Tax Girl

Ok this post has absolutely nothing to do with tax. It’s just I watch a lot of tv and I, of course, happened to watch the premiere of the new Bachelor on ABC. So the guy’s pretty cute, 33, an ER doctor, blonde hair, blue eyes….ya know, all the stuff girls just drool over.

But who was that woman who talked about her reproductive cycle? Honestly, if she were as smart as she claimed to be, she wouldn’t have told the dude that she was ready to get her reproduction on. When she was talking to him on the couch I could just feel the uncomfortableness oozing out of the tv. And then she had the balls, obviously not the brains, to go back after being rejected and ask Travis why he didn’t pick her. And then she equates not wanting to reproduce with “playing around”?

When she was talking to the other rejects her comments were like “nothing else is working…i’ve tried internet dating, dating services….i should just join a convent!” Maybe it’s not the men you’re meeting… Hmm…and so you thought going on the Bachelor would just guarantee you a husband? And she went as far to say “why else do people get married? i mean you get married to reproduce!”. Wow. The man who marries this woman is going to be lucky.

But my roommate and I had a good chuckle. I’ll probably keep watching to see who gets picked. I like Susan and Sarah B(the girl he gave the first rose to). It’ll be interesting….

So I took a 2.5 week break from work for the holidays. Vacation is just sa-weeeet. But I’m back at work. And tax season is creeping up ever so quickly. Hoping it doesn’t kill me.

So on my vacation I took a ton of pictures on my new digital camera. I got a Sony DSC-T5 for Xmas. It’s pretty nice. It’s my first digicam so I have no comparison. Anyway, with all the online photo viewing websites I didn’t know which one to choose. My friends use all sorts like sony image station, kodak easy share, etc. I decided on Fotki. They use to charge a fee and limit your storage space but now it’s free to join and they’re offering unlimited photo storage space. And if you want prints it’s only 9 cents for 4×6’s. So cheap! And I like how the website looks. It’s cute. =)

Why not give a little and get a deduction? It’s near the end of the year and it’s the holiday season. If you think you’ll be itemizing for 2005 then it might be nice to give to a local charity or do some cleaning around the house and donate to goodwill to get a little extra deduction on your Schedule A. If you donate money, it’s good to use a check so that you have a record of your donation. If you donate clothes and stuff to goodwill, they usually give you a receipt that estimates the fair market value, which you would use as your deduction. If you donate more than $250 you will need a statement from the organization detailing the amount you donated and whether you received anything in return.

The end of the year is coming up and I’m going to see if I’m withholding enough or too much from my paycheck. The IRS puts out a really good publication, Publication 919, that basically goes through the why, when, how’s of adjusting your withholding. Basically you don’t want to withhold too little or you’ll pay fines and penalties, but you don’t want to withhold too much because that money could be saved at a nice 4% savings rate. The publication also has these helpful worksheets that guide you through how to project your 2005 taxable income. Then you figure your tax liability and compare it to how much you will have withheld for the entire year.
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So I recently took a trip to Las Vegas. I LOVE that place. I’m in my early twenties and I’ve already been there 5 times. Twice this year. I’ve done pretty well…I think I’m up in the long run. I don’t really go all out though. My games are craps and blackjack and I keep my bankroll to about a couple hundred dollars. And I stick to it. No more, no less. It’s all about moderation baby.

On this recent trip I made a few hundred bucks. Not bad. But as always, I was thinking, do I have to report this income? My answer is no. I think you can fly under the radar if you just go to Vegas and play a little for fun. Now if you’re a high roller and you win the big bucks(like in the thousands) or you hit the jackpot, then the lovely casinos will probably track your winnings. I’m not sure if they automatically send you a letter detailing your winnings or not, so it might be up to you to request one.

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So as I embark on this wonderful journey into the world of blogging I thought to myself…so what exactly are the ways that I can earn a little bit of cash? And, of course, the next logical question from a tax accountant perspective is, would I have to report this income on my tax return?

After talking to some blogging friends, I guess the most common way to make money off a blog is through advertising, such as Google AdSense. Now I hear that Google won’t send you a 1099-MISC if you don’t make $600 in a year, but my guess is that if you make $599 off advertising, the IRS would like you to report it nonetheless. So I would keep track of your earnings. Hmmm…I will have to look into this thing they call advertising then.

So then I was thinking, is blogging just a hobby or is it a business? Income from a hobby or a business is considered taxable. For a hobby, deductions are allowed to offset income but never create a loss. But with a business, ordinary and necessary expenses are allowable deductions and can be deducted fully even if they create a loss. This loss can then be used to offset other income earned or be carried-foward or carried-back, depending on the situation.

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HI. Welcome to my first blog. As the title of my blog suggests, I’ll be writing about Tax. Oh, and I’m a girl. Who am I exactly? Well, I don’t want to give too much of my identity away…what fun would that be? But I am an aspiring CPA and work for a large CPA firm. I got my undergraduate degree in accounting and chose to start my career in tax about a year and a half ago. I’m writing this blog for a few reasons. One, to help people understand how the heck to fill out a 1040. Two, to further my understanding of individual taxation. I see it as a win-win situation. However, I will not give tax advice. Please don’t ask. But please feel free to ask questions! Enjoy!