Our accountant about gave me a coronary!!!!

[Deleted]

We are getting ready to pay 4Q12 quarterly taxes for DH's small business that he just opened in Sept 2012. We save at least 30% of every paycheck in a tax payment account. Accountant emailed me a figure that is over 2K what we had set aside for taxes for 4Q. I about peed my pants and got on a conference call with him and DH. Accountant kept telling me repeatedly that if we had been saving 30% of his income we would have enough money and I kept telling him we have been setting aside 30% of DH's pay but don't have anywhere near that amount. Panic. Fear. Flaming red ears. I couldn't figure out what in the world I'd done wrong and how are we going to come up with this extra money by the 15th?? Finally DH said something that made accountant realize he hadn't factored in the fact that we made a 3Q12 payment. He thought we hadn't paid any taxes on the business' income yet since it's a new business. He's recalculating the numbers but thinks what we owe should be right about what we have saved so we have been doing it right.

My heart is pounding!! It's just noon and I need a drink! :drink:

[Deleted]

As a fellow small business owner, my accountant gives me a coronary about once a week.
It ain't easy.

Throw in employees on foreign status where the tax laws for every country are different and it's a general hot mess all of the time.

We actually as of the first of the year turned all of our accounting and payroll over to our accountant full time. I learned but I'm out of time and energy and the paperwork to file payroll, taxes and whatever other forms is so confusing and changes all of the time. It may cost me a fortune, but at least it's done, done right and not my problem.

And I still somehow manage to have to pay enough taxes to pave the road in front of my house. And then some.

So basically I feel you.

[Deleted]

Jan 11, 2013 12:31:54 GMT -5 @justdairy said:

As a fellow small business owner, my accountant gives me a coronary about once a week.
It ain't easy.

Throw in employees on foreign status where the tax laws for every country are different and it's a general hot mess all of the time.

We actually as of the first of the year turned all of our accounting and payroll over to our accountant full time. I learned but I'm out of time and energy and the paperwork to file payroll, taxes and whatever other forms is so confusing and changes all of the time. It may cost me a fortune, but at least it's done, done right and not my problem.

And I still somehow manage to have to pay enough taxes to pave the road in front of my house. And then some.

So basically I feel you.

Small biz ownership ain't for the faint of heart, that's for sure. We are only dealing with gas and mileage mainly since he's a subcontractor for another business who supplies everything else he needs to do his job. He's not really making a profit yet either. We bought QuickBooks but honestly the software is too fancy for his business needs right now so accountant let me send everything in an Excel file. They have offered to handle everything full time for us. I don't think we can afford the extra fees that would incur just yet but hopefully down the road we can turn everything over. I am Type A enough to keep everything organized but have a tendency to panic too much as evidenced by the phone call!

[Deleted]

Our problem is there isn't accounting software advanced enough. We can only use types and they both cost more than the accountant..lol.

I'm not going to lie, turning everything over the accountant does cost a lot, but it's saved on stress alone. Also, he can think of ways and legal angles to save we could never do on our own. The accountant in our case is also tax deductible, so while he may cost upfront actually saves us in the end.

And don't stress so much. If there's one thing I've learned about taxes through of all this is that it's not so bad. As long as you make an honest attempt, the IRS isn't really coming after you. There really way are ways to fix/take care of most things.

[pitterwoo]

I still get confused with my taxes and estimates, but honestly like dairy said, it's not that bad and they aren't out to get you.

[Deleted]

Jan 11, 2013 13:41:19 GMT -5 @callmefia said:

Ali- I hope your accountant has not forgotten about FICA taxes? Are you guys doing those?!

Yeah we are good on that. That's why we set aside at least 30% so we can cover the would-be-emloyer-paid portion as well. He just mistakenly thought we hadn't paid any at all so the figure was essentually doubled. It's all cool - mistakes happen and I know he's crazy busy with lots of other clients right now.

DH does seasonal work. We are looking forward to spring when the work will explode and the funds will be rolling in. Of course he will be working 6 days a week but at least we will have the chance to get ahead on quarterly taxes and set aside extra for the slow winter season.

[mrssavy42112]

I haven't invested in getting an accountant for my small business yet because I don't have any employees, so I just try to keep track of everything myself. Last year was my 1st year as a contractor with 2 places & I ended up owing about $2000 at tax time. I was NOT happy. This year I sent in 5% more, so I'm hoping that should cover it. Taxes are no fun!

[mrssavy42112]

Jan 11, 2013 14:24:02 GMT -5 @callmefia said:

Ali- ok. 30% seemed low for FICA too but I don't know your situation. That is probably one of the biggest things people don't realize about being a sole proprietor. If you aren't doing them throughout the year, the. You owe both shares at tax time, which is a big chunk (like 12% in 2012 and now it will be 14%!)

Savvy- that is probably why you owed too.

Both- don't forget the SS hike for 2013. You should plan on saving at least 2% more just for your FICA taxes starting 1/1/13.

I'm not a CPA and I don't work for a firm anymore. Not legal advice. Just suggestion from someone who has filled out lots of IRS schedule SE's. for myself and others.

I did pay throughout the year. I was only sending in 25% because that was more than was being deducted when I was an employee. If I had sent in closer to 27%, I would've been good. So that's why this year I saved 30% and sent in over $3000 more than my estimated taxes. I hope I'm good this time!!

[bunnymendelbaum]

Our taxes have been a total shit storm for years. It used to be we had to file like 3 different states, but now it's all crazy self employment stuff. It is so unpredictable in our case. I seriously do not know if we are going to owe a ton or get a huge rebate.
We owed a ton 5 years ago and it almost killed me.

Only good thing is we didn't make shit this year. Like 35% less than last year. Ouch.

[Deleted]

Jan 11, 2013 14:24:02 GMT -5 @callmefia said:

Ali- ok. 30% seemed low for FICA too but I don't know your situation. That is probably one of the biggest things people don't realize about being a sole proprietor. If you aren't doing them throughout the year, the. You owe both shares at tax time, which is a big chunk (like 12% in 2012 and now it will be 14%!)

Actually he isn't a sole proprietor. He opted for an S Corporation because the corporation isn't taxed in addition to our personal income taxes. That's how it was explained to us.

Thanks for the reminder on the tax hike. Gah!!

MrsSavvy - my hat goes off to you handling it yourself. I do not have a head for numbers and would lose my freaking mind trying to do that. I'm just to high strung or something.

[ohjessica]

Phew, glad you got that figured out. I say you deserve at least two drinks after that scare!