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Michelle
My Little Yankee Fans
Member since 1/06 4018 total posts
Name:
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Re: Kill me now
Posted by Bxgell2
Posted by bomb-blast
As a general rule, since nobody wants to be calling their acct everytime they get a big distribution, we usually tell people to automatically send a certain % of the income to the IRS and state. This way you won't wind up with any big surprises at the end of the year, and you're also not tempted to go out and spend the money, unless you absolutely have to. You can still owe penalties even if you pay in enough to cover the prior year.
Dh takes a monthly distribution - so you mean send a portion of every single distribution to the IRS and State, instead of doing the quarterly estimates? Or on top of that?
Not of every check, but if you are taking more then last year, or are making more money, you should adjust the estimates up. But paying more then you are required to pay without paying a penalty is silly. You might as well pay the minimum you can pay to avoid penalty and then pay at the end of the year. Keep your money as long as possible earning interest.
ETA - your income is not only what cash he takes out of the business as a distribution, all income that is earned, even if you don't take it from the business is taxable.
Message edited 3/18/2008 4:35:59 PM.
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Posted 3/18/08 4:34 PM  |
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Long Island Weddings
Long Island's Largest Bridal Resource |
bomb-blast
bye bye
Member since 11/06 1327 total posts
Name:
Leo
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Re: Kill me now
Posted by Bxgell2
Dh takes a monthly distribution - so you mean send a portion of every single distribution to the IRS and State, instead of doing the quarterly estimates? Or on top of that?
Instead of, not in addition to.
The Qtr estimates were based on your 2006 taxes. Unless you want to call your acct on a qrtly basis (which obviously will cost you $) and have him refigure what you owe, it's wise to automatically pay a certain % of whatever distributions you get, to the state and to IRS.
Obviously, I do not know your entire tax situation. I am just giving general advice.
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| Posted 3/18/08 4:35 PM |
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pinkandblue
Our family is complete, maybe
Member since 9/05 32436 total posts
Name:
Stephanie
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Re: Kill me now
Posted by Michelle
Posted by stephanief
Posted by bomb-blast
Posted by Bxgell2
I know this.
But right now all I want to do is punch someone in the face. And he's the first person that comes to mind 
You can punch him...you're still gonna have to pay though. Sorry.
can I ask why you keep saying this? She never said she was not going to pay it....I think she still has a right to be ******  I would die if I had to pay that much 
Why does she have a right to be ****** at her accountant when she did not keep him/her up to date on her income. She owes so much because she made money, it is not like the accountant is getting a cut oif the $25,000. The accountant doens't decide what people owe, your income and deductions are what they are.
Being a CPA, I understand the way it works. I would have to be mad at someone, the accountant seems like the person I would be mad at, whether that is right or wrong
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| Posted 3/18/08 4:37 PM |
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Bxgell2
Perfection
Member since 5/05 16438 total posts
Name:
Beth
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Re: Kill me now
Posted by Michelle
ETA - your income is not only what cash he takes out of the business as a distribution, all income that is earned, even if you don't take it from the business is taxable.
That's why this year hurts. I understand we owe more money because he received more income from the business. But we didn't necessarily see the extra money in our pockets. DH still took the same monthly income from the distributions that he took last year. A lot more money just stayed in the business.
But these are good ideas, from everyone, thank you 
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| Posted 3/18/08 4:38 PM |
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JessInCA
live laugh love
Member since 8/06 5082 total posts
Name:
Jess
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Re: Kill me now
OMG $25K!
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| Posted 3/18/08 4:46 PM |
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MommyTeffi
Yummy!!!
Member since 2/06 1827 total posts
Name:
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Re: Kill me now
I feel your pain. I owe about 10k to the state and 3K to the government mostly due to capital gains from the sale of my home. Thankfully we bought our new home for cash and have no mortgage. We have the money to pay but it still hurts. I'll drink with you.
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| Posted 3/18/08 5:18 PM |
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Re: Kill me now
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| Posted 3/18/08 5:41 PM |
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JenniferEver
The Disney Lady
Member since 5/05 18163 total posts
Name:
Jennifer
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Re: Kill me now
Sorry, that's a big blow...but it means you are making some big $$$ so 
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| Posted 3/18/08 6:22 PM |
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justthe4ofus
I hate hypocrites!!!!!
Member since 5/05 6905 total posts
Name:
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Re: Kill me now
WOW Beth I am so sorry.
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| Posted 3/18/08 7:21 PM |
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Re: Kill me now
I can't give any advice but
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| Posted 3/18/08 7:23 PM |
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SweetestOfPeas
J'taime Paris!
Member since 3/06 32345 total posts
Name:
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Re: Kill me now
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| Posted 3/18/08 7:40 PM |
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Michelle
My Little Yankee Fans
Member since 1/06 4018 total posts
Name:
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Re: Kill me now
Beth - you can always take the cash from the business to pay the balance too, since you are already taxed on it. Or even take the 23,000 as a distribution for the IRA, instead of taking it from your savings. This won't increase your income for 2008, since you are already taxed on the earnings this year.
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| Posted 3/19/08 5:55 AM |
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Michelle
My Little Yankee Fans
Member since 1/06 4018 total posts
Name:
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Re: Kill me now
Posted by stephanief
Being a CPA, I understand the way it works. I would have to be mad at someone, the accountant seems like the person I would be mad at, whether that is right or wrong
I am surprised by your comments, expecially since you are a CPA. 
I just get fed up of dealing with client's that act like I am pocketing from them oweing taxes. I wish I had the problem of owing so much to the IRS! 
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| Posted 3/19/08 5:58 AM |
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Jax430
Hi!
Member since 5/05 18919 total posts
Name:
Jackie
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Re: Kill me now
Sorry Beth, that really stinks!
I was ready to scream at our accountant, my FIL, b/c he called and said "I have some bad news. You owe $2500. I really should have had you paying estimated taxes all year."
Me: "We DID pay estimated taxes all year!"
(and throws the phone at DH to deal with his father)
FIL: (recalculates). "In that case, you're getting back $1700. You should really fire your accountant!"
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| Posted 3/19/08 8:33 AM |
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Bxgell2
Perfection
Member since 5/05 16438 total posts
Name:
Beth
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Re: Kill me now
Posted by Jax430
Sorry Beth, that really stinks!
I was ready to scream at our accountant, my FIL, b/c he called and said "I have some bad news. You owe $2500. I really should have had you paying estimated taxes all year."
Me: "We DID pay estimated taxes all year!"
(and throws the phone at DH to deal with his father)
FIL: (recalculates). "In that case, you're getting back $1700. You should really fire your accountant!"
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| Posted 3/19/08 8:35 AM |
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azoodie
Member since 8/05 8377 total posts
Name:
Team SEXY BACK
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Re: Kill me now
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| Posted 3/19/08 8:38 AM |
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Geraldine
Lovin Life........
Member since 5/07 2388 total posts
Name:
Geraldine
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Re: Kill me now
WOW.....just WOW.........
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| Posted 3/19/08 8:39 AM |
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mommy0604
My Son is my world...
Member since 10/07 3270 total posts
Name:
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Re: Kill me now
Holy Moly!
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| Posted 3/19/08 9:12 AM |
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SoinLove
Making big changes
Member since 5/05 16541 total posts
Name:
Kristin
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Re: Kill me now
Yikes
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| Posted 3/19/08 9:35 AM |
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