A lot of you are probably saying "June 15th isn't tax day, that's April 15th." A few years ago, I would have been saying the same thing. And that is because until a few years ago, I spent my life working as an employee for other people. Four years ago I started my own business and joined the ranks of the self-employed.
As all of my fellow business owners are aware, estimated tax payments are due four times a year - and the second quarter is due today, June 15th (in the true spirit of governmental efficiency, the four quarterly payments are not all three months apart).
For those of you who don't know, here's the idea behind estimated tax payments ...
The government seizes its taxes up-front from employed individuals by forcing employers to withhold taxes from employees' paychecks. The government even has it rigged so that most people pay too much, and therefore a lot of taxpayers get a refund (of their own money) sometime in the new year.
But a self-employed person has no weekly paycheck. So the government mandates that self-employed people estimate their taxes and pay up, in advance of the total bill being due, four times a year.
Now the pain is barely noticeable for employees, as many do not even know or care what is being seized from their weekly paycheck. But for self-employed people the quarterly estimates hurt a little more. Or maybe a lot.
So anyway, my morning can be summed up as follows: I spent an hour figuring out what my estimated taxes should be, printing off the forms, filling out the forms, printing out envelopes, and writing out checks. And then, after putting three 44c stamps on my envelopes, dropped them in the mail. The check I wrote to the I.R.S. will easily be the largest check I write all year (not counting the other quarterly checks). But at least I have the peace of mind of knowing that my money is going to Washington DC where it will certainly be put to good use.
I think we all need to wake up on the issue of taxes. You folks who are among the employed (which was me not too long ago) need to look at those check stubs and understand how much money you are losing on a weekly, monthly, and annual basis to taxes. And then imagine having to write a big fat check for that amount instead of being bled dry slowly through withholdings. The government has it way too easy when it can tax the masses in such a way that the full bill isn't readily understood.
