Big tax bill

[~bs]

*shrug* if you're paying more taxes, you're generally making more income. I'd rather be paying more taxes than less.

[~bs]

Hah! so true. Optionshouse sent me 3 corrected 1099B forms detailing mistakes they made in calculated wash sales...the latest corrected 1099 I received March 25!!!

Yeah, if you get brokerage 1099s, it's usually better to wait to file. That is unless you really like amending tax returns.

[kv968]

kv968,
That's good to know. I thought ETF's were a way around that for tax efficiency, but maybe not? I was comparing VTSAX and VTI, but I'm not sure I totally understand it.

I meant to throw a caveat out there about looking at the potential capital gains from an ETF or index fund since they can be misleading.

Due to their structure of in-kind redemptions of creation units, those type of investment vehicles may not be subject to much, if any, of the capital gains contained within them.

Vanguard's ETF's are actually a share class of their index funds. This structure provides both with a larger asset base which expands their ability to minimize capital gains by having more options when it comes to selling or redeeming the creation units.

[disneysteve]

*shrug* if you're paying more taxes, you're generally making more income. I'd rather be paying more taxes than less.

That's exactly what my father (an accountant) taught me.

When I was a medical resident, I used to moonlight a lot. That meant working part time in a doctor's office and being paid hourly. The rate was very good, like $40-$50/hour and that was in 1991-93. I had fellow residents who said they didn't moonlight because it would raise their taxes. I never understood that. Of course it would raise the taxes but that's because it would raise the income. I was always very happy to take the jobs and earn the money and pay whatever taxes I owed.

[disneysteve]

I usually file in January and pay in April. (Our taxes are simple - I could generally file January 1 - I don't have any tax forms that I need to wait for. Obviously anyone with a taxable brokerage account is wise not to file before April 1 - corrected forms galore).

Wow. There's no way I could file until at least February when the W-2s and 1099s come in. After that, when I file is purely based on my own schedule and when I actually sit down and compile everything I need (charitable donations, internet sales, etc.) and call my accountant for an appointment. This year was about the latest I've ever done it though. I've just been so busy I didn't have time before this.

[MonkeyMama]

Yeah, as an accountant with good professional software, it literally takes me about 5 minutes to do my taxes. But, like I said, our taxes are crazy simple. To be fair, I don't 100% do everything to make them simple, but I do avoid things that would make my taxes crazy complicated. I mentioned in my blog that thank goodness I Was able to import my Grandma's investment tax stuff, because she literally had 400 taxable transactions for schedule D. For reference, she does not have a lot of money, and I HATE her broker. I am sure a couple of years ago we just paper filed her return and attached the schedule. But, it was still way easier just to import it all. I doubt I will ever complicate my taxes in that manner - yeesh!! {For example, I do *all* my stock trading in my ROTH accounts. tax simplification is not the primary reasons, but sure is a compelling reason}.

[disneysteve]

Yeah, as an accountant with good professional software, it literally takes me about 5 minutes to do my taxes.

Even if I were an accountant with the software, I still couldn't do my taxes in January because I wouldn't have the necessary information yet. Must be nice to have it that simple though.

[Like2Plan]

I mentioned in my blog that thank goodness I Was able to import my Grandma's investment tax stuff, because she literally had 400 taxable transactions for schedule D. For reference, she does not have a lot of money, and I HATE her broker. I am sure a couple of years ago we just paper filed her return and attached the schedule. But, it was still way easier just to import it all. I doubt I will ever complicate my taxes in that manner - yeesh!! {For example, I do *all* my stock trading in my ROTH accounts. tax simplification is not the primary reasons, but sure is a compelling reason}.

400 taxable transactions! Wow! It's a good thing your Grandma has you to take care of her taxes.

[feh]

Between state and federal, we owe about $9K this year. Last year it was over $10K.

It's due to capital gains and some LLC income. I need to start making anticipated tax payments.

[bjl584]

Between state and federal, we owe about $9K this year. Last year it was over $10K.

It's due to capital gains and some LLC income. I need to start making anticipated tax payments.

My CPA suggested that I start doing the same.

[elessar78]

Holy crud, I feel left out of the party. I got BACK about $1,300. I need to re-do some stuff as I'll have a year's worth of mortgage interest deductions and 2-kids for (nearly) the whole of 2013.

[snafu]

Monkey M: Is sounds like her broker is churning the a/c. That's illegal and I hope you can convince gran to take action. Scamming seniors is horrid.

[MonkeyMama]

Monkey M: Is sounds like her broker is churning the a/c. That's illegal and I hope you can convince gran to take action. Scamming seniors is horrid.

It's not anything on that level. It's just more of a "10 times more complicated than it has to be" thing. Lord knows I have talked to everyone in that family (in-laws) about dropping the crazy expensive broker.

[mgkimsal]

getting back something like $5k in refund this year - first time in at least 5 years, and it was accidental. I'd scheduled out estimated tax payments for the year, but set up a payroll service, and my cpa was also paying taxes from my bank account, and... I wasn't paying attention until december (really only 2 quarterly payroll payments, but still). That and NC apparently had a "$50k no tax for small business" law in 2012 - first $50k of business income non-taxed. That's actually where a lot of the refund is from, but some federal too.

So then I had a choice - just let them hold on to the money and apply it to 2013 tax payments, or actually get the refund. I'm opting for the refund, although it may take several weeks. I hate having to make choices like this.

[witchkizzle]

MonkeyMama,

We have some retired clients at our firm that like to actively manage their own investments. I had one guy with 2,436 transactions to import, check and reconcile. What a nightmare !! The guy made a killing doing it though. Consecutive years of 600k + in capital gains. What is even better is he buys a lot of it on, say, 6-1-11 and then sells it like 6-2-12 and gets the 15% capital gain rate.

As far as my personal taxes, just a W-2 for my wife and myself and some 1099-DIV and INT's to plug in. HSA information and the occasional 1099-R from rollovers or something are the craziest it gets. Although, I did buy a PTP once and am not really sure why. I got rid of it though, so no more K-1's or antyhing. I usually get way too much back, but just can't bring myself to care. I could have an extra 160 bucks a month earning .25% APR but don't feel like it is that big of a deal. I will also be having a baby this year, so I will end up with more than that this time.

Sometimes tax CPAs are the worst at worrying about their own taxes. We are too busy worrying about everyone elses!