A Huge Financial Hit

9:23 AM

So today is tax day.  For the last couple of years we have done okay.  And by that I mean we have gotten a couple hundred dollars back from both state and federal taxes.  We like that.  It means that we haven't paid too much and the government is using our money and we haven't paid too little and owe money.

That is until this year.  We owe.   A LOT.  We sold Bryan's house last summer and the capital gains screwed us.  I'm not even sure how that works because we had to take money to the closing and we did not make any money on the deal.  The only thing I understand (and then only partially) is that we sold the house for more than he bought it for.   The accountant mentioned something about depreciation, but again, I don't get it.

I am seriously debating getting a second job that is in our neighborhood.  Something that I can take C with me like cat sitting or running errands for the elderly.  Both of which I've done before.  I can most definitely make more money by picking up hours at my current job.  But I don't want to be away from home more than I have to and driving back and forth to the airport is both time consuming and gas expensive.   Plus we'd have to either arrange for day care or Bryan and I would work opposite schedules and we really don't want to not see each other.

I know I'm freaking out right now and maybe just grasping at straws.  I kind of feel like just when we were finally getting a grasp on our financial future we get a huge bucket of cold water thrown in our faces. We will now have to sit down, re do our budget, see what we can eliminate (direct TV), and figure what our monthly payment to the IRS will be.  

Ah,  fun times. NOT!  It will all work out, it just doesn't feel like it right now.

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3 comments

  1. Big hug to you Jen! I ended up filing an extension and hope to have all my papers done by Monday. Sometimes being a grown up is just no fun.

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  2. So sorry, but yeah if the house is sold for more than it was bought you have to pay. I highly recommend getting rid of direct tv. We dropped it. We bought an antenna and a tuner to get the channels. We have subscribed to netflix ($8) and hulu plus ($8). We get 10 channels FREE through the antenna. Start up cost was $200 ish.

    You can watch any tv show at their website the next day (for free) seriously we do not miss netflix. And we are saving $108+ bucks a month.

    There are streaming devices that allow you to watch netflix and hiluplus. Good luck. Btw I would never give up internet....that's where I draw the line.

    ReplyDelete
  3. Umm, yep. Former Accountant here. You have capital gains when sale is more than the original cost basis, whether it be stocks, mutual funds or homes. :-(

    Yeah, it's going to be a hit for you this year, but since I'm assuming you don't plan to sell anymore homes in the near future, you should be OK. You plan on finding ways to cut corners and that's a smart thing. I wish you the best of luck.

    ReplyDelete

I love your comments. Thanks for sharing your thoughts.

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