I spent a few hours yesterday completing my tax return. Although I had wanted to work with a tax professional, my procrastination interfered with the plan. It wasn’t as complicated as I expected, but there may have been some deductions I missed. I owe a few thousand dollars, which was less than I originally anticipated but more than I wanted to the federal and state governments in total.
Once again, I chose TaxAct to calculate and electronically file my federal and state tax returns.
When I finally meet with a tax account this year, I will arrange for a review of the returns from the past few years.
SEP IRA contribution completed
While completing the tax return, I was able to determine how much I could contribute to a SEP-IRA for 2007, so I initiated transfers of $4,350 into Vanguard‘s Total Stock Market Index Fund (VTSMX) and about $8,480 into Prime Money Market Fund (VMMXX) to represent the employer contributions.
I intend on creating an automatic periodic transfer from the money market into the stock index.
The initial contributions as well as the tax payments will be deducted directly from my ING Direct account this week.
Economic stimulus payment
According to the Economic stimulus payment calculator, if I entered my information correctly I can expect a $600 payment this summer.
It will be disappointing to see my net worth drop this month due to my tax payment. I’ve increased my estimated payments for 2008 to attempt prevent a large payment next April.
Updated February 6, 2012 and originally published April 14, 2008. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.