Income tax return done: income up, gifts up, tax not
In addition to doing income tax preparation for low-income people for several years, organized by the income tax dept., I've been preparing returns for a couple of friends for several years and last year the lady began a new business, house rental.
She has somewhat limited accounting skills and told me this year that the paper that I gave her last year detailing how to arrange the payments was too small, to which I said that I had meant it as a guide as she set up her account book.
I brought their returns home, as I expected to visit the tax office, so could deliver their return without postage, telling them that I'd bill them later for postage if I had to mail them. I photocopied his charitable receipts, that we must file, in case of later dispute, supposing the originals might have disappeared.
I had quite a bit of photocopying of stockbroker reports plus about 30 charitable and political receipts of my own, so many that I feared that I couldn't get them all into the envelope - but made it.
I'd have had to pay about $2.00 postage, but was able to deliver it to the tax office.
Despite an unusual, temporary increase of 18% in taxable income over 2 years, I've been managing to reduce my tax load to around 10% in recent years: about 10.4% in 2002, 10.13% in 2003, 9.3% in 2004 and 8.7% in 2005.
Charitable contributions (mine are for health, social and community, educational and religious projects) above a minimum amount are deductible at a generous rate and our church carried out a building project mainly to make it more accessible this year, to which I contributed more than usual for two years - total up nearly double that of 2 years ago.
The interesting thing: my tax load for the past 3 years has varied within only a $25.00 amount - which was entirely unforeseen: I only realized it 10 min. ago.
You've heard my refrain: "Learning how money works - an interesting hobby ... that pays well".
Learning how tax works - also an interesting situation ... that can pay well, as well.
I hope that you're all enjoying an interesting spring.
ole (frugal) joyful