I started this site to be frank about money. I like having give-and-take conversations about actual, specific dollar amounts of all sorts of stuff. So let’s talk taxes in specifics since we got to read all the general stuff all over the dang place over the last few months.
Our 2015 Numbers
So, 2015 was technically a lower income year than “normal” for us even though we sailed along great and still saved for our future. We brought in about $86,000 in overall earnings. But I cracked up laughing as my eyes took in our 21 pages of taxes – deductions flowing like freaking water.
Expenses like mileage for pet sitting and sports officiating and the business expenses like our dedicated office and whatnot just kept hacking into the $86,000 we made. Then the $11,000 contribution to the SEP IRA took a chunk out too. Then our itemized deductions took out a $16,000 chunk.
In the end, we paid taxes on $22,000 (about $2500) plus our self-employment taxes (about $8900). $10,900 total.
We paid in $18,000 over the year. So, we ended up with a $7100 refund that we chose to let them keep for this year’s taxes. We won’t have to pay any estimated quarterly taxes until September. Yay!
Other interesting news, we had to file 21 total pages and 10 total tax forms:
- a 1040 (main tax form)
- a Schedule A (Itemized Deductions)
- three Schedule C’s (our self-employment businesses)
- a Schedule E (Supplemental Income and Loss for our rent stuff)
- a Schedule SE (Self-Employment Tax)
- an 8965 (Health Coverage Exemptions)
- an 8582 (Passive Activity Loss Limitations for rental home)
- a 4562 (Depreciation and Amortization)
The biggest thing I really took in is how much the SEP IRA affected the total taxes. That $11,000 chunk out of taxable earnings was pretty cool. Of course, we’ll be taxed on it in 30+ years. But hey, that’s what the Roth IRA’s are around to balance out. 🙂
Hope you have a tax hiding retirement account like a 401k or IRA too! And remember to balance it out with a Roth IRA or some tax-free-in-the-future option!
It was also cool to have a CPA handle it all this year for several reasons.
- First, $750 for all of our tax forms is a low cost to pay for what amounts to IRS insurance for future problems (here is a link to the crap we’ve been dealing with over our 2013 taxes because the IRS is inefficient and you can’t talk to them directly).
- Secondly, we compared our tax forms this year to the ones that Mr. BFS did in the past, and he was kicking ass and taking names. No deductions or crazy crap missed. Mr. BFS could be a freaking CPA. That was an ego boost for him (and me – I’m proud).
- Thirdly, it was a little less work and a lot less stress. Mr. BFS still worked out all the numbers to plug in, we still had to get together all of our meticulous records, and we still had to make our tax packet of info like normal. But then we handed it over, checked their work a few weeks later, signed a page, and were done. No more stress. If the IRS wants to take it up with us in a few years, whatever. We’re keeping our records obviously and can prove every number. And a licensed, certified CPA from a reputable estate lawyer firm will be on our side.
Our Tax Refund
Even though we are letting the IRS keep our $7100 for this year’s taxes instead of getting an actual check or deposit, we had already set aside the $4500 we were paying for estimated quarterly taxes. In essence, that $4500 is our refund. 🙂
We’re probably going to use $500 or so to get a new dishwasher since the one that came with our house in 2012 doesn’t dry a freaking thing. The rest will most likely be divided up between boosting our emergency fund, investment savings, our car fund, and more fun money.
How did you do on income taxes this year? What does your CPA charge? What did you use your refund for or how much extra did you have to shell out? How happy are we all that this year’s returns are pretty much over? Sorry if it isn’t for you…