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Originally Posted by **********
Here's a simple trick. Create a second savings account and start depositing money into it on a regular basis. You probably already know what your tax bill will be next year, so divide that number by 12 or 24 and start paying that amount into it every month or twice a month. Then when it comes time to paying the taxes, you will already have the money to do it.
If you can't pay your taxes in one shot, sometimes the government will let you spread it out over payments (Revenue Quebec allows this). This is ok except that the government will charge you interest (usually a lot) plus other fees too. If this is the case, you might be able to borrow the money from your bank or even from your credit card at a much lower interest rate than the government interest rate.
Finally if possible explore other options. Look into TFSA's (Tax Free savings accounts), RRSP's etc, to reduce your tax burden. And if you don't have an accountant, hire one immediately. If you're running a business you are entitled to all kinds of discounts and programs that the governments offer that you should be taking advantage of.
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I actually did set up a savings account which deducts automatically from my business checking, and fortunately I have just enough to cover it, but I was NOT expecting to have to use the whole entire thing since I did draw a paycheck and paid taxes every 2 weeks this whole past year. Problem is, my business increased and my income doubled what I actually paid myself.
I do have an accountant, but he knows nothing about adult business other than working with me for the past 7 years or so. I feel like if I had someone who was more skilled in adult, there may be some things I would be entitled to, that my accountant doesn't know about. I'm not sure if they are all the same no matter the industry. I think I would need an entertainment accountant I suppose?
I don't think my CPA gets me any damn deals. And he really should have set me up in DE instead of NJ then I wouldn't have state taxes on top of federal taxes. Booooo.
I have no choice but to pay my taxes when they are due, as I already have an agreement and once you do, you can not screw up going forward. I'm happy as heck that I can pay the bill. So I'm not really COMPLAINING, just saying damn...it's crazy.