WooooHoooo!!
No, not really. Tax day for most can be a scary time. This year things were especially difficult as the President’s new tax laws were causing many more to not have taken enough taxes out during the year to avoid owing. I was hearing stories from friends that they were owing thousands. The people that said that they were getting money back were claiming to not be getting back as much as they used to in previous years.
So what happened?
Well, the short and somewhat uneducated version is that while the President decreased our tax liability for the year, he also decreased our tax credits. So what you could once claim at the end of the year to ease your tax burden may not be eligible this year.
For instance, owning a home is not necessarily a grand tax break anymore. The amount that you can claim for an exemption is $10,000.00. That’s nice and all, but by the time you figure property tax and everything else, you really haven’t benefited from the home ownership. The tax credit is just too low to make the difference like it used to. By the way, my wife isn’t happy about this as it plays into my “renting is best for now” philosophy and not into her “we need to buy a house NOW” philosophy.
We waited until the last minute to do our taxes this year. Yes, we figured that we would owe and why rush to give the Government yet more money. We scheduled our appointment with the accountant for the end of last week. Yes, a mere few days before the dreaded tax day of April 15th.
You did WHAT?!!!
We sat down with the accountant and presented our documents for his preparation. We had the usual chit chat while he typed furiously on the computer. He has a very dry sense of humor so you really have to pay attention because he’ll catch you off-guard. Then, after a few short minutes, he starts printing tax documents for us to sign.
So I ask, “Well Ron, what’s the damage?” His response was, “You did ok on Federal but you owe on State. I scheduled the money to come out of your account. Hopefully you have $930 in that account, haha.”
“Haha?” “HAHA??” Seriously? No Ron (if that is your real name), I don’t have $930 in that account. In reality, although that was going through both of our heads, we didn’t say it. We played it cool. We just knew that we had to ask which account he scheduled it for so we knew which account we had to scramble to deposit funds. He informed us that we had until April 15th before they take the money.
So, waiting until the last minute wasn’t the best idea.
We basically had the weekend to rearrange funds to cover our taxes. My wife’s paycheck covered it but there was still money movement from multiple sources to do what needed to be done. Part of this problem is that a few of our financial institutions are still exclusive to Arizona. Something that needs to be remedied.
So fortunately we survived this year’s Tax Day. It wasn’t easy and if it wasn’t for my wife’s job, things would have been uglier. We have a ton of “end of cheer season” expenses happening right now and it’s taking it toll. No worries as this is the very last of it, cheer-wise, that is. But that is a topic for another post.
Hopefully Tax Day left you in good spirits but if it didn’t please consider this, in my usual GHF (Glass Half Full) attitude, you netted more money throughout the year and you just have to review your W-4 for this year to balance things out. It will be ok.
You’re going to be great. 🙂
Dave
CONS: We owed taxes this year, unexpected expenses and high-speed scramble to cover them
PROS: We didn’t owe as much as we thought we would, we got more money during the year, tax debt is paid so one less expense lingering, and I scored a point towrad my renting argument 🙂