Finally paid off IRS back taxes in full!

I finally bit the bullet and used a sizeable chunk of the cash in my rainy-day contingency fund to pay off my IRS back taxes in full. All the way to zero. For the first time since 2002 I do not owe the IRS any money. In fact, I am likely to get a sizeable refund in April. Last year I had a big refund, but it went towards the back taxes.

As a curious coincidence, the same week I am paying off the IRS, I am once again self-employed and liable for estimated taxes, which is what got me in trouble back in 2002. This time I have a solid plan for estimated tax payments. I have pre-calculated the taxes on my self-employment income and will be paying that money to the IRS either on a monthly basis or keeping it in a separate account (earning interest) for quarterly payments. No more co-mingling of "tax money" or expecting to pay taxes at the due date out of current income.

Now, it is time to start getting my data together for my accountant to prepare my 2007 tax return.

Also, since I am working part-time, I will be well under the limit for making IRA contributions, so I want to plan on making at least some conttribution to my retirement plans.

-- Jack Krupansky