The taxman came around this year, as usual. From my work in Georgia in 2009, I owed the almighty Georgian state an extra $17.00:
Image may be NSFW.
Clik here to view.
If they’re gonna take my money, they should at least know that I’m not happy about it.
I made out OK with my federal income taxes but by the time I paid my accountant, I ended up down about $100. I’ve always thought that personal income taxes were the worst thing in the world, but after helping with the management and finances of the company, I’ve realized that corporate taxes (even for an S-corp) are far worse. I don’t mean this in terms of pain of payment, but in terms of the absurd rules and laws required of corporate taxpayers. As a small business, you can’t do anything without consulting a CPA about the tax consequences and filing the appropriate stack of paperwork.
For example: Our current company method of payroll disbursement is horrifically slow. We send the payments out to our bank (electronically) via quickbooks and our bank (apparently) forwards the payroll list to some clearing house in another state where they physically print and mail a paper check, and snail-mail that check down to each employee’s personal bank. The funds are then added to the account whenever a local branch representative checks the mail and physically deposits the check. I’m not kidding. The entire process takes about 7-10 business days — completely unacceptable for 2010. My personal bank account is at the same branch as our business account and it takes me almost 2 weeks to get a paycheck.
I called our bank and attempted to setup online payments so that we can just disburse instant electronic payments to our employees and contractors, which seems like a reasonable thing to do in the Internet era. But no! If some of your “employees” are consultants/contractors who are on a 1099 instead of W2 — as all of our employees are — you have to fill about 20 pages of tax paperwork proving that you have all sorts of unemployment insurance (or why you don’t have it) and a half-dozen other things the government has decided that mere citizens must have. Our administrator and myself have spent wasted many hours over the past 4 weeks just trying to pay our employees faster — it’s absurd. It’s been a major headache and it’s completely unnecessary. In recent discussions with our bank, I found out that because I’m a company partner, I have to fill out even more paperwork and may not even be able to use the electronic payroll anyway due to tax issues.
Paying your personal taxes hurts enough, but trying to comply with our tax code as a business owner is a nightmare. I’m not even talking about the pain of writing a check; I’m talking about the red tape you have to go through just to get yourself to the point where you feel like you’re not in gross violation of the law. This whole income tax, payroll tax, FICA, and unemployment insurance thing is completely out of hand. And no one understands it. Even accountants are saying “screw it, close enough” when sending out returns. Let’s adopt the Fairtax, get rid of the income tax in its entirety (ideal), or just make a flat tax. At this point I don’t even care which, just change something. This whole system is so ridiculously messed up, I can’t believe it’s lasted for this long. The Taxman always wants his share — I get that. I hate it, but I get it. But does it have to be so complicated? I’ve got stuff to do, and I could do it if the damn government would get out of my way. Though I think we all know that “that’s what governments are for — to get in a man’s way.”
