www.inkthinkerblog.com — TaxGirl Kelly Phillips Erb is giving away 40 free copies of TaxCut software to blog readers. Go here for details. Hurry up, because it’s first come, first served.
Now, on a more Inkthinker-related note, do you do your own taxes, or do you use an accountant? And do you file annually or quarterly? At the moment, I’m filing annually and using an accountant. I doubt I’ll ever be doing them on my own, but I suspect that this year I’ll have to start filing quarterly. We’ll have to see what my account says… I’ll keep you posted.
Leave a comment about YOUR tax sitch.
Tags: freelance writing blog, freelance writing, freelance, writing, free tax software, help doing your taxes, last minute tax help, filing annually, filing quarterly, using an accountant, doing your own taxes, inkthinker, kristen king
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I have a tax preparer do mine. She’s certified, but not a CPA, so she costs much less. She’s well worth the money, even though I could save myself a hundred bucks or more by doing them myself. She simply knows the rules better and gets me more deductions–not to mention the work time hours I’d lose trying to figure it out myself!
So far I file annually since my husband’s withholding more than covers us anyway–with 4 kids, that’s not too hard to do. No need to let the big Uncle hold my money for me when I could be using it myself!!
Hi, Kristen! I’ve been filing my taxes for years, using TurboTax as my “people.” Wouldn’t have it any other way.
I file annually, but the last few years have been — ahem — kinda lean on the freelancing side (which, until this year, was all part-time anyway). I may have to start thinking about doing it quarterly, though.
I did our taxes early again this year, mostly because I knew we were going to get a big refund. Had it done by the middle of February, and had the refund in my bank account 2-3 weeks later. I have to say, that’s when I really love the IRS.
Cheers,
Marjorie
Marjorie’s last blog post..Crohn’s & Colitis Foundation of America – Take Steps Walk
Years ago when I was an employee, I used to do the joint tax returns for my first husband and me—no private-practice accountant, no H&R Block. We were both employees, not self-employed.
I’ve never done tax forms for Ed (current husband) and me. I’ve merely recorded all appropriate data in Excel tables and passed them along to our accountant, a CPA. And ever since I switched to self-employment 13 years ago, I’ve been paying quarterly estimated taxes. Until last October, Ed was an employee of a small company; then he was laid off after 14 years with the company. He then started his own small business.
For tax year 2007, in additional to personal tax data and tax data for my sole proprietorship, I had to provide tax data for Ed’s new corporation, for which he and I are the only officers and the only employees. For once, I have no clear idea of how everything’s going to shake out once the accountant’s done, other than that we (or the corporation—not sure yet how it works) should get a whopping huge federal refund because we spent megabucks (from our point of view, at least) on startup costs yet Ed brought in very little income through the corporation. But the low income isn’t surprising, given that the incorporation process wasn’t completed until November, only one month before the end of tax year 2007. His corporate income versus expenses will be a very different story, though, for tax year 2008—thank goodness! And my sole proprietorship is still getting more profitable every year.
My dad still does my taxes. Of course, this year is really confusing since my US $ income was about $300, my foreign income was about $10K, and I’m married to a foreign national while living in another country. I wouldn’t even know where to begin in figuring out what to with those forms for Uncle Sam. Maybe I can fill it in with lots of question marks.
china-matt’s last blog post..Sweeping Up
This was my first year doing taxes as a freelancer. I took an evening to crunch numbers, which included taxes from before and after I made the switch to freelancing; my husband’s taxes (we file jointly); a past-year filing I had to take care of; and I figured out how I would know when I’d need to start paying quarterly taxes.
Total time: 2 hours. That includes printing the forms, filling them out by hand, and sticking on the stamps.
If my tax situation gets really complex, I’d consider going to an accountant, but I really don’t mind spending my own time on it. Filling out tax forms is almost relaxing, like doing a crossword puzzle.
The few times I hired so called professionals to do it, they messed it up so badly, I’m still digging out of the mess.
I do it myself and file annually. I know the number I plan/need to hit before I start filing quarterly, and that will probably happen after the move. Not there yet.
Devon Ellington’s last blog post..Sunday, April 6, 2008
Last April was the first year I had an accountant do my/our taxes. Now that I’m a full-time freelancer, I think it’s worth the $300 to have an expert file them. I pay quarterly estimated payments, but I think we’ll still get hit with a pretty big bill this month, since I made about $13K more last year than I did the previous year. It’s my fault for not giving our accountant a heads-up on it, though. Ugh. Taxes.
I’m not sure what you mean by “I’ll have to start filing quarterly”; my understanding is that if you’re self-employed (and make above a certain income) you have to make quarterly payments. Otherwise, the IRS loses the interest on the income it would have if you were a “regular” employee and your taxes were taken out of every paycheck. If I’m wrong, would you mind letting me know? It would be nice to have the choice!
Cory, you’re basically right – you have to pay quarterly if your estimated payment will be (IIRC) $1000 or more. There are two situations where you wouldn’t have to pay quarterly:
One is if you don’t make enough money. Say you’re new to freelancing, or you only do it part-time. Your taxes might come to, say, $999 and the IRS is fine with getting that at the end of the year. (This was my situation last year.)
The other is if the IRS gets their money some other way. Maybe you or your spouse has another job, and you ask the employer to take withholding out of your paycheck at a level that covers all your total taxes. (This is what Mary Ward describes, above.)
Remember that the cutoff is about what you expect to owe, not your income or even your total tax amount.
Yeah, I’m at the point now where my estimated payments are enough that I have to file quarterly, but of course I have no idea how, so that’s where the accountant comes in. :)