy Man and Mrs. on their new baby arrival!
Last week’s Carnival of Personal Finance: the Fall Traditions Edition was hosted by Tie the Money Knot and this week’s Carnival: The Leaves are Changing Edition was hosted by Walking to Wealth’s Adam Hagerman.
It’s the beginning of October and Kay Bell’s got a list of things to do for the month. Happily, in the chaos of all of Doggle’s health issues, and with the filing deadline of October 15th approaching, of course it seemed October 1st was the right time to sit down and power through. It only took about … 7 hours? Applicable excerpts for me:
Charitable donations other than cash: This year’s Goodwill donations included Mom’s entire wardrobe. I didn’t have it in me to go through that for anything to keep. Even now I can’t think about it. I know what was in there so I could list it for the donation, though, and it was substantial. But Dad wanted to donate everything but a small pile so I let him.
Medical costs: Out of curiosity, I just wanted to know whether I could deduct medical costs. Started to seem worth asking this year, having spent a few thousand or so on them. We would have had to have costs over $11, 500. Ooof. Ok, life doesn’t seem so bad now.
Athena just said good-bye to a lot of her mom’s stuff too. I’ve never been able to deal with actually being surrounded by too many things but it struck me how difficult it was to think about the idea of her things not being there anymore. Because it meant she wasn’t either. She used to rescue things that I planned to purge too, and I think it was to remind her of me. Now I have that double memory infused in that thing, as I let it go.
I grew up going to Chinatown in LA for cultural celebrations every year, shopping in the almost-musty shops several times a year, using the elderly and funeral services for my grandparents. I didn’t live in Chinatown but it was as much part of my extended neighborhood as any of the closely neighboring cities. And the idea of seeing a Walmart in that place that’s both a cultural entity and also a home is disconcerting. I wonder if the residential support for a Walmart comes from just wanting any general store in the area?
This is a super old story and I don’t know how I ran across it, but it was disconcerting anyway. Minnesota’s Public Health program and Team D was apparently how we managed to track down foodborne illness outbreaks so well in the past. I am so glad we shut that down….?
/sarcasm.
Not totally sure that we really needed this pointed out but NYTimes covers the perils of goalsetting. As in, you shouldn’t be setting goals without regard for how you reach them, or to the exclusion of all other things. Well, duh. “Reach this goal no matter what” generally results in bad. I’m certainly OCD enough that even I’ve had to retrain my brain to let in the rest of the world after focusing on Goals 1 and 2 but absolutely nothing else ever. Of course I’m saying this from a point of view of a person whose only goal is to freakin’ survive right now. So… you know. *shrug* Perspective. I got some.
Found this new-to-me blog called Farm to Kitchen to Table that occasionally shares recipes/creations based on a CSA box. I still haven’t convinced myself to get one because they are actually rather pricey, but someday….
Looks like Fabulously Fru-Gal also buys and returns (shoes) online. I do this for anything that has free shipping because I hate going to B&M stores. Energy is too precious.
DOGGLE UPDATE: Doggle’s recovering from his ordeal rather nicely so far, feeling full of himself and trying to go for broke on his limited walks. He’s doing much better than his mama, so I take that as a great sign!
MONEY UPDATE: Taxes were submitted and if I did everything right, we should be getting a rather large refund altogether. I wasn’t ready to screw around with our deductions from last year without having done a tax year as married filing jointly yet. Now that I have a single year under my belt, and waiting to see the IRS process it without hassle and quietly (fingers crossed, salt tossed, whatever), I may make some adjustments to our money.
I’m increasing his retirement contributions, definitely, to make up for my lack of a fund right now. I’m pretty sure we’re over the eligibility for ROTHs now but I’m not 100% certain so when I have some energy, that’s another thing to check. We may be able to increase his contributions to just max him out. I take over a different payment for him to balance the take-home cash availability since we don’t have time to deal with changing banks for the moment. Fair enough for both of us right now.
More plotting later ….
September 30, 2012
XKCD is one of my favorite webcomics and this interview with the creator just affirms my love.
This story about Lonni Sue, a once-accomplished illustrator, who became ill with encephalitis and lost all her memory is just chilling. She only remembers her mother and her sister and has to relearn everything, including basic life functions.
Seemed like this graduate advisor’s column on the difficulties of life as a married couple in academia could have been instructive or interesting but instead, just struck me as a little bit odd in some places. Maybe it’s just me and my huge sphere of privacy, to be broached only if you’re invited to my inner circle, but while I personally seek and heed advice given in good faith, I’m also put off by these paragraphs:
The couple didn’t consult me when they got engaged, and they haven’t asked for my guidance since. They are Midwesterners, and together they radiate a niceness that almost burns your skin. They might consider inquiries about their marital and academic status too forward; or maybe they suspect that my advice might bring them down.
Their romance is really none of my business. Still, I can’t help being intrigued by the trend they seem to represent. In the past eight years, I’ve witnessed more than a dozen graduate students take a similar plunge. The marriage rate in our department rivals our placement record. If an alien landed and surveyed our program, the creature might assume that we were operating a dating service or a fertility clinic. What’s gotten into the youth of today?
It really seemed like the goal here was more like nostalgia crossed with a Type-A’s need to control (takes one to know one) been thwarted recap of everything that’s gone wrong with the youth of today. Just me? Have a look.
~~ ~~ ~~
In the decidedly less freakish, Funny About Money has identified that Time is Relative. So. Very. True.
This is why I put up with so much less bullshit in my life and give one reason: I’m too old for this.
Speaking of being old for things, is getting laundry done amicably really such a fraught issue? Oil and Garlic shared the labor divide in her household. It works well for them. I’m just confused why chores involve wars. It’s not that PiC and I are the most patient people in the world because seriously, no. But we’re at the point where: if it gets done, and we’re both putting in what time and energy we can, then fine. NBD. Good enough. He gets 80%+ credit anyway because frankly, I can’t do an equal physical amount around here but I do all our taxes, financial planning, negotiating, knee-busting on lowlives and hooligans, all the talkin’ and follow-up with people. To each, their strength.
Does that work for anyone else or do you need to have a strict division of labor? Or some other thing?
~~ ~~ ~~
To distract myself from the big canine medical drama that I’ll write up later, I’m working on …..
Taxes: The things that were once fun, aren’t anymore. My eyes are burning out as we speak, while I pore over 2011’s taxes and my brain tries to figure out who?what?where?whu?
Itemizing is a new thing in my life. Itemized PiC’s taxes for him last year. And I have now discovered that the Form 1099-G: Report of State Income Tax Refund is like a new little Devil.
Would you believe this bugger says:
“It may be taxable to you if you deducted the state or local income tax paid on Schedule A (Form 1040). Even if you did not receive the amount shown, for example, because it was credited to your state or local estimated tax, it is still taxable if it was deducted. If you received interest on this amount, you should receive Form 1099-INT for the interest.”
So: If you itemized last year and deducted it, and got a state refund, this becomes a taxable item. And if you ended up not coming out ahead, you’re still getting taxed anyway. SUCKER.
For a stupid moment, I thought, this’ll be next year’s headache, but as it turns out, nope. What a jerk.
Now I’m going down blind alley after blind alley wondering, why are you asking for all this information? I’ve never even touched Schedule L, I can’t give you figures from that!
I’m starting to think of this tax software as a sadistic psychopath. Yes, as opposed to the soft and cuddly kind. Leave me alone. Everything is wrong in my world when taxes are horrible. They’re supposed to be fun. Right, Kay Bell?