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Tax Filing Time, I’m Going To Owe

by Flexo on January 25, 2006

in Taxes

I’ve begun receiving my 1099s and W2s, and that means it must be tax time. Jeff Schnepper steps right in to provide me with 15 quick points to motivate me to get my taxes done and done well. For the past several years, I’ve been filing my taxes online with TurboTax Online for which I’ve been able to find rebates. This year, I’ll shop around to make sure I’m getting the best deal.

This will probably be the last year I’ll be doing calculating and filing my taxes myself. I’ve acquired a federal Employer Identification Number and I plan to have deductible expenses in 2006. We’ll see how that goes.

On first glance, it looks like I’m going to owe money. I kept my withholding too low for most of the year, and I made more money at various types of freelancing jobs than I had planned. It could have been worse — at least I’ve been holding that money, earning interest, instead of providing the government with an “interest free loan.”

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About the Author

Flexo, the owner and creator of Consumerism Commentary, has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about him and follow him on Twitter.

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  • You made the right decision by keeping your witholding low. I know so many people love the thought of a giant refund check but they're missing the point completely - we want our money to work FOR us!

    Best of luck with your taxes, thankfully i'm still in 1040EZ land!
  • I did some shopping around myself and was surprised at how *much* more expensive TurboTax and Taxcut online solutions were once you added a state return into the mix. I ultimately found something for $9.95 for both, including e-filing both if I file before 2/15 so i'm giving that one a try
  • jim
    The downside of having not given the government a tax free loan is that now you'll need to pay estimated quarterly taxes. You can get away with owing money on that revenue if you had a surplus a year before (a lot of people have withholding increased a little at their day job) but since you owe, you'll have to calculate those payments.
  • Poe
    I, too, withheld too low and made abit more than expected from a side job (1099) this past year. I hope I won't owe too much.
  • The state return does add a big chunk. Here in Indiana, we have free online tax return filing and preparation for state. So, I just use TurboTax Online for my federal stuff, and then the state's stuff for that. It has all the features you could ask for, including direct deposit.
  • FMF
    Congratulations! It's better to owe (due to more income) than the alternative. ;-)
  • RS
    It always amazes me how many people would rather get money back than owe it for taxes. There are even tax software commercials that make it sound bad to owe.

    I will say that I usually end up owing too much though...last year it was something around $5000 for both. I would probably like to owe a little less than that.
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