Stunned About My Tax Bill!!!

**forHISglory** · 04-14-2008, 05:46 PM

It's April 14; do you know where your taxes are?

My taxes just got finished, and I am absolutely speechless. We usually have to pay a little out of pocket on top of our withholding, but this year, we owe almost $10,000 more!

We are both retired, living on one pension. (And it's a teacher's pension, so no big bucks there!) But we transferred some funds from one brokerage house to another. We had paid capital gains and dividends all these years on our tax forms, and thought that took care of it. Guess we were painfully ignorant. Turns out that we owe almost 40% of our profit in taxes!

When the accountant told me that today, I was floored. Now I have to try and figure out how to put my hands on this kind of cash before tomorrow.

Please don't tell me how stupid I am for making this money move; I'm telling myself that over and over. Just learn a lesson at my expense.

**Loganberry** · 04-14-2008, 06:17 PM

I would request an extension and go to your neighborhood Credit Union for a loan to cover the taxes. Sorry you have to go through this. Will have you in my prayers.

**frugalfriend** · 04-14-2008, 06:21 PM

I'm sorry!! This could happen to anyone, so don't beat yourself up! Praying you can find a way to work it all out!

**Samigirl** · 04-14-2008, 07:26 PM

Oh no...I'm so sorry. Hearing that news must have taken the breath out of you. I hope and pray you can find a way to make it all work out.

**AspiringToBeFrugal** · 04-14-2008, 07:55 PM

I am so sorry to hear this. DH and I owed $2200 in state and federal this year. While it's not your 10,000, I still empathize with you!

**Mom23boys** · 04-14-2008, 08:51 PM

I would also suggest an extension on your taxes which would give you more time to accumulate the money.

**Michelle68** · 04-14-2008, 08:52 PM

That's a big bill. I'm sorry this has happened.

Is there anything of value that you can sell to come up with some of the cash?

--Michelle

**justpeachy92** · 04-15-2008, 12:15 AM

You can go to the IRS.gov website, and get a copy of form 433-D, this is to set up an installment agreement.

**Luv2BeFrugal** · 04-15-2008, 03:28 AM

That HAD to be a shocker!

Hope you can work out an installment payment with them...

I'm sorry this happened to ya... Sending hugs...

**PrairieRose** · 04-15-2008, 08:44 AM

Seems to me that there should be a form that the firm that you moved your money from could provide you with to avert this huge tax....but your accountant would have known that I reckon. Anyway, I'm really sorry. We're paying a lot too....knew we'd have to but still it's not easy to write that check.

Hope you get it figured out soon....(um, like today).

**erstbrmom** · 04-15-2008, 08:49 AM

FYI - An extension is only an extension of time to file the tax return. If you owe money, the money is paid with the extension.
An installment option with the IRS would be worthwhile checking into.

**happimommi** · 04-15-2008, 09:53 AM

I know the feeling, a couple of years ago we moved to a new state and we able to cash out my DH retirement account to pay off some credit cards. Since the account was in New Hampshire, there was no state tax owed there, but since we were living in Wisconsin, we owed taxes here. Didn't realize it until tax time and had to scramble to find the money.

**Loganberry** · 04-15-2008, 10:24 AM

Originally Posted by erstbrmom

FYI - An extension is only an extension of time to file the tax return. If you owe money, the money is paid with the extension.
An installment option with the IRS would be worthwhile checking into.

I believe you are correct. We can only hope that her CPA didn't file yet due to the amount owed. Start with the installment with the irs, but thus giving them time to get a loan with a bank. With a good credit history they could possible get a better interest rate with a bank than what the irs charges. Also, which i'm not promoting, from what i understand loans with the irs are non bankruptable and the irs wields more power than a bank ever will.

If I remember you said that you were receiving a pension from teacher. As a teacher you have skills that people like me need, the gift to teach. I love my daughter, but sometimes it is frustrating when helping with her first grade homework. People will pay a premium for a tutor to help those with learning disabilities. Good source of income to pay this off. Good luck!

**Cricketlegs** · 04-15-2008, 12:22 PM

We cashed in a 401k--yeow!

We all do dumb stuff but the trick is to learn from it.

Note to self--NEVER cash in a 401k....

**forHISglory** · 04-15-2008, 05:30 PM

Well, the deed is done. We made arrangements to transfer money from our savings to checking to cover the amount. I hated to take out a loan, but also hated to send my savings!

Thanks for all your ideas and encouragement, and for never telling me how ignorant I am! kick, kick, kick!!!!!