Although I am a Certified Financial Coach, let me be clear, I am not a tax expert offering tax advice.
Frankly, I never expected to write a blog about filing taxes because, well, that sounds boring. But in hindsight, I realized the filing process I went through was an intuitively guided, and worth a share. You’ll want to keep reading, especially if the thought of the IRS makes you anxious or fearful, and hearing the word taxes puts you in procrastination mode.
Back in 2006, I took a tax course where I learned how to maximize small business deductions for things like:
+ claiming my home office
+ properly documenting meals and entertainment expenses.
The course was taught by a guy named Sandy Botkin, who is a former IRS agent who had in-depth knowledge and experience with taxes for small businesses. I utilized many things I learned from him that came in quite handy several years later, when I received an audit notification letter from the IRS. Confidently, I sent copies of documentation stored in the tax system I had set up after the course. They responded within a couple of weeks with a letter letting me know all was well.
Fast forward to 2018, and I was now fully self-employed; I heard the deductions like entertainment became entirely disallowed as a result of the tax rules rolled out in 2017. It was now vital for me to understand how the new rules impacted me.
With the April 15th deadline a few weeks away,
I put all my financial information into Turbo Tax software to find out approximately how much I owed. When I saw the total due, my stomach churned, and I felt frustrated and uptight with myself because I hadn’t yet learned how to apply the new rules.
I also noticed the thought of filing my tax form as-is created an uncomfortable feeling in my gut. I knew from experience that unpleasant sensation was my intuition telling me something was off, and I better pay attention. Since moving to a different state, I hadn’t established a relationship with a new accountant, yet. Because it was a busy tax season, I preferred to wait to connect with one when they had more time to take an in-depth look at my situation.
So, with the looming tax deadline, I trusted my intuition and filed a tax extension, but made the large tax payment to avoid unnecessary penalties and late fees.
My body confirmed that decision
By completely dissolving the worry and stress I had been feeling and replaced it with pure relief. Ahhhhh. I feel so much better! At that moment, I set the intention I would find someone to help me learn so that I could feel confident filing my taxes before the October extension deadline.
Serendipitously, a couple of months later, I received an email about a course for small business owners on understanding how to take advantage of the new tax laws to legally lower taxes. The same guy that taught the course in 2006 was teaching this course, too. I felt excited about the opportunity to learn from him again at the perfect time!
Over seven weeks, I pushed myself to stay engaged in class, despite taxes not being an interesting topic. I wanted to learn the ins and outs of the new tax law. By the end, I felt confident knowing what I could and couldn’t deduct. I applied my newly acquired knowledge to my taxes. I gathered additional receipts for all my travel meals and measured the hallways and stairways in my home to recalculate the home office deduction. After updating Turbo Tax, a tax advisor audited them for me. He caught a significant deduction that I qualified for but hadn’t passed through the tax software onto my return.
After all was said and done, I got a refund totaling $600 more than what I invested in the tax course. Awesome ROI! And I was actually excited to file my taxes! Not just because I was getting money back, but because I felt confident understanding the new tax rules.
Below are my takeaways
I am passing them on to you as a reminder to take time to follow your gut when something feels off. (I’m not just talking taxes here… these apply to just about anything):
- When needed, request more time to complete a project, despite set deadlines.
2. Take time to learn and understand new things that impact you, especially when they aren’t in your wheelhouse.
3. It’s okay to ask for help from an expert!
But here’s the message I really want to share: Follow your intuition, no matter the situation. And especially when you’re feeling rushed, pressured, anxious, or fearful, that’s the time you need to be sure to pause to check-in with yourself to find out why you feel off so you can make any changes instead of just uncomfortably plowing forward to get it done.
I’d love to hear your insights below…