This Year I Owe Even More

In January of last year, I let everybody know that I owed the government more than $10,000. At the end of that post, I specifically made a note to “Plan better to pay my taxes in 2009″ and “Always trust God, no matter what.”

I had written the first note in particular because last year I had no money to pay my taxes. I wrote the second note because it was God’s miraculous provision that helped me pay my obligations by the deadlines.

So: How did I do on “planning better?”

Well, since I owed about $10K last year, I saved a lot of money this year. I figured $12K would cover it. But to be safe, I saved about $20,000.

In mid-December, I was shocked to discover that my tax bill is approximately $21,000. Whoa. That caused my heart rate to rise!

Fortunately, I only have to pay about $15,000 by January 15. I can postpone the remainder for a couple months.

I was really hoping that I’d have some money left over to pay off more debt. But, no. Such will not be the case.

On the bright side, I do have the money to pay my taxes, so my stress levels are still in check. :-)

Over Christmas, I joked with my wife: “Well, technically we don’t have any money at all since we owe it all to the government. But at least you can enjoy that rich feeling for a little bit longer.”

So my NEW note to myself for this coming year is this:

  • Estimate tax obligations every quarter and save accordingly.

This way I won’t be making assumptions about how much (or how little) I owe the government — and hopefully there won’t be any nasty surprises when taxes are due.

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5 thoughts on “This Year I Owe Even More”

  1. Hey, at least you had the money in your hands earning interest instead of in their hands…mmm maybe I’ll just end the rant here. I’m glad you didn’t have to stress too bad.

    -Bill

  2. Wow that is still a lot of money to be owing the government.

    I guess it is different because you run a business (I just read the original posts) so I guess you need to really overestimate the taxes and put that in your ING account.

  3. Yep, because I run a business AND I only pay taxes once a year. Employed people pay taxes every paycheck. Big difference.

    I’m convinced there’d be a revolution in the U.S. if every citizen had to write a big fat check to the IRS a couple times a year. Most people truly don’t realize how much the government takes.

    Also, it would probably be better to put my money in an ING account. Good reminder.

    Ryan

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