[DirtyDog]

I thought I was really going to get hit hard with a penalty because I didn't prepay any taxes last year and I have a big tax bill coming. I got my filing today from my accountant and my penalty was a whopping....... 21 dollars.

Why the hell would anyone prepay taxes and lose the interest they could be getting on that money?

 

[N8 v2.0]

I thought I was really going to get hit hard with a penalty because I didn't prepay any taxes last year and I have a big tax bill coming. I got my filing today from my accountant and my penalty was a whopping....... 21 dollars.

Why the hell would anyone prepay taxes and lose the interest they could be getting on that money?

I've often wondered this myself... unless the IRS says you MUST pay estimated taxes, and the penality is not much, why do it?

 

[SkaredShtles]

<snip>

Why the hell would anyone prepay taxes and lose the interest they could be getting on that money?

Because lots of people are dumb?

 

[Crashby]

People want to "plan it out" - "budget it"... etc.... fools I tell you!!!

I used to work for Paychex who offered a "Taxpay" product in which they would bill the client weekly for the taxes owed on the next year. We would, in turn, invest this "float" and make millions.

 

[Transcend]

WTF is this about pre paying your taxes?

Crazy USA...

 

[DirtyDog]

I guess that's a huge advantage of being self employed. Tax withholding is a load of crap.

 

[SkaredShtles]

I guess that's a huge advantage of being self employed. Tax withholding is a load of crap.

"But it's just like a big extra paycheck at the end of the year. I'd never be disciplined enough to save the money......."

 

[Transcend]

I guess that's a huge advantage of being self employed. Tax withholding is a load of crap.

I just pay what I owe when I file my return, no penalties. Why do they friggin penalize you for paying taxes at the end of the tax year, after you have actually earned the money?

 

[Transcend]

"But it's just like a big extra paycheck at the end of the year. I'd never be disciplined enough to save the money......."

Remember the idiot a few weeks ago who said this was "cheating" the tax system, and you would get more money back by paying more in?

what a 'tard.

 

[SkaredShtles]

Remember the idiot a few weeks ago who said this was "cheating" the tax system, and you would get more money back by paying more in?

what a 'tard.

Yeah! What a brilliant idea he had come up with.........

 

[jimmydean]

What I don't get is why I paid nearly the same in state tax as I did to the feds, yet I owe the state $600 and the feds are giving me $2000 to pay it with.

I sort of understand with the way deductions fall, but you would think it would even out.

 

[RhinofromWA]

I once saw a client receive penalties of over $5,000....not uncommon.

You pay taxes as you earn the money....that is the idea. The government doesn't like giving out zero interest loans....though they don't pay you interest when they take to much.

It also depends on when you earn the money....if the bulk of your money is loaded on the tail end of the year(seasonal workers or if you just start working at the tail end of a year) than you aren't really late in paying the taxes. so the penalties are less.

Rhino