Can I just say that I hate the new Windows 7 shortcuts, which for some reason can be triggered very easily (by accident, still haven't figured out what I am pressing) and cause me to highlight and delete stuff when I don't want to? I just deleted a whole post. Uggh!
Anyway, on to taxes .... after seeing my huge $1800 tax bill I went back into my tax prep software to see if I could do anything about it. I took the standard deduction on the business use of my car. But when I plugged in the actual expenses, it yielded more.
Also, I bought a new car in 2009. I can take the Section 179 deduction, which is super complicated and makes me nervous. But in short it lets you deduct a huge portion of the car this year as a one-time thing instead of depreciating it over many years. The catch is you have to use actual mileage from here on out. So once I do it, I'm stuck with actual. Which could mean years of headaches. But $1800 is a huge bill I can't afford, and it would be nice to trim that down so I can spend this money on debt instead. I use TurboTax which I like for the most part, but I was surprised to find out their 179 area is actually pretty confusing and even asks you to make some calcualations with your own calculator. What, I thought that was their job. That's why I paid $69 for the software, for them to add for me.
Taxes are complicated, especially when you run a small business. And when I'm taking a bunch of deductions, even though they're valid, it makes me worry about being audited. I've spent most of the past few weekends working on all this. But I'm almost finished, I just have to figure out how to deduct my car, make some decisions as to that, and then I'm ready to file.
I recommend working on your taxes this month, so that if anything like this comes up, you have time to think on it and decide what to do without feeling pressured to file.
Sunday, February 7, 2010
Friday, February 5, 2010
Ouch, I owe taxes this year
Turns out I owe about $1800 to the IRS and state tax board this year....uggh.
There's a couple reasons this happened. I got two raises this year and worked the whole year, and I made a few thousand more in heavily taxed self-employed income. I ended up having about $16,000 more in income this year. It's fun to get all the self-employed income "tax-free" during the year, but the IRS wants their money at the end of the year. I've heard a tip to save the first few months of your self-employed income in savings at the beginning of the year to pay your tax bill the following year. Good tip, oops.
Even with my student loan deduction, and squeezing out a lot of other miscellaneous deductions, I still owe. I was a little taken off guard. So snowballing my car loan is on hold now and I have to focus on trying to knock this tax bill out by April 15th so they won't charge me interest on it. Yuck.
There's a couple reasons this happened. I got two raises this year and worked the whole year, and I made a few thousand more in heavily taxed self-employed income. I ended up having about $16,000 more in income this year. It's fun to get all the self-employed income "tax-free" during the year, but the IRS wants their money at the end of the year. I've heard a tip to save the first few months of your self-employed income in savings at the beginning of the year to pay your tax bill the following year. Good tip, oops.
Even with my student loan deduction, and squeezing out a lot of other miscellaneous deductions, I still owe. I was a little taken off guard. So snowballing my car loan is on hold now and I have to focus on trying to knock this tax bill out by April 15th so they won't charge me interest on it. Yuck.
Thursday, February 4, 2010
Monthly Debt Update: February
Chugging along with my debt. A few milestones this month. My parents are paid in full, yippie! My Perkin's Loan is down in the 10-thousands, and my undergraduate loans are down to the 13-thousands. My car loan is almost in the 12-thousands and dropping. I am in the middle of consolidating my student loans to qualify for loan forgiveness, which might change up a bit of the numbers next month. Here's the breakdown:
Total Outstanding Debt: $165,558.02
Emergency Fund: $1,683
401(k): $10,313
Debt breakdown, original amount / current balance:
1. Credit card $1,700/$0 PAID IN FULL
2. Money Owed to Parents $2,900/$0 PAID IN FULL
3. Sallie Mae Student Loan $4,194.31/$0 PAID IN FULL
4. Perkin's Loan $12,062.42/$10,985.06
5. PLUS Loan $12,760.06/$12,092.61
6. Undergraduate Loan $14,327.03/$13,998.60
7. Car Loan $15,800/$13,037
8. Consolidated Loan $120,499.02/$115,446.00
Total Outstanding Debt: $165,558.02
Emergency Fund: $1,683
401(k): $10,313
Debt breakdown, original amount / current balance:
1. Credit card $1,700/$0 PAID IN FULL
2. Money Owed to Parents $2,900/$0 PAID IN FULL
3. Sallie Mae Student Loan $4,194.31/$0 PAID IN FULL
4. Perkin's Loan $12,062.42/$10,985.06
5. PLUS Loan $12,760.06/$12,092.61
6. Undergraduate Loan $14,327.03/$13,998.60
7. Car Loan $15,800/$13,037
8. Consolidated Loan $120,499.02/$115,446.00
Saturday, January 30, 2010
Seeing the doctor
I have not been feeling so good the past few months. I have a lot of nausea when I eat, and other digestive symptoms. I am not one to go to the doctor unless I really feel sick, but I finally broke down and went today. I was starting to have some anxiety about what all this could be and I had to go seek help. And I think stress and anxiety are just making it worse.
The doc is thinking it could be lactose intolerance or gluten, and I'm being tested for a host of other things. At this point, I can deal with whatever it is as long as I can live with it! Lactose intolerance sounds just fine even though I love dairy.
Times like this makes me appreciate the money I pay each month for insurance. A $10 copay covered my visit, and $10 will cover all these tests I need. Prilosec, in the hopes it will help my tummy feel better while we wait for test results, was $20 for several months of pills. And if this is something that is going to require more medical attention, my insurance is here and ready to go. At least I don't have to worry about money while I deal with this.
The doc is thinking it could be lactose intolerance or gluten, and I'm being tested for a host of other things. At this point, I can deal with whatever it is as long as I can live with it! Lactose intolerance sounds just fine even though I love dairy.
Times like this makes me appreciate the money I pay each month for insurance. A $10 copay covered my visit, and $10 will cover all these tests I need. Prilosec, in the hopes it will help my tummy feel better while we wait for test results, was $20 for several months of pills. And if this is something that is going to require more medical attention, my insurance is here and ready to go. At least I don't have to worry about money while I deal with this.
Wednesday, January 27, 2010
My car loan people are so shady!
I've explained before how my car loan makes it really hard to pay the principal. Heck, it's almost like they don't want you to pay the principal. And they absolutely have a vested interest in you not paying it.
There is no way to pay the principal online. I either have to call in and be put on hold forever, or mail a check in and mark it principal, which wastes a check, a stamp, an envelope, and time. Oh, and you could pay over the phone, but they smack you with a big fee. So usually I call in after I make a payment online. I swear these people are trained to give the run around when I request a payment be applied to the principal. Today I was told, "We don't do that, you have to call back once the payment is applied." Which takes about four long days.
"Really?" I said, "Because this is how I applied the last 10 payments to the principal."
Long silence on her end. Then I was put on hold, and two minutes later, magically, my payment was applied to the principal. Wait, I thought you didn't do that. It seems to me there should be regulations in place to require companies to allow borrowers the option to pay the principal online. Or a regulation that whatever form of payment you set up, there must always be an easy option to pay the principal. And when I ask to have my payment and my money applied to my principal, why can't the answer always be, "absolutely ma'am no problem"?
Is is a mathematical certainty that if you pay the principal first, you will pay the loan off faster. When I asked why this wasn't an option online, as I make a point to ask every time I call, the vague answer this time was "it was not set up that way." I know it's not set up that way. I'm asking why. Well, the real answer is, they make less money that way. They can't make paying the principal too easy or everyone would do it.
There is no way to pay the principal online. I either have to call in and be put on hold forever, or mail a check in and mark it principal, which wastes a check, a stamp, an envelope, and time. Oh, and you could pay over the phone, but they smack you with a big fee. So usually I call in after I make a payment online. I swear these people are trained to give the run around when I request a payment be applied to the principal. Today I was told, "We don't do that, you have to call back once the payment is applied." Which takes about four long days.
"Really?" I said, "Because this is how I applied the last 10 payments to the principal."
Long silence on her end. Then I was put on hold, and two minutes later, magically, my payment was applied to the principal. Wait, I thought you didn't do that. It seems to me there should be regulations in place to require companies to allow borrowers the option to pay the principal online. Or a regulation that whatever form of payment you set up, there must always be an easy option to pay the principal. And when I ask to have my payment and my money applied to my principal, why can't the answer always be, "absolutely ma'am no problem"?
Is is a mathematical certainty that if you pay the principal first, you will pay the loan off faster. When I asked why this wasn't an option online, as I make a point to ask every time I call, the vague answer this time was "it was not set up that way." I know it's not set up that way. I'm asking why. Well, the real answer is, they make less money that way. They can't make paying the principal too easy or everyone would do it.
Tuesday, January 26, 2010
You can deal with it!
American Education Services, which handles a couple of my loans, has a link page I was snooping around with when I found this site, http://www.youcandealwithit.com/. I like the URL. Because you can deal with your loans. You must, really. I like the attitude that it is doable and to face it head on.
The site is apparently run by AES themselves, and it's pretty minimal. But it still has a few good tips on budgeting, how grace periods work, essentials like that. I have yet to find a site that comprehensively explains all the questions you need to know about paying back student loans in a simple and accurate way. I may start one myself at some point. There is nothing out there I've ever found that truly explains the federal loan forgiveness program in a way that a layman can understand, other than the private organization Young Lawyers, which did so buried in a newsletter and not online. This information can be found scattered in obscure places around the Net, and explained vaguely and elaborately, as if the writer doesn't really understand the program themselves and are just faking it like you would a high school essay.
But let me just debunk this part of their web site on credit cards, and this is not anything Dave Ramsey or other debt gurus wouldn't say.
They claim the pros of credit cards are:
1. You can establish good credit (so you can get things like a car).
2. It could come in handy if you have an emergency.
3. Some credit cards will insure whatever you buy with them.
Oh, Lord, was my first reaction to this garbage.
1. Ok, first, you can also establish good credit by paying all your utility bills and rent on time as well as your student loans. And you can save for a car instead of taking out a loan. Really good credit is only necessary to get more credit cards (and get in more financial trouble) and to get a house. So get one card, maybe get gas with it, and pay the balance in full every month, to keep a good credit history.
2. Please! Build an Emergency Fund and use that in emergencies. That is the first thing you're supposed to do anyway in most debt reduction plans. With a credit card everything will seem like an emergency. With a true emergency fund, chances are it will rarely be touched. I've only dipped into mine a few times for minor car problems this past year.
3. Insurance? You will save more money by buying separate insurance plans for your stuff than paying all the interest on a credit card. If you really honestly think you need insurance for your crap, a separate insurance plan is almost always cheaper. Even a basic renter's insurance plan will cover most of your crap. Or spend the money on a good security system that will last a long time to protect big-ticket items.
Nice idea for a web site, but encouraging credit card use to people in my age group I'm never going to be okay with.
The site is apparently run by AES themselves, and it's pretty minimal. But it still has a few good tips on budgeting, how grace periods work, essentials like that. I have yet to find a site that comprehensively explains all the questions you need to know about paying back student loans in a simple and accurate way. I may start one myself at some point. There is nothing out there I've ever found that truly explains the federal loan forgiveness program in a way that a layman can understand, other than the private organization Young Lawyers, which did so buried in a newsletter and not online. This information can be found scattered in obscure places around the Net, and explained vaguely and elaborately, as if the writer doesn't really understand the program themselves and are just faking it like you would a high school essay.
But let me just debunk this part of their web site on credit cards, and this is not anything Dave Ramsey or other debt gurus wouldn't say.
They claim the pros of credit cards are:
1. You can establish good credit (so you can get things like a car).
2. It could come in handy if you have an emergency.
3. Some credit cards will insure whatever you buy with them.
Oh, Lord, was my first reaction to this garbage.
1. Ok, first, you can also establish good credit by paying all your utility bills and rent on time as well as your student loans. And you can save for a car instead of taking out a loan. Really good credit is only necessary to get more credit cards (and get in more financial trouble) and to get a house. So get one card, maybe get gas with it, and pay the balance in full every month, to keep a good credit history.
2. Please! Build an Emergency Fund and use that in emergencies. That is the first thing you're supposed to do anyway in most debt reduction plans. With a credit card everything will seem like an emergency. With a true emergency fund, chances are it will rarely be touched. I've only dipped into mine a few times for minor car problems this past year.
3. Insurance? You will save more money by buying separate insurance plans for your stuff than paying all the interest on a credit card. If you really honestly think you need insurance for your crap, a separate insurance plan is almost always cheaper. Even a basic renter's insurance plan will cover most of your crap. Or spend the money on a good security system that will last a long time to protect big-ticket items.
Nice idea for a web site, but encouraging credit card use to people in my age group I'm never going to be okay with.
Saturday, January 23, 2010
When a phone call is worth more than money
I've talked about how the perks at my job make up for the low salary. And my nice boss really helps to make up for it too. I wrote about him here a few months back.
The boss is out for two months recovering from surgery. He's okay, but he needs to rest. We miss him, but we have good supervisors who take over in his stead.
Friday, I took a big case to trial and won. I so wish I could discuss all the facts, because they were great. So was my approach if I do say so myself! It was about marijuana, actually, and all I'll say is it was a victory for the potheads out there! My firm has been trying for a long time to push certain marijuana issues, and this was our second victory, so it was a big deal. One of my supervisors sent an e-mail to the whole firm about my win, which was embarrassing but also really nice of him at the same time.
Anyway, the boss, who was supposed to be resting, gave me a personal call to congratulate me, talk about the case, and just overall check in. That made me feel really good. It made me feel like I am earning my dollar there, and that people are noticing my work. I know he does this with everyone when they do good work, and it just goes so, so far. In a better economy, maybe I would have gotten a bonus. But that phone call felt almost as good.
We are going on 10 months now without any turnover. In a bad economy, you can find other ways to reward people other than pure financial. My boss has found those ways.
The boss is out for two months recovering from surgery. He's okay, but he needs to rest. We miss him, but we have good supervisors who take over in his stead.
Friday, I took a big case to trial and won. I so wish I could discuss all the facts, because they were great. So was my approach if I do say so myself! It was about marijuana, actually, and all I'll say is it was a victory for the potheads out there! My firm has been trying for a long time to push certain marijuana issues, and this was our second victory, so it was a big deal. One of my supervisors sent an e-mail to the whole firm about my win, which was embarrassing but also really nice of him at the same time.
Anyway, the boss, who was supposed to be resting, gave me a personal call to congratulate me, talk about the case, and just overall check in. That made me feel really good. It made me feel like I am earning my dollar there, and that people are noticing my work. I know he does this with everyone when they do good work, and it just goes so, so far. In a better economy, maybe I would have gotten a bonus. But that phone call felt almost as good.
We are going on 10 months now without any turnover. In a bad economy, you can find other ways to reward people other than pure financial. My boss has found those ways.
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