yup TAXES...ugh..i'm feelin' for ya.i discovered if you are just a little over the profit line level, the percent owed Jumps big time.quarterlies are a pain but you don't risk a stroke at the end of the tax year.
Thanks for sharing. I feel your pain, I really do. We just got our taxes done last week and are now scrambling. I hope the sale helped!
I have so been there. When you are a DINK (dual income no kids) and actually make money you owe big time. We owed over 10k one year and weren't prepared at all.I admire your honesty in this situation because I am sure there were people wondering why is she having a sale. Tell Joe don't worry about it because owing money means you made money and making money is a good thing right?!I started putting a little bit a month away in a savings account to prepare for tax time.Shannon C
I love how you talked about this. I'm sure it is helpful to other business owners to hear about your experience. That is one of the things that is so endearing about you is that you open yourself up and are real to people no matter what the situation. FYI we are also doing the "Government Sucks" dance in the Keever house this week.
Thank you Lorelei, that was a good lesson for everyone. Keeping good records throughout the year doesn't appeal to our creative side and worse it is not a lot of fun. Neither is putting aside funds to cover taxes when there are beads to be bought (or a new camera, props, domain names, table cloths, tents, comfortable chairs, software to track it all, etc...) Sharing hard lessons is not easy but hopefully a lot of us who follow you will take the lesson to heart.
Hi Lorelei,thanks for sharing your story i am sure your information will be helpful for a lot of people your honesty is very endearing ttfn L:)
I have charts, and as I do my quarterly sales tax, I get an idea of what I am going to owe at the end of the year, and set it aside. My husband and I are both self employed (so we have to be organized)...and my business is not really showing a profit yet....but it should this year. So I need to be sure to have enough to pay my part!!! 30% of your profit is what you should set aside. At each quarterly tax period, I enter ALL my reciepts and deductions for that quarter in a chart, and all my sales in another so I can see what my profit is right away. Then sock away 30%. The beauty of that is, at tax time, you can write off miles and everything and you shouldn't owe that whole 30%. Then you will actually HAVE money at the end of the year!Hope that helps! Glad you sale helped too!!!
Lorelei, as painful for you as this was to talk about, you really did everyone a favour...you learned a valuable lesson and you are sharing that with others...hopefully what you have been through will be an eye opener for others as well.Your honesty and your disappointment at life/government/money speaks volumes. Hang in there! ♥
Oh I feel your pain ... I pay quarterly because of my editorial work, but look forward to the day when my jewelry efforts might require the same contributions ...
I feel your pain Lorelei. Doing our taxes was a huge eye opener on a lot of levels for me this year. Your honesty in sharing this is just wonderful. Life is real, and not always glamorous! Good luck with your sale....
Hi Lorelei, This webblog hit close to home with me, Mark, my husband talked me in to purchasing business lisence and tax exempt cards, Though I have not yet bought the liscense yet, I have my Sales Tax Cert. I am gettinge nervous about the whole situation. I can't imagine what we would do if I had to pay in to the state, I have to send in the sales tax I collected on my (1) sell. Which right now is not that much. I feel for you and hope you can make it. Keep your head up and push forward. It is wonderful that you opened up and shared your troubles with your following. Maybe you can take comfort in knowing your not alone and have planty of people to help you threw hard times. Have a wonderful weekend. :)
Ouch, Lorelei! I feel your pain.
Yep, I owe too this year. Stinks. But as my boyfriend says, if you owe money, it means you made money! I guess that's a positive way to look at it!
My husband has his own business with employees, and it is amazing how much you have to make just to break even. My lesson this year was less impulse buying and use what I have, it seems the more I sell the more I buy. Congratulations on a successful year.
I picked up a little "real job" side work this past year where I didn't have even close to enough deducted...the look on our faces when the accountant told us how much we owed must have been something to behold! Glad your sale helped you make up some of the difference :)
Well, I'm glad I did a little shopping when I saw your "Poor Planning" sale...I work in accounting, and I do one of the things that any planner will tell you NOT to do - my hubby and I both file as Single, 0 and take out a little on top of that. Yeah, we both have "regular" jobs, but we do that because he gets overtime...and we never know how much it could be from one year to the next...So, we plan our budget without that extra (that we don't miss) and get a nice "bonus" at the end of the year..I've only ever had to pay "the man" once, and I know how tough it can be! Glad I could help :o)
Hi Lorelei, As you can see you are not alone. I personally have forgotten that all of the money from sales isn't 'allowed' to go into my pocket - dang it! The terrifically great and wonderful and termendous news is - You Are Successful! Yippee! You Are Talented! Yippee! You Are Loved! Bigger Yipper!
Yeah, Taxes suck. My advice to all is to make sure you have a good accountant who is knowledgable about small home businesses. We always had our taxes done by a standard CPA, but when I switched to a guy who did a lot of the local taxes for small businesses here,we saved a HUGE amount. Cenya
Oh Lorelei I too felt your pain! You must really owe alot. Bless you. If I wasnt really trying to buckle down on my bills I would of bought something. Hopefully the necklace I recently bought helped too. I hope your Shop gets cleaned out good! big higgs L ox
An idea that might make the whole situation less painful: go to your human resources dept. at work and have an extra $25/$50/$75 or whatever held out of each check; you could also claim zero exemptions. That way, you don't have to fool with paying in quarterly taxes, etc.; you might still end up in the hole at the end of the year, but much less so. My husband and I both do this, and the end result may be that we have a few less dollars per paycheck, but at tax time, our surprises are good ones! Good luck. This issue is definitely a downside of the whole art-business-on-the-side thing.
I feel your pain...and I've been feeling it for 30 years. My husband and I have our own business aside from my little jewelry business and for thirty years we are "surprised" by how much we have to pay. Last year we sold a sportscar we were given by a airline because my husband flys so much on business. That's how much we were surprised and that was because the prizes were given unexpectedly put us over the percentage. So we actually owed more than just what the car brought in. But you know, the one thing that makes me proud is that my husband always stands up and pays what's due and the reason I say this is because I worked for so many companies who didn't and it just goes to show you who is really taking care of this country, it's you, it's me, it's all of us little guys. So don't be to sad Lorelei, you stand with the best of us.
I do zero exemptions on the W2 at my "real" job to cover income tax owed on my etsy sales. I need my real job to afford my side job!
Lorelei - this really sucks for you and your hubby. I am in a similar boat and am DREADING when he finishes our taxes. I really does say a lot about your character that you opened up to your online fans and supporters. I really hope you can get out from under this and don't let it squash your creativity... Can you apply for a deferment until August? Would that help?
Dear LoriI'm far away in France but i feel your pain ; je la partage et je suis sûre que tout finira par s'arranger.Take care of you and keep on making wonderful jewels for us!
Hi Lorelei....by the way I love your jewelry and your blog! I think some of your travel could be written off...and maybe finding more business expenses would help. Hey Exxon paid nothing. Thanks for your beautiful jewelry ...love it. Hang in there.
Giiiiiiirl, I hear you. I learned a hard lesson this year, too. My part time job didn't take nearly enough out, and as a result, we owed too. I had my heart set on a new camera. BOO.
Oh I found this out years ago when I worked in Ct but lived in NY and CT didn't have a state tax at the time UGH not only did I have to pay the tax but the penalty too BLEECH It's the worst feeling in the world - we are only human! So sorry it totally sucks. Big HugsXOXO
Lorelei, I really appreciated your honesty about this subject. For those of us in the early stages of our business, it is a great piece of wisdom for you to have shared! I missed your sale, but have to tell you that a piece by Lorelei is on my list! You continually amaze me with your designs!
I'm sorry to have to turn on the word verification here, but I got fed up with spammers comments! Better than a thousand hollow words, is one word that brings peace.Buddha