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The last two weeks have been incredibly busy for me because the entire engineering team was working on an important major release of our software. We all worked multiple weekends and nights and finally the software is out! As a reward we got to have five days floating holidays for the extra time we worked. I am taking one of those days off today just to unwind a bit, and also work on our dreaded taxes.

I already entered our W-2s and 1099s into the tax software and it looks like we owe quite a bit of money. The reason is that we adjusted our W-4 from single to married at the end of 2007. Strangely enough, this made our paychecks bigger for the duration of 2008, but we actually owe more taxes than when we were single because of the marriage tax penalty. Basically, we withheld less, and we owe more. So we may owe $4000 to $6000 for last year. This is not that bad because we actually needed the cash during the year to complete the home purchase. We also have the cash to pay for the taxes so it is not a dire situation. From my calculations we should be fine with the same W-4 status this year because our mortgage interest deduction will be around $6000 for the year and it will basically be a wash. Last year we only made two mortgage payments and a couple months of property taxes so the deductions are not very large.  I think the optimal thing to do is to owe a little bit of money every year in case the government needs to give out an IOU.

Nevertheless, paying taxes is always pretty depressing. I did a bit of math yesterday and our biggest monthly expense is actually our taxes and that is pretty sad. In fact, the amount we are required to spend on taxes every month is more than our rent and food money. Ironically, all of this money is mostly wasted by the government on bailouts upon bailouts.

Additionally, I am not a citizen, but a  permanent resident of this country, but the IRS states that I should be taxed like any other citizen working here.  I am fine with that since I have the same work opportunities as citizens, but for me it is truly taxation without representation.

Anyway, I should pull out all my various tax statements now and start working.  This is quite depressing indeed.

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generic viagra safetyon 03.09.09 at 10:11 pm

Time to move to Texas, Florida, or Nevada? (No state income tax.) CA is expensive.

-Erica

generic viagra safetyon 03.10.09 at 9:28 am

I’m going pay many 5 figures for 2008. More than I made in many years.

This year, I hope to just cover my bills while building skills… and pay as little taxes as possible. I could end up paying none, but I don’t want to dip that far into savings.

Texas is nice. I’ve lived there. So is Tennessee. Lived there too. Both lower tax states. (Don’t believe the hype, there’s nice people as well as jerks anywhere you go.)

No matter where you land, I suggest you build a home business that at least breaks even in the second year, and reduce your tax load through investing in your business.

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