Comments on: Tax refund = cushion http://www.mightybargainhunter.com/2006/09/27/tax-refund-cushion/ Personal finance, commentary, and spending less the easy way Fri, 19 Mar 2010 14:24:44 -0400 http://wordpress.org/?v=2.8.6 hourly 1 By: mapgirl http://www.mightybargainhunter.com/2006/09/27/tax-refund-cushion/comment-page-1/#comment-9091 mapgirl Wed, 27 Sep 2006 15:12:54 +0000 http://www.mightybargainhunter.com/2006/09/27/tax-refund-cushion/#comment-9091 I'm with you. I prefer the refund. I've been in debt to the IRS Man and it's not fun. The only good thing about it is that the interest rate is fairly low compared to commercial lending. I’m with you. I prefer the refund. I’ve been in debt to the IRS Man and it’s not fun. The only good thing about it is that the interest rate is fairly low compared to commercial lending.

]]> By: D http://www.mightybargainhunter.com/2006/09/27/tax-refund-cushion/comment-page-1/#comment-9087 D Wed, 27 Sep 2006 12:37:20 +0000 http://www.mightybargainhunter.com/2006/09/27/tax-refund-cushion/#comment-9087 Hi, A recap of the estimated tax payment thing. I posted a bit on 2 Nickels. Anyway, to avoid penalties, you need to file on time..an extension with a balance due will accumulate interest and penalties after the 4/15 deadline. Next, you need to pay 100% of the prior years tax liability or 90% of the current years liability. An Excel spreadsheet could help you here. In put your 05' return info into the spreadsheet. Then, hopefully you are using Quicken or another f/s software, take your year to dates and put them in a column next to the 05'. If it is September are you 9/12ths of the 05' balance? Higher? Lower? Know your tax rate. Have the spreadsheet automatically calculate what you would owe. Remember you are setting it up like your 1040. You can check for rate changes at income levels on irs.gov. If you do not use financial software, shame on you....then take your 3rd quarter ending statements and pull the numbers from there. (i.e. last paycheck for September, bank statements, investment accounts) If you have a self employment avenue, Create a 2nd page in your file and break out like the schedule C & SE and link these totals to your front page in the appropriate box for the 1040. This system won't be perfect. But it will provide you with numbers close to where you actually are. The hardest part will be set-up, but you can reuse the form each and every year after creation. Hi, A recap of the estimated tax payment thing. I posted a bit on 2 Nickels. Anyway, to avoid penalties, you need to file on time..an extension with a balance due will accumulate interest and penalties after the 4/15 deadline.

Next, you need to pay 100% of the prior years tax liability or 90% of the current years liability.

An Excel spreadsheet could help you here. In put your 05′ return info into the spreadsheet. Then, hopefully you are using Quicken or another f/s software, take your year to dates and put them in a column next to the 05′. If it is September are you 9/12ths of the 05′ balance? Higher? Lower?

Know your tax rate. Have the spreadsheet automatically calculate what you would owe. Remember you are setting it up like your 1040. You can check for rate changes at income levels on irs.gov.

If you do not use financial software, shame on you….then take your 3rd quarter ending statements and pull the numbers from there. (i.e. last paycheck for September, bank statements, investment accounts) If you have a self employment avenue, Create a 2nd page in your file and break out like the schedule C & SE and link these totals to your front page in the appropriate box for the 1040.

This system won’t be perfect. But it will provide you with numbers close to where you actually are.

The hardest part will be set-up, but you can reuse the form each and every year after creation.

]]>