April 16, 2006, 12:25 pm
Instead of blogging about what’s really going on in my life, I’ll just say that I’m always surprised at the amount of whining I hear from computer professionals about doing taxes. Not whining about taxes, which is more than understandable, especially for the self-employed, but whining about doing taxes. Doing taxes takes me less than a workday and a good portion of that day is very mechanical double-checking of line items and categories.
The key to efficient taxes is tracking expenses during the year. As far as I’m concerned, there are only two keys to making tax preparation trivial:
- Use Quicken / Money all year round
- Keep and use a separate credit card for tax-related expenditures.
Both Quicken and Money allow you to assign tax-lines to specific categories. Every time you balance your accounts, you just assign the expenditures to the proper line-item (I also have a “Tax:Perhaps” category for ones that I’ll eventually check). And it’s not like it’s that hard to figure out what is and isn’t deductible — business expenses, yes; movie tickets, no. The things that are hard to figure are the mixed-use things: computers, cell phones, home office. To make that easy, I just draw the boundaries in bold red lines: I have a home computer and my business computers, a business cell phone, and my office is all business.
I’ve only had a tax pro do my taxes one year and he gave me a list of questions and forms to fill out and it was at least as hard as using TurboTax.
Maybe preparing taxes is harder if you’re rich.
