<< Back to all Blogs
Login or Create your own free blog
Layout:
Home > Spreading out the Pain of a Big Bill
 

Spreading out the Pain of a Big Bill

March 6th, 2017 at 03:14 pm

I don't know how much people care about the minutiae of other people's financial arrangements... sometimes I like to see how other people are handling things so that I can figure out my own finances better.

Anyway, for the record, here are the minutiae of how we are going to fit our big tax bill into the finance stream.

Federal tax bill $4033
State tax bill $411
Estimated payment for April $1649
Total = $6093

The PLAN!!
Since we have some savings and money allocated but not yet spent, we have a cushion and can pay the tax bill and estimated taxes and pay ourselves back little by little. YNAB helps with this... I've set up a category called "Estimated Taxes" that will be negative for about 4 months.

This method will allow me to maintain cash flow in my business and to maintain a good balance in our Irish account. Those two things (business profit and Irish house rental profit) are the reasons for the big tax bill.

March - Deposit into our personal account $1000 as a distribution from my business, $300 from the Irish account, $200 from my husband's side business account
balance will now be: $4593

April - We pay the big bill. Already have $1500 allocated. Deposit another $1000 as a distribution from my business, $300 from the Irish account
balance will now be: $3293

May - Deposit another $1000 as a distribution from my business, $300 from the Irish account
balance wil now be: $1993

June - Deposit $1000 as a distribution from my business
balance will now be : $693

We will cover the $693 with underspending in other categories, little by little.

So there you go. That's my creative accounting method, to soften the blow of the Big Tax Bill. We still have to pay it of course.

I feel privileged to have made a profit this year.

1 Responses to “Spreading out the Pain of a Big Bill”

  1. creditcardfree Says:

    Great plan! I think others do like to see how one can attack a big bill. Thanks for sharing!

Leave a Reply

(Note: If you were logged in, we could automatically fill in these fields for you.)
*
Will not be published.
   

* Please spell out the number 9.  [ Why? ]

vB Code: You can use these tags: [b] [i] [u] [url] [email]