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Tuesday, March 4, 2014

IT’s TAX TIME AGAIN


IT’s TAX TIME AGAIN
 
Mrs. C and I just dropped our tax information to our accountant.  My mom would be ashamed of me for not just doing my own taxes.  I considered it my only vice and luxury.  It is a vice and a luxury because there is no good reason I do not just do my own taxes. 

My mom always did all the family’s taxes.  Mrs. C used to do all her family’s taxes.  I used to always do my taxes.

It amazes me how many people who only have simple short forms to file are so afraid of taxes that they pay for someone else to perform about three calculations, consult a tax table and lick a stamp.  I think our schools should have a several week course to teach kids how easy it can be to file their own taxes.

Still.

I hated doing taxes, especially because I used to have to do four.  There was the Federal, New Jersey as a resident, New York as a non-resident whose income was earned in New York, and New York City as a non-resident.  Each jurisdiction had different rules and different explanations.   Being a natural procrastinator I always did my taxes on April 15th, often racing to the post office just before midnight to get that April 15th postmark.

I did my own taxes for over 25 years, until I made one bad mistake.

One year ex-wife number two took a buy-out from her company in exchange for not being a pain in the ass after she was laid off.   She was paid bi-weekly for one year, but never had to go to her job.  I treated this income as New Jersey income because she never worked in New York.  The checks, however, were paid out of a New York address.

New York taxed at a 9% rate; I filed the income as New Jersey and paid at a 6% rate. 

New York disagreed. 

They disagreed three years after the fact and did not want to listen to my argument as my position had already been ruled on against many others who had used my same flawed logic. 

I had to pay up. 

New York was nice enough to wave the interest and penalty.  

New Jersey ruled three years was too late to file an amended return.   This mistake cost me 6% of the income as I ended up paying to both jurisdictions.

The money loss was bad enough; the worst was the wrath of ex-wife number two.   I was called every name in the book.  I was emasculated, berated, beleaguered and damn near beheaded.   I vowed to never file on my own again even though it was well within my ability to do so.

I could file on my own today.   Mrs. C would never berate me for making an error, and she is tax savvy so we could certainly work on them together.  However, my income today is far more complicated than in the old days.  There is Social Security income and Social Security rules, there are capital gains rules, dividend rules, some Mutual Funds have a mixture of dividend and capital gains income that I can never figure out, and Mrs. C has earned income.  So the hell with it, I give it all over to my accountant and pay him a pretty penny.

I sleep well on April 15th. 

It is my only luxury.

16 comments:

  1. Luckily for us (well, with a loose definition of "lucky") we have a company who does our taxes. The only reason for that was our little sojourn in Europe for four and a half years. Too complicated as an "Ex-Pat" to do ones own taxes.
    Now, on the downside, it's a huge firm, and once in a while they miss the obvious. Like, the fact that we're Canadians, and there's a different time line for filing. Just a minor thing. Duh.
    We get one more kick at that cat (two years after repatriation) and then we're on our own. We still just might hire somebody.

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  2. After 34 years of taxes I can't stand the sight of them. However, my return is soooo simple that I can't justify anyone else doing it. So sometime this month, I'll get around to adding up all the medical bills and then go do it on line.

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  3. I have finally reached the delightful stage in life where I am too old and too poor to have to pay taxes. Ahhhhhhhhh.

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  4. For years I had my CPA do my taxes as they were complicated and I didn't want to spend my golden years in Leavenworth. For better or worse things are less complicated today, but I still like someone looking over my shoulder to make sure I don't do nothin' dumb. TurboTax $19.95 Special to the rescue!

    Oh, I've already filed mine. I had to pay more this year. UGH!

    S

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  5. Hubby does our taxes each year and ours is pretty simple. So no need to have someone else prepare them. Quite some story about that costly mistake. I think I'd have someone else do mine after that too.

    Have a fabulous day. ☺

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  6. i've always done ours, but this year i think i'm going to have to give in and get professional help. dammit.

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  7. Sounds to me like a luxury well spent!Before I married and came to England, I did my own taxes -- only needed to do the short form. Sent it in as soon as I got my W-2 because I always had a rebate coming. UK taxes scare me to death, but my husband does his and he does mine. When he talks to me about taxes -- my eyes glaze over...

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  8. My Mrs. C. does our taxes, a holdover from when she worked as a tax accountant years ago. We always overpay and end up with a refund.

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  9. I used to file my own return ...until I had investments, ex-wife, child suppoet, and losses to report.

    Now there's Social Security, IRA's, Roth IRA's, and medical crap with mileage.

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  10. we have used an online tax service for more than 10 years and that manages all the complication without requiring us to drive somewhere and pay some knucklehead to enter the same data for us. takes about as long to do it as it would to manage accountant appointments and is a lot less expensive.

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  11. FOUR RETURNS! That's preposterous! Federal long form and Missouri's convoluted labyrinth are taxing enough for me.

    I do the taxes around this house. It's fairly straightforward, what with not having a high-mortgage mansion, earning too much to count medical expenses, and keeping our savings in a sock buried in the back yard. Even our dependent Genius has so much scholarship aid that we can barely claim a dollar or two in education expenses.

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  12. I know what you mean. I had always done our taxes until last year when I, too, turned it over to a highly-paid CPA. I worried, I fretted, but in the end I just paid him and enjoyed a life of ease. I'll do the same thing this year. It's worth it.

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  13. I think if your income is even slightly complicated you might as well let an accountant do your taxes. Can you claim the cost of the accountant on the following year's tax bill? We can here in Australia, so you don't lose.
    Nevertheless, I have recently gone back to doing our taxes myself, because it is now very easy as it's done electronically. You download the "eTax" software and it prompts you for everything and calculates it all. It does a better job than I used to with pen and paper, and as good a job as any accountant would do for us, as our finances are very simple. I quite enjoy doing it too.

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  14. I've always done my own taxes, it's incredibly easy when all you have to declare is wages. I switched to doing it online when that option became available and that was fine for the first few years, then they started changing the form every year, different questions asked in more complicated ways that all meant the same things as the simple questions used to, but I still managed to do my own forms. Now I'm retired and my social security and superannuation income is under a certain limit so I no longer pay taxes or fill in any forms.

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  15. I too am happy to pay someone else to do it for me.

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