During the month of March, the COMPASS blog is providing space for questions and reflections related to taxes. To start this month’s series, I thought I would share some of my own thoughts and reflections.
Have you already submitted your tax return? If so, congratulations! If not, you are like my wife Allison and I. I admit, I have started filling out our joint return, but have not yet completed it. Part of me loves doing our tax return, because it’s kind of like putting a puzzle together that you’ve never seen before. You are not quite sure what the picture is going to look like. At the same time, there is some dread because you are not sure what it is going to look like and how much you might owe.
Many people receive tax refunds. Allison and I have only had that experience once. My best guess is we won’t often receive a refund because of the nature of our work and ministry. If you are a Millennial or young adult, there is a good chance that you work in multiple roles or work as part of multiple projects. If this is the case, at least in the United States, you are likely classified as self-employed for tax purposes (you might get a 1099-MISC instead of a W-2) and need to deal with self-employment tax filing.
My first year with this experience was an eye opening one because our tax bill was much higher than we had anticipated, mainly because we were working while in school and did not realize that some of our roles and projects were considered self-employment at the time. Since that experience we have worked hard to find ways to make the most of deductions and write-offs. I mention all of this because even though I have a degree in economics and a graduate degree in management, I was still surprised and caught off guard. I chalk that experience up to an important life lesson. It also helped Allison and I grow into a fuller sense of who we are as a family.
We have found that money conversations are important, and when we don’t talk about our finances, our collective stress level goes up. Tax time is no different. Since I had put off doing our taxes until the beginning of March, I could sense my own stress level going up. Long story short, we had more income-producing projects last year which was great, but also some job transitions and changes that led to some unexpected income fluctuations. I’m not sure what quite to expect about what we might owe in taxes this year.
I’m encouraged though, because while I’m not done with our return yet, it doesn’t look like we are going to owe as much as feared we might. I am a little bummed that we won’t be receiving a refund, but in all honesty I wasn’t expecting one either. To be fair, I don’t have a problem with paying taxes. In their best and necessary sense, I believe they are a form of stewardship- a way to support the common good through the provision of education and infrastructure.
This month you’ll find more reflections on the blog about taxes. Would you like to share a story or some of your own reflections? What is the thing you dislike most about tax time? What stresses or questions are you dealing with during tax season? How do you stay grateful?
Image Credits: Finances and taxes
This blog is a component of the Ecumenical Stewardship Center’s COMPASS initiative to engage young adults in conversations about faith and finances. Like what you see and want to know/do more? Visit the COMPASS web page and join the COMPASS community on Facebook.