Tuesday Tax Time: Mind Your Estimates
I had a client do a smart thing recently. He has paid his first two quarterly estimates but wondered if his business situation warranted him paying his remaining two estimates. To know this, he compared his current business income and expense situation to the prior year.
He properly assessed which parts of his business were different this year than they were last year and came to the conclusion that he probably didn’t need to pay in his last two estimates.
I reviewed his situation and I agreed after a couple of clarifying questions.
Just because your CPA gives you four quarterly tax estimates to make, doesn’t mean your situation won’t change and that you may not need to make all of your estimates before the year is up. ‘Tis the season for fall tax planning. Are you game?
How Do You Track Your Personal Finances?
There are many ways to track your personal finances. As usual, our firm leans toward putting your money management online because of the convenience and ease of use of such products.
Intuit's Quicken
Some will use a desktop software, like Intuit’s Quicken, but moving your info online makes it accessible anywhere, doesn’t tie you to a particular computer while keeping your information safe from remembering to backup your info all the time (backups happen automagically when you are in the cloud!).
I just received a notice from Intuit that they will be discontinuing their online Quicken product and replacing it with Mint.com.
Mint.com is quickly becoming the leader in online personal financial management. It’s interface is simply beautiful and easy to use. It pulls in tons of bank feeds so you don’t have to key in your data manually, and you can access it on your iPhone! Sweet! The budget features and new goals feature are also cool reasons to migrate to Mint.com. Though it’s free to use, some criticize that your online information is really a huge database for marketers (and in fact, they do have a whole section of the site dedicated to selling new products to you). But it’s hard to beat free.
Xero.com, an award-winning business accounting software we support online, also has a pretty robust online personal financial management side called Xero Personal. Their help center is top notch and they are releasing new updates as quick as user comments can populate their blog posts. They are a company that listens and they will quickly become a large player in the market place. And with Wesabe’s recent announcement that they will discontinue their service (they are another online financial community and money management site), Xero has come to their rescue to allow Wesabe imports directly into Xero Personal. Xero Personal doesn’t yet allow for bank feeds to be brought into their software automagically, but it won’t be long. They are a long term player in this market, and it’s only $34 per year!
I don’t know much about Mvelopes, but have heard good things. They also allow for bank feeds and credit card imports into your account (which can be viewed on your mobile phone too). One cool thing about this program is they have a full blown bill pay service built right in. So if you pay your bills online through you bank, now you can do it in the same place you track your money. Mvelopes uses the popular feature of putting your paychecks into envelopes that fill up as you get paid. You see the envelopes getting bigger, and they even take some money out of your envelope as you use your credit card - as they take money out of your “clothing” envelope, they put it in a “for credit card payment” envelope so you can pay off your credit card in full when the bill comes at the end of the month. I couldn’t find out how much the service actually costs, but it looks pretty cool.
Which system do you use? (and don’t say nothing).
Tuesday Tax Time: “Should the Bush Tax Cuts Be Extended?”
Here are the results so far for WebCPA’s poll question “Should the Bush Tax Cuts be Extended?”
If you don’t extend them, then it will effectually be a tax hike (a big one). But if you do extend them, that will just take us into an era where tax hikes are going to be required to pay for the debt the current administration has created (or added to). Some say taxes are extremely low now, and that this tax hike is necessary.
Here is a great summary on what is meant by the “Bush Tax Cuts.”
What do you think?
