Well, we went and did it. We did our taxes. And by we, I mean Johnny. As we discussed in this post, we use TurboTax software as our tax filing weapon of choice. Normally, Johnny looks forward to doing our taxes. He even gets — dare I say — giddy about it. But this year, not so much.
Johnny spent the majority of 2012 working in a contracted freelance position, so our taxes were a bit more complicated. That, and we moved to a new state, which meant double the filing fun. Because Johnny was freelancing, there were a lot more variables and questions marks than usual, which meant a lot of uncertainty. And that lack of total confidence in how we’d fare at the final tally put a damper on his geeky fun. Admittedly, I never know where we stand come tax season. It’s similar to the way I felt before our first freaking budget came into existence. I would go into a month blindly and spend as I pleased, hoping that by the end of the month the odds would be ever in my favor (Hunger Games fan, deal with it).
Some personal finance topics don’t resonate with everyone. Some people may never need or want to know about 401k’s. Other people whose hair isn’t dishwater blonde (yup, it’s as bad a color as it sounds) will never need to know how much hair coloring costs. But regardless of who you are, you gots to do taxes. It’s the one time of year when — no matter what — every single money-earning human has to think about their money situation. And while this might (read: will) be an unpopular thing to say, I actually think tax season is good for us all.
I didn’t just go there, did I? Taxes are good? You mean the things that makes grown ups throw five-year-old tantrums?!
Just replace “bewd” with “taxcess.”
Here’s what’s good. When you file your taxes, you have to account for your money: how much you earned, how much your investments earned, how much you saved for retirement, etc. It covers a lot of the same territory as a monthly budget. In fact, you could even look at monthly budgets as a small-scale tax filing. And if you keep a budget, you aren’t surprised by the amount of money that is (or isn’t) in your bank account at the end of the month. The same can go for taxes. Preparing our taxes shouldn’t be like pulling a slot machine arm… although that would make it a lot more interesting.
Obviously, there are plenty of differences. Taxes are a whole lot more complicated and messy. Figuring them out isn’t as easy as keeping a budget. And the money that leaves your budget stems from a choice you made — not one bureaucrats will make for you. If the money in your budget gets spent recklessly, you only have yourself to blame.
Basically, be more like Johnny and less like me (that’s really hard to say) by knowing what to expect and avoiding being surprised in April. Knowing when and where your money’s coming and going is empowering. And it’s so much more preferable than, “Oh crap. I really hope I have the money in my account to pay for this shirt. I should. I mean, I haven’t bought that much stuff recently, have I? No, I haven’t. Wait, I don’t know. WHY IS THIS CASHIER STARING INTO MY SOUL?” Or in my case freshman year, hoping there was enough money in the bank for a Harry Potter book. And then getting declined at the register. By a cute boy I liked. And I forgot to wear pants that day. That part is a lie. The point is, such situations are avoidable.
So here’s what we wanna know… Have you done your taxes? How did/will you do them? On a scale of 1-10, with 10 being a spoonful of sand mixed in a peanut butter jar, what’s your level of distaste toward taxes?
I used to do my taxes doing TurboTax and now my very wonderful boyfriend does them for me using TurboTax 🙂 I have always hated doing my taxes, but typically I get money back so I guess I’l give taxes a 5. My taxes got complicated with the 4 + jobs I worked last year, some freelance, some not…are you saying you would give tax season a 1?
Ain’t nothing like delegation. 🙂 Adding freelance/consulting work, rental properties, small businesses, etc, really makes one yearn for the days of filling out that 1040EZ.
I would probably high tax season a 3 -. Joanna? 4. But that 4 is only based on how hard it is for her to hear me talking in circles about ways to find more deductions.
I did our taxes a couple of weeks ago and I HATE doing them. SO boring!
Boooo! Actually, they are pretty boring. I just wanted to pretend like that offended me. 🙂
You brought up two of my favorite things in one post. Harry Potter and the Hunger Games. Yeaaa Joanna! I don’t mind doing our taxes even though they’re always messy (since we’re military and my wife and I claim separate states even though we live in a completely different one). We had to use a CPA this year, there was no way around it. How did you guys actually make out numbers-wise with taxes? Are you getting a refund or not? If you said that I must have missed it.
And give Johnny a hug for me and tell him thanks for getting back to me so promptly about the plugin thing.
As a prerequisite for getting married, Joanna made me read the first Harry Potter book. So I did and I enjoyed it. But I stopped there and let the movies fill me in on the rest. Hunger Games on the other hand I’ve totally gotten into.
We’ll get a chump-change refund from our federal return, and get hit heavy for state taxes in Massachusetts. Lame.
No prob on the plugin. May your readers now be notified when you drop knowledge on them.
I actually don’t dislike taxes, for the reasons you mentioned. I always find it interesting how many sources of income we have with our savings and investments. We haven’t done our taxes yet this year because we can’t decide what our gross income is – that’s what my post today it’s about and we need help! If we decide on the higher gross we will have to pay a bit more so that stinks.
I just read about your sticky situation. I want to agree with the Mr., but taxes are one of those things where it’s probably better to take a small hit than risk the hassle of being audited. Good luck and look forward to hearing who wins the battle.
We are doing our taxes tonight and will use TurboTax. I used TurboTax last year for the first time and I loved how easy it was. My blog income and expenses essentially zero out so I didn’t have to worry about that this year (2012), but next year I will. I did have a contract job for Excel-related work that complicates it slightly but not too bad.
I would rate my “distaste” at a 9. Mainly the tax code frustrates me. It should be nowhere near as complicated as it is. We could drastically simplify it with a flat consumption tax, which I would argue by far is the ideal form of taxation. Unfortunately, any time “consumerism” falls the stock market reacts negatively and the pinheads in DC try to manipulate the monetary system to stimulate demand for consumable products….blah! I could go on but I’ll stop there : )
A slightly-less-than-heaping spoonful of sand, I see.
I’m with you on the tax code. It’s as if the IRS and government are trying to make our lives miserable. There is absolutely no reason the government can’t hire TurboTax or a UX design firm to simplify the process. Heaven forbid our money goes to something that makes our lives easier… I’ll stop there, too. 🙂
As I may have mentioned here in the past, here in Canada when we lived in Quebec I used to prepare not one but two sets of income tax forms (federal, provincial) for not only myself but for each of the others in my family (ie., wife, M-I-L, F-I-L) and this was all done manually, in the days before Turbo Tax programs existed so I considered the scale back then to be a 11 (especially if at the end we found that we owed the feds money) 🙂
That was then, today it’s different since for the last few years our dear “Baby Girl” (who now has 2 kids of her own and is a senior executive at one of the country’s top Accounting firms) has kindly volunteered to prepare the tax returns for her dear old mom and dad! And she knows all the tax angles using her company’s tax software programs! So now the rating has dropped down to a 2 (unless of course it ends up that we still owe the feds money) !!! 🙂
That must have been some extra gritty peanut butter. 🙂
Treat your kids right and they’ll return the favor. We’ll make sure that we gently push Baby Girl in a direction that will directly benefit us in our later years. 🙂
We did our taxes this year and were happy with our refund. We have managed to get a refund every year so far. Hopefully that continues for a long time and we never owe. The first time we ever filed, we went to HR Block (did not like it AT ALL) and every time since we’ve used Turbo Tax online. Our taxes are usually pretty easy-peasy so I like doing them myself, but wouldn’t have a problem going to a CPA if things were more complicated. I don’t really have a problem with paying taxes. I think of it as paying rent to live in America. My problems exist more with the landlord(s), ifyaknowwhatimean? I think there should just be a flat tax and we all pay the same percentage out of our incomes with no cuts or breaks or credits or any other complicated bull. That way no one would have to “do” their taxes. You would just have that amount deducted from each paycheck and at the end of the year, the government should have to tell YOU what they did with your money, not the other way around.
This might be the most logical post I’ve read all week. But you and I both now that “logic” and “taxes” don’t belong together. So stop this idealistic nonsense! 🙂 I love the idea of government being accountable to us, its taxpayers, and telling us where every dollar went.
I filed my taxes early using TurboTax. Now my SO requested my non-existent expertise with his using the same software. Weirdly enough, I’m excited wading through the paper work. Go figure.
You know what I’m talking about! Once you pop… err, file, you just can’t stop.
We usually have ours done for no other reason than we hope they can help us every year… We are married, have two kids, and don’t make THAT much money, but we end up paying every year, and it was pretty frustrating. This year, my husband decided to check to see how many dependants we was claiming… Um… He was claiming 4!!! FOUR!!!! This is why we pay every year, and you can beleive he was in trouble for a little bit on that one. 😉
Haha. That explains a bit. I know some people are adamant about not letting the government borrow your money all year by claiming too few exemptions, but they can keep whatever little amount of interest I might have earned if it means never owing anything come April.
I roll with TurboTax each and every year. I am not a fan of taxes, but I think I am closer to a 6 when doing them. They are a good way to see your financial picture and to make changes for the next year, so I don’t think they are all bad. I still don’t like seeing a good chunk of my money going to the government that can’t control their spending. It just doesn’t seem fair sometimes.
The part of me doing my taxes is around a 3. The part where I know my taxes are in the hands of a bunch of politicians who throw the word “billion” around like it’s a peasant’s loaf of bread? That’s probably a 34 out of 10.
I do mine online, I can’t remember the website but its free for federal and $5 for state. I usually do them as soon as I can too. My refund is already squirreled away for vacation (so every time I check my account I get to stare at it until June lol) They’re pretty painless so far, I’m not married, not a homeowner, no kids. The thought of the sand in the PB makes my teeth hurt just ihinking about it…
Sorry about the sand/teeth thing. Joanna knows how to turn up the torture examples.
Good for you for having a place for that refund to land safely and out of harm from all the “Tax Refund Sale!!!” promotions. Just a few more months out from enjoying your squirreling tactics.
I did my taxes for this year with TurboTax. But I have to say, I’m getting irritated with the tax process. Because I invest my money instead of spending it all on iCrap and spinning rims, my taxes are getting much more complicated. I’m sure that they’ll be even worse next year if my blog produces any income.
I would rate my distaste for taxes at a 10. I’m never (even before I started investing seriously) sure that I actually did them right.
It’s a sad commentary on our tax system that it’s easier spend money in our society than it is to save/invest it.
You bring up a good point about never knowing if you’ve done them right. I think what I’ll do next year is fill out my own return and then take it to a CPA, pay his rate to have him review it, and see if I’m doing it right. If so, there’s my green light to keep doing it on the cheap with software.
I love taxes! I’m a CPA, so money and finance interests me. Yet, I love handling my family’s money and get excited about finding deductions and calculating our refund (which I’ve been lucky to receive every year I’ve done my taxes).
Our returns have been pretty simple (w-2 income, some investments, basic deductions) up to this point. However, next year I’ll get to research higher education tax credits and child care deductions!! I use turbo tax and I like the step-by-step process they employ. I guess I’m a little weird and things could change if I ran my own business, but for now, I’m a fan of taxes and don’t mind paying my share.
Ha! That’s awesome to hear that you enjoy it despite doing it for your day job. I think most people want to run from anything in their free time that even remotely resembles what they do during their 9-5.
I’m happy to pay my share. But I think our government can do a better job on the PR front in bringing pride back to supporting your country via taxes. Right now, there’s a general distaste and resentment for having to fork over money to run our country.
I finished my taxes last Sunday. It was incredibly painless! I used H&R Block’s online thing. I had really basic stuff this year. I wasn’t self-employed like I had been in years past so I actually am getting money back! The hardest part about it though was looking at how much I had to pay over to Uncle Sam. I would love to have that chunk of my paycheck back…I’d do so much with it, I promise! I think this was my easy year. Next year will be terrible, I’m sure of it.
Way to go on getting those taxes filed away. And don’t get me started on how much we paid to Uncle Sam. When I think about our salaries versus our actual take-home pay, I get downright angrified.
I’ve been using TurboTax for years and I find it fairly painless. I only have one job, but it’s complicated by kids in college & other issues. I wish I understood my taxes better, I just answer the questions and assume TurboTax won’t steer me wrong~ It helps that I always get money back, otherwise I might hate it! The past 2 years I filed my older son’s return on TurboTax as well. Hope he appreciates me! 😉
So far TurboTax hasn’t steered us wrong, so I think you’re good! I would have definitely appreciated some help with that process from my parents back in the day. Even if your son doesn’t fully appreciate it now, he definitely will when he has to file them himself someday! 🙂
Haven’t done my taxes. I have kind of a messy self-employment, sold a couple businesses last year kind of situation that will require (for me, anyway) the help of a pro.
And yeah, on average, I rate taxes as a spoonful of peanut butter mixed with sand. No refunds for me, just an annual punch to the throat.
Yes, the messier the taxes and the more non-existent the refund, the more peanut butter mixed with sand they become. Ick. Because most of the year was spent with Johnny in a freelancing position, we’ll be getting a punch to the throat right there with you. Woo!!
I have done my taxes, and it wasn’t so bad. I actually like getting my taxes done, because it seems to alleviate any “what ifs” that I might have had. Plus, this year I got money back!
I used to do my own taxes, but I married 8 years ago and we rented out my house. We use an accountant because I am way too afraid of going to prison for doing something wrong! We have always gotten a refund, but this will be the first year we can’t claim my adult son and the first year we don’t get the child tax credit for my 17-year-old daughter. On the other hand, we spent $11,000 on the rental property when we discovered a very slow leak that had caused mold in both bathrooms, requiring that both be completely gutted and replaced. When I found out over the weekend that the $11k has to ammortized over 27.5 years, I may or may not have wept.
There’s something wrong with our tax system if you have to worry about going to jail because you don’t know how to do them right. And I’m totally the same way, but I guess jail time is a risk I’m willing to take. 🙂
Sorry to hear about the amortization. Lame, lame, lame.
I use the turbotax and I get quite giddy doing my taxes as well. I mean…I HATE paying the taxes, so the thought of getting anything back is always palatable. But this last year we had our second child…so i just KNEW that we’d be swimming in the benjamins… having a whole second mouth to feed, booty to clothe, daycare to pay…. At least that is what I’d always heard from my friends who had multiple offspring. That was not the case. I got about $2k LESS than when I only had one child…and nothing else changed. We made maybe $5k more than we did the previous year. Nothing to change tax brackets…AARRRG. Uncle Sam is my least favorite relative.
WHA?! You’re right: Uncle Sam is a chump. I would have totally guessed you would have gotten hooked up for baby #2. Our Baby Girl didn’t help us out much for this year’s taxes since she was born six days into the new year. She just didn’t want to leave her warm, comfy home.