Tax Rants II: The Bloody Sequel

Mammas, don’t let your babies write ink on 1040s….

Ahem. *G* Apologies to Willie Nelson. If I had a better sense of lyrics I’d probably try to filk the whole thing. As it is this line won’t get out of my head.

Taxes have been interesting this year. The previous week’s adventures with a tax preparer were unnerving enough. This week I did my taxes.

Yes, I do them myself. By hand, with pencil, calculator, and multiple sheets of scrap paper. There are reasons for that. Though most of them boil down to just two. One, I don’t calculate very well with the background noise of a computer going. It’s a thing. Two – as a writer earning royalties (yay!) I qualify as self-employed and as a small business, and thus must fill out self-employment tax forms (argh!), various parts of schedule 1 that relate to said self-employment (double argh!) and the 1040-C for reporting business income (aiiyeee!).

The 1040-C is new. Back when I took a deep breath, self-published, and started getting actually paid for this, you could just use the C-EZ form. Much, much simpler; you could get by filling out a brief page of stuff, with simple breakdowns of income here, expenses there, there’s your net profits, go forth and enter the numbers on the other forms, oh fortunate one.

The 1040-C… is not that simple.

First off, it’s recursive. As in there are at least four different places in sections I and II where you have to get the numbers by filling out sections III through V first. I wish I were joking.

Second – two different places to write down expenses for “supplies”. No, definitely not joking. It takes a close reading of the sixteen-page instruction book to be reasonably certain that the supplies in section II are supposed to be office supplies and postage, whereas the same entry in section III means more or less “everything else”, material-wise, that might go into your business. So. Had to go back and redo all my calculations of expenses to break them into the two categories. Sigh. Fortunately writing expenses are mostly simple; cover art, research books, that kind of thing. Still.

Third – square footage of the house specifically used for your business? *Facepalms* Oh, if only. I doubt they’d take a write-off for “ideas gotten in the shower or bed”.

So. Read through forms, sketched calculations, filled out all the numbers on scratch paper. Let sit overnight. Redo everything the next day and check if the numbers match. If yes, fill out the forms, sign, photocopy in case of later Murphy, put forms in envelope with check, mail.

Yes, with check. The joy of being self-employed is that it doesn’t matter how little you make. They still get a 15.3% cut. Always.

But, done. Mailing this morning. Whew.

…Until next year.

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27 thoughts on “Tax Rants II: The Bloody Sequel

  1. Living and working (and paying taxes) overseas, I don’t owe taxes to the federal government, but I tend to have trouble filling out E-forms because of the way addresses and telephone numbers can have different formats. I have to jump some hoops because of my foreign financial accounts though.

    Doesn’t sound nearly as bothersome as your ordeal.

    Though my parents have some issue regarding how Trusts are having to be redefined as legal entities, or the ownership/name thereof… or something like that.

    I guess the only solution is to somehow create a (off-shore?) shell corporation to that owns all your assets, to take advantage of all those lovely coporate tax loopholes

    Liked by 2 people

  2. Your tax-tales makes me increasingly grateful that I live in Sweden where the tax-forms arrive pre-filled and you just check if they’ve done them right. Might take some more finangling if you’re self-employed though, haven’t checked.

    Liked by 2 people

      1. Considering our taxes are pulled from our wages before we even get them and our tax-forms are our way of potentially get some back, I’m not sure they would count as *voluntary*…

        Liked by 2 people

  3. “I like to pay taxes. With them, I buy civilization”

    Oliver Wendell Holmes Jr.

    Greece is in such a mess in part because tax evasion is practically a national pastime (but they sure love their pensions/social support net), and the Italians aren’t much better, iirc.

    Liked by 2 people

    1. Back when we had 90% taxes on the highest income bracket, it was a national pastime in the US as well. Turns out that in practice, if the income tax rate is above 20%, Americans will figure out how to cheat it down to or below that rate.

      That said, the 16th Amendment needs to be repealed for reasons of liberty: The power to levy income tax requires the power to audit, which is automatically at the expense of the auditee in lost time if nothing else – in practice, it’s _never_ ‘nothing else’ – and thus is the power to arbitrarily destroy political enemies. States can experiment with income tax if they like, part of the laboratories of Democracy is making the really dumbshit decisions so that others can learn from your example (and occasionally proving that a dumbass idea in theory works out much better in practice), but for the sake of liberty it needs to be purged from the federal level.

      I wonder if anyone could point out to our Trumperor that self-employed artists really shouldn’t be considered as a ‘small business’. He does like reducing the regulatory burden, after all.

      -Albert

      Liked by 1 person

      1. The power to levy income tax requires the power to audit, which is automatically at the expense of the auditee in lost time if nothing else – in practice, it’s _never_ ‘nothing else’ – and thus is the power to arbitrarily destroy political enemies.

        What makes me scream is that folks want to replace it with a sales tax.

        Good heavens. “Taxing every time you pay someone for work is too intrusive; let’s replace it with taxing every time you pay for ANYTHING!”

        Liked by 1 person

      2. The solution to that was everybody getting a “rebate” on tax day for the estimated bare minimum you’d be taxed, otherwise.

        Which does nothing for the places that can’t buy direct from the supplier, and makes fraud even MORE rewarding….

        Liked by 2 people

      3. A worrying number of big-L libertarians are best understood as stealth Democrats. 😀

        It mostly bugs me because the theory appeals to me the same way that ‘from each according to ability, to each according to his need’ appeals to some folks. I know it won’t work, but it’s very emotionally appealing. And then some twits pin it to their chest and ignore it….

        Liked by 1 person

    1. Generic “your,” not stalkerish “your.”

      Although it’s kinda entertaining to cross-reference old lettercols (such as from sf magazines from the 1930’s, when they printed street addresses to facilitate penpals and reader correspondence) to Google Maps.

      Liked by 1 person

    2. Nah, it goes off tax information and what prior owners put in.

      *grins in taxes*
      It’s amazing how much of a different locations have in their taxes. Our current house, on paper, is about half the size of our prior one and has only two bedrooms rather than four, and does not have a garage. In reality, between the two rooms that have less-than-seven-foot-ceilings, and the full-sized, legally unfinished basement, and the freaking shop with two car garage and two work rooms (which is accessed at a much lower rate than an attached garage), and the three rooms that don’t have closets, and for that matter the closet that is the size of a bedroom… much, much bigger.

      Some counties only tax on the footprint of the houses, too, or don’t count a house as having two bathrooms unless they have a tub in both.

      Liked by 1 person

  4. /Two – as a writer earning royalties (yay!) I qualify as self-employed and as a small business, /

    You also qualify as royalty.
    I’m pretty sure that’s how it works.

    One thing to be aware of, especially when it comes to business taxes, is that several portions of the tax code are fairly ambiguous and open to interpretation, even to the IRS.

    My cousin is the head accountant at a company, when an audit happens they say “you did X wrong” and she responds “okay, how is it supposed to be done?”
    No sudden realizations or tricks, just that year, with that person, it’s interpreted that way… and different the next year.

    Liked by 2 people

      1. In general, I don’t care if Bob down the street is also Chief Bob.

        There’s a lady who is queen of her African tribe, and a fair number of tribal princes have served in the US military and done good stuff. A surprising number of folks earn money here and send it home to the tribe or noble estate.

        Also, Lafayette. He’s pretty much our chief argument for foreign titleholders hanging out with us. Nobody better mess with Lafayette.

        OTOH, it’s a good thing we had Grace Kelly as a counterexample to all the other mess, because historically, Americans haven’t made a good showing as royals. Nobility, sometimes. But it’s not something we are good at.

        Liked by 2 people

      2. Let’s not forget Steuben, without whom the American Revolutionary Army might never have gotten enough spine to last against the British Regulars.

        Liked by 1 person

  5. There’s a documentary about this one guy in Australia, who arguably has a better claim to the throne of the UK than Elizabeth R. does. (There are a few others, too. But Parliament’s interpretation is what counts.)

    I was kinda bored by the genealogy and history portions, which I already mostly knew, but the guy in Australia and his family are great fun.

    Liked by 2 people

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