Prior year taxes


M

Mark Horn

I was looking at the FAQ for how to handle prior year taxes.

http://umpmfaq.info/faqdb.php?q=102

I just need a little clarity. For the first suggested solution
(where you create the separate bank account) it seems like you can
really only do this for federal tax refunds. Because if you put
the state refund in that account on 12/31/lastyear, then it won't
show up as federal income for thisyear.

Do I have this right, or am I missing something?
 
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D

Dick Watson

Sounds right to me. I don't actually use the method that puts the extra/less
tax liability in last year. As you note, though, state refunds treated this
way for last year will mislead when it comes to figuring federal income for
the current year.
 
M

Mark Horn

Sounds right to me. I don't actually use the method that puts the extra/less
tax liability in last year.
I assume you create a category for "Taxes: Federal Income Tax
Previous Year" (or something similar). How does that mess up
the budget?
 
D

Dick Watson

I don't budget that category. (In part, because Budget Planner deals very
poorly with things like this that aren't monthly recurring and are not
derived from scheduled transactions.) For that matter, I don't work too hard
on BP at all. I mostly manage to cash flow and periodically review budget
performance. IF BP didn't assume that scheduled items were, by definition,
in budget, and didn't try to force everything into monthly periodicity, I
would find it a lot more useful.

 
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M

Mark Horn

For that matter, I don't work too hard
on BP at all. I mostly manage to cash flow and periodically review budget
performance. IF BP didn't assume that scheduled items were, by definition,
in budget, and didn't try to force everything into monthly periodicity, I
would find it a lot more useful.
Yeah. Me, too. I rely on budget reports to tell me how I'm doing
instead of BP because they handle the periods correctly. E.g. in BP
a $100 transaction that I have scheduled for only three consecutive
months, will result in $1200 in my budget in BP. But in the budget
report, it correctly shows up as only $300.

I've also noticed that if I create a budget, and then go back and
add a scheduled transaction, it will ask me if I want to add it to
my budget. But once having added it to my budget, there's no way
to take it out.
 

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