Cash The Checks

Another year goes by and it’s time to file your taxes again. If you haven’t done so, what are you waiting for? If you need more time, you can file for an extension free of charge. You get 6 more months to file. This IRS page will explain what form you need to print and mail in.

I did mine in early March this year and managed to get a refund within a few weeks. Direct deposit is great, I bet it saves them time and money and you get your money quicker. Whenever I owe money, I set the date of withdrawal to be right before taxes are due so they don’t get my money early.

The IRS expects more returns this year than ever before because of the rebates we’re getting. You only get one if you file your taxes this year. If you file an extension you’ll still get your rebate check - but you’ll get it after you send in your taxes.If you’ve done your taxes already you should be expecting your rebate as early as next month.

It’s that time again to pay your quarterly taxes if you’re self employed. I made my payment today and had to readjust my payment since my income has unexpectedly increased. My first quarterly payment was big, my second one was small, and this third one was big again. I read that the IRS may issue a penalty because my 2nd quarterly payment was so small. I think a penalty is unfair because it’s supposed to be estimated taxes. If you’re supposed to be accurate to a certain percentage, then it’s not really an estimate anymore, but more like a precise mathematical calculation correct within a range. Self employment tax is killing me, I got to learn how to form an LLC and pay myself a wage to cut that tax out. It’s too late this year but maybe in ‘08 I’ll get started on that.

On another note, I’m planning on buying my first home in a few months, so I’m going to be receiving a big tax deduction for that in my 2008 taxes. I will actually be paying less in taxes next year even though I’m going to be earning more.

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Today June 15th is another installment date for sole proprietors who pay estimated taxes (1040-ES)

The due dates for estimated tax payments are:

For the period: Jan 1 - March 31
Due date: April 15

For the period: April 1 - May 31
Due date: June 15

For the period: June 1 - August 31
Due date: September 15

For the period: September 1 - December 31
Due date: January 15 the next year

If the 15th happens to fall on a holiday or a weekend day then the due date will be the next business day.

I pay my taxes at: https://www.eftps.com/eftps/ and just so I don’t forget, I set up automatic payments, so it’s withdrawn from my bank account right before it’s due.

The end of the year is quickly approaching and for those of us who have a business and make business expenses, it’s a good time to make some calculations and see how much you’re going to pay Uncle Sam this year. The advantage of doing this now is that if your tax liability is too high, it’s a perfect time to make some extra business expenses before the year is through.

Here’s a few things you can do to increase your business expenses yet not spend foolishlly.

• If you’ve been wanting to upgrade your computer, there’s no better time than now.
• Pre-pay your advertising expenses for the next few weeks/months in advance.
• If there’s this business investment you’ve been hesitant to make, this could be the extra motivation you need to take the risk.

Lets say you have a home office, but you’re not declaring a home office on your taxes, just because of the extra form you have to fill out and because of the added attention it may bring. Can you still put the electricity bill (or a percentage of the electricity bill) as a deduction on your income tax return? I don’t know why I’m thinking about it now, as it’s not tax time, but what a headache.

I’m beginning to think we’d all be better off if we just had a flat tax. Just add a federal income tax on all the goods and services we purchase, and eliminate income taxes. Just imagine how much easier that would be - and no more complicated tax forms. In fact, no more IRS either, no more audits. The only bad part is - no more IRS jokes.