I am self employed so I make quarterly payments. Except, I don't. I always wait to pay it all in the last quarter. (So far, the IRS does not seem to mind this approach). Of course, that means that I basically pay all my taxes for the year in one lump sum. I don't want to put the number out there, but it is not pleasant. I paid it last week and now I feel poor.
I'm nervous about this year. We have some capital gains and extra income that may eliminate some of our rental loss write off. I have no forms yet though. Hoping for the best!
The year DH and I got married (2005). I worked in WI from Jan to April (DH was already living in VA). Got married in April and moved to VA May 1..... We owed WI just under 11k - which is more than I made in WI those few months I was there.... It was because WI combined the income from DH and I and WI taxed the heck out of us. I was single while living in WI but we filed our taxes as married. And this was a tax professional who did the taxes - not us. I still bitch that something wasn't right but there's nothing I can do.
The next year DH and I both claimed married and 0 however when you combines our income it pushed us to the lower part of the next tax bracket so we ended up owing again... this time it was 2k.
I am self employed so I make quarterly payments. Except, I don't. I always wait to pay it all in the last quarter. (So far, the IRS does not seem to mind this approach). Of course, that means that I basically pay all my taxes for the year in one lump sum. I don't want to put the number out there, but it is not pleasant. I paid it last week and now I feel poor.
This is me too, self employed is so tricky with taxes. We will never get a refund again and DH is good about prepaying quarterly.
I am self employed so I make quarterly payments. Except, I don't. I always wait to pay it all in the last quarter. (So far, the IRS does not seem to mind this approach). Of course, that means that I basically pay all my taxes for the year in one lump sum. I don't want to put the number out there, but it is not pleasant. I paid it last week and now I feel poor.
I used to do this, too. A few years ago I incorporated and pay myself as an employee of my own company. Now I pay the taxes every month. I kind of feel poor every month now
I got an $1800 tax bill last May from underreporting while married. Apparently we underreported because XH cashed in some retirement accounts I was unaware of him cashing in, so they were penalized and unclaimed income.
That is still a mess. He said he took care of it, but of course he didn't. I recently filed an innocent spouse relief form, so I hope that goes through. In the meantime, I'm hoping he files his taxes ASAP and gets a big refund, because they'll take the payment from whoever files first. I think there is a big chance his refund won't cover it, so I hope the innocent spouse thing goes through. If not, I don't get my refund (which, ironically, looks like it will be around $1800 this year).
I'm not planning on actually filing for my refund until after the tax deadline, unless I find out this has been cleared up sooner. Which sucks, because I could really use the money NOW.
same boat
xh cashed out his SEPIRA and never bothered to have the taxes taken out. never tells me about this and OMG the bill from the IRS ! now bc he's an unemployed transient, guess who they come after bc we filed JOINT those years ! I've got an innocent spouse petition going to *fingers crossed* but I won't be seeing a tax refund for a LONG time otherwise
OMG I am just reading this. Good luck with the petition!!!
As I now understand it, with an S class Corp, if the company made money and had it on the books at year end, the owners are taxed as if it was income, even if they reinvested it Jan 1 of the next year. So if the company had 500k in cash profit on Dec 31 saved to buy stuff or pay employee bonuses Jan 1, that gets taxed as 500k of personal income for the owner(s). It blows.
As I now understand it, with an S class Corp, if the company made money and had it on the books at year end, the owners are taxed as if it was income, even if they reinvested it Jan 1 of the next year. So if the company had 500k in cash profit on Dec 31 saved to buy stuff or pay employee bonuses Jan 1, that gets taxed as 500k of personal income for the owner(s). It blows.
OMFG. Why would anybody want to be an S class corporation. That sounds awful.
The upside is that you don't pay both a corporate income tax on the money and then personal income tax when you get bonuses. (Or so I understand, but corporate taxation is most assuredly not my area of expertise!) If you're smart about reinvesting before year end, the tax hit isn't so bad. DH and his partner just didn't prepare and had a bunch of cash saved to pay employee bonuses in January. They've been a lot smarter in the years since.