By dixie
I did my taxes last week. In stark contrast to last year, when I did my taxes at the last minute because the Wanderer’s insane boss didn’t get the paperwork to us until the week before the deadline (yes, we know it’s illegal, no, there’s not a damn thing we can do about it in any practical way), this year I had all the necessary paperwork in early February and have simply dragged my feet.
Also contrasting with last year, this year we owe a bit of money to the good IRS and FTB. This, by any rational analysis, is a good thing. Yet I am strangely melodramatic about the entire thing.
Conventional wisdom states that it is better to owe money at tax time (within reason, since the relevant agencies will slap you with fines and inconvenience if you underpay by a lot) than to receive a refund. As much fun as it is to get a nice fat cheque from the government in the spring, it is your own money that has been withheld from your salary that the government is kindly giving back to you. Usually when someone takes money from someone (s)he doesn’t know and pays it back later, that person pays interest as well. Yet for some reason most Americans celebrate when they get a tax refund cheque rather than saying “Where is my damn interest?”
I deliberately undercut the Wanderer’s and my salary withholding this year, and we started saving. (Almost like we’re real growups. When did that happen?) As a result, we have a nest egg and interest income and a small(ish) bill to pay to the government. By any rational analysis, this is a good thing, sound financial planning, and completely sensible.
Yet I am irritated.
I want to keep that money, dang it. I want to buy wool or go to the cinema or fly to Dublin or go on a honeymoon. Knowing I’ve done things right does not ease my annoyance at having to carve a chunk (however small and reasonable) out of my monthly budget and/or savings to take care of this minor nuisance. As a result I moped around for most of last week being angry, bitter, or otherwise unsociable. Then I got annoyed that I wasn’t reacting a more sensible way.
Happily, I managed to get over it before I really took it out on anyone, but I’m still a bit disappointed. Perhaps the $1200 economic stimulus cheque coming in May will lift my spirits.
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26th of March, 2008
Out of interest, what will the situation be when you come to the Emerald Isle? Is there some global-income-taxation dealie that you have over in the USA that needs to be sidestepped?
26th of March, 2008
There is indeed a global taxation dealie that will need to be dealt with. The US doesn’t collect tax on the first $X equivalent in “foreign income” its expats make, but does tax the rest in accordance with tax treaties arranged bilaterally with one’s country of interest.
By then, I expect to be making enough money to hire an accountant who will sort it out for me. Otherwise, it will be a full time job for me to figure out how to keep the Wanderer’s income safe (since he’s not a citizen, and therefore doesn’t owe US tax on foreign income unless we do something stupid) and keep Interpol away from my doorstep.
27th of March, 2008
From what I recall of my other half’s accounting, overseas Americans only have to start paying Uncle Sam when they’re making more than $85,000 a year.
And frankly, if you’re making that much, I have no sympathy :)
27th of March, 2008
I don’t suppose the dollar will get so bad that $85k will head too far down.
27th of March, 2008
When I was in the US I did my own taxes and managed to get by fairly well except for the one time I did my State taxes quite incorrectly. I thought I owed the Commonwealth of Massachussetts $51 dollars which I duly paid. Two months later I got $51 back in the post with a polite note trying not to say “you’re an idiot here’s your own money back”.
But when I got to Ireland I just couldn’t get my head around the Foreign Earned Income forms. It was like some nightmare SAT scenario where 3 lines into the equation everything just becomes noodles. So I did some research and dug out a US accountant who lives in Dublin. Every February I send him some paperwork and give him some money and he sends me back my completed tax returns which just says “here’s how much I make (€X) and here’s how much you (the US Gov’t) gets of it ($0)”. I may not be saving money but sometimes it’s worth to pay for peace of mind.
Dixie, when this becomes your problem, if you want to look at my old returns to figure out how to do it yourself, be my guest. I’m just a tax wuss.