The End is Near!
No, I’m not talking about the end of the world, but it got your attention, didn’t it? I’m talking about December 31, the end of the tax year.
If you’ve been less than diligent in keeping your financial records nice and neat this year, you’ve still got time to get your ducks in a row. Make it a point during the next month to straighten out your files and start organizing things for your tax person. Staying on top of your tax situation is a must, and that goes double for the self-employed and independent contractors among us.
I had a shock last year at tax time because I wasn’t paying enough attention to the bottom line. I had paid my quarterly estimated tax. At year’s end, I took my neat little pile to my accountant and asked her to give me a ballpark figure of how much I was going to owe (I always want to owe a little; if I overpay enough to get a refund I feel like I’m loaning the government my money interest free). She gave it the brief once over and announced a figure I was okay with.
Two weeks later when I went to collect my returns, that amount had increased by almost 7,000. I nearly croaked!I had spent the year on a debt reduction mission, really cut down on my spending (translation, tax deductions), and subsequently the business kept a good bit more money. Since I was spending that money on reducing debt instead of giving myself a big raise and living the high life, I really didn’t feel like I had more money, and I didn’t pay enough quarterly tax. I’m happy to say I’m more on top of it this year. I still won’t get a refund, but hopefully I won’t have to spend the family vacation money making up a deficit caused by carelessness.
I hope you have a wildly prosperous holiday season, sell more gift certificates than you ever imagined, and remember to save enough to pay Uncle Sam.
Laura Allen
Posted on November 28th, 2007 by Laura Allen
Filed under: General
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