February 12, 2008
In my haze of coughing instead of sleeping at night, and working instead of resting during the day, I realized I have never had to pay taxes before. It’s always been a refund, large or small, and so I’ve never had to consider this question:
How should I pay my taxes?
As I mentioned before, I think it’s going to be a hefty sum. As a matter of principle, I hate to pay by check. Should I look into using a credit card and do they always charge a convenience fee? If they do, the only way it might be worth it would be to have a high percent of rewards (at least 5%) to offset the fee. Whatever the case, I’d like to make sure that I maximize this “purchase!”
In other news, this is one of the nastiest colds I’ve ever had. It’s been a week, and I think I’m getting worse. At least it’s not the flu!
February 9, 2008
As it turns out, I didn’t properly track my non-W2 income in the form of bonuses and supplemental income as well as I thought I had.
All the paperwork is here in front of me, and I may very well be getting soaked on my taxes this year. Let’s see, nearly 30% of my total income was paid as “miscellaneous income” documented on a 1099. Since I didn’t anticipate this, I’ve only paid approximately 8% on total income this year, and only have my filing status as Head of Household with 1 dependent to help keep the tax bill lower. Yikes!
I’m not eager to find out what the real bill will be, but not knowing is making me a bit itchy. Guess this means I’d better get this paperwork to the accountant and let him work his magic soon.
April 10, 2007
Hmph. It turns out that, despite my intense denial, the accountant is right and I can’t claim HOH status with both Pa and MaDucky as my dependents. Force of willpower can’t make him wrong, after all.
MaDucky made more than the 3,300/year income limit, and so, despite the fact that I’m pretty much paying for the entire household, I cannot claim an exemption for her. This means I could end up owing money after all. I’d artificially inflated my exemptions for the last quarter of 2006 to compensate for what I thought was overwithholding all year, but forgot to factor in my bonus and the possibility that I might not have 3 exemptions this time ’round.
Drat.
What does this mean? Well, I’ve already reduced my exemptions for this year. But, I have to try to sock away more into my retirement accounts to lower my taxable income some more in case my bonus is the same as last year’s or better.
Phooey phooey and drat. I hate it when well-laid plans go awry. It’s a good thing I never counted on a refund, though.