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Thread: estimated taxes and taking a year off

  1. #1
    Picaresque
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    Default estimated taxes and taking a year off

    Have any of you taken an entire year or more off from dancing, and if so, how did you handle your tax situation?

    I'm going back to school in Jan, and I've got exactly a year left if I go full time. It's possible I won't be dancing at all. If I decide not to work at all, what am I supposed to do about my taxes and estimated payments? Specifically, how am I supposed to let the IRS and state know that I'm not working?

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    Banned Melonie's Avatar
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    Default Re: estimated taxes and taking a year off

    just take it one 'quarter' at a time. If you didn't earn any money as an independent contractor during the quarter, you don't send in an estimated tax payment.

  3. #3
    Picaresque
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    Default Re: estimated taxes and taking a year off

    ^^ that's what's got me confused. if I don't send in a payment, won't they assume that I'm working and just neglected to pay it, and won't that get me in some undeserved trouble?

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    Default Re: estimated taxes and taking a year off

    ^^^ no they don't look at estimated tax payments at the time the payments are sent in. They only start looking at estimated tax payments after the end of the year tax return is filed. If the tax return shows big taxable income but no 'balance' in the estimated tax 'account'. aaa-ooh-gah. But if the tax return shows nearly zero income and no 'balance' in the estimated tax 'account' it's no big deal since the amount of taxes owed is also nearly zero.

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    Picaresque
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    Default Re: estimated taxes and taking a year off

    oh ok...that makes sense, I think. I guess that also answers the question of what to do if I decide to work only like twice a month or something, for basic expenses while I do the school thing. Thank you!

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    Default Re: estimated taxes and taking a year off

    The trouble as I see it will be getting them to "believe" that you did in fact take a year off and are not still dancing some, a few weekends anyway on the side. As long as your spending drops off or it can be shown that you are living on some kind of savings from the past you should be OK on the other hand if money seems to be just appearing out of no where that would be different.

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    Default Re: estimated taxes and taking a year off

    ^A few weekends worth of dancing doesn't seem like it would be worth their time (although I guess it depends on how much she can make in a couple of weekends, lol).
    If you think school is hard, try being stupid.

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    Featured Member Starfire's Avatar
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    Default Re: estimated taxes and taking a year off

    this is sort of related...is it a big deal to be a little late with the estimated taxes on one quarter?
    Last edited by Starfire; 09-07-2007 at 02:53 PM. Reason: forgot a word

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    Default Re: estimated taxes and taking a year off

    ^^^ generally, no - as long as you make up the shortfall by the next quarter.

  10. #10
    Picaresque
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    Default Re: estimated taxes and taking a year off

    Quote Originally Posted by phonehome View Post
    The trouble as I see it will be getting them to "believe" that you did in fact take a year off and are not still dancing some, a few weekends anyway on the side. As long as your spending drops off or it can be shown that you are living on some kind of savings from the past you should be OK on the other hand if money seems to be just appearing out of no where that would be different.
    I'm not sure how to prove that, but I will be living mostly on savings, and my father has generously offered to front the tuition money.

    Thanks, starfire, I was wondering about that too. I'll probably be a week late getting this payment in. I haven't even been spending money; summer's just been that bad and I don't have it all yet. Not much else I can do but send it in a week or so late.

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    Featured Member paintgoddess's Avatar
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    Default Re: estimated taxes and taking a year off

    I haven't been paying my estimated taxes this year....

    I took nine months off last year, didn't pay estimated taxes, and was only penalized a little bit because I only had three months worth of earnings.

    Am I going to get raped on my estimated taxes this year for not paying them?!?! I haven't taken any time off in 2007. Should I start now? And what do I do? Send in the most recent coupon with three months worth of estimated taxes to mitigate the penalties?

    My apologies if this is considered a thread-jack.
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    Default Re: estimated taxes and taking a year off

    ^^^ to minimize interest payments and penalty charges, the best thing to do would be to send in an estimated tax check by the September 15th due date covering the taxes due from January 1st through September 1st. You'll still get slapped with two quarters worth of interest on the first quarter taxes, plus one quarter's worth of interest on the second quarter taxes, but this is a lot less expensive than letting yet another quarter's interest pile up (at the IRS 8% ? interest rate)

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    Featured Member paintgoddess's Avatar
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    Default Re: estimated taxes and taking a year off

    Thanks so much, Melonie!

    I've been so gung-ho about paying off my debt, that I've been pretending the taxes don't exist until April 15th, incurring yet more debt. (I have to retrain myself from years of filing W-2's and 1099's!!) I'm going to go ahead and pay the three quarters by this Sept 15th due date. I'm jumping on the wagon, albeit late!!
    Quote Originally Posted by Lysondra View Post
    Strippers are like ninjas. You never know how many there are or if the person next to you is one.
    Quote Originally Posted by Emily View Post
    ...I assume you probably don't want to deal with pervs, and the guys that just don't give a fuck about money are like unicorns...
    Quote Originally Posted by Sinder View Post
    I know I have said it before, and I'll say it again.... THE VAGINA IS NOT A CLOWN CAR!


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