O blessed 2012! Blessed because April 15 fell on a Sunday, and Monday the 16th was Emancipation Day in D.C., where the federal government lives, and Patriots Day in Massachusetts, where I live. This means that neither of my returns had to be postmarked till today. Guess what? They haven’t been postmarked yet.
Doing my taxes is always a miserable business. I start procrastinating when my 1099s arrive at the end of January, and generally don’t actually do them till around April 13. This year it was April 15.
As a self-employed person, I have zero incentive to do my taxes early. Incentive = refund, and I haven’t received a refund since about 1980. I pay what are euphemistically called “quarterlies”: estimated tax for the current year. Quarterlies are indeed due in four installments, but the quarters are not created equal: the due dates are April 15, June 15, September 15, and January 15.
You see the problem with this? The first quarterly payment is due the same day you’re writing a check for what you still owe on last year’s tax. The latter deadline is non-negotiable: if you owe them money, they expect to find a check in your return — unless you file for an extension, in which case you’re still supposed to come up with the amount you think you’ll owe. But I discovered early in my freelancing career that quarterly deadlines are more forgiving. Much more forgiving: as long as you’re pretty well paid up by April 15, they don’t seem to care.
Before I even start, all my expenditures for the past year have to be entered in Quicken. This provides yet another reason to procrastinate. My checkbook is usually within a month of up-to-date, but when I sat down around April 1, 2012, with a thick sheaf of credit card statements, the most recent posting was dated February 2011. Plenty of my credit card purchases are work-related, so I can’t fill out Schedule C till I know what they are. Yes, I do know that I could download bank and credit card statements directly into Quicken, but my illusion that I have some control over my finances depends on entering my transactions manually.
Anxiety and dread rarely darken my doorstep, but in the run-up to Tax Day they’re my constant, ever more insistent companions. Cause #1: When I add up the income and subtract the expenses, will I still qualify for Commonwealth Care? I lived more than 20 years with either no insurance or major medical that never did me any good, so you’d think losing my coverage would be no big deal, but it is, it is. In 2008 I had cataract surgery with insurance. In 2004 I had two retina reattachment surgeries without. The latter meant not only two big out-of-pocket expenses but a wrangle with the anesthesiologist’s employer that went on for more than a year. It sucked.
I’m healthy, I’m less than five years away from Medicare — but nevertheless insured is better than uninsured, and most years I come in pretty close to the cutoff. If you’re under the cutoff, you qualify. If you’re over, you don’t, even though you can’t begin to afford what’s available commercially to single self-employed people. For this reason, Massachusetts won’t fine you if you aren’t covered, but like I said, insured is better than uninsured. The new federal plan seems to have a similar gap.
Thinking about this for too long makes me really, really angry. I manage not to think about it too much when I’m not putting off doing my taxes. Is this a pro or a con for procrastination? Hmmm . . .
The other source of anxiety and dread is the Form 1040 instruction book. I’m a word person. I’ve been making my living in the word trades for 35 years. Of all the English-language works I’ve encountered over the years, the Form 1040 book is hands-down the most incomprehensible. This is humiliating. The IRS keeps telling us that most people should be able to prepare their own taxes. You think? If a highly skilled native speaker of English can’t figure out the instructions, what chance does a person with merely average skills have?
Once again, if I think too hard about who benefits most from the opaque instructions and the byzantine tax code, my ordinarily normal blood pressure starts to rise.
Long time ago I figured out the obvious solution: Don’t read the instructions. I read the “what’s new” section and then pretty much fill out the forms the way I did the previous year.
This year the story has a happy ending: I overpaid the feds by $52 and the commonwealth by $13. What this means is that I’ve already written my first-quarterly estimated check to the Massachusetts Department of Revenue. The U.S. Treasury might actually get its first installment by the end of the month. I hope nobody faints from the shock.
Oh Susannah, I so agree with your every word. Also self-employed, haven’t any incentive to “crunch the numbers”, have to use Quickbooks for my business, and don’t want to actually know how much I made (or didn’t) last year! I have filed the annual extension, so I get to keep dread and anxiety around for at least a few more weeks. Nice to know someone else shares this seasonal dysfunction. Your piece made my day! I admire the fact that you’re done for this year…
Misery loves company! 🙂 I don’t want to be miserable till August though. Summer is challenging enough without Form 1040 hanging over my head.
When we lived in Massachusetts in the 1970s, we called it “Taxachusetts.” The only warrant that has ever been issued for my arrest was in Acton, MA, when I repeatedly refused to pay the town’s exorbitant yearly excise tax on my car. The town’s roads were always so badly potholed that I had to keep repairing the car’s alignment/front end, so that’s where I spent the money. The warrant finally arrived just as I was preparing to leave the state (1977), so I couldn’t (and didn’t) go back for seven years, which was the statute of limitations. So I don’t need to worry about this when I come to Boston in May?
I don’t think so! My sister lives in Stow, within a stone’s throw of the Acton line. You might not want to go there, though. 😉 The state excise tax is hefty on newish cars, but it takes a dive after three or four years. Given the roundabout battle here, I’d love to withhold all contributions to MassDOT (the state department of transportation).