ktgrok Posted April 12, 2017 Share Posted April 12, 2017 So...I'm finally doing our taxes. I knew we'd owe money because of my writing income. Last year we paid about $1,200. Ok, expected that. But....I'm putting in the W2 forms for my husband and at one of his jobs, his teaching job, he didn't have ANY federal tax withheld!!!! Now, this is a part time job, but still! Between that and the fact that by taking the job he is now over the limit for income for some tax credits we have gotten in the past it looks like we are going to owe nearly $6K!!!!!!!!!!!!!! He is NOT expecting this. He has anxiety and on a nd off depression and this is NOT going to go over well. We do have the money, in savings, but that will clear out over half of it and we were holding onto that money to put towards a new used van for me when my dies (which could be any day now..it has multiple problems). He is expecting a bonus any time now from his main job, which will help, but we don't know how much. Now I REALLY hope he gets the promotion at work he's applied for....it would be much more money and a better title than will relieve some of his stress. Because man, giving him this news is NOT going to go well. He's especially going to be upset because it seems it was his own error. He hates when he messes up. Crap. I'm sick to my stomach. 2 Quote Link to comment Share on other sites More sharing options...
footballmom Posted April 12, 2017 Share Posted April 12, 2017 I'm sorry. I totally feel your pain. DH started a new job beginning of 2016 and we found out when we did taxes that his job majorly under withheld and we owe a huge chunk. The irony is we won't have to fix his deductions with the company since he got laid off from that job earlier this year. I pray the money is replenished in your savings quickly from the bonus or promotion! Quote Link to comment Share on other sites More sharing options...
Jean in Newcastle Posted April 12, 2017 Share Posted April 12, 2017 I hate to tell you this but you will have a fine on top of the money you owe. We had a mistake like that last year and found out that if you owe more than $1000 then you are fined. 1 Quote Link to comment Share on other sites More sharing options...
Arcadia Posted April 12, 2017 Share Posted April 12, 2017 :grouphug: Did he have any social security tax withheld for his part time job? The years my husband changed employers, more social security tax was withheld then needed so we got money back from that. Quote Link to comment Share on other sites More sharing options...
happi duck Posted April 12, 2017 Share Posted April 12, 2017 (hugs) Quote Link to comment Share on other sites More sharing options...
J-rap Posted April 12, 2017 Share Posted April 12, 2017 Ugh, that's an awful feeling. I'm just working on taxes now too. Hopefully we won't have any surprises like that... (In the end, it will work out for you... but I know how distressing news like this is!) Quote Link to comment Share on other sites More sharing options...
ktgrok Posted April 12, 2017 Author Share Posted April 12, 2017 (edited) I hate to tell you this but you will have a fine on top of the money you owe. We had a mistake like that last year and found out that if you owe more than $1000 then you are fined. hmm...we didn't have a fine last year I don't think, and owed over 1K....maybe I missed it? Edited to add: looks like it is if you owe more than 1K, UNLESS you paid 90% of your taxes, OR you paid 100 percent of the amount equal to last years taxes (so basically, if you taxes went way up and you didn't realize they give you a break for that..I think we fall into that category) Edited April 12, 2017 by ktgrok 5 Quote Link to comment Share on other sites More sharing options...
Just Kate Posted April 12, 2017 Share Posted April 12, 2017 hmm...we didn't have a fine last year I don't think, and owed over 1K....maybe I missed it? We've paid more than $1,000 before and I don't recall a fine either. ??? 1 Quote Link to comment Share on other sites More sharing options...
Spryte Posted April 12, 2017 Share Posted April 12, 2017 I'm sorry. That stinks. Quote Link to comment Share on other sites More sharing options...
Bootsie Posted April 12, 2017 Share Posted April 12, 2017 If you had writing income, have you taken all of the business expenses you are allowed to take against that income? 1 Quote Link to comment Share on other sites More sharing options...
Miss Tick Posted April 12, 2017 Share Posted April 12, 2017 Well, if you do end up owing a fine you will probably have to file your taxes quarterly next year, yuck! PLUS, in that case, you are already past-due on your first quarter filings. You can guess how I know that! The fun just keeps stacking up. ((Hugs ktgrok)) we had a mildly similar incident this year also. Quote Link to comment Share on other sites More sharing options...
DawnM Posted April 12, 2017 Share Posted April 12, 2017 I am so sorry. We are going to owe about half of that ($3000) it looks like, due to my starting back to work in 2016. Quote Link to comment Share on other sites More sharing options...
ktgrok Posted April 12, 2017 Author Share Posted April 12, 2017 If you had writing income, have you taken all of the business expenses you are allowed to take against that income? Yes..although my husband is convinced a talented accountant could magically write off all of that income. But really, software licensing for Microsoft Office, dues to RWA, and some mailing expenses are all I really have to write off. I did write off my laptop, which turbo tax automatically does (partial deduction each year...can't remember what that is called). But I don't have a home office or anything. Quote Link to comment Share on other sites More sharing options...
ktgrok Posted April 12, 2017 Author Share Posted April 12, 2017 yeah, a big issue is that last year we got $3K in the form of the child tax credit. This year he went over the income limit so we are only getting $500 in credit. Didn't anticipate that :( Quote Link to comment Share on other sites More sharing options...
Robin M Posted April 12, 2017 Share Posted April 12, 2017 Laptop is 179 expense. You can also write off any books, paper, magazine subscriptions, etc. Anything related to writing profession. You should be able to deduct for home office. It would be a percentage of your home since you write from home. Check out what nolo says. Lots more to write off - http://www.nolo.com/legal-encyclopedia/tax-deductions-writers.html Totally enjoyed Puppy Proposal! 👠3 Quote Link to comment Share on other sites More sharing options...
Guest Posted April 12, 2017 Share Posted April 12, 2017 I feel ya. We are self-employed so taxes are a constant issue. Hugs! 1 Quote Link to comment Share on other sites More sharing options...
ktgrok Posted April 12, 2017 Author Share Posted April 12, 2017 Laptop is 179 expense. You can also write off any books, paper, magazine subscriptions, etc. Anything related to writing profession. You should be able to deduct for home office. It would be a percentage of your home since you write from home. Check out what nolo says. Lots more to write off - http://www.nolo.com/legal-encyclopedia/tax-deductions-writers.html Totally enjoyed Puppy Proposal! 👠I didn't buy any books about the profession, or for research. no magazine subscriptions. And no, I don't have an area of the house that is a dedicated home office (hence the laptop, i usually write in my bed, at the park, etc). I don't even buy paper to print stuff since I send all my manuscripts electronically. Quote Link to comment Share on other sites More sharing options...
mom31257 Posted April 12, 2017 Share Posted April 12, 2017 I'm so sorry! I pray he will take it well, and it won't stress him too much! Sometimes I feel working part-time does not help that much when it ups your taxes and reduces credits, especially if there's much distance to get there and adds to gas expenses and car maintenance. I was trying to look at math tutoring for a local technical college, but they only needed tutors at two satellite campuses over 30 miles away. I would probably only make $15-17 an hour, so I didn't see how it was worth it. Both our vehicles have a lot of miles on them, so I hate to add even more. Quote Link to comment Share on other sites More sharing options...
AmandaVT Posted April 12, 2017 Share Posted April 12, 2017 We ran into this two years ago. What I did that helped - I immediately maxed out the taxes coming out of DH's and my paychecks. Then I filed an extension until Oct 15th. I filed in the beginning of Oct and requested a payment plan from the IRS at $150/month. They're slow, like really slow, so it took them until Feb to figure that out and start deducting payments. Then I filed for taxes this year in March and we had a refund that *almost* covered the rest of what we owed. I should be able to pay off the remainder this year. 5 Quote Link to comment Share on other sites More sharing options...
Liz CA Posted April 12, 2017 Share Posted April 12, 2017 So...I'm finally doing our taxes. I knew we'd owe money because of my writing income. Last year we paid about $1,200. Ok, expected that. But....I'm putting in the W2 forms for my husband and at one of his jobs, his teaching job, he didn't have ANY federal tax withheld!!!! Now, this is a part time job, but still! Between that and the fact that by taking the job he is now over the limit for income for some tax credits we have gotten in the past it looks like we are going to owe nearly $6K!!!!!!!!!!!!!! He is NOT expecting this. He has anxiety and on a nd off depression and this is NOT going to go over well. We do have the money, in savings, but that will clear out over half of it and we were holding onto that money to put towards a new used van for me when my dies (which could be any day now..it has multiple problems). He is expecting a bonus any time now from his main job, which will help, but we don't know how much. Now I REALLY hope he gets the promotion at work he's applied for....it would be much more money and a better title than will relieve some of his stress. Because man, giving him this news is NOT going to go well. He's especially going to be upset because it seems it was his own error. He hates when he messes up. Crap. I'm sick to my stomach. If he gets anxious generally, it may also be a good idea to have him work on some coping skills. Cr@p happens to all of us and the better we are equipped, the smoother it usually goes. Is he open to adding some tools? Sorry, I'd be seriously miffed if I had to pony up 6K to the government. 1 Quote Link to comment Share on other sites More sharing options...
MerryAtHope Posted April 12, 2017 Share Posted April 12, 2017 Look into whether you can claim self-employed health insurance--that could well end up being all of your writing income. If you advertise your writing online, internet may be deductible too. Also, if you have more room to put money into your IRA's, experiment with what your taxes would look like if you did that--I've noticed that some years the differences are pretty significant, depending on how the various credits fall and how close we are to cut-offs. You can still put money into your previous year's IRA. 1 Quote Link to comment Share on other sites More sharing options...
vonfirmath Posted April 12, 2017 Share Posted April 12, 2017 I hate to tell you this but you will have a fine on top of the money you owe. We had a mistake like that last year and found out that if you owe more than $1000 then you are fined. You do not get a fine if you pay at least as much taxes as you owed the previous year, even if you end up owing more than $1000 2 Quote Link to comment Share on other sites More sharing options...
ktgrok Posted April 12, 2017 Author Share Posted April 12, 2017 Look into whether you can claim self-employed health insurance--that could well end up being all of your writing income. If you advertise your writing online, internet may be deductible too. Also, if you have more room to put money into your IRA's, experiment with what your taxes would look like if you did that--I've noticed that some years the differences are pretty significant, depending on how the various credits fall and how close we are to cut-offs. You can still put money into your previous year's IRA. I don't think so, as my insurance is via my husband's job, but will double check. Quote Link to comment Share on other sites More sharing options...
Jean in Newcastle Posted April 12, 2017 Share Posted April 12, 2017 hmm...we didn't have a fine last year I don't think, and owed over 1K....maybe I missed it? Edited to add: looks like it is if you owe more than 1K, UNLESS you paid 90% of your taxes, OR you paid 100 percent of the amount equal to last years taxes (so basically, if you taxes went way up and you didn't realize they give you a break for that..I think we fall into that category) We've paid more than $1,000 before and I don't recall a fine either. ??? You do not get a fine if you pay at least as much taxes as you owed the previous year, even if you end up owing more than $1000 Which is why you should not take tax advice from me! I just did what I was told last year. And this year (when it all worked out). Quote Link to comment Share on other sites More sharing options...
teachermom2834 Posted April 12, 2017 Share Posted April 12, 2017 My dh has a side teaching gig and he doesn't get federal taken out either. We are used to it now. But it is always the last W2 we get and it is always the last piece of info we enter into Turbo Tax. Seeing that refund calculator in the corner dwindle down is one of the saddest parts of the year. It is a shock the first time! Sorry. To owe that amount unexpectedly is a gut punch. Sorry! 1 Quote Link to comment Share on other sites More sharing options...
Bootsie Posted April 12, 2017 Share Posted April 12, 2017 You do not get a fine if you pay at least as much taxes as you owed the previous year, even if you end up owing more than $1000 But, if you think that you will be in a similar situation next year, you want to start having withholding increased so that you do not owe a penalty next year. 3 Quote Link to comment Share on other sites More sharing options...
LucyStoner Posted April 12, 2017 Share Posted April 12, 2017 I hate to tell you this but you will have a fine on top of the money you owe. We had a mistake like that last year and found out that if you owe more than $1000 then you are fined. That depends on what percentage of your total tax liability was unpaid. Quote Link to comment Share on other sites More sharing options...
LucyStoner Posted April 12, 2017 Share Posted April 12, 2017 Do you have a traditional IRA or can you open one? You have until 4/18 to make contributions for 2016. That would reduce your tax liability somewhat and, you are anclose enough, get your AGI into range for some of the credits it sounds like you have just exceeded the phase out income for. Roth IRA contributions are not tax deductible. 2 Quote Link to comment Share on other sites More sharing options...
Happy Posted April 13, 2017 Share Posted April 13, 2017 Ugh. I hate tax time. Both dh and I are self employed which means we write a whopping check each year. Just got word today what the pain will be....sigh. I was so enjoying our savings getting fat. We pay a small amount during the year and take the relatively small fine for writing one check instead of four. We like having control of our money all year. But, yuck, it's never a fun moment. Hang in there! 2 Quote Link to comment Share on other sites More sharing options...
Carrie12345 Posted April 13, 2017 Share Posted April 13, 2017 I'm so sorry! We just got ours done today, and I was holding my breath the whole time. Quote Link to comment Share on other sites More sharing options...
IfIOnly Posted April 13, 2017 Share Posted April 13, 2017 (edited) Yes..although my husband is convinced a talented accountant could magically write off all of that income. But really, software licensing for Microsoft Office, dues to RWA, and some mailing expenses are all I really have to write off. I did write off my laptop, which turbo tax automatically does (partial deduction each year...can't remember what that is called). But I don't have a home office or anything. Maybe look into how you could make more investments that are tax deductible next year. We almost never owe but DH dumps a lot of his building business profits into other side businesses too. He built a home office in our garage for write off purposes. We pay our kids to work as much as they'd like because it's tax deductible. I'm not sure but would your conference coming up be tax deductible? We've had a lot of help and advice from accountants over the years. Edited April 13, 2017 by ifIonlyhadabrain Quote Link to comment Share on other sites More sharing options...
IfIOnly Posted April 13, 2017 Share Posted April 13, 2017 And the accountant consults were write off too! So is a bookkeeper, thankfully! I have enough on my plate. :) 1 Quote Link to comment Share on other sites More sharing options...
IfIOnly Posted April 13, 2017 Share Posted April 13, 2017 Re conferences: "Can you write off conferences? Expenses That Are Tax-Deductible. As long as you are actually conducting business in a city other than the one you live in, the following business expenses generally qualify as tax-deductible. Whether you fly, take a train or bus, or rent a car to get to your business meetings or conference, you can deduct the expense." http://quickbooks.intuit.com/r/taxes/what-you-can-and-cant-write-off-with-business-travel/ 1 Quote Link to comment Share on other sites More sharing options...
ktgrok Posted April 13, 2017 Author Share Posted April 13, 2017 The conference will go on next year's taxes. I've gotten it down to $4,500 now, and still need to put in one more deduction. But shouldn't go down much more. 1 Quote Link to comment Share on other sites More sharing options...
Anne in CA Posted April 13, 2017 Share Posted April 13, 2017 I hate to tell you this but you will have a fine on top of the money you owe. We had a mistake like that last year and found out that if you owe more than $1000 then you are fined. I don't like liking this but since this happened to me I know you are right. It does happen. Quote Link to comment Share on other sites More sharing options...
Twigs Posted April 13, 2017 Share Posted April 13, 2017 :grouphug: :grouphug: :grouphug: Quote Link to comment Share on other sites More sharing options...
eternalsummer Posted April 13, 2017 Share Posted April 13, 2017 Well, if you do end up owing a fine you will probably have to file your taxes quarterly next year, yuck! PLUS, in that case, you are already past-due on your first quarter filings. You can guess how I know that! The fun just keeps stacking up. ((Hugs ktgrok)) we had a mildly similar incident this year also. I thought first quarterly estimated was due April 18? 1 Quote Link to comment Share on other sites More sharing options...
Bootsie Posted April 13, 2017 Share Posted April 13, 2017 Well, if you do end up owing a fine you will probably have to file your taxes quarterly next year, yuck! PLUS, in that case, you are already past-due on your first quarter filings. You can guess how I know that! The fun just keeps stacking up. ((Hugs ktgrok)) we had a mildly similar incident this year also. If you increase withholdings from a paycheck to cover what you think you will need for the upcoming year's tax bill, the withholdings are treated as if they have been spread throughout the year. In other words a big withholding in December can prevent you from having trouble from not paying enough in quarterly taxes by the deadline. 1 Quote Link to comment Share on other sites More sharing options...
Reefgazer Posted April 13, 2017 Share Posted April 13, 2017 We are in a similar position as the OP, but we only owe about 2K and have to pay a fine, nor the alternative minimum tax. I hate to tell you this but you will have a fine on top of the money you owe. We had a mistake like that last year and found out that if you owe more than $1000 then you are fined. Quote Link to comment Share on other sites More sharing options...
Reefgazer Posted April 13, 2017 Share Posted April 13, 2017 I think quarterly taxes are due on April 18, so not quite past us yet. Well, if you do end up owing a fine you will probably have to file your taxes quarterly next year, yuck! PLUS, in that case, you are already past-due on your first quarter filings. You can guess how I know that! The fun just keeps stacking up. ((Hugs ktgrok)) we had a mildly similar incident this year also. Quote Link to comment Share on other sites More sharing options...
kitten18 Posted April 13, 2017 Share Posted April 13, 2017 I think quarterly taxes are due on April 18, so not quite past us yet. Yep, I just printed the form today. Quote Link to comment Share on other sites More sharing options...
Robin M Posted April 13, 2017 Share Posted April 13, 2017 2016 is the first year I actually skipped paying one quarter of estimated tax payments since our gross was down 20% from the previous year. Came out just about even with a small refund so fortunately the penalty was minuscule. I remember one year we paid a huge amount of estimated taxes and had IRS berating me for overpaying just so could get a huge refund. Since then I've adjusted what I think estimated will be rather than going with the 110%. Too much information, but all this to say, maybe increase his deductions or pay more estimated. Turbo tax is great in walking you through all expenses and deductions. And yes, first estimated taxes are due on April 18. Quote Link to comment Share on other sites More sharing options...
Guest Posted April 13, 2017 Share Posted April 13, 2017 In an attempt to make you feel better because someone else has had worse, ;) one year due to house sales, our tax payment was...an extremely shocking number with FIVE digits. I was pumping gas when my accountant delivered this news, and my phone signal was breaking up. It was almost exactly like that moment in the movie Father of the Bride where the wedding planner gives Steve Martin's character the per-head cost of the wedding and he thinks surely he misheard. I seriously almost passed out. Quote Link to comment Share on other sites More sharing options...
displace Posted April 13, 2017 Share Posted April 13, 2017 I'm sorry :( Quote Link to comment Share on other sites More sharing options...
G5052 Posted April 13, 2017 Share Posted April 13, 2017 The bulk of my income comes as an independent contractor, so I hear you. I do have a lot of deductions, but I managed to put off all of my business accounting until late last week. That's really fun to pull together in a few days (cough, cough). At least I got the stuff to our accountant on Friday, and they turned it around quickly. I do monthly federal estimated taxes in the months I work (usually September-June) and quarterly for the state, but I do the summer payment early for the state. I underestimated on my IC work, and we lost the child tax credit with our youngest turning 17. So we owe both federal and state, but no penalties. In the scheme of things we weren't too much off. Our accountant made several suggestions, and I think we have it figured out for 2017. She said to bring all the data in early August though, and she'll give a ballpark estimate of how close we are. 1 Quote Link to comment Share on other sites More sharing options...
ondreeuh Posted April 14, 2017 Share Posted April 14, 2017 Ugh, money stress is the worst! We sold a house last year in another state, and hired an accountant to help us do the taxes. We started with Turbo Tax and I think it said we owed like $20k. But we had paid some tax at the time of the sale, and we needed to itemize deductions, so it should be a lot less ... anyway we hired someone locally and turned in everything she asked for, answered all her questions, etc. We haven't heard anything for over 2 weeks. DH has been leaving her messages, and hasn't heard anything back. I'm about to stop by the office tomorrow and try to get some answers. We need to know if we can contribute to our Roth IRA and file everything before the deadline! I am ticked. Luckily we knew we would owe and have the money ready to go. Quote Link to comment Share on other sites More sharing options...
sassenach Posted April 14, 2017 Share Posted April 14, 2017 We did that a couple of years ago and we ended up putting it on a payment plan. That costs in interest, though. It's a huge bummer. Sorry! Quote Link to comment Share on other sites More sharing options...
StephanieZ Posted April 14, 2017 Share Posted April 14, 2017 Taxes suck. We are small business owners, so we really have no good idea how much we'll owe until the CPA tells us in March/April, and for YEARS (like, a DECADE) every April was a freaking nightmare. 5 figure tax bills right at the end of the winter slow season. Every damn time. UGH. I'm so sorry. I finally got really aggressive about avoiding the April nightmare . . . I estimate very conservatively (last year's taxes + 10% to be sure we can avoid penalties . . . even more if I think business is increasing . . . and withhold right away at the the top marginal rate for any investment sales, etc.) . . . AND, I actually double check our tax withholdings once a month as part of our business financial review . . . We work the numbers to make sure we haven't screwed up somewhere . . . all over again (it's quick and easy, I have it in Excel), because once, two years ago, we thought we were "on track" but our office manager had made an oopsie with the math -- so dh & I took responsibility ourselves for checking the math on it, since it's so critical. So, anyway, all that is to say that you might just want to check dh's pay stubs in coming months . . . on a routine basis . . . to make sure you're on track. And, assuming he's still working those same jobs, you're now 4 months into the same story for 2018, so you'll want to bump up your withholdings the rest of the year to make up for that . . . So sorry!! ps. Make sure your maximizing your business deductions for your writing . . . There are a million little tricks and things you can deduct . . . This past year, I've finally gotten better at THAT part of the tax game. Makes me crazy, but this is the world we live in for the time being. 1 Quote Link to comment Share on other sites More sharing options...
goldberry Posted April 14, 2017 Share Posted April 14, 2017 Part time jobs will calculate your withholding as if that is all the money you will make, that's why they don't take out enough if you have more than one job. You can ask to have more taken out. If you are married, you can choose married but withhold as single and zero deductions. If that isn't enough, you can choose to have $xx additional set amount to be taken out per paycheck. Sorry... DH and I are both self-employed and taxes suck every year. Ah, the days we used to get refunds instead of a bill... It's been about ten years. Quote Link to comment Share on other sites More sharing options...
idnib Posted April 14, 2017 Share Posted April 14, 2017 :grouphug: How'd it go with telling DH? Quote Link to comment Share on other sites More sharing options...
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