Bah Humbug! Tis the Season for Income Tax
November 28, 2007
Do not shoot the messenger! Although I intellectually understand the necessity of paying my share of income tax, I too would rather not have the expense. As soon as the holidays are over, income tax information is deposited in my mailbox. Even though taxes are not due until April 15th, I know in advance if I am going to be required to pay.
If I have any idea that I might owe Uncle Sam, I need to plan for it now. If I wait until the deadline, it could mean financial disaster! For example, I know a man who spends his wages as fast as he makes the money. Saving for the unexpected, or even the expected, is not any part of his financial plan.
Thus, if he does not have the money, he simply chooses to ignore the fact that he owes income tax. If he does not file, maybe the Federal government will not notice. BIG MISTAKE! The IRS might not catch on today, but when they come across flagrant neglect or naivetÃ©, it still costs big bucks in the end.
The penalties and interest of neglecting your civic responsibilities, whether you agree with them or not, can far exceed anything you can imagine. The process is similar to mating rabbits: you start with two little rabbits, and by the end of the year, you are overrun with the little creatures. Your tax bill will grow faster than multiplying bunnies, if you neglect the bill.
To avoid financial devastation that bankruptcy cannot even cure, budget for your income taxes, especially if you are self-employed. In the event you do find yourself owing Uncle Sam, do not shove the problem under the proverbial rug. Make arrangements to take care of your tax debt as soon as possible.
So, why am I being a Scrooge and bringing up taxes and the IRS now, instead of after the holidays?
Plan now or pay later. Before you spend every spare cent you have on Christmas, consider the financial responsibilities in the coming months. If you are going to need the money you are spending today, tomorrow, you need to adjust your Christmas budget.
You will have a much merrier holiday, if you do not have the financial pressures of next year weighing on your mind. Remember is does not mean you will become a Scrooge to live within your budget. After all, as the story goes, the Cratchits are far happier being poor than Scrooge ever was with all of his money.
Do you have any tax tips, or ways you celebrate Christmas that are inexpensive (free) and fun?
All posts by Tina