The Tax Man Cometh

For the 2008 tax season, I made the mistake of buying Turbo Tax too early and missing out on subsequent price cuts and sales. This year I decided to be patient and just as I expected, Costco issued a $10 off coupon that's effective between 1/27 - 1/24/10. My taxes are relatively straight forward so I purchased Turbo Tax Deluxe (Federal and State) for $39.99. I spent a good part of Saturday morning estimating my tax liability for 2009.

I was a bit worried about my 2009 taxes in light of the fact that I got a significant windfall on New Year's Eve. The most I've ever paid in taxes was back in 2007 when I temporarily halted my 401k contributions and sold off a bunch of my stocks to pay down a significant chunk of my debts. In 2007 I had to pay $653 in Federal taxes and $489 in State taxes.

I thought my taxes in 2007 were pretty bad. Do you want to venture to guess how much I approximately owe this year?

Wait for it.... wait for it...



$916 for Federal taxes and $2,359 on State taxes. Oy! If you consider the amount of tax that had already been taken out, I'll be paying an obscene amount (IMHO) this year. I never ever thought I would pay this much tax.

I'm not complaining, mind you. I've always believed in a progressive tax system. In my opinion, taxation should be based on one's discretionary income and ability to pay. I also actually agree with Justice Oliver Wendell Homes that you pay for the privilege of living in a civilized society by paying taxes. There's absolutely no excuse for cheating on taxes and I'm prepared to pay my fair share.

Besides, I already suspected that I would I owe about $3,679, so I mentally took that amount off the top of my windfall from the get-go. There are no disappointments or surprises here.

Actually, I did learn something new while estimating my taxes. I sold my company stocks for a $305.97 loss earlier this year. In a separate transaction, I sold the stock for a realized gain of $405.91 for which I was hoping to take an offset of my $306 capital loss. Unfortunately, I am subject to the wash-sale rule and can only take a part of the capital loss.

A wash-sale rule occurs when you sell a stock for a loss and acquire the same stock (or a substantially identical stock) 30 days before and after the sale. The rule was established by the IRS from preventing taxpayers from creating a tax loss while still holding a position in the same stock (and thereby avoiding capital gain taxes). It is irrelevant whether you intended to harvest a loss or not.

Anyhow, I can only claim $168.31 of my loss in my tax returns this year. The $137.66 loss that I'm prohibited from taking this year can be used to reduce my cost basis for the stocks that I acquired during the 60-day period, though. I guess if I'm really motivated (or bored), I'll read the IRS Publication 550 - "Investment Income and Expenses" to learn more.

My FICO Score Improved...

...from 712 to 723. Dagnabbit! It's still a couple of points short of my goal of 725.

I purchased my score from myFICO. You can purchase a standard FICO score for $12.76 (usual price $15.95) before May 31st by using the promotion code: FICOMAY20.




Nothing new here. I already know about my past late payments on my student loans. Only time will resolve this issue.

But another issue that's dragging my score down is the fact that I'm currently using 18% of my credit limits right now. This too will be resolved in October when I plan to pay off my $11,000+ credit card debt. The credit card balance currently has a 0% APR until October so I'm in no hurry to pay it down before then.

The myFICO site has a pretty cool simulator that will estimate how certain actions taken can affect your score. I simulated a scenario where I paid off my credit card debt in 6 months. According to myFICO, my score should improve to about 723 - 763. If I can get beyond 760, that should get me into the top 2% of all credit scores. Cha-ching!

Additionally, in a couple of years, assuming I keep paying my bills on time, my delinquent record should fall off and my score should improve to 813 - 850 range. Awesome!

In another 6 months, I'm planning to purchase my FICO score from TransUnion. I've heard that TransUnion scores are a bit more lenient. If my CreditKarma score is any indication, I suspect that may be true. We'll see.

I'm not sure why I bother to check my FICO scores since I don't intend to make any new purchases. But I guess I do so because my FICO score is a report card on my financial progress. And my report card tells me I'm on my way.

Jones New York Friends and Family Discounts

I have a friend who is a lot like an airport hub. She is so well connected and generous that I often reap the benefits. For example, I'll be catching a screening of the new Star Trek movie at Paramount Studios this weekend, complements of my bud.



Now, one of her friends has generously let her know that between 5/7 and Sunday 5/10, all friends and family members of the Jones New York brand line can get 30% off all regular-priced merchandise and 20% off sale merchandise online by using the following codes.

Jones New York
Code: FRIEND1

Anne Klein
Code: FRIEND1

Nine West
Code: NWFRND5

Bandolino
Code: BDFRND5

Easy Spirit
Code: ESFRND5

Live long and prosper, friends!

Shtinkykat Has A New Laptop

I've been without a home computer for over a year now. I set aside some money last year to pay for a laptop but I instead used it to pay for my cat's vet bill and a set of new tires. This year, I set aside some of my bonus money to buy a new laptop, but I didn't plan to buy one unless I absolutely needed to (i.e., when I get laid off).

Before I go on, have you ever prepared for an event only to forget its purpose?

I wrote a semi-smug, self-congragulatory post about setting aside money to cover future cost of living increases. But I boneheadedly forgot that I should probably buy a big-ticket item before California sales tax goes up effective 4/1/09. (Click here to see your city's new sales tax rate.)

Thankfully, I've got the financially savvy Miss M, watching my back. (A shout out to Miss M: Thanks for the reminder!)

So I took the plunge and bought myself a pink laptop. Yep, pink. Sad to say, that was my sole criteria for my new laptop, so I was limited to buying a Dell Inspiron laptop. (I realize I may be too old to be buying pink computers but Dell is going donate $5 to the Susan G. Komen Foundation if I went "pink". That'll be my excuse to the world.)

Anyhow, my final price for my laptop was $907.93, including 7.75% sales tax. This is within my budget and I feel great that I'll be paying for my laptop with cash, but I can't help feel a bit of buyer's remorse.

In hindsight, I made the stupid mistake of upgrading components while I was building my computer online. Did I really need 3GB vs. 2GB of RAM? Did I really need a 320GB vs. 160 GBHard Drive? This is gonna gnaw on me for awhile.

On the bright side, the upgrades bumped the price above the $799 threshold, thereby giving me free shipping and handling ($25 off) and allowing me to take advantage of a 20% off coupon code ($208.80 off).

I guess part of the remorse came about after seeing an ad from Fry's that sold comparable laptops for much less. Oh well. I guess I paid a premium to own a pink laptop. And atleast I didn't pay an additional $9 in taxes.

Update: Now that I think about it, I guess I did have several other criteria: I wanted an Intel (not AMD) processor, I wanted to own a name-brand laptop and no refurbished laptops, based upon my experience from owning 3 prior laptops.

Free Admission to Disney Parks on Birthday!

You know the economy is bad when Walt Disney Parks and Resorts is giving visitors free admission in 2009 to one of their parks on the visitor's birthday.



Growing up in So. Cal., my parents used to complain that Disney NEVER offered discounts or coupons like other amusement parks such as Magic Mountain or Knott's Berry Farm. I guess with the downturn in the economy, Disney is willing to forgo a 1-day admission ticket for the likelihood that the guest will buy souvenirs and concession stand food.

To qualify, visitors to Disney's parks have to show I.D. and proof of birth date. You can register online in advance.

I Guess I CAN Go to the Opera!

I love opera. I love all kinds of opera.

The San Diego Opera's 2009 season includes performances of Tosca, Don Quixote, Rigoletto and Madama Butterfly. Unfortunately, with my new frugal budget, I won't be able to purchase the $35-$200/seat tickets this year.

In order to compensate, I've been borrowing DVDs of classic opera performances from the local library. Of course, the opera experience is not quite the same on my non-HD, 26-inch TV.

Now, thanks to the Metropolitan Opera's The Met: Live in HD series, I'll be able to enjoy Madama Butterfly at 1/2 the price of nosebleed seats at the local opera. Unlike my TV, the Met performances wil be broadcast in HD and in THX stereo. Best of all, I'll be able to eat popcorn and Raisinets (and sneak in beer) during the performance!

Tonight is the Opening Night Gala starring Renee Fleming and a ticket costs $22. As much as I'd like to go, the performance starts at 6 p.m. and is 4.5 hours long! I'll take a pass on this and will likely attend other performances in the future.

If anyone is interested, tickets can be purchased here.

Big Savings During Spa Week - $50/Treatment

From September 15-21, participating spas in California, Arizona and Washington lower their rates of their full-length signature services to $50/treatment!

Go to Spa Week's Website to register (you'll need to give your name and email address) to get a list of participating spas near you.

Spa Week will be moving to the Midwest and East Coast from Oct. 13-19.

Since this really isn't included in my budget, I'll unfortunately have to forego this deal.... Sigh...

Eating For Free At Restaurants

The best way to eat for free at restaurants is to "dine and dash". Just kidding.
I was cleaning out my coupon envelope yesterday and found an expired e-coupon from Gordon Biersch Brewery offering me a free meal with purchase of an entrée for my birthday. I realized that when I signed up for various restaurant e-clubs, I had foolishly been honest about my birth date. Come every June, I get various offers from restaurants for free meals/desserts or discount coupons. Every year I use maybe one or two of them and let the others go to waste.

This got me thinking, when I join these restaurant clubs, why don’t I just stagger my birthdate so that I get a freebie or discount from a restaurant every month? This way, I can take advantage of the offers throughout the year rather than being overwhelmed one month of the year.

I should also remember not to sign up at once. Often times, these restaurants will give me a freebie or a discount on my sign-up “anniversary” date.

Here are some restaurants that have great birthday club offers:
Red Robin: Join e-Club For Free Birthday Burger

Wienerschnizel: Free Corn Dog

Black Angus: Free Steak Dinner

Pick Up Stix: Free Wok Combo for Signing Up

Daphne’s Greek Café: Free Combo Meal Coupon on Birthday

TGIFriday’s: Free Appetizer for Signing Up

Of course, I could just go to a restaurant and tell the server it’s my birthday. More often than not, I’ll get a free dessert with no questions asked. :-D