Yes, we owe a lot. Again. Now, we were not supposed to owe very much ($7K was what we were expecting) based on our calculations. However, M switched jobs, we had the income/bonus/repayment issue, & an error on the side of M's previous employer where they did not correctly withhold from a stock exercise when he left the company.
We owe just under $16,000 in federal taxes. Now, I've already had my crying jag over this. My personality needs to immediately process & accept the situation, then look for solutions for dealing with it. I do not handle drawn out stress well, & must have a solution in mind before I move on, mentally.
That said, it's money we owe, & we clearly (CLEARLY) need a more proactive tax strategy for 2013. Here's what I've done (again, aside from the crying):
- Increased my with holdings by $200/month, to make next year less painful
- Increased M's with holdings by $200/month, for next year
- Figured out where the money is coming from (the vast majority will come from an investment that we will sell. The rest will come from our liquid savings account. We don't want to completely empty this, in case of an emergency).
We are two very smart people, so . . . how do we keep screwing this up on such a giant scale? Well, I know that the only accountant we used was not able to predict how much we'd owe, the IRS calculator is grossly inaccurate, & we've had a variety of "changes in circumstance" this year that made any calculation difficult.
My goal for 2013? To owe less than $5,000. If we can get within that window, well, that's about as good as I can hope for.
How am I going to accommodate the $400/month in "lost" cash flow? I'm working on that. Given our tight budget, that should be a very fun exercise. ;-)
I almost blew it on the frugality side. The stress & "oh, what does it matter if I keep my weekly spend under $300, when I owe $16000) side of my almost took over yesterday. The kids wanted to go out to dinner (I almost caved), I was running late for lunch, & almost went out. . . the list goes on. I managed to keep my head together & we're still on track for our weekly spending goal. Baby steps, people!
Have you done your taxes yet? We've uploaded 95% of our information into TurboTax, & I don't expect the remaining 5% to have a material impact on how much we owe, luckily.