Mark Terry

Saturday, February 21, 2009

Taxes and the Writer

February 21, 2009
We went and did our taxes today. It was made even more complicated because I spent a couple weeks working for a company in New York that made me pay taxes in New York--I live in Michigan.

Here's a conversational tidbit with my tax woman:

Me: The tax laws are sure unfriendly to small businesses.

Her: Yes, they sure are.

So, my recommendation to freelancers making any money: go to an expert. What a pain in the ass.


Blogger Mark Terry said...

At one point I flung my arms up in the air as if making a field goal and said, "These two are are brought to you!"

2:27 PM  
Blogger Mark Terry said...

Uh... these two wars...

2:48 PM  
Blogger spyscribbler said...

I can't tell you how many people have lectured me on how I shouldn't be honest and I'm running my business badly because I report every cent. A huge percentage of piano teachers report nothing at all, which frankly pisses me off.

I report every penny, but I guess I can see where they're coming from. But I would be REALLY WELL OFF if I hadn't reported every penny. It's the taxes that kill me.

I don't go to a professional, but I worked in a tax law office for awhile. I knew I was going to be running my business, so I read the weekly books on the tax law changes every single week. In fact, I read their whole library and took notes. I keep up to date, mostly, and I haven't come across anything that's too complicated yet.

11:21 PM  
Blogger Mark Terry said...

-I suppose the new software helps a lot. One of the problems we ran into, among other things, was conflict between the state of Michigan and the state of New York income--ie., they both wanted to tax it, then we hit a snag which is not that uncommon, which is my quarterly "estimated" taxes were more roller coaster in 2008 than usual. That is to say, I don't "estimate" my taxes, I pay 24% of what I made to the federal government. And in the 2nd quarter I didn't make shit, but in the 3rd quarter I made half my yearly income, and my "estimated" taxes reflected that, but the government in its wisdom wants to penalize you for that, so we had to override it and that took some time...

I try to be as scrupulous as possible in declaring things. I know people shade their taxes a lot, but my take on it is, I think, both honest and practical--if I get audited I want to be able to hand over everything without worrying about it, knowing that I was honest about it.

6:50 AM  
Blogger spyscribbler said...

See, I totally respect that. A lot. If everyone stopped 'shading,' as you put it so well, it would probably be easier to get the penalties--I mean, taxes--reduced on self-employment.

I don't know. Maybe. We don't exactly have a strong lobbying force in DC.

10:26 PM  
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