Friday, May 18

Ouch! Another Taxing Setback...

Well, the bad news is that I underestimated my tax liability for this year. Today I wrote cheques totalling over $18,000 to federal and provincial tax departments, as well as my accountant, for her services. I only had $7000 budgeted as a tax liability so once again I am going to be taking a huge hit this month.

The good news? Well, none on the tax front. I suppose that the good news came months ago as I had my best year ever and saw my net worth increase by nearly 60% in 2006.

Additionally, I am planning a major health expense in the next few weeks which will further decimate my account balances. The good news on that topic is that the health trust I set up last year will pay for itself immediately.

So all in all, I'm feeling rather poor today. A couple weeks ago when I sold my car I was feeling quite rich. Funny how money becomes so subjective like that!

5 comments:

thefinancialblogger.com said...

Ouch! I know how it feels... I was in a dispute with the provincial government for 2003 taxes and they just paid themselves among my 2006 tax return. I was expecting big bucks... now I'm left with peanuts! At least, if you are paying taxes, it means you are making more money ;)
MiKe!

Anonymous said...

The first thing that comes to mind with "major health expense" is elective surgery.

I hope all is well.

Mike said...

You win some, you lose some.

That's the problem with keeping close tabs on your net worth, investment return etc - you tend to overfeel the normal day to day ups and downs

Although $18k is not a minor daily change!!

Re: money said...

I really sympathize!

2 years ago we got hit with a huge tax bill, about 50% more than expected. So I reconditioned myself to think about everything in after-tax dollars, and it's like second-nature now.

I also tend to over-estimate taxes in my head - a defense mechanism? :) - which means nice surprises when the time comes to pay again.

mOOm said...

Interesting article for you:

http://finance.yahoo.com/retirement/article/103047/Dividend-Funds-Enjoy-a-Boom,-Helped-by-Aging-Baby-Boomers?mod=oneclick