It’s everyone’s favorite time of year again: tax season!
In the past few days, I’ve opened my mailbox and discovered 1099 forms, a W-2, as well as 1098-E forms (student loan interest statements) in my email inbox. The forms are currently being organized in a folder. Our favorite time of year has come and I’m slowly preparing for it. Today, Jan. 20, marks the official start of the tax-filing season.
Nearly 80% of us would be interested in dropping out of the FT workforce to go freelance.
I have always done my taxes myself, because for a long time, they were very simple. I had one job, or maybe two jobs, depending on the year, and a student loan interest form that I always lost the minute it was mailed to me. Doing my taxes is exciting, because I get to fill in the numbers, check off the boxes, and watch the amount of money that I’m going to get back from the government grow. One year, I did my taxes at the end of January, got my refund by the first week of February, and booked a plane ticket to New Orleans for Jazzfest with the proceeds. Another year, I put some of the money aside in savings and spent the rest on a Coach bag, convinced that I would have it for decades, telling myself that I deserved the purchase because that was money I worked for.
Nearly three-quarters of college students borrow funds to pay for school these days and, as we know, it is not always easy — or possible — to pay those loans back. Well, it turns out one thing you might be able to do to help yourself succeed is move. Specifically, move west.
According to schools.com, four of the top five states for student loan repayment are on the Pacific side of things: Utah, Wyoming, Washington, and Nevada. (The fifth is Virginia so the Atlantic gets a brief nod.) California and Colorado also place in the top 10. But stop short of Cali: San Francisco is a luxury ghost town these days. (“On average, 39 percent of condos built since 2000 have absentee owners, and for newer buildings like One Rincon Hill, that number is 50 percent or above.”) Also there’s no water.
Why is the West such fertile ground for loan repayment? Low unemployment rates, low cost-of-living, and high incomes boost Utah and Wyoming. Washington State, Wyoming, and Nevada make things easier on residents by not charging income tax. Wait, what?
FYI, there are only seven states that don’t charge income tax: Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming. I can understand the small and the oil-rich not needing to profit off individuals but how on earth do huge states with significant populations of poors and olds like Texas and Florida get away with that? Texas makes up the difference via property taxes, “some of the highest in the nation.” New Jersey and New Hampshire are also expensive places to own property. And Florida … is there anything good to say about Florida?
If individuals were treated like corporations, I could set up an affiliate called “Catherine Rampell Bermuda,” have it pay my college tuition and then declare that the affiliate owns the resulting degree. I could then tell the IRS that everything I earn above the average high school grad’s wage should be recorded as income in Bermuda, since it’s all derived from a Bermuda-based asset. Until I decide to repatriate those diploma-derived earnings, I’ve built myself a tax-free IRA.
At the Washington Post, Catherine Rampell is like, Well if corporations are people, then people should be corporations! She talks to Tax Experts who list the many potential benefits we could earn by reporting our taxes as a corporate entity rather than an unfortunate old human being. No taxes on international income! Deduct sales tax! Deduct healthcare spending!
This sounds great although I don’t appreciate being made to think about taxes outside of tax time.
Meanwhile, Rebecca J. Rosen at the Atlantic retells an “extremely literal instance of corporate personhood” wherein a 1960′s IBM employee named Susan Elliott had her husband incorporate her so that she could keep working when she was pregnant. Amazing:
A little over a month ago, I wrote about how I finally went out and got a CPA after a CSR working for an automated tax software program told me “you really need a professional to do your taxes.”
Here is how my CPA experience went! I am curious if it was anything like other people’s experiences with CPAs and financial advisers.
1. I had no idea how much it was going to cost.
My CPA’s website didn’t have any rates listed, which is fine, but it took me to the end of our first in-person meeting (after a few phone conversations) to finally say “um… what do you charge, and is it by hour or by project?”
It was per hour, and since some of those hours happened without me in the room I really didn’t have any idea what my bill would be until I received it. That, of course, made me nervous because I like to plan things in advance, but it turned out fine.