Friday, May 12, 2006


Taxing issues

Whoever coined that phrase about death and taxes was pretty close. More accurate would be "taxes are going to cause my death".

Our tax season just came and went about two weeks ago, and boy, was I in for a rude awakening. Seriously though, it's my own damned fault. See, my business partner and I, up until earlier this year, never did the standard "pay cheque with deductions" thing. No, we chose to just draw from the business whenever we felt the need, leaving the onus upon ourselves to put a little something aside for tax time.

Since I came into this business in the fall a few years back, I did alright at tax time the following year because I had deductions from my previous job that resulted in my having to pay only a small amount to the tax man.

The year after that I was on my own. I've never been much of a saver, so of course I didn't change my ways and prepare for the fact that I would have to pay income tax on whatever money I brought home.

The Squeeze figured out my taxes last year, and informed me that in order to avoid paying a huge sum, I should purchase some RRSPs to minimize my taxes, and that I could claim a portion of my pay and carry the rest forward to this year. Sounded good at the time.

Well, that time is now. I brought home a printout of my total income for 2005 and The Squeeze entered all of the numbers. Of course, we had to add the amount that I didn't claim from last year as well. In short, it looked like I made a pretty healthy salary. Translation: I owed several thousand dollars to the government. The bastards!

I jokingly asked if we can't redirect some of the pay into other areas so it looks like I made...oh, I don't know...half of what I did. The Squeeze was not amused.

"Well, you know," he said, "since you don't have anything set aside for retirement, maybe going to prison could be your retirement plan."

I really couldn't tell him off since he's spotting me the money for my taxes, and besides, it was kind of funny. I think he was shocked when just four days later I paid him back $1,000. My goal is to give him a thousand bucks a month until I'm paid up. It's going to be a lean year. I'll be left with enough each month to make my car payments, car & home insurance, and the few other bills I look after. Oy, and then there's my Visa and line of credit.

The reward at the end of all of this is that this time next year, since I'm having extra deductions taken off, I should be getting a refund. However, that is 12 months away. I think I'm going to pick up a lottery ticket on my way home tonight.

LOL! Did the Squeeze have any suggestions on how to put the correct money away so that next year you don't owe the government? Of course, you have a conservative in office now, so shouldn't you be getting a massive tax cut?

Loved the prison as retirement plan line!
This year we are submitting tax witholding from each pay (I'm even volunteering a bit extra to be sure) so we'll be ok next year.
Ya, that Squeeze...he's a funny guy. That's why I'm going to kill him last.

Note: the last two lines should be read with an Arnord Schwarzenegger-like accent.
Wow, did I come anywhere near spelling his last name correctly? How could I live so long and never have to spell that name? A friend of mine calls him Arnold Sweatyknickers. :o)
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